Powell Industries 2025 Q4 Earnings Record Net Income Surges 11.7%

Powell Industries (POWL) exceeded expectations in its Q4 2025 earnings report, with both revenue and EPS surpassing forecasts. The company raised full-year guidance, citing robust demand in electric utility, LNG, and data center markets. Management emphasized sustained momentum and capacity expansions to support long-term growth.

Revenue

The total revenue of Powell Industries increased by 8.3% to $297.98 million in 2025 Q4, up from $275.06 million in 2024 Q4.

Earnings/Net Income

Powell Industries's EPS rose 10.9% to $4.26 in 2025 Q4 from $3.84 in 2024 Q4, marking continued earnings growth. Meanwhile, the company's profitability strengthened with net income of $51.42 million in 2025 Q4, marking 11.7% growth from $46.05 million in 2024 Q4. Remarkably, in 2025 Q4, the company set a new record high for fiscal Q4 net income, the highest in over 20 years. The EPS and net income growth underscore the company’s strong operational performance and pricing stability.

Price Action

The stock price of Powell Industries has plummeted 16.68% during the latest trading day, has plummeted 19.91% during the most recent full trading week, and has plummeted 18.30% month-to-date.

CEO Commentary

Brett Cope, Chairman of the Board, President & CEO, highlighted Powell’s record 2025 performance, noting 16% gross profit growth, 8% revenue growth, and $61 million in operating cash flow. He emphasized strength in nonindustrial markets (Electric Utility and Commercial/Industrial sectors), which now comprise 48% of backlog, up from 20% five years ago. The Light Rail Traction market nearly doubled in revenue. Cope cited strategic investments, including a $12.4 million expansion at Jacintoport to support LNG projects, and the Remsdaq acquisition to enhance automation capabilities. He expressed optimism about 2026, citing robust demand in Electric Utility, data centers, and LNG, while acknowledging softness in traditional oil and gas sectors.

Guidance

Powell expects fiscal 2026 to reflect sustained momentum in Electric Utility, LNG, and data center markets, with capacity expansions at Jacintoport and $12.4 million in CapEx, plus $5–7 million for maintenance. Backlog of $1.4 billion, 60% deliverable in 2026, supports revenue growth. Margins are projected to remain in the “upper 20s” due to project execution and pricing stability. The company anticipates leveraging SG&A expenses, with no material acquisition costs in 2026 post-Remsdaq.

Post-Earnings Price Action Review

Despite surpassing earnings and revenue forecasts, Powell Industries’ stock fell over 11% in post-earnings trading, closing at $321.66. The decline followed a strong performance in Q4 2025, with the stock reaching a 52-week high of $413.00 earlier in the year. The market’s reaction suggests investor caution or profit-taking, despite the company’s record net income and operating cash flow growth.

Additional News

Powell Industries recently announced the completion of its $12.4 million Jacintoport expansion to boost LNG project capacity, with completion expected by mid-2026. The acquisition of Remsdaq, a UK-based automation company, was finalized in Q4 to enhance its electrical automation strategy. Additionally, the firm declared a quarterly dividend of $0.2675, representing a 0.3% yield, as part of its capital return strategy.

Financial Health

Powell Industries’ balance sheet reflects robust liquidity, with a current ratio of 2.06 and a debt-to-equity ratio of 0. The company’s gross margin of 28.79% and net margin of 16.22% highlight efficient cost management. Institutional ownership stands at 89.77%, with hedge funds like Quest Investment Management and Zacks Investment Management increasing their stakes in Q3 2025.

Strategic Outlook

Management remains confident in Powell’s ability to capitalize on high-growth sectors like electric utility and data centers, supported by a $1.4 billion backlog. The company’s focus on automation, LNG infrastructure, and capacity expansion positions it to sustain margins in the upper 20s and deliver long-term shareholder value. Analysts maintain a “Buy” rating, with a consensus target price of $312.00.

Institutional and Insider Activity

Recent insider transactions included a 11.07% reduction in shares by EVP Michael Metcalf and a 30.93% decrease in ownership by Director John Birchall. Institutional investors, including Quantinno Capital Management and State of Wyoming, adjusted their holdings in Q3 and Q2 2025, reflecting confidence in the company’s strategic direction.