Prepared remarks
Thank you for standing by. My name is Tina, and I will be your conference operator today. At this time, I would like to welcome everyone to the Q2 2026 Ameresco Incorporated Earnings Conference Call. It is now my pleasure to turn the call over to Leila Dillon, Chief Marketing Officer. Please go ahead.
Thank you, Tina, and good afternoon, everyone. We appreciate you joining us for today's call. Our speakers on the call today will be George Sakellaris, Ameresco's Chairman and Chief Executive Officer, Nicole Bulgarino, Co-President of Ameresco and Mark Chiplock, Chief Financial Officer. In addition, Joshua Baribeau, our Chief Investment Officer, will also be available during Q&A to help answer questions. Before I turn the call over to George, I would like to make a brief statement regarding forward-looking remarks. Today's earnings materials contain forward-looking statements, including statements regarding our expectations. All forward-looking statements are subject to risks and uncertainties. Please refer to today's earnings materials, the safe harbor language, on Slide 2 of our supplemental information and SEC filings for a discussion of the major risk factors that could cause our actual results to differ from those in our forward-looking statements. In addition, we use several non-GAAP measures when presenting our financial results. We have included the reconciliations of these measures and additional information in our supplemental slides that were posted to our website. Please note that all comparisons that we will be discussing today are on a year-over-year basis, unless otherwise noted. I will now turn the call over to George. George?
Thank you, Leila, and good afternoon, everyone. Q2 was a transformational quarter for Ameresco, highlighted by exceptional execution and strong financial performance. First, we had a record of $1.8 billion of new awards driven by $1.2 billion for data centers and $600 million for our other key markets. Second, we closed our Neogenyx joint venture with HASI, providing us with significant external capital to accelerate growth in all of our business lines. And we announced our first successful delivery of RNG into the European compliance markets. Third, we repositioned Ameresco into two core pillars and we are releasing a new rebranded corporate identity to reflect the updated position. And finally, we successfully brought online the 250 megawatt Napanee Battery Energy Storage System, one of the largest energy storage projects in Canada, and we energized the 560 megawatt solar project in Greece, one of the largest projects in Europe. Many of you have been anticipating updates on our involvement in the data center market. There is a growing demand for reliable power infrastructure and increasingly favorable policy for on-site power infrastructure, encouraging hyperscale customers to secure dedicated on-site power solutions. Combined with Ameresco's integrated capabilities, we are well positioned to deliver solutions that provide speed, reliability, and the energy independence that these customers need. During the quarter several opportunities advanced to the point where they met our criteria for inclusion in our awarded backlog. Importantly, the projects we added to our backlog represent only a portion of our broader pipeline. As we continue to advance additional data center opportunities, we will remain highly selective in our partnerships and disciplined in our approach. We expect the amount of backlog added from these opportunities to increase as development progresses, project scopes are finalized, and they convert to contracted backlog. As you will see in our updated corporate presentation, the company is well positioned to flourish in the current market environment. With our recent promotions of Nicole Bulgarino and Louis Maltezos to Co-Presidents, we have positioned the company to address two core market pillars: Power Infrastructure, and Building & Public Infrastructure. This strategic positioning reinforces Ameresco's standing as one of the world's leading energy infrastructure companies, focused on delivering integrated solutions to provide reliable power and modernize infrastructure. With a powerful combination of market catalysts and a robust pipeline of opportunities, we are confident in our ability to drive exceptional long-term profitable growth. With that, I would like to turn the call over to Nicole to provide some additional details about the exciting data center activities as well as other notable project wins and business opportunities.
