AMSC: Record Revenue, But the Tape Says Sell — The Data Center Inflection

Record Q4 revenue and a direct data center entry contrast with a 49% drawdown from the May peak

AMSC · Earnings Call · 2026-05-28

Record Quarter, Falling Tape

AMSC closed fiscal 2025 with a record quarter: revenue of $86.4M, up 30% year-over-year, and a 40% jump in 12-month backlog to $280M. The CEO opened the call with “We are really excited to report a record revenue quarter.” — Daniel Patrick McGahn, Chairman, President, and Chief Executive Officer · 2026-05-28 Yet the stock, which peaked at $58.72 on May 11, has since drawn down nearly 49% over the past 90 trading days. Total Revenue grew 30% y/y, and the full-year gross margin expanded to 30.5%, up 270 bps, as shown in Gross Margin. A falling tape in the face of record fundamentals is the story to unpack.

Direct Data Center Inflection

The most significant pivot is the company's direct entry into data centers. Data center-related orders accounted for ~10% of Q4 bookings, up from 5% last quarter. Management was explicit that these are direct-to-data-center wins, not just utility support: “direct to the data center, not direct to utility, which is why we highlight it.” — Daniel Patrick McGahn, Chairman, President, and Chief Executive Officer · 2026-05-28 The product set targets a power quality problem that grows with the scale of AI compute. As the CEO noted, “We are hoping it is a step up to the next level.” — Daniel Patrick McGahn, Chairman, President, and Chief Executive Officer · 2026-05-28 This confirms the strategic shift flagged in prior calls: in February, management noted the first data centers delivery, and last November they were hoping to announce one.

The data center wins that we have had direct to the data centers are principally for power quality, at the data center as the data center is being constructed.
Daniel Patrick McGahn, Chairman, President, and Chief Executive Officer · 2026-05-28

The company is clearly riding a global theme. Across the broader market, “AI data centers” is a top momentum keyword, and recent reporters like GRRR and VNET have flagged similar data center capacity demand. AMSC's direct participation is unique — most industrial equipment makers are still indirect suppliers.

Comtrafo: The Brazilian Bridge

Comtrafo, acquired earlier in fiscal 2025, is the catalyst for geographic and product expansion. The company is leveraging it to push into Latin America, especially Brazil, and to add large power transformers to its portfolio. Management is deliberately sequencing: first capture Brazilian opportunity, then expand across Latin America, then qualify for North America. “We believe this acquisition creates new opportunities across utilities, transmission infrastructure and grid expansion.” The balance sheet supports the plan: the company ended the year with $145M in cash, and Effective Net Cash stands at $135M after accounting for debt. The integration is only four months in, but management is optimistic about the cross-selling potential across the combined product line.

What the Tape Is Missing

The stock's drawdown may reflect valuation concerns — the P/R multiple peaked at 10.1x in Q3 2025 and has since compressed to 5.4x — or skepticism about order lumpiness. But the fundamentals tell a different story: a 12-month backlog of $280M covers roughly 85% of next year's revenue guidance, and the company has delivered seven consecutive quarters of GAAP profitability. The data center direct wins, if they replicate the semiconductor playbook, could be a step-function growth driver. As the CEO said in a previous call, “We are not just responding to grid challenges. We are enabling the changes.” The market may be underestimating how quickly the order book is converting into revenue. The tape's -20% return over the past 90 days stands in stark contrast to the record results — a divergence that often resolves in favor of fundamentals.