Generac Holdings Inc. (GNRC) Business Profile

What it does

Generac Holdings designs and manufactures generators, energy storage systems and devices that help customers manage electricity. Founded in 1959 and headquartered in Waukesha, it is led by Chief Executive Officer Aaron P. Jagdfeld.

Its residential standby generators are permanently installed at homes and switch on automatically when power fails. They mainly run on natural gas or liquid propane. Generac also sells portable generators for home backup, construction and recreation, along with battery storage, solar equipment and smart home devices.

For businesses and institutions, Generac offers generators and transfer switches for backup power, as well as equipment for applications that can operate beyond emergencies. Customers include data centers, telecommunications networks, healthcare facilities, retailers and manufacturers. Its mobile generators, light towers and other equipment provide temporary power and lighting, often through rental companies.

The company also sells controls that connect and manage energy equipment. At home, customers can use its ecobee interface to monitor and control Generac products; commercial customers can use controls to manage generators and other energy assets together. Parts, installation, maintenance and monitoring services support the equipment after sale.

Generac has entered the data center market with large diesel generators designed for facilities with substantial backup power needs. It also offers natural gas generators for uses including distributed generation and microgrids, which can combine several sources of power and storage.

How it makes money

Generac earns most of its revenue by selling equipment. In FY2025, residential power products generated $2.3 billion and commercial and industrial power products generated $1.5 billion. In Q3 2026, consolidated net sales were $1.29 billion.

Residential sales include permanently installed standby generators, portable generators, smart home devices and energy storage products. Commercial and industrial sales include stationary generators, transfer switches and mobile equipment. Customers choose equipment for different power requirements and applications, from a small home to a data center. Generac offers portable generators across consumer value and premium price points, while industrial products can be configured for individual projects.

The company also earns revenue after equipment is sold. Its other products and services include replacement parts, accessories, installation, maintenance, extended warranties and project management. Services accounted for approximately 4% of net sales in 2025.

Some service revenue recurs. Homeowners and dealers can subscribe to Mobile Link remote monitoring services. Blue Pillar earns software subscription and support revenue for monitoring and managing commercial equipment, while Ageto offers software-as-a-service contracts to integrate and control microgrid assets. Ecobee can receive payments from utilities when authorized homeowners connect their thermostats to utility grid-services programs.

Generac reports domestic and international operations for FY2025. In Q3 2026, it reported residential and commercial and industrial segment results: residential sales benefited from generator growth, while revenue from data center products contributed to commercial and industrial growth. In that quarter, the company said the faster growth of commercial and industrial sales had an unfavorable effect on consolidated gross margin mix.

Customers and how it sells

Generac serves homeowners, businesses, institutions and equipment rental companies. Homeowners buy standby and portable generators, storage systems and smart home products. Commercial customers use its equipment for backup power, temporary power, lighting and energy management; data centers, telecom operators, healthcare facilities and governments are among the end markets it serves.

The company sells through independent dealers and contractors, industrial distributors, retailers, online partners, wholesalers and rental companies. Residential dealers sell, install and service generators, while industrial dealers provide sales, installation and continuing product support. Generac also sells directly to some businesses and consumers.

In FY2025, domestic revenue was $3.5 billion and international revenue was $738.2 million. No single customer represented more than 4% of net sales in 2025, and the top ten customers represented approximately 18% in aggregate.

Generac has a long-term supply agreement with Amazon for data center backup generators. Initial deliveries under the agreement are expected to total a combined $2.4 billion in 2027 and 2028. The company also has data center customers outside the hyperscale category and reported orders across multiple continents.

Its international sales operations and industrial dealer network give customers access to local support. In Q3 2026, Generac said it was expanding large-generator manufacturing capacity in Europe, Asia and Latin America to serve demand already secured in those regions.

Suppliers and costs

Generac’s principal production costs include components, raw materials, freight, factory overhead and labor. Steel, copper and aluminum are its primary raw materials; engines, alternators, batteries, electronic controls and steel enclosures are important components. Commodity prices, labor costs, exchange rates and tariffs can affect its results.

