Ormat Technologies — Second Quarter 2026 Earnings Summary

Financial Performance

• Total revenues for Q2 2026 were $258.8 million, a 10.6% increase year-over-year (YoY) from $234.0 million; H1 2026 revenues were $662.7 million, up 42.9% YoY from $463.8 million.
• Electricity segment revenue was $169.3 million in Q2 2026 (up 5.8% YoY) and $350.9 million in H1 2026 (up 3.1% YoY).
• Product segment revenue was $46.7 million in Q2 2026 (down 21.6% YoY) but $224.1 million in H1 2026 (up 145.3% YoY).
• Energy Storage revenue was $42.8 million in Q2 2026 (up 195.1% YoY) and $87.7 million in H1 2026 (up 172.0% YoY).
• Gross profit was $68.7 million in Q2 2026 (up 20.8% YoY) and $189.1 million in H1 2026 (up 45.6% YoY).
• Overall gross margin was 26.5% in Q2 2026 compared to 24.3% in Q2 2025; H1 2026 gross margin was 28.5% compared to 28.0% in H1 2025.
• Electricity gross margin was 23.7% in Q2 2026 (vs. 24.2% in Q2 2025); Product gross margin was 9.7% in Q2 2026 (vs. 27.7% in Q2 2025); Energy Storage gross margin was 56.2% in Q2 2026 (vs. 11.9% in Q2 2025).
• Operating income was $34.2 million in Q2 2026 (down 3.2% YoY) and $114.5 million in H1 2026 (up 32.7% YoY).
• Net income attributable to stockholders was $27.1 million in Q2 2026 (down 3.4% YoY) and $71.2 million in H1 2026 (up 4.0% YoY).
• Diluted EPS was $0.43 in Q2 2026 (down 6.5% YoY) and $1.14 in H1 2026 (up 1.8% YoY).
• Adjusted Net income attributable to stockholders was $31.0 million in Q2 2026 (up 6.5% YoY) and $111.3 million in H1 2026 (up 57.6% YoY).
• Adjusted Diluted EPS was $0.50 in Q2 2026 (up 4.2% YoY) and $1.79 in H1 2026 (up 54.3% YoY).
• Adjusted EBITDA was $143.9 million in Q2 2026 (up 6.9% YoY) and $338.8 million in H1 2026 (up 18.9% YoY).
• A $6.6 million write-off of storage projects not pursued contributed to the decrease in GAAP net income for the quarter.
• Cash and cash equivalents were $513.7 million as of June 30, 2026, compared to $147.4 million as of December 31, 2025.
• Total debt (current and long-term) increased from $1.75 billion at December 31, 2025, to $2.08 billion at June 30, 2026, driven by the issuance of convertible senior notes.

Guidance and Future Outlook

• Full-year 2026 total revenue guidance raised to $1,150 million–$1,200 million.
• Full-year 2026 Electricity segment revenue guidance set at $710 million–$725 million.
• Full-year 2026 Product segment revenue guidance set at $300 million–$320 million.
• Full-year 2026 Energy Storage revenue guidance set at $140 million–$155 million.
• Full-year 2026 Adjusted EBITDA guidance raised to $630 million–$650 million (including approximately $17.0 million attributable to minority interest).
• The company does not provide guidance on net income or a reconciliation of Adjusted EBITDA to net income due to high variability in estimating forward-looking amounts.
• Management expressed confidence in achieving long-term growth objectives driven by increasing demand for reliable renewable electricity and improving power pricing.

Business Segments and Product Lines

• Electricity segment growth in Q2 2026 was driven by the Blue Mountain geothermal power plant acquisition (June 2025), improved performance at Olkaria and Puna plants, and lower curtailments in the USA.
• Energy Storage segment growth was driven by high asset availability, favorable merchant pricing in the PJM market, and new capacity additions.
• Product segment revenue decline in Q2 2026 was due to timing of manufacturing and construction progress; H1 results reflected strong execution driven by the Topp 2 sale.
• Product segment gross margin decline to 9.7% in Q2 2026 was attributed to high construction costs for a European project and exchange rate impacts on manufacturing costs; margin is expected to improve in the second half of the year.
• Product backlog stood at approximately $202.8 million as of August 5, 2026.
• The company has 202 MW of electricity generation projects and 497 MW / 1,888 MWh of energy storage projects under construction and development.
• New project milestones include the commercial operation of the 10 MW Dominica geothermal plant (July 2026), the 5 MW Cove Fort upgrade completion (June 2026), and the decision to develop the 100 MW / 400 MWh Denali energy storage facility in California (August 2026).

Market and Competitive Landscape

• The company is advancing its Enhanced Geothermal Systems (EGS) strategy through pilot programs with SLB and Sage Geosystems.
• The Ormega100 surface generation unit was introduced to accelerate the conversion of subsurface EGS resources into grid-scale power.
• At the Desert Peak project with SLB, geophysical data acquisition was completed, and the project is in the final stages of vendor selection ahead of planned drilling in Q4 2026.
• At the Sage Geosystems pilot, a power plant in Nevada was selected, and procurement for drilling services and equipment is nearing completion.
• The company is expanding its geothermal land position and water rights to support future EGS development.

Risks and Challenges

• The company noted a $6.6 million write-off of storage projects it decided to no longer pursue.
• Product segment gross margins were negatively impacted by high construction costs on a specific European project and unfavorable exchange rate movements.
• The press release includes a standard Safe Harbor statement regarding forward-looking statements, citing risks such as regulatory changes, geopolitical developments, commodity prices, interest rates, and supply chain disruptions.

Management Commentary and Tone

• CEO Doron Blachar stated that Q2 results reflected "continued successful execution of our diversified growth strategy" with double-digit revenue growth and over 20% gross profit expansion.
• Management highlighted the strength and balance of the three operating segments and the value of combining long-term contracted revenues with selective merchant exposure in Energy Storage.
• Blachar expressed confidence in achieving long-term growth objectives due to the strong pipeline of projects backed by long-term PPAs and increasing market demand.
• The tone regarding EGS was positive, noting significant progress toward commercial-scale validation and the anticipation of accelerating commercialization.

Other Key Points

• The Board of Directors declared a quarterly dividend of $0.12 per share, payable on September 2, 2026, to stockholders of record as of August 19, 2026.
• The company expects to pay a dividend of $0.12 per share in the next quarter.
• In May 2026, Ormat secured an exploration financing facility of up to $40 million with PT Sarana Multi Infrastruktur (SMI) for the Wapsalit geothermal project in Indonesia under the World Bank's GREM Program.
• The company issued convertible senior notes, resulting in an induced conversion expense of $761,000 in Q2 2026 and $34.4 million in H1 2026.
• A bargain purchase gain of $9.6 million was recorded in H1 2026.
• Impairment of long-lived assets totaled $316,000 in Q2 2026 and $8.4 million in H1 2026.
• The company has a total generating portfolio of 1,850 MW, including 1,355 MW of geothermal and solar generation and a 495 MW energy storage portfolio.