Financial Analysis

Business acquisitions On May 7, 2025, as part of an all-cash transaction, the Company acquired 100% of the interest in Bentek, an industry pioneer and manufacturer of electrical infrastructure used in all types of solar power plants. Additionally, on May 9, 2025, the Company acquired 100% of the interest in OnSight, a supplier of autonomous inspection robots and fire detection systems purpose-built for solar plants. Further, on September 8, 2025, the Company acquired 100% of the interest in Origami, a pioneer in roll-formed steel frame technology for solar modules. On November 7, 2025, in an all-cash transaction, the Company also acquired 100% of the interest in Fracsun, a leading name in solar panel soiling measurement and monitoring solutions. These business acquisitions expand Nextpowers capabilities to provide its customers with electrical infrastructure components that collect and transport electricity from solar panels to the power grid, and certain services related to operations and maintenance. Additionally, the acquisition of Origami expands the Companys capability to accelerate panel installation and improve long-term module durability. Further, the acquisition of Fracsun expands the Companys capability to provide soiling measurement and monitoring solutions. These business acquisitions continue Nextpowers strategy of adding and incorporating complementary technologies into the companys market-leading tracker platform to accelerate solar power plant construction, in …

BusinessCombinationDisclosureTextBlock · excerpt; the full note is in the filing

Commitments and contingencies Litigation and other legal matters Nextpower has accrued for a loss contingency to the extent it believes that losses are probable and estimable. The amounts accrued are not material, but it is reasonably possible that actual losses could be in excess of Nextpowers accrual. Any related excess loss could have a material adverse effect on Nextpowers results of operations or cash flows for a particular period or on Nextpowers financial condition. On February 6, 2024, pursuant to the Third Amended and Restated Limited Liability Company Agreement of Nextpower LLC (the LLC Agreement), the LLC made pro rata tax distributions in an aggregate amount of $94.3 million to the common members of the LLC, including an aggregate of $48.5 million to Yuma Acquisition Sub LLC and Yuma Subsidiary, Inc. (Yuma Sub). As of the date of the tax distribution, Yuma Acquisition Sub LLC and Yuma Sub were wholly-owned subsidiaries of Nextpower. On February 21, 2025, Flex and Flextronics International USA, Inc. filed suit in the Delaware Court of Chancery, alleging that Flex is entitled to the distribution that was paid to Yuma Acquisition Sub LLC and Yuma Sub on February 6, 2024 under the terms of the contracts governing Nextpowers spin-off from Flex. The complaint asserts claims against Nextpower, the LLC, Yuma Acquisition Sub LLC and Yuma Sub (collectively Defendants) for breach of contract, breach of the implied covenant of good faith and fair dealing, mistake and unjust e …

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Credit facilities On September 8, 2025, the Company and the LLC, as the borrower, entered into a credit agreement (the New Credit Agreement), which replaced the existing credit agreement originally entered into by the Company on February 13, 2023 (as amended from time to time, the Existing Credit Agreement). The New Credit Agreement provides for an unsecured revolving credit facility (the New Revolving Credit Facility) that matures on September 8, 2030 (the Maturity Date). The initial maximum aggregate principal amount available under the New Revolving Credit Facility is $1.0 billion. Subject to the satisfaction of certain conditions, the LLC may request an increase of the aggregate amount available under the New Revolving Credit Facility of up to $250.0 million at any time. The New Revolving Credit Facility provides for sub-facilities for the issuances of letters of credit in an aggregate amount not to exceed $500.0 million and swingline loans not to exceed $150.0 million in the aggregate. The LLC may borrow, repay and re-borrow amounts under the New Credit Agreement from time to time until the Maturity Date. Voluntary prepayments under the New Credit Agreement are permitted from time to time generally without premium or penalty. The New Revolving Credit Facility is guaranteed by the Company and the LLC. Borrowings under the New Credit Agreement bear interest at a rate of either (i) the Term SOFR rate, (ii) the Daily Simple SOFR rate, (iii) the Term RFR rate, (iv) the Daily …

DebtDisclosureTextBlock · excerpt; the full note is in the filing

The following table presents Nextpowers revenue disaggregated based on timing of transfer-point in time and over time for the three and nine-month periods ended December 31, 2025 and December 31, 2024: Three-month periods ended Nine-month periods ended December 31, 2025 December 31, 2024 December 31, 2025 December 31, 2024 (In thousands) Timing of Transfer Point in time $ 145,441 $ 15,800 $ 221,335 $ 46,806 Over time 763,911 663,563 2,457,538 1,988,049 Total revenue $ 909,352 $ 679,363 $ 2,678,873 $ 2,034,855 …

