ARRY — Array Technologies, Inc.

Summary of Array Technologies Q1 2026 Earnings Call

1. Key Financial Results and Metrics:

• Revenue: $223 million, with a 15% increase in volume quarter-over-quarter.
• Adjusted Gross Margin: 30.7%, up 620 basis points from Q4, driven by improved execution and a favorable domestic mix.
• Adjusted EBITDA: $29 million, a 157% increase sequentially, with an adjusted EBITDA margin of 12.9%.
• Net Loss: $14 million, significantly improved from the previous quarter, with diluted loss per share at $0.09.
• Order Book: Record high of $2.4 billion, with a book-to-bill ratio of approximately 2x for the quarter and a trailing 12-month ratio of 1.3x.

2. Strategic Updates and Business Highlights:

• Product Innovation: Launched the DuraTrack D2S tracker, designed for international markets, enhancing performance and reliability.
• International Expansion: Secured contracts in Turkey, Peru, and Colombia, indicating successful geographic diversification.
• Operational Initiatives: Opened a new 30,000 square foot headquarters to foster collaboration and innovation, including a dedicated research and testing center.
• Customer Engagement: Strong technical sales efforts have improved win rates, with over 50% of the order book now comprising new products.

3. Forward Guidance and Outlook:

• 2026 Revenue Guidance: Reaffirmed, expecting Q2 revenue between $300 million to $320 million, with adjusted gross margins at the higher end of the 26%-27% range.
• Long-term Margin Expansion: Anticipated through increased penetration of differentiated products, international scale benefits, and continued productivity improvements.
• Backlog Conversion: Approximately 80% of the order book expected to convert over the next six quarters, providing strong visibility.

4. Bad News, Challenges, or Points of Concern:

• Net Loss: Despite improvements, the company reported a net loss, indicating ongoing challenges in profitability.
• Geopolitical Risks: Elevated logistics costs due to conflicts (e.g., in the Middle East) could impact margins and operational costs.
• International Market Dynamics: Some international markets, particularly in Brazil, face macroeconomic challenges that could affect future bookings and project timelines.
• Cost Pressures: Rising commodity and logistics costs remain a concern, although management is implementing strategies to mitigate these impacts.

5. Notable Q&A Insights:

• Gross Margin Strategy: Management emphasized their hedging strategies and productivity gains to maintain margins despite rising costs.
• Project Timelines: No significant delays in project timelines were reported due to tax equity issues, with a focus on well-financed projects.
• International Business: The company remains selective in international expansion, focusing on markets that appreciate their value proposition, particularly in challenging terrains.
• Future M&A Opportunities: Management is open to M&A but prioritizing operational discipline and cash generation in the near term.

Overall, Array Technologies demonstrated strong financial performance in Q1 2026, with significant improvements in profitability and a robust order book, while also navigating challenges related to geopolitical risks and cost pressures. The company remains focused on innovation and strategic expansion in both domestic and international markets.