Generac Secures $8 Billion Deal with Amazon Amid Data Center Expansion
Generac Holdings, the Wisconsin-based manufacturer of backup power generators, has secured an enormous supply agreement with Amazon worth up to $8 billion. The partnership, announced on [no specific date mentioned], will see Generac provide backup power generators for Amazon's data centers. According to Stifel, an investment firm that reiterated a Buy rating and price target of $285 on Generac stock, the deal represents a significant commitment from Amazon.
The agreement, which is expected to generate initial deliveries totaling roughly $2.4 billion across 2027 and 2028, expands Generac's backlog by approximately $4 billion. This comes as Amazon's data center expansion accelerates, with the company reporting 15.77% revenue growth over the last twelve months.
In connection with the supply agreement, Generac issued Amazon warrants to acquire up to 1,693,745 Generac common shares at an exercise price of $200.9266 per share. Stifel noted that this aligns Amazon and Generac's interests and validates Generac's market position.