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Stock-based compensation The Company adopted the First Amended and Restated 2022 Nextpower LLC Equity Incentive Plan in April 2022 (the LLC Plan), which provides for the issuance of options, unit appreciation rights, performance units, performance incentive units, restricted incentive units and other unit-based awards to employees, directors and consultants of the Company. Additionally, in connection with the Companys initial public offering (IPO), the Company approved the Second Amended and Restated 2022 Nextpower Inc. Equity Incentive Plan (together with the LLC Plan, the 2022 Plan) to reflect, among other things, that the underlying equity interests with respect to awards issued under the LLC Plan shall, in lieu of common units of the LLC, relate to Class A common stock of Nextpower for periods from and after the closing of the IPO. The following table summarizes the Companys stock-based compensation expense: Three-month periods ended Nine-month periods ended December 31, 2025 December 31, 2024 December 31, 2025 December 31, 2024 (In thousands) Cost of sales $ 4,851 $ 3,084 $ 12,166 $ 9,345 Selling, general and administrative expenses 25,075 21,482 67,606 62,186 Research and development 3,929 2,414 8,046 7,235 Total stock-based compensation expense $ 33,855 $ 26,980 $ 87,818 $ 78,766 During the nine-month period ended December 31, 2025, the Company granted 1.5 million time-based unvested restricted share units (RSU) awards to certain of its employees under the 2022 Plan. T …

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Goodwill and intangible assets Goodwill During the nine-month period ended December 31, 2025, additions to the Companys goodwill are driven by its acquisitions of Bentek Corporation (Bentek), OnSight Technology, Inc. (OnSight), Origami Solar, Inc., (Origami) and Fracsun Inc. (Fracsun), as further described in Note 11. The following table summarizes the activity in the Companys goodwill during the nine-month period ended December 31, 2025 (in thousands): Balance as of March 31, 2025 $ 371,018 Additions 114,282 Balance as of December 31, 2025 $ 485,300 Other intangible assets During the nine-month period ended December 31, 2025, the total gross value of other intangible assets increased by $35.6 million, primarily consisting of $32.2 million of developed technology and $3.3 million of trade names and customer relationships. This increase is primarily driven by the recent business acquisitions as further described in Note 11. The components of identifiable intangible assets are as follows: As of December 31, 2025 As of March 31, 2025 Gross carrying amount Accumulated amortization Net carrying amount Gross carrying amount Accumulated amortization Net carrying amount (In thousands) Developed technology $ 71,443 $ (6,913) $ 64,530 $ 39,200 $ (2,394) $ 36,806 Customer relationships 19,159 (5,563) 13,596 18,000 (2,779) 15,221 Trade names and other intangibles 5,199 (2,748) 2,451 3,018 (1,804) 1,214 Total $ 95,801 $ (15,224) $ 80,577 $ 60,218 $ (6,977) $ 53,241 The gross carrying amou …

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Income taxes The Company follows the guidance under ASC 740-270, Interim Reporting , which requires a company to calculate the income tax associated with ordinary income using an estimated annual effective tax rate. The following table presents income tax expense recorded by the Company along with the respective consolidated effective tax rates for each period presented: Three-month periods ended Nine-month periods ended December 31, 2025 December 31, 2024 December 31, 2025 December 31, 2024 (In thousands, except percentages) Income tax $ 49,263 $ 42,842 $ 118,911 $ 89,922 Effective tax rates 27.3% 26.7% 21.5% 20.0% The increase in income tax expense and effective tax rate from the three-month period ended December 31, 2024 to the three-month period ended December 31, 2025 is primarily driven by an increase in income before income taxes for the corresponding period, a change in domestic and foreign earnings mix and non-deductible stock-based compensation expense. The increase in income tax expense and effective tax rate from the nine-month period ended December 31, 2024 to the nine-month period ended December 31, 2025 is driven by an increase in income before income taxes for the corresponding period and discrete tax benefits in the nine-month period ended December 31, 2024 related to a change in managements assertion to the realization for certain deferred tax assets, a change in domestic and foreign earnings mix and non-deductible stock-based compensation, partially offset …

IncomeTaxDisclosureTextBlock · excerpt; the full note is in the filing

Recently issued accounting pronouncement Accounting Standards Update (ASU) 2025-11, Interim ReportingNarrow Scope Improvements : In December 2025, the FASB issued a new accounting standard, to provide clarity and navigability of interim reporting requirements, requiring the entities to provide interim financial statements and notes in accordance with U.S. GAAP and added a comprehensive list of interim disclosures required by U.S. GAAP. The new standard is effective for the Company beginning in fiscal year 2029 with early adoption permitted. The Company expects to adopt the new guidance in first quarter of fiscal year 2029 with an immaterial impact on its consolidated financial statements. ASU 2025-09, Derivatives and HedgingHedge Accounting Improvements : In November 2025, the FASB issued a new accounting standard, aiming to better align Hedge Accounting with Risk Management. The update relaxes similar-risk requirements for grouped cash flow hedges, introduces an optional model for choose-your-rate debt, expands cash flow hedge eligibility for nonfinancial forecasts, clarifies the net written option test, and adjusts effectiveness assessment for dual foreign-currency debt hedges by excluding basis adjustments. The new standard is effective for the Company beginning in fiscal year 2028 with early adoption permitted. The Company expects to adopt the new guidance in first quarter of fiscal year 2028 with an immaterial impact on its consolidated financial statements. ASU 2025-05, …

