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Fluence Energy (FLNC)
NASDAQ:FLNC
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Fluence Energy
(NASDAQ:FLNC)
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Rating:46Neutral
Price Target:
$16.00
▼(-3.32% Downside)
Action:ReiteratedDate:02/06/26
The score is held back primarily by weak and volatile fundamentals (ongoing losses, negative operating/free cash flow, and higher leverage) and bearish technical positioning (below key moving averages with low RSI). These are partially offset by a constructive earnings call: reaffirmed FY2026 targets supported by record backlog, strong order intake/pipeline growth, and solid liquidity, though near-term margin and execution risks remain evident.
Positive Factors
Record Backlog and Pipeline Growth
A record $5.5B backlog and ~30% pipeline expansion give multi-quarter revenue visibility and optionality. This durable commercial momentum reduces near-term demand risk, supports conversion-driven revenue over 2–6 months, and underpins management's capacity to meet FY‑2026 guidance if execution holds.
Strong Liquidity Position
Roughly $1.1B of liquidity provides runway to fund project working capital, absorb timing/scale execution hiccups, and invest in supply-chain ramp without immediate dilution. That level materially lowers solvency and short-term refinancing risk while backlog converts to revenue.
Domestic Supply-Chain and Manufacturing Progress
Progress on domestic cell/module production and Arizona enclosure manufacturing, plus full-year supply commitments, reduce sourcing and logistics risk. Localized production and a ~50/50 mix of U.S. vs imported components strengthen execution resilience and long-term project delivery capability.
Negative Factors
Negative Cash Generation
Sustained negative OCF/FCF increases reliance on external financing and credit facilities to fund backlog-to-revenue working capital needs. While cash flow improved historically, the reversion to negative cash generation elevates execution and liquidity risk if margins or project timings deteriorate.
Profitability Volatility and Weak Margins
Modest long-run gross margins and quarter-to-quarter swings (Q1 at 5.6%) reflect execution sensitivity to seasonality, scope changes, and discrete project costs. This volatility undermines sustainable profitability and makes multi-quarter margin targets contingent on consistent project execution and cost control.
Rising Leverage versus Equity
Leverage has increased materially, reducing financial flexibility. With equity roughly matched by debt and returns negative, the company has less buffer to absorb cash-flow shortfalls or fund growth internally, increasing sensitivity to higher interest costs and constrained capital allocation choices.
Fluence Energy (FLNC) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$3.21B
Dividend YieldN/A
Average Volume (3M)6.32M
Price to Earnings (P/E)―
Beta (1Y)1.97
Revenue Growth-16.15%
EPS Growth-324.40%
CountryUS
Employees1,595
SectorUtilities
Sector Strength65
IndustryRenewable Utilities
Share Statistics
EPS (TTM)-0.34
Shares Outstanding132,436,080
10 Day Avg. Volume5,647,035
30 Day Avg. Volume6,324,081
Financial Highlights & Ratios
PEG Ratio0.10
Price to Book (P/B)3.28
Price to Sales (P/S)0.62
P/FCF Ratio-8.03
Enterprise Value/Market Cap0.66
Enterprise Value/Revenue0.82
Enterprise Value/Gross Profit7.07
Enterprise Value/Ebitda-95.24
Forecast
1Y Price Target
$19.33Price Target Upside16.80% Upside
Rating ConsensusHold
Number of Analyst Covering15
EPS Forecast (FY)-0.08
Revenue Forecast (FY)$3.38B
Fluence Energy Business Overview & Revenue Model
Company DescriptionFluence Energy, Inc. provides energy storage products and services, and artificial intelligence enabled digital applications for renewables and storage applications worldwide. The company sells energy storage products with integrated hardware, software, and digital intelligence, as well as engineering and delivery services to support the deployment of its storage products; operational and maintenance, and energy storage-as-a-service; and digital applications and solutions. Its energy storage products include Gridstack, a grid-scale industrial strength energy storage product; Sunstack for optimizing solar capture and delivery; and Edgestack, a commercial energy storage product that discharges when needed to flatten a facility's energy load profile. The company serves utilities, developers, and commercial and industrial customers. Fluence Energy, Inc. was founded in 2018 and is headquartered in Arlington, Virginia. Fluence Energy, Inc. is a joint venture of Siemens Aktiengesellschaft and The AES Corporation.
How the Company Makes MoneyFluence Energy generates revenue through multiple streams, primarily by selling energy storage systems and associated software solutions to utility companies, commercial customers, and other energy stakeholders. The company also earns money through ongoing service contracts, including maintenance and operational support for its installed systems. Additionally, Fluence benefits from strategic partnerships with key players in the energy sector, which can lead to collaborative projects and joint ventures that provide further revenue opportunities. The demand for energy storage solutions, driven by the growing emphasis on renewable energy sources and grid modernization, plays a significant role in Fluence's revenue growth.
Fluence Energy Key Performance Indicators (KPIs)
Any
Backlog
Represents the value of unfulfilled orders, indicating future revenue visibility and the strength of product demand.
