Ormat Technologies Q2 Earnings Call Highlights

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Sun, August 9, 2026 at 2:03 AM GMT+3 7 min read

ORA +0.66%

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Ormat raised its 2026 outlook after second-quarter revenue increased 10.6% to $258.8 million and adjusted EBITDA rose 6.9% to $143.9 million. The company now expects $1.15 billion–$1.2 billion in revenue and $630 million–$650 million in adjusted EBITDA.
Energy storage was the primary growth driver: revenue nearly tripled to $42.8 million, supported by strong PJM merchant pricing and newly commissioned facilities. Ormat's operating storage portfolio reached 495 MW and 1,358 MWh, with 497 MW of additional projects under development or construction.
Electricity revenue grew 5.8% as generation improved and curtailment declined, while Ormat advanced enhanced geothermal systems pilots and plans to begin drilling at its Desert Peak project in the fourth quarter of 2026.

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Ormat Technologies (NYSE:ORA) raised its full-year revenue and adjusted EBITDA outlook after reporting second-quarter growth across its electricity, energy storage and product businesses, led by higher energy storage revenue and improved geothermal operations.

Second-quarter revenue rose 10.6% from a year earlier to $258.8 million, while gross profit increased 20.8% to $68.7 million. Consolidated gross margin expanded 220 basis points to 26.5%, driven in part by the margin contribution from energy storage assets in the PJM market, Chief Financial Officer Assi Ginzburg said.

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Net income attributable to company stockholders was $27.1 million, or $0.43 per diluted share, compared with $28 million, or $0.46 per diluted share, in the prior-year quarter. Ginzburg said the decline reflected a $6.6 million write-off for a storage project the company decided not to pursue. Adjusted net income rose 6.5% to $31 million, or $0.50 per diluted share, while adjusted EBITDA increased 6.9% to $143.9 million.

Energy Storage Drives Segment Growth

Energy storage revenue nearly tripled, increasing 195.1% to $42.8 million. The segment's gross margin reached 56.2%, as high asset availability enabled the company to benefit from merchant pricing in PJM and recently completed facilities added capacity.

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Chief Executive Officer Doron Blachar said approximately $19.5 million of the revenue increase came from existing PJM assets, while newly commissioned facilities contributed about $7.7 million. Ormat's operating storage portfolio stood at 495 megawatts and 1,358 megawatt-hours at quarter-end.

Management said it expects storage pricing to normalize during the second half of the year, though it anticipates conditions will remain stronger than in prior years. The company expects energy storage gross margin of 30% to 40% in the second half and 40% to 50% for the full year.

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Blachar said the company continues to target a mix of roughly 50% contracted and 50% merchant exposure in storage. In markets where merchant pricing is lower, including Texas and California, Ormat is seeking tolling agreements, he said, while PJM's more variable pricing supports merchant exposure.

Ormat has seven storage projects under construction or development totaling 497 MW, or 1,888 MWh. The portfolio includes the recently approved 100 MW, 400 MWh Denali facility in California, which is expected to begin operations by the end of 2028 under a 20-year tolling agreement with Clean Power Alliance.

Electricity Results Benefit From Operations, Lower Curtailment

Electricity segment revenue increased 5.8% to $169.3 million. The increase reflected a full-quarter contribution from Blue Mountain, higher energy rates and improved performance at Puna, stronger generation at Olkaria after well-field optimization, and reduced curtailment at McGinness Hills, Dixie Valley and Tungsten.

Blachar said U.S. curtailment declined by $4.2 million during the quarter. Blue Mountain contributed about $2.6 million in revenue, Puna revenue rose about $3 million, and Olkaria added approximately $2.5 million from stronger generation. Overall power generation rose 3% year over year.

Ginzburg said planned maintenance affected second-quarter electricity margins, but management expects margins to improve later in the year. The company also cited delays of about one to two months at two Caribbean projects as a factor in lowering its electricity-segment outlook. One of those projects, the 10 MW Dominica Laudat Geothermal Power Plant, began commercial operations on July 31.

Ormat's electricity portfolio totaled approximately 1,355 MW globally, including 15 MW added during the quarter. The company has 202 MW of electricity projects under construction and development through 2028, comprising 87 MW of geothermal capacity and 115 MW of solar capacity. Management said those projects are supported by long-term power purchase agreements.

The company said recently recontracted and blend-and-extend agreements, including one for Blue Mountain, are expected to increase annual revenue by about $14 million as they take effect between 2026 and 2030. Ormat also has approximately 190 MW under contract between 2031 and 2034 at a weighted average price of about $86 per MWh, compared with what Blachar described as current market pricing above $100 per MWh.

Guidance Raised as Pipeline Expands

For 2026, Ormat now expects total revenue of $1.15 billion to $1.2 billion and adjusted EBITDA of $630 million to $650 million. The midpoint of the revenue outlook represents growth of approximately 18.7% from 2025, while the adjusted EBITDA midpoint represents approximately 10% growth, according to management.

Electricity revenue is expected to be $710 million to $725 million.
Product revenue is projected at $300 million to $320 million.
Energy storage revenue is expected to be $140 million to $155 million.

Product-segment revenue declined 21.6% to $46.7 million, which Ginzburg attributed to the timing of manufacturing and construction activity. Gross margin was 9.7%, affected by higher construction costs on a European project and foreign-exchange effects on manufacturing costs. The company expects product gross margin of about 15% in the second half and about 18% for the full year.

During the first half, Ormat generated $662.7 million in revenue, up 42.9%, and adjusted EBITDA of $338.8 million, up 18.9%. Adjusted diluted earnings per share rose 54.3% to $1.79.

EGS Programs Advance Toward Drilling

Ormat said it advanced its enhanced geothermal systems, or EGS, efforts through pilot programs with SLB and Sage. At the SLB Desert Peak pilot, the company completed analysis of geophysical seismic data, updated its subsurface model, submitted drilling permit applications and advanced procurement. Blachar said drilling remains on track to begin in the fourth quarter of 2026.

At the Sage pilot, Ormat selected a location, advanced permitting and procurement for drilling services, and continued engineering work to integrate Sage technology into an existing Ormat power plant. Blachar said the pilots are intended to operate outside existing reservoirs and should require only a short shutdown to connect to existing facilities.

The company also introduced Ormega100, a modular 100 MW binary unit intended for large-scale conventional geothermal and EGS applications. Ormat said it was expanding its EGS land position, including a federal lease covering 10,642 acres in New Mexico, while negotiating additional acreage in Oregon and Idaho.

As of June 30, Ormat had approximately $1.1 billion in total liquidity, $658 million in cash, cash equivalents and restricted cash, and approximately $3.4 billion in total debt. The board declared a quarterly dividend of $0.12 per share, payable Sept. 2 to shareholders of record on Aug. 19.

About Ormat Technologies (NYSE:ORA)

Ormat Technologies, Inc is a leading renewable energy company specializing in geothermal and recovered energy power plants. Through its vertically integrated business model, Ormat designs, develops, engineers, constructs, owns and operates clean energy projects worldwide. The company's core technology centers on the Organic Rankine Cycle (ORC), which converts heat from geothermal sources or industrial waste streams into sustainable electricity without combustion.

Ormat's offering includes turnkey power plant solutions, proprietary ORC equipment and ongoing operations and maintenance services.

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