Shares of Generac Holdings skyrocketed in late Wednesday after-hours trading following the announcement of a major agreement with Amazon.com to supply backup-power generators for data centers. The contract, valued at up to $8 billion, cements the company’s expanding role in powering the artificial intelligence infrastructure boom.
Generac disclosed that the initial deliveries under the agreement will include backup generators worth $2.4 billion, scheduled for 2027 and 2028. Additionally, the deal includes warrants permitting an Amazon subsidiary to purchase Generac shares through the year 2033, according to a filing submitted late Wednesday.
The market reacted sharply to the news. Generac stock climbed more than 34% during after-hours trading on Wednesday, a significant jump from its regular-session close, which saw only a marginal gain of less than 0.1%.
The partnership represents a major milestone for the Olathe, Kansas-based manufacturer, which is valued at approximately $10 billion. While Generac is widely recognized for its residential generators commonly sold at major retailers such as Home Depot and Costco, the company has been aggressively pivoting toward industrial and commercial energy solutions. Its product portfolio also includes electric vehicle chargers and solar-battery storage systems.
In its July earnings report, Generac highlighted sustained momentum in its data-center sales division and committed to increasing production capacity for large-megawatt backup generators. At that time, the company reported a backlog of roughly $1.6 billion for products destined for the data-center market.
The trajectory aligns with earlier projections made by the company. During a March investor presentation, Generac forecasted data-center sales reaching $1 billion by 2028, describing the sector as a “generational growth opportunity.”
Investors have already rewarded the company’s strategic shift. Generac shares have risen 28% year-to-date, outperforming the broader market, where the S&P 500 index has gained approximately 10% over the same period.
Interesting pivot to industrial scale. Their EV chargers and solar storage might finally be paying off too.
Beware of hype cycles. $8 billion sounds huge, but I want to see actual deliveries before celebrating.
Wait, they’re known for backyard backup generators. How does that translate to an $8 billion data center deal?
Thirty-four percent after-hours? Generac is definitely riding the AI energy wave hard right now.