Represents the value of unfulfilled orders, indicating future revenue visibility and the strength of product demand.
Data provided by:
The Fly
The FlyFluence Energy Earnings Call Summary
Earnings Call Date:Feb 04, 2026
(Q1-2026)
| % Change Since: |
Next Earnings Date:May 13, 2026
Earnings Call Sentiment Positive
The call conveyed strong commercial momentum (record $5.5B backlog, $750M+ Q1 bookings, ~30% pipeline growth) and robust liquidity ($1.1B), with clear progress on domestic supply chain and legal risk reduction. However, Q1 margin weakness (5.6% adjusted gross margin), a negative adjusted EBITDA (-$52M), and discrete ~$20M project costs underscore near-term execution and margin risks. Several large upside opportunities (data center and long-duration projects) remain at an early stage and must be converted to backlog to materially impact near-term results. On balance, the positives (backlog, bookings, pipeline growth, liquidity, supply-chain progress, legal wins, reaffirmed FY guidance) outweigh the near-term margin and execution headwinds.Q1-2026 Updates
Positive Updates
Record Backlog and Strong Order Intake
Backlog reached a record $5.5 billion. Q1 order intake exceeded $750 million globally, with over $500 million from the U.S.; management noted that the midpoint of full-year revenue guidance is fully covered by backlog.
Material Pipeline Expansion
Pipeline increased by approximately $7 billion, or ~30%, quarter-over-quarter, with the majority of growth coming from the U.S. Management is also engaged in discussions covering ~36 GWh of potential data center projects (many not yet in the pipeline) and ~34 GWh of long-duration storage opportunities.
Revenue, Guidance and Targeted Financial Goals
Q1 revenue was $475 million (about 14% of full-year guidance). Management reaffirmed fiscal 2026 guidance: revenue $3.2–$3.6 billion (midpoint $3.4 billion), annual recurring revenue target of ~$180 million by year-end, and adjusted EBITDA guidance of $40–$60 million for the full year.
Strong Liquidity Position
Ended the quarter with approximately $1.1 billion in total liquidity, including $477 million in cash and $617 million available under credit facilities, providing flexibility to support growth and working capital needs.
Progress on Domestic Supply Chain and Manufacturing
Domestic content supply chain performing to schedule: cell and module production running ahead of plan and Arizona enclosure manufacturing on track. Management reported they have secured 100% of domestic and international supply needs for the year and cited an approximate 50/50 mix of U.S.-made versus imported components in the plan. ASC (cell supplier) is actively working to resolve PFE compliance issues.
Resolution of Key Legal Matters
Two previously pending legal matters were favorably resolved: Moss Landing settled for an immaterial amount (confidential terms) and a court dismissed Diablo Canyon's $230 million disgorgement claim.
Negative Updates
Q1 Gross Margin Weakness and EBITDA Loss
Adjusted gross profit for the quarter was $27 million, representing an adjusted gross margin of 5.6%, well below the company's full-year target range of 11%–13%. This resulted in adjusted EBITDA of negative $52 million for the quarter. Management attributes much of the variance to seasonal Q1 dynamics and specific project items rather than structural issues; rolling 12-month adjusted gross margin was cited at 12.3%.
Discrete Project Cost Impacts (~$20 million)
The quarter included approximately $20 million of incremental costs tied to two non-U.S. projects (scope changes and schedule impacts). Management expects to recover most of these costs over the remainder of the fiscal year under contract.
Uncertainty Converting Pipeline to Backlog
Significant upside opportunities (notably ~36 GWh of data center discussions and ~34 GWh long-duration leads) have not yet converted to firm backlog. Management emphasized conversion timing is uncertain and expects much of the data center conversion to occur later in the year (second half), creating execution risk to realize pipeline upside in FY2026.
First-Quarter Margin Seasonality and Execution Sensitivities
Management noted typical first-quarter margin dynamics—lower revenue weighting with fixed overheads—can swing quarterly margins by 1–2 percentage points. Project-specific scope and schedule changes underscore execution risk on margins if similar events recur.
Supply/Competitive Exposure and ASC Ownership Ambiguity
While management is confident ASC will resolve PFE issues, there remains some uncertainty around ASC's ownership/resolution approach. The competitive landscape is evolving with new entrants (e.g., EV lines repurposing cells), which could increase pricing and supply dynamics risk over time.
