Nextpower Inc. reported third-quarter revenue of $909.35 million, a 12% year-over-year increase and 12% above consensus estimates. The company achieved a record backlog of $6.5 billion, driven by strong orders in North America and Europe. While service revenue rose 18% year-over-year, hardware sales grew 10%, underscoring broad‐based demand for Nextpower’s solar tracking solutions.

Despite top‐line strength, gross margin contracted to 28.4% from 32.1% in the prior year quarter, reflecting higher raw material and logistics costs. Operating margin declined to 12.7% from 15.3% a year ago. Management attributed the compression to short‐term supply chain disruptions and indicated that margin expansion will depend on cost savings initiatives scheduled to ramp in FY27.

Nextpower now trades at a forward price-to-earnings multiple above 30x, up from 24x six months ago, while the P/E/G ratio stands at 3.32. In light of valuation expansion, several analysts have moved from buy to hold, even as consensus EPS guidance for FY26 was raised to $3.29. Institutional demand remains strong, but the stretched valuation suggests limited upside absent operational improvements.

The company ended the quarter with $952 million in cash and equivalents and zero debt, providing ample flexibility for strategic acquisitions and R&D investments. However, cash flow from operations declined 12% year-over-year to $210 million, as working capital absorbed additional inventory for future projects. Nextpower reiterated its intention to maintain a net cash balance above $600 million throughout FY26.