0001628280-26-012501
SEC filingPower Solutions revenue surged 763% to $333.5M, driving total revenue to $622.2M, but segment cost margin expanded 15ppts.
Solaris Energy Infrastructure, Inc. describes itself as a provider of modular and scalable equipment-based solutions for power generation, control and distribution, and the management of raw materials in oil and natural gas well completions. Headquartered in Houston, Texas, the company serves multiple U.S. end markets, including data center, energy, and other commercial and industrial sectors.
The company operates through two reportable business segments. Solaris Power Solutions delivers power generation, control, and distribution solutions, offering flexible, on-demand power infrastructure to data center, energy, and other commercial/industrial customers. Solaris Logistics Solutions designs and manufactures specialized equipment for efficient management of raw materials used in oil and natural gas well completions, with services including field technician support, software solutions, and last mile/mobilization services.
The filing does not name specific products or platforms beyond the segment descriptions. The company emphasizes its software capabilities for supply chain planning and management, and its patent portfolio focuses on systems, services, and technologies supporting its offerings.
In the Power Solutions segment, revenue is significantly concentrated with a single data center customer, accounting for 88% and 96% of segment revenue in 2025 and 2024 respectively. The company entered a long-term commercial arrangement to provide up to approximately 900 megawatts of power generation capacity for this customer under a seven-year initial term. Additionally, in early 2026, it entered a rental agreement with an affiliate of an investment-grade global technology company to provide over 500 megawatts for AI computing needs, with a ten-year term starting in 2027. The Logistics Solutions segment primarily serves major E&P and oilfield services companies through Master Service Agreements, with one customer representing 28% and 20% of segment revenue in 2025 and 2024, and another 12% and 13%.
For Power Solutions, primary competition is the electricity grid, with behind-the-meter power as an alternative or complement. Numerous distributed energy companies exist, but few have similar integrated capabilities for large behind-the-meter applications. For Logistics Solutions, the oil and gas services industry is highly competitive, including logistics companies, equipment manufacturers, hydraulic fracturing service companies, and sand mining companies. Key competitive factors include equipment reliability, technical expertise, patent-protected technology, bundled services, capacity, workforce competency, safety, reputation, and price.
The company's strategic priorities include delivering high-quality services and equipment with superior execution and operating efficiency, differentiating through a safe working environment and patent-protected technology (especially in Logistics), and pursuing long-term commercial arrangements for power generation capacity, as demonstrated by the multi-hundred megawatt data center contracts.
As of December 31, 2025, Solaris employed 468 employees, none of whom are subject to collective bargaining agreements. The company considers employee relations good and emphasizes equal employment opportunity and attracting talent through various recruiting programs, including online postings, job fairs, and academic partnerships.
Total revenue increased 99% to $622.2 million in 2025, driven primarily by the Solaris Power Solutions segment, which grew from $38.6 million to $333.5 million. Cost of revenue (exclusive of depreciation and amortization) rose to $336.8 million from $184.9 million, reflecting higher activity. Non-leasing depreciation and amortization increased 21% to $49.9 million, primarily from intangible assets acquired in the MER Acquisition. Depreciation of leasing equipment for Power Solutions increased $28.3 million to $34.4 million due to asset additions. Selling, general and administrative expenses increased 73% to $61.7 million, driven by higher headcount and professional fees. Interest expense rose 108% to $27.6 million, mostly from the Term Loan before its repayment in October 2025. A loss on debt extinguishment of $41.5 million was recognized from prepayment penalties and write-off of unamortized debt issuance costs. Interest income increased to $6.7 million from higher cash balances. Income tax expense was $14.7 million, up from $8.0 million, with an effective rate of 20.1%. Net cash provided by operating activities increased to $209.1 million from $59.4 million, driven by higher revenue and working capital improvements.
Solaris Power Solutions revenue surged 763% YoY to $333.5 million, contributing 54% of total revenue. Deployed capacity averaged approximately 630 MW in 2025 versus 230 MW in 2024. Segment cost of revenue as a percentage of revenue increased to 41% from 26%, reflecting higher direct costs and a full year of operations following the September 2024 establishment of the segment. Solaris Logistics Solutions revenue grew 5% to $288.7 million, driven by an $18.5 million increase in last mile and ancillary services from higher tonnage, partially offset by a $4.3 million decline in fully utilized systems revenue despite a slight increase in system count to 93 from 91. Logistics cost of revenue as a percentage of revenue rose to 69% from 64%, primarily due to higher last mile costs and the absence of a favorable property tax reversal in 2024.