Thank you, George, and good afternoon, everyone. As George highlighted, Ameresco made significant progress with our Power Infrastructure business during the quarter. The backlog additions we announced today are the result of months of work to secure, develop, and advance opportunities with leading partners across the data center ecosystem. Our strategy remains highly focused and selective, partnering with experienced developers, operators, hyperscalers, and capital providers, while concentrating exclusively on on-site power data solutions. This landscape is dynamic and often requires persistence and flexibility with solutions due to permitting, gas supply, and specific tenant needs. This is where Ameresco's decades of experience developing, delivering, owning, and operating critical energy infrastructure provides us with a clear competitive advantage. During this quarter, we added three new data center projects to our awarded backlog, bringing our total to five data center projects in addition to the Lemoore data center in our energy assets portfolio. These projects further expand our presence in the nation's most active data center markets, adding both Texas and Arizona to our existing footprint of data center projects. Collectively, they will represent more than one gigawatt of power generation and showcase the breadth of Ameresco's capabilities. The solutions we are providing include a combination of reciprocating engines, gas turbines, fuel cells, battery energy storage systems, and integrated microgrids designed to deliver the reliability required by today's most demanding data center customers. These awarded projects also only represent a portion of the opportunities we are actively developing. We continue to see exceptional demand for on-site power solutions and are encouraged by both the scale and the quality of our growing pipeline. We are engaged with many of the industry's leading data center partners, and we believe our differentiated capabilities position us extremely well to capitalize on the significant opportunities ahead. We look forward to sharing additional developments as we continue to convert this momentum into backlog and long-term profitable growth. While the data center activity was certainly a highlight of the quarter, it is also important to note that our momentum extends well beyond this market. We also secured a significant amount of new project awards across a broad range of geographies, customers, and in-market verticals, underscoring the strength and diversity of our business. These wins reflect continued demand for Ameresco's comprehensive energy infrastructure solution and demonstrate our ability to capitalize on the opportunities across multiple verticals while maintaining a balanced and resilient growth profile. I'll now turn the call over to Mark to cover our strong Q2 financial performance.
Thank you, Nicole, and good afternoon, everyone. Q2 was a strong quarter across the board. We delivered revenue of $515 million and made meaningful progress on the priorities that matter most, executing well, expanding our growth visibility through record awards, and strengthening our capital position to support the opportunities ahead. Q2 demonstrated the strength of our current operating model and the increasing visibility we are building as we work to execute the next phase of our growth strategy. Our total revenues grew by 9%, while project revenue increased 6% to $381 million. This reflects solid execution across our core project business with strength in Federal and North America and continued strong performance from our European JV. This was not just a strong quarter financially. It was also an outstanding business development quarter. As George highlighted, awarded project backlog increased 65% to a record level of $4.4 billion, increasing our total project backlog by 32% to $6.7 billion. As always, the timing and extent of conversion of our backlog will depend on commercial, permitting, procurement, financing, and execution milestones. This backlog provides tremendous long-term visibility as we expect to convert over the next three to four years. Q2 energy asset revenue was a clear highlight, increasing 21% to $76 million as we continue to expand the operating portfolio. During the quarter, we placed an additional 32 megawatts into operation. Our operating energy asset base now stands at 822 megawatts, with another 513 megawatts in development or construction. These figures reflect Ameresco's 70% ownership interest in the Neogenyx JV. O&M also had a very strong quarter with revenue up 29%. This remains an important part of the model for us because it builds naturally from successful project execution and creates long-term recurring revenue. As we continue to see solid growth in our third-party O&M business, which expands the opportunity set beyond just Ameresco-executed projects, we now provide service for over 2.5 gigawatts of third-party solar and battery storage. With long-term O&M backlog now exceeding $1.5 billion, this business continues to provide strong visibility, recurring revenue, and durability across cycles. Gross margin was 17.7%, a meaningful improvement both sequentially and year-over-year, reflecting a favorable business mix and strong execution. Net income attributable to common shareholders was $9.7 million or $0.18 per diluted share, while non-GAAP EPS was $0.20. Adjusted EBITDA increased 12% to $62.8 million, outpacing revenue growth and reflecting strong operating execution, improved business mix, and the continued expansion of our higher margin recurring businesses. EPS reflected higher depreciation and interest expense associated with the continued growth in our energy asset portfolio, along with a lower tax benefit and the non-controlling interest impact from the Neogenyx transaction. Turning to our balance sheet, unrestricted cash increased to $138 million, with total corporate debt of $385 million. Our corporate leverage was 3.2x, comfortably below our 3.5x covenant. We also strengthened our capital position in Q2, securing $471 million of new financing commitments, including the $400 million related to the Neogenyx transaction. That capital gives us added flexibility to fund growth, support our working capital needs, and continue scaling the energy assets portfolio in a disciplined way. Adjusted cash from operations was impacted in Q2 by the timing of project execution, billings, and collections. The strong revenue quarter included significant work performed ahead of contractual billing milestones, resulting in more cash being temporarily absorbed in working capital. Cash conversion remains a key priority for the second half. Given our strong first half performance, the visibility provided by our backlog, and the financing progress achieved in Q2, we remain confident in our 2026 outlook. As a result, we are reaffirming our full-year guidance across all metrics and increasing our non-GAAP EPS guidance. We are increasing our non-GAAP EPS guidance range to be $1.15 to $1.35 as we now expect a tax benefit rate in the range of 25% to 40%. The additional expected tax benefit is supported by our planned transition to a new accounting policy for transferable tax credits in the second half of the year. This methodology better aligns earnings recognition with the period in which the investment tax credits are generated rather than allocating the benefit over the life of the related assets. Prior-period results will be recast to enhance comparability once we make this change. Looking ahead, we expect the second half to follow our normal seasonal cadence with activity weighted somewhat more towards Q4, supported by continued project execution, backlog conversion, and disciplined cost management. Now I'd like to turn the call back to George for closing comments.