The company manufactures certain engines and many alternators for its generators. It sources engines for some smaller products and all diesel products, and buys cooling packages and alternators for larger commercial and industrial equipment from suppliers around the world. It completes final assembly of home standby generators in its US factories. For some energy technology products, contract manufacturers produce finished goods using Generac designs.

Generac has said it uses multiple sources for major large-generator components, except engines, where high-horsepower diesel engine supply is limited. It has discussed domestic production options with its current engine supplier. The company has also altered its global supply chain and raised prices across many products to try to mitigate tariffs; it said tariff-related price increases had nevertheless hurt demand and margins for certain products.

Competitive position

Generac competes with diversified industrial companies and smaller generator makers, as well as companies focused on particular energy technology products. In residential products, it names Rehlko, Briggs & Stratton, Honda, Champion, Tesla and Enphase among competitors. In commercial and industrial products, it names Caterpillar, Cummins, Rehlko, MTU and Atlas Copco, among others. The competitive field also extends to service parts and warranties.

Generac says competition depends on brand reputation, quality, reliability, pricing, features, product availability, breadth of offering and factory support. It believes it has regained the leading share of the US portable generator market.

Its dealer and distributor network sells and services equipment, while factory training, sales leads and remote monitoring tools support channel partners. The company also offers products across residential, commercial and industrial applications, with controls that can connect generators, storage and other energy assets.

Our reading: Distribution and service are meaningful competitive assets because generators need installation and ongoing support, and Generac has invested in tools for its dealers. Our reading: Product breadth and connected controls can help Generac serve multiple customer needs, but competitors range from generator specialists to companies in storage and smart home products, so those advantages face different challenges in each market.

Growth opportunities

Generac expects demand for backup power to benefit from power-quality problems and customers seeking protection from outages. It estimates that approximately 6.75% of its defined addressable US home market has a standby generator and plans to expand distribution, develop products and market the category to reach more households.

Data centers are another growth market. Generac introduced large-megawatt diesel generators for facilities with substantial backup power requirements. Its data center product backlog reached approximately $4.5 billion in Q3 2026, including expected initial deliveries under the Amazon agreement. Generac expects revenue from products sold to the data center market to well exceed $2 billion in 2027.

To serve orders, Generac began initial production at its large-generator facility in Sussex, Wisconsin, at the end of Q3 2026. It is adding production capacity internationally and outfitting a packaging facility in Illinois. The company is working toward tripling global large-megawatt production capacity, although achieving its plans depends on production and component supply.

Generac also sees opportunities in natural gas generators used for applications beyond standby power, including microgrids. Its residential energy strategy combines generators, batteries, solar equipment and controls in a common interface. The company expects long-term demand for solar, storage and energy management products, while acknowledging that the phase-out of solar tax incentives will hurt solar and storage markets in the near term.

Structural risks

• Unpredictable outages: Demand for many Generac products is significantly affected by power outages, whose timing and severity are unpredictable. Low outage activity in the second half of 2025 affected residential demand; sales and profitability can vary between periods.

• Supply and expansion: Generac sources many components overseas and faces tariffs, logistics challenges and supplier disruptions. Supply of high-horsepower diesel engines is limited, and the company is expanding production to meet its data center backlog.

• Customer investment cycles: Residential demand depends partly on consumer confidence, interest rates and housing activity. Commercial and industrial demand depends on business investment cycles that differ across construction, data centers, telecom and other markets.

• Solar and storage policy: The phase-out of solar tax incentives is expected to hurt solar and storage markets in the near term. Generac also says higher interest rates and a more challenging policy environment have weighed on demand for these products.

• Debt and operational disruption: Indebtedness could affect cash flow and the ability to make debt payments. Network or information technology failures and security breaches could also adversely affect the business.

Bottom line

Our reading

Generac combines an established residential generator and service business with a growing commercial power business. Our reading: Its dealer network and installed equipment support customer relationships, while the data center backlog creates a substantial new source of demand. The trade-off is exposure to unpredictable outages, customer investment cycles and the execution and component supply needed to deliver large-generator orders.