stockrowWhat it does
Forgent Power Solutions designs and manufactures electrical distribution equipment: the systems and components that move electricity from its source to equipment inside a facility. Its products are used in data centers, utility grids and energy-intensive industrial facilities. Gary Niederpruem is its chief executive officer.
Its equipment includes transformers, which change voltage; switchgear and switchboards, which control and protect electrical circuits; automatic transfer switches; and power distribution units. Forgent also makes prefabricated electrical houses and power skids, which bring equipment together before delivery to a site.
The company sells individual products designed for a particular project as well as integrated Powertrain Solutions, in which custom products are combined or designed to work together. It also sells standard products based on common designs. Engineers work with customers to define requirements and design equipment for applications such as data center power distribution and utility substations.
Customers include technology companies, utilities, power producers and industrial companies. Forgent also sells through equipment makers and integrators, contractors and electrical products distributors. Its services include on-site commissioning, testing, maintenance, repair and upgrades. Forgent operates manufacturing campuses in the United States and Mexico.
How it makes money
Forgent generates revenue from selling custom electrical equipment, integrated Powertrain Solutions and standard products, as well as providing services. It has one reportable segment. Full-year fiscal 2026 revenue was $1.42 billion; fourth-quarter fiscal 2026 revenue was $462 million.
Custom Products are designed for a specific project or application, typically in small quantities, with substantial consultation between the customer and Forgent’s engineers. Powertrain Solutions combine custom products into a system. Standard Products use common designs for basic applications and are typically manufactured in larger quantities. In fiscal 2026, Custom Products generated $990.5 million of revenue and Powertrain Solutions generated $357.4 million.
Forgent typically recovers the research and development costs of custom products and Powertrain Solutions through the prices it charges customers. Its engineers help customers evaluate cost, performance and availability when developing a solution. The company says customers typically choose its products for their customization, reputation for reliability and lead time, and to a lesser extent price.
Service revenue comes from work including commissioning, testing, maintenance, repairs and aftermarket retrofits. Customers typically use these services for new construction and upgrades, and Forgent can provide 24/7 support where uptime is critical. The company also attaches start-up and commissioning work to equipment orders. Service revenue was $29.7 million in fiscal 2026; the company does not describe it as a subscription or provide a recurring-revenue figure.
Forgent sells directly and through representatives, integrators and other equipment manufacturers. Some partners incorporate Forgent products into their own systems or resell them under their own brands.
| Product or service | Revenue, FY2026 | Share | Change on the year |
|---|---|---|---|
| Custom products | $990.5 million | 69.7% | 67.7% |
| Powertrain solutions | $357.4 million | 25.2% | 259.3% |
| Standard products | $42.5 million | 2.99% | 22.6% |
| Services | $29.7 million | 2.09% | 4.48% |
Customers and how it sells
Forgent serves technology, power, utility and industrial companies, both directly and through intermediaries. Those intermediaries include original equipment manufacturers and integrators that incorporate Forgent products into systems they sell, contractors building data centers and power infrastructure, and electrical products distributors.
The company uses a direct salesforce alongside independent sales representatives. Its sales professionals and application engineers are organized around data centers, grid and industrial markets. Representatives receive commissions on the products they sell, while some integrators and equipment manufacturers resell Forgent products under their own brands.
In fiscal 2026, approximately 59% of revenue came from the Data Center market, 21% from Grid, 10% from Industrial and 10% from other markets. One major customer accounted for 11.0% of fiscal 2026 revenue. Substantially all revenue came from customers located in North America.
Forgent received its first direct order from a Frontier AI lab in the fourth quarter of fiscal 2026 and signed a master services agreement with a hyperscaler. It operates manufacturing campuses in Minnesota, Texas, Maryland, California and Mexico. The company plans to expand internationally over the long term.
| Segment | Revenue, FY2026 | Share | Change on the year |
|---|---|---|---|
| Reportable Segment | $1.4 billion | 100.0% | 88.5% |
Suppliers and costs
Forgent manufactures components in-house and generally buys raw materials and selected components from domestic and international suppliers. Its inputs include copper, electrical and carbon steel, aluminum, insulation, circuit breakers, protective devices, electrical wires and fuses. The company generally sources key materials and components from a large number of suppliers.
Most raw materials and sourced goods are purchased through purchase orders rather than long-term supplier contracts. Forgent may fix prices for certain raw materials at the beginning of a year. It also incorporates current input prices into customer quotes, limits how long quotes remain valid and includes provisions in certain contracts that adjust final prices for changes in key raw material costs.
The manufacturing process includes fabrication and electrical assembly as well as transformer manufacturing. Forgent says its campuses can change their product mix and production volume with limited disruption, and that it can manufacture every product it sells for any end market at more than one campus.
The company employs production workers, engineers, skilled tradespeople, technicians and administrative staff. Forgent says manufacturing is labor-intensive and provides training and technical development. Third-party equipment included in a Powertrain Solution can carry less markup than Forgent’s own equipment.
