Fluence Energy’s third quarter results were shaped by both operational setbacks and rising demand for energy storage solutions. While the company’s revenue fell short of Wall Street’s expectations due to production delays at its Arizona manufacturing facility, management pointed to a record $1.4 billion in new orders and a growing project backlog. CEO Julian Jose Marquez acknowledged the impact of labor shortages on output but noted, “We have implemented corrective actions. Production is improving, and we are confident in meeting delivery commitments.”
Is now the time to buy FLNC? Find out in our full research report (it’s free for active Edge members).
Fluence Energy (FLNC) Q3 CY2025 Highlights:
- Revenue: $1.04 billion vs analyst estimates of $1.39 billion (15.2% year-on-year decline, 24.8% miss)
- Adjusted EPS: $0.13 vs analyst expectations of $0.23 (42.5% miss)
- Adjusted EBITDA: $72.19 million vs analyst estimates of $62.89 million (6.9% margin, 14.8% beat)
- EBITDA guidance for the upcoming financial year 2026 is $50 million at the midpoint, below analyst estimates of $57.75 million
- Operating Margin: 4.6%, in line with the same quarter last year
- Deployed Megawatts for Digital Contracts: 22,000, up 3,700 year on year
- Backlog: $5.3 billion at quarter end, up 17.8% year on year
- Market Capitalization: $2.58 billion
While we enjoy listening to the management's commentary, our favorite part of earnings calls are the analyst questions. Those are unscripted and can often highlight topics that management teams would rather avoid or topics where the answer is complicated. Here is what has caught our attention.
Our Top 5 Analyst Questions From Fluence Energy’s Q3 Earnings Call
- George Gianarikas (Canaccord): asked about shifts in the competitive landscape in the U.S. and internationally. CEO Julian Jose Marquez noted increased preference for domestic, non-prohibited suppliers in the U.S. and stable competition globally, with Chinese players remaining prominent.
- Brian Lee (Goldman Sachs): pressed for detail on the size and timing of the data center pipeline. Marquez described the opportunity as rapidly expanding, with half of the 30 GWh pipeline expected to convert to orders for next year or later, but emphasized much remains uncertain.
- Dylan Nassano (Wolfe Research): sought assurance that manufacturing delays were resolved. Marquez and CFO Ahmed Pasha explained staffing and operational changes had stabilized output, increasing from 1.5 to 5 units per day, and expressed confidence in meeting future targets.
- Ameet Thakkar (BMO Capital Markets): questioned gross margin trends amid lower pricing. Pasha attributed margin pressure to lower average selling prices and volume, but stressed that operating leverage should improve as revenue scales.
- Mark W. Strouse (JPMorgan): inquired about timing and capacity from the new battery cell supplier. Pasha confirmed additional capacity would come online in 10-11 months, with current needs covered, and said the move was to secure future growth and compliance.
Catalysts in Upcoming Quarters
In the coming quarters, the StockStory team will focus on (1) the stabilization of output at Fluence’s Arizona and other U.S. manufacturing facilities, (2) the pace of Smartstack adoption in data center and long-duration storage markets, and (3) concrete progress toward full domestic content and regulatory compliance—including updates on the Tennessee supplier negotiations. Any shift in customer mix, contract wins in emerging sectors, or further supply chain disruptions will also be closely monitored as signs of execution and competitive positioning.
Fluence Energy currently trades at $19.41, up from $15.80 just before the earnings. In the wake of this quarter, is it a buy or sell? Find out in our full research report (it’s free for active Edge members).
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