Powell Industries (POWL) executives outlined record growth at the 17th Annual Midwest IDEAS Conference, citing a $2.4 billion backlog and accelerating demand from data center operators.
The Houston-based manufacturer reported $860 million in revenue for the first nine months of fiscal 2025, down from $1.01 billion in the prior full year. Quarterly orders reached a record $934 million in Q3, bringing year-to-date orders to approximately $1.9 billion. Michael Metcalf, Executive Vice President and CFO, described the company’s liquidity position as "impeccable," with more than $600 million in cash and zero debt.
Data centers now represent roughly one-third of Powell’s commercial and industrial backlog, with a $400 million contract from a major technology client contributing to the surge. Core industrial segments—including oil and gas, LNG, and refineries—also account for about one-third of the backlog, while utilities comprise approximately 25%. The remaining portion includes commercial and other industrial projects.
Metcalf noted that industry peers view the current data center cycle as being between the "third and fifth inning," signaling sustained demand. The company’s geographic revenue remains concentrated in North America, with roughly 80% generated in the U.S., followed by Canada and the U.K.
Powell is expanding capacity to meet demand, including a 335,000-square-foot manufacturing yard expansion that will add capacity for 10 to 12 substations annually, with each unit valued between $10 million and $15 million. A new greenfield facility, estimated at $75 million to $100 million, is planned for completion within the next 24 months.
Research and development spending has increased to 1.5% of sales from 0.5% eight years ago, while working capital consumption remains between 12% and 15% of revenue to fund future projects. Customers typically provide 25% advance payments upon contract signing, supporting the company’s strong cash flow position of approximately $200 million for the first nine months of fiscal 2025.
