Nextracker (US:NXT)2025-10-23 22:00Financial Data and Key Metrics Changes - In Q2, revenue grew 42% year over year to $905 million, and adjusted EBITDA increased 29% to $224 million, representing a 25% EBITDA margin [6][18] - For the first half of fiscal year 2026, revenue was up 31% year over year to $1.77 billion, marking a record first half for the company [6][18] - Adjusted free cash flow was $171 million for the quarter and $241 million year to date [18] Business Line Data and Key Metrics Changes - Record bookings for eBOS and foundations were achieved, with a record number of new customers and contracts for robotic inspection and fire detection services [11][12] - The NX PowerMerge product was launched, contributing to record eBOS bookings [7] - The company booked its first fully integrated NX Earth Trust foundation, significantly reducing parts count [8] Market Data and Key Metrics Changes - In the U.S., bookings and revenue were up significantly year over year, with revenue increasing by 49% [13] - Europe emerged as a top market, delivering record sales in Q2 [14] - The company announced a joint venture, NextTracker Arabia, to expand its manufacturing footprint in the Middle East and North Africa [9] Company Strategy and Development Direction - The company aims to build an integrated technology platform through internal innovation, targeted acquisitions, and operational execution [10] - The strategy focuses on delivering the lowest cost and most reliable solutions to meet customer needs [10] - The company is confident in its ability to deliver sustained profitability and cash generation while scaling its platform globally [21] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the long-term prospects for solar, citing strong fundamentals and a record backlog of over $5 billion [25] - The company anticipates modest margin impacts in the second half of the year due to tariffs and a higher percentage of international projects [21] - Management highlighted the importance of domestic manufacturing and the ability to deliver 100% domestic content to meet U.S. Treasury guidelines [16] Other Important Information - The company closed the quarter with $845 million in cash, no debt, and total liquidity of nearly $1.8 billion [19] - The company raised its full-year fiscal 2026 outlook, expecting revenue between $3.275 billion and $3.475 billion [20] Q&A Session Summary Question: Industry growth outlook through the end of the decade - Management believes the fundamentals for solar are strong, with significant project orders and a record backlog of over $5 billion [25][29] Question: Cadence for this year and project timing - Management noted a strong first half and raised the outlook, indicating a smoother operational cadence compared to previous years [32][34] Question: Bookings mix and regional performance - The U.S. has seen a strong run with a 49% year-over-year revenue increase, while international business continues to grow [38] Question: Impact of tariffs on margins - Management acknowledged tariff-related headwinds but emphasized the strength of their domestic supply chain to mitigate impacts [20][44] Question: T1 Energy partnership and future deals - The company views the T1 Energy partnership as a positive development and anticipates similar opportunities in the future [50] Question: Tracker uptake in international markets - Trackers have become the predominant structure for utility-scale solar projects globally, with significant energy yield improvements [58] Question: Investment in Saudi Arabia JV - The company is excited about the NextTracker Arabia joint venture, which includes a local manufacturing facility and aims to fulfill multi-gigawatt orders [66][70]