- Revenue$1.4B
- Cost of revenue−$922.5M
- Selling, general and administrative−$262.9M
- Other operating costs−$52.2M
- Operating income$182.5M
Competitive position
Forgent competes on lead time, customization, product performance and features, reliability, and price. In data centers, it names Vertiv, PCX Corporation, Schneider Electric and IEM Holdings Group. PCX is a subsidiary of Hubbell. In prefabricated and modular systems, competitors include Schneider Electric, Eaton, Vertiv and Mission Critical Group.
In grid equipment, Forgent names Hitachi Energy, GE-Prolec Transformers, Hubbell’s Systems Control brand and Eaton’s Cooper Power series. In industrial markets, it names nVent Electric, Hitachi Energy, GE-Prolec Transformers, Eaton and WEG. Smaller private companies also compete across its markets.
Forgent’s engineers work with customers before production, using proprietary design tools and reference designs. The company manufactures critical components, including medium-voltage switchgear and dry-type transformers, in-house. It also offers integrated solutions and field services alongside individual equipment.
Our reading: Engineering collaboration and project-specific designs can help Forgent establish customer relationships, although customers can also choose among named competitors offering electrical equipment and modular systems. Our reading: In-house component manufacturing and a broad product range support customization and delivery control, but the company still relies on outside suppliers for materials and components. Our reading: Proprietary know-how provides some protection, while mature equipment technology and the general absence of patent protection limit the strength of patents as a moat.
| Competitor | Where they compete | Threat (our reading) |
|---|---|---|
| Vertiv Holdings Co. | Data center power management and modular power solutions | Medium |
| Hubbell Incorporated | Data centers through PCX and grid through Systems Control | High |
| Schneider Electric SE | Data center power management and prefabricated infrastructure | Medium |
| IEM Holdings Group, Inc. | Data center electrical equipment | Medium |
| Eaton Corporation plc | Modular power, grid and industrial equipment | High |
| Mission Critical Group | Electrical skids, modular power systems and electrical houses | Medium |
| Hitachi Energy Ltd. | Grid and industrial equipment | Medium |
| GE-Prolec Transformers, Inc. | Grid and industrial equipment | Medium |
Growth opportunities
Forgent’s growth strategy includes using recently expanded capacity, selling more prefabricated solutions, increasing order sizes, introducing products and expanding services. Over the longer term, it plans to offer upgrades for existing data centers, pursue acquisitions and expand internationally.
The company links demand for its equipment to data center investment, new power generation, utility infrastructure upgrades and manufacturing investment. It says customers increasingly want factory-built modular solutions that move work away from construction sites. Powertrain Solutions revenue grew 259.3% in fiscal 2026, and Forgent says Powertrain Solutions represented approximately 40% of its year-end backlog.
Forgent invested approximately $190 million across fiscal 2025 and fiscal 2026 to add manufacturing capacity. It has announced a dedicated 385,000 square foot Powertrain Solutions facility at its Tijuana campus and expects it to come online in the fourth quarter of fiscal 2027. The company expects the facility to increase Powertrain Solutions manufacturing capacity by more than 50% once complete.
Backlog was $3.0 billion as of June 30, 2026, up 256% from the same date in the prior year. Forgent expects fiscal 2027 revenue of $2.4 billion to $2.6 billion and says backlog covers more than 90% of its revenue guidance. It plans to report orders and backlog annually rather than quarterly, while providing rolling quarterly revenue and adjusted EBITDA guidance.
- $181.3MFY2024
- $753.2MFY2025
- $1.4BFY2026
- $2.4BFY2027 guidance
Structural risks
- Data center investment: A significant portion of Forgent’s revenue comes from data center products. Demand depends partly on continued investment in digital infrastructure and the availability of capital for that investment.
- Materials and pricing: Copper, steel, aluminum and insulation are subject to potentially substantial market price fluctuations. Forgent uses limited-duration quotes and price adjustments in certain contracts, but most sourced goods are purchased without long-term supplier contracts.
- Workforce and expansion: Forgent relies on skilled manufacturing workers, engineers and technical personnel. Recruiting, training and retaining qualified employees are important to supporting its expanded manufacturing footprint and increasing production.
- Debt and restrictions: Forgent’s credit agreement contains financial restrictions, including limits on additional indebtedness, investments and asset sales. Its variable-rate borrowing also exposes it to interest-rate fluctuations.
- Environmental and technology obligations: Environmental, health and safety requirements can result in costs or liabilities. Failure to use information technology effectively or implement new technologies could disrupt the business or reduce sales or profitability.
- Acquisitions: Potential acquisitions carry risks including integration difficulties, failure to realize expected benefits, unidentified liabilities and difficulties retaining customers and personnel.
Bottom line
Our reading
Forgent is an equipment manufacturer whose business rests on project-specific engineering, in-house production and increasingly integrated electrical systems. Our reading: Its backlog and expanded capacity support the company’s growth plans, but delivering them depends on hiring and training workers as well as continued customer investment, especially in data centers. Our reading: Customer collaboration and product breadth can help defend its position, although competition, input costs and reliance on suppliers remain important constraints.