Management expects Solaris Power Solutions to remain the dominant segment in revenue and Adjusted EBITDA contribution. Capital expenditures in 2026 are expected to be higher than the $646.8 million incurred in 2025, with most spending allocated to Power Solutions. The company ordered an additional 500 MW of power generation equipment in November 2025, with delivery expected from mid-2027 through early 2028, targeting total capacity of approximately 2,200 MW. As of December 31, 2025, purchase commitments total $851.9 million, including $655.9 million due in 2026. The Master Equipment Rental Agreement signed in February 2026 for over 500 MW with a data center customer underscores strong demand. Liquidity is supported by $353.3 million cash, $59.9 million available under the revolving credit facility, and $332.5 million remaining on the Stateline term loan facility. The 2031 Notes refinancing has improved the interest expense profile. No specific quantitative earnings guidance was provided, but the outlook remains positive based on committed capacity and ongoing investments.
As of December 31, 2025, Solaris Energy Infrastructure held $353.3M in cash and cash equivalents, with no restricted cash. Total debt stood at $1.06B, comprising $880.4M in convertible notes (2030 and 2031 series) and $184.0M net under the Stateline term loan. Stockholders' equity totaled $827.3M, including $262.9M of non-controlling interest. The current ratio (current assets $483.0M vs current liabilities $163.3M) remains strong at 3.0x.
The company has entered into material purchase commitments for power generation equipment totaling $851.9M as of December 31, 2025. These commitments are cancellable but subject to significant termination penalties. Payments are expected as follows: $655.9M in 2026, $184.1M in 2027, and $11.9M in 2028. Of the total, $304.1M relates to the Stateline VIE and is expected to be funded without recourse to the company.
Two reportable segments are disclosed in the notes: Solaris Power Solutions and Solaris Logistics Solutions. Power Solutions generated $333.5M in revenue (all from leasing and services) versus $38.6M in 2024, reflecting the MER acquisition and organic growth. Logistics Solutions contributed $288.7M, relatively flat year-over-year. Segment profitability is measured by Adjusted EBITDA: Power Solutions $189.1M (56.7% margin), Logistics Solutions $88.9M (30.8% margin). No geographic breakdown is provided; operations are U.S.-focused.
Solaris faces significant concentration risk with one data center customer driving 47% of revenue. The Stateline venture, representing 41% of power generation assets, adds exposure to AI demand uncertainty, financing needs, and potential loss of operatorship. The company's ability to adapt distributed power technologies to rising load demands is critical; failure could lead to downtime and reputational harm. Competition in the evolving distributed power industry may pressure market share and pricing.
Tariffs and trade measures have increased equipment costs, and the company may be unable to pass these on to customers. Dependence on a limited number of suppliers for specialized equipment amplifies disruption risk. Inflation and rising interest rates further pressure capital expenditures and operating costs.
Debt covenants under the credit facility and Stateline term loan restrict financial flexibility. The convertible notes due 2030 and 2031 carry conditional conversion features that could trigger repurchase obligations, diluting equity and straining liquidity. The Tax Receivable Agreement could require substantial payments (estimated $159 million termination value) upon change of control, potentially exceeding realized tax benefits.
Hydraulic fracturing and environmental regulations, including air quality and GHG emissions rules, could increase compliance costs and reduce customer demand. Climate change initiatives may accelerate the transition away from fossil fuels, impacting the core business. Anti-indemnity statutes in key states limit contractual protections.
Cybersecurity threats pose operational and data integrity risks. The company relies on a few key employees without employment agreements or key person insurance. Volatility in oil and gas prices directly affects customer spending. The holding company structure depends on distributions from Solaris LLC, which may be restricted by debt agreements.
The provided document excerpt contains only the audit report and no actual cash flow statement figures for Solaris Energy Infrastructure, Inc. for the year ended December 31, 2025. The only cash flow-related disclosures are the issuance of $155 million in 4.75% convertible senior notes (2030 Notes) and $747.5 million in 0.25% convertible senior notes (2031 Notes) during 2025, as noted in the critical audit matter. These issuances represent significant financing inflows but cannot be placed into a complete cash flow context without the full statement. Operating cash flow, investing activities (including capex), and net financing cash flow are not provided. Therefore, no analysis of cash flow quality, CFO vs net income, or FCF is possible. The filing date is February 27, 2026, for the period ended December 31, 2025.