Key Highlights

  • Revenue was USD 195.3 million against an estimate of USD 161.78 million and USD 135.8 million a year earlier.
  • Adjusted diluted EPS was USD 0.14 against an estimate of USD 0.12, while GAAP diluted EPS was USD 0.11.
  • Each Shoals share would convert into 1.6931 ARRAY shares under a Merger agreement signed November 4, 2026.
  • Backlog and awarded orders stood at USD 791.7 million at September 30, including USD 374.7 million of backlog.

Shoals Technologies Group, Inc. (NASDAQ:SHLS) signed a stock-for-stock merger agreement with ARRAY Technologies on November 4, 2026, the same day it reported third quarter results. Under the agreement, each Shoals Class A share converts into 1.6931 ARRAY shares, subject to Shareholder and regulatory approvals. The quarter itself produced Revenue of USD 195.3 million, against an estimate of USD 161.78 million, and adjusted diluted EPS of USD 0.14, against an estimate of USD 0.12.

How the ARRAY Merger Fits the Quarter

Management said ARRAY is the surviving Legal entity and that Shoals shareholders would own approximately 65% of the combined company's basic shares. Management said the structure avoids the need to refinance ARRAY's existing debt. Management named the first quarter of 2027 for closing, and said a new corporate name and ticker symbol would be announced in the coming months.

The company described targets of USD 35 million of run-rate synergies in the first year and more than USD 100 million by the third year. As part of the transaction, USD 161.3 million of ARRAY's Series A preferred stock is to be redeemed within 90 days of closing, with a further USD 156.3 million committed over three years. A termination fee of USD 40.3 million may be payable to ARRAY in certain circumstances.

Results Around the Event

Revenue rose to USD 195.3 million from USD 135.8 million, which the company stated was an increase of 43.8%. Gross Profit was USD 62.4 million, and gross profit percentage was 31.9% against 37.0% a year earlier. The company linked the lower percentage to inefficiencies from the ramp-up and transition into its new Manufacturing facility, product mix, costs to address product quality matters and incremental Lease accounting amortization.

Income from operations was USD 29.0 million, compared with USD 18.7 million, and Net Income was USD 17.9 million against USD 11.9 million. Adjusted EBITDA was USD 39.8 million against USD 32.2 million, and adjusted net income was USD 24.5 million.

Backlog was USD 374.7 million and awarded orders were USD 417.0 million, together USD 791.7 million. The chief executive cited about USD 186 million of new orders in the quarter and a book-to-bill ratio of approximately 1.0.

Financing, Cash and Combined-Company Figures

Net cash used in Operating Activities was USD 5.8 million for the nine months, against cash provided of USD 21.2 million a year earlier. Management cited Operating Cash Flow of USD 28.9 million in the third quarter, which supported a USD 33 million revolver paydown. Cash and cash equivalents were USD 7.7 million at September 30, and outstanding borrowings were USD 163.8 million against USD 136.8 million at year end 2025.

For the combined company, management gave a preliminary 2027 range of USD 2.2 billion to USD 2.4 billion in revenue and USD 410 million to USD 480 million in adjusted EBITDA including synergies. It also described pro forma net Debt to adjusted EBITDA of 2.6 times for 2026 and below two times for 2027.

Balance Sheet and Cash Markers

Cash of USD 7.7 million sits alongside borrowings of USD 163.8 million, third quarter adjusted EBITDA of USD 39.8 million and Backlog and awarded orders of USD 791.7 million. Management named a closing target of the first quarter of 2027, a Series A Redemption within 90 days of closing and a registration statement on Form S-4 to be filed in the coming weeks.

It also stated a goal of more than USD 100 million of annual synergies by year three, and pointed to Shoals' tax Assets of about USD 1.6 billion of tax amortization and USD 237 million of net operating losses.