Shoals Technologies Group, Inc. reported fourth‑quarter 2025 results that included record revenue of $148.3 million, a 39% year‑over‑year increase, operating profit of $17.4 million, net income of $8.1 million, and adjusted EBITDA of $30.3 million. Backlog and awarded orders rose to $747.6 million, up 18% from the end of 2024, reflecting a strong order pipeline as the company expands into battery energy storage and other markets.
The company beat revenue expectations but missed adjusted diluted earnings per share, reporting $0.10 versus consensus estimates of $0.13–$0.14. The EPS miss was driven by a 31.6% gross margin, down from 37.6% a year earlier, as increased material costs, $3.3 million in duties and tariffs, and $1.5 million in right‑of‑use amortization for a new Tennessee facility eroded profitability.
BESS and international segments contributed significantly to the top‑line growth. Over $67 million of the backlog is attributed to the Battery Energy Storage Systems offering, and international revenue grew from less than $1 million in 2024 to approximately $13 million in 2025, underscoring the company’s expanding geographic reach.
"2025 was an exceptional year for Shoals. While the rapidly shifting political climate brought some volatility, the massive increase in demand for energy through the rest of the decade supports strong fundamentals for our business. We are beginning to see tangible results of executing our strategic plan; expanding our product portfolio, defending share within our core markets, and diversifying our presence into new, attractive market segments. We've made great progress and look forward to building on the momentum," said CEO Brandon Moss. "Fourth quarter revenue was in line with our expectations at approximately $148 million, up 38.6% over the prior‑year period. Our commercial team also drove significant growth in our book of business, adding approximately $175 million in new orders in the period. This resulted in a company record backlog in awarded orders, or BLAO, of approximately $748 million, an 18% year‑over‑year increase," he added. CFO Dominic Bardos noted that the revenue increase was primarily driven by higher domestic project volume and growth in international, CC&I, and OEM channels, while also highlighting the impact of higher material costs and new facility amortization on gross margin. "While these elevated legal costs impacted our results in 2025 and will continue in 2026, they will not occur in perpetuity, and we expect them to decline in 2027," Bardos said.
Management guided for full‑year 2026 revenue of $560 million to $600 million and adjusted EBITDA of $110 million to $130 million, a range that reflects confidence in continued demand but also signals near‑term margin pressure. Investors reacted negatively to the EPS miss and margin compression, underscoring the importance of profitability metrics even amid strong top‑line growth. Headwinds include rising material costs, duties and tariffs, and legal expenses, while tailwinds are driven by robust renewable‑energy demand, BESS expansion, and a growing international order book.
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