Capstone Green Energy Reports 25% Revenue Growth and Net Income Turnaround in Q2 Fiscal 2026

Capstone Green Energy Holdings, Inc. reported a significant increase in financial performance for the second quarter of fiscal 2026, ending September 30, 2025. The company generated total revenue of $28.4 million, a 25% increase from $22.7 million in the same period last year. This growth was primarily driven by a 42% rise in revenue from microturbine products and accessories, which reached $16.1 million, up from $11.3 million. The company also reported a net income of $0.8 million for the quarter, compared to a net loss of $0.4 million in the prior year, although the net income was offset by $18.2 million in accretion of dividends on preferred units.

In terms of operational metrics, Capstone's gross profit for the quarter was $9.0 million, representing 32% of total revenue, compared to 31% in the previous year. The increase in gross profit was attributed to higher product sales volume and improved pricing strategies. The company’s total operating expenses rose to $7.6 million, up from $7.0 million, reflecting increased costs associated with the acquisition of Cal Microturbine, which was completed on August 13, 2025. The acquisition is expected to enhance Capstone's distribution and service capabilities in key markets.

Capstone's customer base remains concentrated, with three domestic distributors—E-Finity, Cal Microturbine, and Lone Star Power Solutions—accounting for 36%, 13%, and 10% of revenue, respectively, for the quarter. The company’s backlog at the end of September 2025 was approximately $14.8 million, an increase from $10.6 million a year earlier, indicating a positive outlook for future revenue generation. However, the book-to-bill ratio was 0.4:1, down from 0.8:1 in the previous year, suggesting that new orders received were lower than units shipped during the period.

Looking ahead, Capstone faces challenges related to its liquidity and upcoming debt obligations. As of September 30, 2025, the company had cash and restricted cash totaling $7.7 million and a working capital deficit of $14.2 million. The Exit New Money Notes, amounting to $33.2 million, are due on December 7, 2025, and the company has expressed concerns about its ability to meet these obligations without additional financing. Management is exploring various options, including potential equity issuances or incurring additional debt, to address these financial challenges. The company’s future performance will depend on its ability to execute its strategic initiatives effectively while navigating the current economic landscape.