Company Guidance
Fluence reaffirmed its FY‑2026 guidance, calling for revenue of $3.2–$3.6 billion (midpoint $3.4B) — with the midpoint fully covered by a record $5.5B backlog — adjusted EBITDA of $40–$60M, and adjusted gross margin of 11–13%; the company also expects annual recurring revenue of about $180M by year‑end. In Q1 it reported $475M of revenue (14% of the full‑year guide), $27M of adjusted gross profit (5.6% quarter margin vs. the 11–13% full‑year target), adjusted EBITDA of negative $52M, about $20M of discrete project costs it expects to recover, liquidity of roughly $1.1B (cash $477M plus $617M available on credit), Q1 order intake of >$750M (>$500M in the U.S.), and a ~ $7B (30%) expansion in its pipeline.Fluence Energy Financial Statement Overview
Summary
Revenue is growing (TTM +12.7%), but profitability and cash generation are weak and inconsistent: modest gross margin (~13%), TTM operating results still negative, and operating/free cash flow meaningfully negative (about -$161M/-$173M). Leverage has increased sharply (debt roughly matches equity), reducing flexibility while returns remain negative.Income Statement
TTM (Trailing-Twelve-Months) revenue grew 12.7%, showing continued demand, but profitability remains pressured: gross margin is modest (~13%) and operating results are still negative (EBIT and EBITDA below zero) with a net loss (~-2.1% margin). The trajectory improved meaningfully versus 2022–2023 losses and even reached profitability in 2024, but the relapse into losses in the latest annual period (2025) highlights earnings volatility and limited consistency.46
Neutral
Balance Sheet
Leverage has moved up sharply versus 2024: total debt is ~391M against equity of ~388M (debt-to-equity ~0.71), which reduces financial flexibility compared with prior years when debt was low. Equity remains positive, and total assets have grown versus 2023, but negative returns on equity in 2025 and TTM indicate that the balance sheet is currently supporting losses rather than compounding value.52
Neutral
Cash Flow
Cash generation is a key weak spot: TTM (Trailing-Twelve-Months) operating cash flow and free cash flow are both meaningfully negative (about -161M and -173M). While free cash flow has improved from the deeper deficits seen in 2021–2022 and was positive in 2024, the shift back to negative cash flow in 2025/TTM raises execution and working-capital risk and increases reliance on financing capacity.34
Negative
| Breakdown | TTM | Sep 2025 | Sep 2024 | Sep 2023 | Sep 2022 | Sep 2021 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 2.55B | 2.26B | 2.70B | 2.22B | 1.20B | 680.77M |
| Gross Profit | 297.63M | 295.79M | 341.08M | 140.96M | -62.35M | -69.14M |
| EBITDA | -22.09M | -16.99M | 41.10M | -101.94M | -276.41M | -153.63M |
| Net Income | -51.92M | -48.31M | 22.72M | -69.62M | -289.18M | -162.00M |
Balance Sheet | ||||||
| Total Assets | 2.27B | 2.36B | 1.90B | 1.35B | 1.75B | 717.67M |
| Cash, Cash Equivalents and Short-Term Investments | 452.56M | 690.77M | 448.69M | 345.90M | 467.65M | 36.83M |
| Total Debt | 391.25M | 390.80M | 30.36M | 50.56M | 2.74M | 100.00M |
| Total Liabilities | 1.78B | 1.81B | 1.30B | 795.82M | 1.12B | 773.87M |
| Stockholders Equity | 387.99M | 429.60M | 472.10M | 402.35M | 435.83M | -56.20M |
Cash Flow | ||||||
| Free Cash Flow | -195.06M | -175.34M | 60.71M | -124.15M | -290.32M | -269.56M |
| Operating Cash Flow | -161.10M | -145.54M | 79.69M | -111.93M | -282.38M | -265.27M |
| Investing Cash Flow | -33.96M | -29.80M | -18.98M | 94.44M | -148.42M | -22.29M |
| Financing Cash Flow | -5.74M | 356.88M | -8.68M | 52.59M | 817.05M | 231.13M |
Fluence Energy Technical Analysis
Negative
16.55
Price Trends
22.72
Negative
20.28
Negative
13.69
Positive
Market Momentum
-2.14
Positive
33.04
Neutral
7.61
Positive
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For FLNC, the sentiment is Negative. The current price of 16.55 is below the 20-day moving average (MA) of 23.32, below the 50-day MA of 22.72, and above the 200-day MA of 13.69, indicating a neutral trend. The MACD of -2.14 indicates Positive momentum. The RSI at 33.04 is Neutral, neither overbought nor oversold. The STOCH value of 7.61 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for FLNC.
Fluence Energy Risk Analysis
Fluence Energy disclosed 76 risk factors in its most recent earnings report. Fluence Energy reported the most risks in the "Finance & Corporate" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Fluence Energy Peers Comparison
UnderperformOutperform
Sector (66)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
66 Neutral | $17.65B | 18.10 | 5.60% | 3.62% | 6.62% | 11.55% | |
57 Neutral | $515.12M | -3.35 | -111.44% | ― | -35.99% | -46.51% | |
55 Neutral | $1.98B | 13.19 | 11.20% | ― | 42.09% | 219.69% | |
52 Neutral | $4.30B | ― | -76.85% | ― | 765.67% | -202.81% | |
47 Neutral | $95.74M | ― | ― | ― | 146.01% | 63.18% | |
46 Neutral | $3.21B | ― | -13.02% | ― | -16.15% | -324.40% | |
45 Neutral | $27.92M | -8.45 | -54.43% | ― | -40.99% | -46.52% |
* Utilities Sector Average
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Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.