Thank you, Mark. This is a transformative time for Ameresco as we continue to execute our growth strategy, positioning ourselves in some of the fastest growing and most attractive energy infrastructure markets. Our twin market pillars of Power Infrastructure and Building & Public Infrastructure not only continue to drive our growth, but also provide greater diversification of the company's customers and solutions. Our decades of experience delivering reliable on-site power solutions uniquely position us to capitalize on the significant opportunities ahead. We look forward to connecting with many of you at upcoming meetings and conferences. In closing, I want to once again thank our employees, customers, and stockholders for their continued support and confidence in Ameresco. Operator, we would like to open the call to questions.
Questions and answers
Our first question is from George Gianarikas with Canaccord Genuity. Please go ahead.
Hi everyone, thank you for taking my questions and congratulations on the data center wins. Regarding those wins, how are project delivery commitments structured from a risk-sharing perspective? Specifically, what's the financial exposure or liquidated damages that Ameresco would bear if a completion timeline slipped due to equipment supply chain bottlenecks, interconnection queues, or local permitting delays?
Yes, that's a great question, George. We won't get into any project specifics because, as you can imagine, it's very sensitive to our customers and to the agreements that we're in. But be assured, Ameresco and all of our projects are very mindful and diligent about what commitments we're signing up to.
And maybe a question for Mike, any update on what's happening with Neogenyx, project updates, etc.?
Thank you. Mike is not here, but since we did the partial sale or partnership with HASI, the relationship is going very, very well. Development opportunities are increasing, and we actually see more opportunities now, not only organic but maybe some project acquisitions that they are bringing to us. So the relationship is very good. It provides a lot of flexibility and great capital contribution into the company, and of course, we can use the capital to grow not only that unit, but other lines of our business as well.
Next question comes from the line of Stephen Gengaro with Stifel. Please go ahead.
Maybe following up on George's question a little bit, when you think about the data center awards and what it means for backlog, is the cadence of backlog conversion to revenue any different with awards of this size than what we've become accustomed to?
Yes, that's a great question. It's not different than the other projects we have in the backlog, especially the federal government projects. By putting these projects into the award category, we have done comprehensive diligence to make sure they meet the criteria we use to put a project into the award category. Many have been through some customer RFP processes, so there's some kind of exclusivity agreement between us and that base, and they have achieved certain milestones in their development process. If you look at it, that's how we move from the award to contracts. For data centers, we would probably see between 6 and 24 months for awards to move to contracted. Then, once they move to contracted, you're talking 12 to 36 months depending on the implementation schedule. But the awards are solid and over time they will move into the contracted category and then into implementation.
Great. Thank you. And just as a quick follow-up to that, if I assume the margin profile is similar to the legacy activity, is that a fair place to start?
Yes, excellent question. The margin on these particular projects is basically what we get for EPC projects similar to federal government projects, which is in the high teens.
Your next question is from Eric Stine with Craig-Hallum. Please go ahead.
