Powell Industries Eyes Record Revenue as Data Center Backlog Powers Growth

Key Points

• Powell Industries is positioned to exceed $1 billion in annual revenue, with about $860 million recorded through the first nine months of its fiscal year and a $2.4 billion backlog.
• Data centers account for roughly one-third of the backlog, supported by $934 million in quarterly orders and a data-center contract worth more than $400 million. Management expects demand to remain significant for another three to five years, although growth could moderate.
• With more than $600 million in cash and no debt, Powell plans to expand manufacturing capacity, including a 335,000-square-foot fabrication-yard expansion and potentially a $75 million to $100 million greenfield facility.

Powell Industries NASDAQ: POWL said it is on track to surpass the more than $1 billion in revenue it generated last year, supported by demand for medium-voltage electrical equipment from data centers, utilities and industrial customers.

Speaking at the Midwest IDEAS Conference, Executive Vice President and CFO Michael Metcalf said the company reported approximately $860 million in revenue through the first nine months of its fiscal year. Powell manufactures low- and medium-voltage switchgear, circuit breakers, power control rooms and related automation systems, with its primary operating range between 480 volts and 38,000 volts.

Metcalf said Powell’s equipment supports power distribution after electricity moves from high voltage to medium voltage, regardless of whether the power is generated by solar, natural gas or another source. The company primarily serves North American markets using ANSI electrical standards, with five U.S. manufacturing facilities, a large Canadian operation and a U.K. facility serving the IEC-standard market.

Data Centers Represent About One-Third of Backlog

Data-center activity has become a major driver of Powell’s order growth. Metcalf said data centers accounted for about one-third of the company’s backlog, while core industrial markets such as refining, LNG, petrochemicals and oil and gas represented roughly another third. Utilities account for most of the remaining backlog.

The company reported $934 million in orders during its most recent quarter, including a data-center contract valued at more than $400 million that was formally booked in the third quarter. Total backlog reached $2.4 billion, with approximately 55% expected to convert into revenue over the next 12 months, according to Metcalf.

“2027 is essentially booked at this point, and we’re booking into 2028 backlog,” Metcalf said.

Powell’s data-center work includes power control rooms and medium-voltage equipment located outside the facilities, rather than equipment installed within the data centers themselves. Metcalf said the company has seen demand shift toward its highest-voltage offerings, including 38 kV systems, as operators seek more power capacity.

While the company initially worked with hyperscalers and colocation providers, Metcalf said Powell has found opportunities serving “neoscalers,” which he described as real-estate-oriented developers that build infrastructure and lease capacity to companies such as Google or Microsoft. He said these customers can offer more manageable contract terms than some hyperscaler agreements.

Metcalf said management believes data-center demand could remain significant for another three to five years, though he acknowledged the pace of growth could soften. He said Powell has not seen a slowdown in current project activity.

Integrated Model and Automation Strategy

Powell competes with larger electrical-equipment companies including ABB, Siemens, Schneider Electric and Eaton. Metcalf said Powell differentiates itself by supplying an integrated solution that includes switchgear, circuit breakers and the power control room or module housing the equipment.

He said competitors often must outsource the construction and integration of the building that houses their equipment, while Powell designs and builds the complete unit. That integrated approach has been particularly important in core industrial applications, according to Metcalf.

The company is also expanding its automation business, which Metcalf described as a high-margin and rapidly growing operation. Automation offerings include sensors and systems intended to help customers monitor equipment condition, identify abnormalities and support predictive maintenance.

Powell acquired U.K.-based controller company Remsdaq in August 2025. Metcalf said the business was integrated quickly and its technology was applied to a large U.S. data-center order during the first month after the acquisition closed.

The company is pursuing additional opportunities in engineered services, particularly upgrades and support for its installed base of circuit breakers. Powell acquired GE’s circuit-breaker business in 2006, giving it a broad installed base that management sees as a potential source of value-added service revenue.

Cash Position Supports Capacity Investments

Metcalf said Powell had more than $600 million of cash and no debt at its most recent reporting date. He said the company does not currently need to raise debt or equity to fund planned capital expenditures, although a large transformational acquisition could require additional financing.

The company expects a meaningful portion of its cash balance to support working capital because Powell receives advance payments on long-cycle projects and later deploys capital during project execution. Metcalf estimated that 12% to 15% of each revenue dollar will eventually be required for working capital.

Powell is also completing a 335,000-square-foot expansion of its fabrication yard. Metcalf said the added capacity will allow the company to work on an additional 10 to 12 substations annually, with each substation typically valued at $10 million to $15 million. The expansion is aimed at supporting large, one-piece buildings for LNG, refinery and other industrial projects.

Looking ahead, Metcalf said Powell may consider a $75 million to $100 million greenfield facility within roughly the next 24 months to address capacity needs. He said the company could fund such a project with existing cash reserves.

About Powell Industries (NASDAQ:POWL)

Powell Industries, Inc is an industrial electrical engineering company specializing in the design, manufacture and integration of customized power control and distribution solutions. The firm's offerings range from medium‐voltage switchgear and power control centers to bus duct, motor control centers and specialty transformers. Powell also provides automation systems, protective relaying, metering, supervisory control and data acquisition (SCADA) platforms, and turnkey engineering services to help clients manage critical power infrastructure.

Serving the oil and gas, petrochemical, refining, utility, mining and industrial sectors, Powell's products are engineered to meet demanding performance, safety and reliability requirements.

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