Generac Stock Soars After Announcing $8 Billion Data Center Power Deal with Amazon

Generac (NYSE: GNRC) shares surged 27.3% in after-hours trading after the company disclosed a major long-term supply agreement with Amazon.com (NASDAQ: AMZN). The deal positions Generac to provide backup power generators for Amazon's extensive global data center infrastructure.

Details of the Agreement

The transformational deal includes a warrant issued to an Amazon subsidiary, allowing it to acquire up to approximately 1.69 million Generac shares. The warrant has an exercise price of roughly $200.93 per share.

A key feature of the agreement is its performance-based structure. The vesting of the warrant is contingent on Amazon making aggregate gross payments of up to $8 billion to Generac for its data center backup power products. This structure directly aligns Amazon's potential equity stake with the scale of its purchasing commitment from Generac.

Market Impact and Strategic Significance

The stock's sharp upward move was entirely company-specific, as broader market indices like the S&P 500 and Nasdaq were essentially flat. This announcement provides a significant boost to Generac's revenue visibility, marking the first time the company has publicly named a hyperscale customer for an agreement of this magnitude.

Ad

The Amazon deal builds on substantial existing momentum in Generac's data center business. The company had previously secured two separate global supply agreements with undisclosed hyperscale operators in 2026, which helped build its data center backlog to $1.6 billion as of its second-quarter report.

Reinforcing the AI Infrastructure Thesis

This agreement reinforces a key narrative shift for investors, recasting Generac from a business primarily dependent on residential generator sales to a critical supplier for AI and cloud computing infrastructure. The power demands of data centers are a foundational element of the AI boom, and reliable backup power is non-negotiable.

The company had already raised its full-year 2026 adjusted EBITDA margin guidance to a range of 20.0–21.0%, citing strength in its Commercial & Industrial (C&I) segment. The Amazon announcement provides a powerful new catalyst that validates this strategic focus, which the market rewarded decisively.