Yes, so obviously a big highlight on the awards at $1.2 billion, and it sounds like you're pretty optimistic about the pipeline. Wondering if you can talk in more detail about the size of that pipeline versus the awards that you have now pulled in, the $1.2 billion, and if there's a way to think about where those are in their various life cycles in terms of getting to the point where you could think about pulling those into awarded backlog?
Nicole basically said that what we put in the award category right now is part of what the ultimate size of this particular award will be. We'll probably see that it increases. I wouldn't be surprised if we get up to $2 billion associated with this particular award that we have right now.
Sure. We're continuing—this is our business day-to-day—and we continue to vet opportunities every day. We're being very strategic and diligent about how we are partnering on new opportunities. We expect to add additional projects as we continue to develop in this market.
To add a bit more clarity, there are five data center opportunities, including Lemoore, which is an asset base, and we're looking at at least that many more.
Got it. And maybe for my follow-up, Neogenyx was a very successful setup and structure. If you think about these data center opportunities and that they are sizable, is there some structure along those lines that could help speed up or increase the amount you can handle from a financing perspective?
You're right on track. We were very successful with Neogenyx and we learned a lot in the process. The data center opportunity is very large and will require substantial capital. We will look at similar structures, and if the terms are right and the right partner comes along, we will consider it. It's not specific to announce at this point in time, but it could be a great opportunity for another vehicle like Neogenyx.
Your next question is from the line of Noah Kaye with Oppenheimer & Co. Please go ahead.
George, this is transformational and I want to take a step back and recognize that this quarterly award is almost double any of your previous quarters in history. It's remarkable, so congratulations. Can you take us through how you won these awards and who the customers are? We're not expecting names, but are they hyperscalers, neoclouds, government, etc.? With the understanding that as you build these relationships, there's opportunity for a lot of future growth.
Nicole worked very hard to secure them, so I'll let Nicole provide color.
Thanks. As we've shared in previous earnings calls, our reputation with the federal government has served as a great entry point into this market because we've been effectively acting as the utility for federal government sites for decades. We're working with data center operators, hyperscalers, neocloud tenants, and commercial real estate developers who now need the added power side to their projects. Our delivery model—bringing integrated energy solutions, integrating different asset types, and the ability to microgrid—has been a unique offering and has served us well with the different players in this ecosystem.
So to confirm, the customers for these data center projects include hyperscalers and neoclouds, correct?
Yes, they are part of the deals.
And last follow-up: can you help us understand where you are in the process of securing supply for some of those long-lead items? Have you already placed orders for key equipment?
We have not placed orders yet for these projects because they're still in our awarded pipeline. That's not been the model we've chosen for this market. We are working on and finalizing equipment selection with our partners. The projects are far enough along to move into the awarded pipeline, and then we'll continue to develop them into contracts and then place equipment orders.
Your next question is from Ryan Pfingst with B. Riley Securities. Please go ahead.
Congratulations on the progress. George, can you talk about the potential revenue cadence for a project that comes online in 2028, 2029 or 2030?
It's a difficult question because projects vary. For a typical complex project, such as a federal government project, once we get the award, we do detailed engineering, permitting, and so on, and negotiate scope with the government. It usually takes about 12 to 24 months to move an award to contract. Once contracted, some projects have one-year timelines, but if it's a turbine or a reciprocating engine power plant that is very complex, it might take up to two years to construct. So it moves along depending on complexity.
Yes, it really depends on the project.
For data centers specifically, I said earlier that awards may move to contracted status in 6 to 24 months because for some of them the development milestones are more advanced. Hyperscalers and developers typically move faster than the federal government and often have a sense of urgency to get power online as soon as possible.
Got it. Appreciate that. And then somewhat related, can you remind us where the CyrusOne project fits with regard to awarded or contracted backlog for you guys? Is there anything to share on how that's progressing at the Naval Air Station?
Lemoore is still in our awarded backlog, and like other projects we've discussed, it has a development timeline of 12 to 24 months. We're just moving along in that development now.
Your next question comes from Joseph Osha with Guggenheim Partners.
Congratulations on a strong result. I have two related questions. First, how should we think about this six-project pipeline—will most of this show up as EPC revenue or will some end up being at least partially capitalized on your balance sheet? Second, Nicole, on the storage side, are most of the deployments you're seeing short-duration, power-quality types of deployments, or are you seeing longer multi-hour deployments focused on resilience?
