Generac Lands $8B Deal with Amazon for Data Center Backup Generators
Generac, a Waukesha-based company, has entered into an $8 billion deal with Amazon to provide backup generators for the tech giant's data centers. Under the agreement, Generac is expected to deliver $2.4 billion worth of generators to Amazon in 2027 and 2028.
The deal establishes Generac as a 'long-term partner' for the supply of industrial backup generators to Amazon, according to CEO Aaron Jagdfeld. It demonstrates the industry's growth and provides visibility to Generac's multi-year growth expectations.
Amazon will acquire up to nearly 1.7 million shares of Generac stock for roughly $200 per share under the agreement. News of the deal sent Generac's stock price surging from roughly $175 per share to nearly $250 per share on Wednesday, although it declined slightly by Thursday afternoon.
Data centers have been a key driver of growth for Generac in recent years, with the company reporting a 29% increase in net sales for its commercial and industrial segment in the second quarter of this year. The company has invested heavily in new manufacturing plants to meet demand, including a facility in Beaver Dam and another under construction in Sussex.