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Revenue Based on ASC 606 provisions, the Company disaggregates its revenue from contracts with customers by those sales recorded over time and sales recorded at a point in time. The following table presents Nextpowers revenue disaggregated based on timing of transfer-point in time and over time for the three and nine-month periods ended December 31, 2025 and December 31, 2024: Three-month periods ended Nine-month periods ended December 31, 2025 December 31, 2024 December 31, 2025 December 31, 2024 (In thousands) Timing of Transfer Point in time $ 145,441 $ 15,800 $ 221,335 $ 46,806 Over time 763,911 663,563 2,457,538 1,988,049 Total revenue $ 909,352 $ 679,363 $ 2,678,873 $ 2,034,855 Contract balances The timing of revenue recognition, billings and cash collections results in contract assets and contract liabilities (deferred revenue) on the unaudited condensed consolidated balance sheets. Nextpowers contract amounts are billed as work progresses in accordance with agreed-upon contractual terms, which generally coincide with the shipment of one or more phases of the project. When billing occurs subsequent to revenue recognition, a contract asset results. Contract assets of $443.4 million and $405.9 million as of December 31, 2025 and March 31, 2025, respectively, are presented in the unaudited condensed consolidated balance sheets, of which $108.7 million and $140.4 million, respectively, will be invoiced at the end of the projects as they represent funds withheld until the p …

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Segment reporting Operating segments are defined as components of an enterprise for which separate financial information is available that is evaluated regularly by the Chief Operating Decision Maker (CODM), or a decision-making group, in deciding how to allocate resources and in assessing performance. Resource allocation decisions and Nextpowers performance are assessed by its Chief Executive Officer, identified as the CODM, using consolidated net income as the primary measure of segment profit to support business expansion, new product development and operational efficiencies. The measure of segment assets is reported on the unaudited condensed consolidated balance sheets as total consolidated assets. For all periods presented, Nextpower has one operating and reportable segment. The following table presents significant segment expenses with respect to the Companys single reportable segment for the three and nine-month periods ended December 31, 2025 and December 31, 2024: Three-month periods ended Nine-month periods ended December 31, 2025 December 31, 2024 December 31, 2025 December 31, 2024 (In thousands) Revenue $ 909,352 $ 679,363 $ 2,678,873 $ 2,034,855 Less: Material cost 569,633 409,728 1,701,857 1,216,745 45X vendor credits (96,760) (52,182) (289,035) (150,192) Tariffs 43,639 4,488 86,941 12,427 Freight, labor and other cost of sales 104,708 76,426 316,392 252,737 Selling, general and administrative expenses 82,733 70,573 241,295 203,527 Research and development 29, …

SegmentReportingDisclosureTextBlock · excerpt; the full note is in the filing

Subsequent events On January 12, 2026, Nextpower and Abunayyan Holding announced the completion of the incorporation of the previously announced joint venture, Nextpower Arabia, headquartered in Riyadh, Kingdom of Saudi Arabia. The new joint venture will provide tracker system equipment for utility-scale solar power plants across the Middle East and North Africa (MENA) region. The shareholders of Nextpower Arabia include Nextracker Spain S.L., a wholly-owned subsidiary of Nextpower LLC, and Abdullah Abunayyan Investment Holding (Abunayyan). As part of the Joint Venture Agreement and to initiate the organization of the new entity, the Company contributed cash of $2.7 million in the quarter ended December 31, 2025, which is included in other assets on the unaudited condensed consolidated balance sheet and reflected as other investing activities on the unaudited condensed consolidated statements of cash flows for the nine-month period ended December 31, 2025. In January 2026, Nextpower LLC executed a Share Purchase and Transfer Agreement to transfer two legal entities doing business in the region to Nextpower Arabia. The shareholders will have an equal number of board seats, with the chair position appointed by Abunayyan, which also nominates the chief executive officer. Abunayyan will maintain 51% ownership and control will be shared between the two partners. Accordingly, the investment will be accounted for by the Company as an equity method investment. On January 27, 2026, th …

SubsequentEventsTextBlock · excerpt; the full note is in the filing