The hidden AI "water seller"? Argan (AGX) Q3 earnings quick read: Not just construction, but also a winner in energy transition

AI data centers not only require chips but also massive amounts of electricity. While everyone is focused on Nvidia, power plant builder Argan (AGX) just delivered a very interesting report card. 📊

Here are the key highlights for Q3 FY26:

1. Backlog Hits Record High (Backlog is King) 📜

The most eye-catching data isn't revenue but the staggering $3 billion backlog.

• This means extremely high revenue visibility in the future.
• Main drivers: Natural gas projects (79%) and renewables (16%).

2. Profitability Significantly Improved 💰

Although revenue dipped slightly by 2.3% YoY to $251 million due to project transitions, profitability strengthened:

• Gross Margin: Rose to 18.7% (vs. 17.2% last year).
• EPS: $2.17 (vs. $2.00 last year).
• Reasons: Better project mix, strong pricing power, and fewer competitors.

3. Why Is It a Key Player in AI Infrastructure? 🏭

Management made it clear in the call: AI data centers and reshoring manufacturing require 24/7 uninterrupted power supply.

• Wind/solar are intermittent and must rely on natural gas power to stabilize the grid.
• Argan is one of the few EPC firms capable of handling such complex combined-cycle gas plants, with deeper moat than expected.

4. Rock-Solid Balance Sheet 🛡️

• Zero debt.
• Cash and investments total $726 million.
• Dividend raised 33%, with ongoing share buybacks.

💡 Bottom Line:

Argan is riding the "supercycle" of energy infrastructure. If you're bullish on AI-driven long-term power demand, this $3B-backlog, zero-debt company belongs on your watchlist.

$Argan(AGX.US) 

AGX Q3FY26 Earnings Summary