This is Josh. I'll answer the first question. The data center opportunities are expected to be recognized as our normal EPC revenue—percent-complete in accordance with our spend. It's not an asset sale or different balance sheet treatment than our other project business.
So this will be straight EPC revenue?
Correct.
As for the storage question, it really depends on the site. Many deployments are two hours in duration. Storage is used both for resiliency during maintenance or grid upsets and to stabilize load shifts, especially with AI-driven load profiles. So it's a combination of purposes, with two-hour durations being common.
Your next question comes from the line of Craig Shere with Touhy Brothers. Please go ahead.
Congratulations on the expanding awarded pipeline. George, you mentioned you had maybe another five potential counterparties or projects on top of the five already in awarded backlog. Are all of these roughly about the same size in terms of revenue and project size on average, or are you seeing them increase over time? How would you look at the pipeline outside of the awarded projects so far?
I think they're similar, but it depends. Some are smaller phased developments; others are campus-style projects where we may participate in one phase or several. The technologies are similar—reciprocating engines, fuel cells for earlier deployments for speed to power, and in some later phases combined-cycle gas turbines or simple-cycle gas turbines. It really depends on the project.
One other point to give perspective: the opportunity with these data centers is larger than the five projects we're discussing and does not include some federal government bases where we have enhanced lease uses. Among the five, Lemoore is included, and another is Pearl Harbor. There's considerable potential. People are realizing that to win the AI race, they need on-site power plants and reliable power, which is why our track record in building resiliency power plants and microgrids for the federal government is helping us gain traction in the marketplace.
Got you. Last clarification: you mentioned the timeline to move awards to contract could be 6 to 24 months and then up to 3 years for major projects to be completed thereafter. When you think about projects in 2028 and beyond that last two to three years in several phases, is it reasonable to think revenues and margins will be roughly evenly distributed across the years they're live?
Phase timing depends on the project. Some projects have multiple phases; phase one might take six months to a year, phase two another year, and so on. That's why I noted up to three years. Most likely we will not see a big impact from the data centers until 2028 and beyond. Between 2028 and 2030 you might see a substantial impact. There could be a small impact next year, but the major impact will be between 2028 and 2030. The awarded projects give early indication where we'll be two to three years down the road.
It's probably too soon to give an exact rule of thumb for revenue shape. Construction projects tend to be a bit front-end loaded as we place equipment orders and mobilize, but with six projects underway you could get some smoothing. Still, it's early to provide a precise distribution.
I'd also add that after construction there's a significant operations and maintenance stream associated with these projects. As Mark pointed out in our earnings commentary, O&M is an area we've always focused on building as recurring revenue, and these projects would certainly present that opportunity.
Next question comes from Swetha Rakhecha with Cantor Fitzgerald. Please go ahead.
Swetha here on behalf of Manish. Congrats on the new wins. A couple of follow-ups on the data center wins: First, are the three new wins affiliated with the two that were already booked? Second, as much as possible, can you help qualify whether the underlying customers are hyperscalers, co-location operators, or non-hyperscaler users? And finally, how are you thinking about risk when it comes to project delays, especially local data center bans, zoning restrictions, or other regulatory risks?
Those are good questions. Regarding customer types, these projects typically involve multiple parties: the landowner, the data center operator, and end-use tenants, which can include hyperscalers and neocloud tenants. We're working with a broad set of participants in this market. For risk mitigation, we've been working with the federal government and utilities for many years, so we understand the risk profile for building and developing large infrastructure projects. To mitigate development risk, we are strategic about whom we partner with upfront and assess the work they've already completed. We pick partners with strong local relationships and customers experienced in the market. We also pursue federal government land opportunities, which often have less community-related risk. These are steps we've taken over months to qualify opportunities carefully.
Thank you. Given the robust pipeline, how should we think about guidance? What would it take for you to raise guidance from here?
For 2026, the visibility we have from the data centers is already baked into our guidance, which we've reaffirmed. We don't expect the data centers to have a significant additional impact in 2026 beyond what we've already included. We're feeling good about the guidance for the year.
And with no further questions in queue, this does conclude today's conference call. Thank you very much for joining us today. You may now disconnect.