Power resiliency solutions provider American Superconductor (NASDAQ: AMSC) reported Q2 CY2026 results beating Wall Street’s revenue expectations, with sales up 30% year on year to $94.07 million. On the other hand, next quarter’s revenue guidance of $85 million was less impressive, coming in 3.2% below analysts’ estimates. Its non-GAAP profit of $0.17 per share was 17.7% below analysts’ consensus estimates.

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"Our first quarter results mark a powerful start, pushing our quarterly revenue past $90 million with 30% year-over-year growth," said Daniel P. McGahn, Chairman, President, and CEO, AMSC.

Company Overview

Founded in 1987, American Superconductor (NASDAQ: AMSC) has shifted from superconductor research to developing power systems, adapting to changing energy grid needs and naval technology requirements.

Revenue Growth

Examining a company’s long-term performance can provide clues about its quality. Any business can have short-term success, but a top-tier one grows for years. Over the last five years, American Superconductor grew its sales at an incredible 28.6% compounded annual growth rate. Its growth surpassed the average industrials company and shows its offerings resonate with customers, a great starting point for our analysis.

Long-term growth is the most important, but within industrials, a half-decade historical view may miss new industry trends or demand cycles. American Superconductor’s annualized revenue growth of 43.6% over the last two years is above its five-year trend, suggesting its demand was strong and recently accelerated.

This quarter, American Superconductor reported wonderful year-on-year revenue growth of 30%, and its $94.07 million of revenue exceeded Wall Street’s estimates by 9.2%. Company management is currently guiding for a 29.1% year-on-year increase in sales next quarter.

Looking further ahead, sell-side analysts expect revenue to grow 15.7% over the next 12 months, a deceleration versus the last two years. Still, this projection is noteworthy and implies the market is baking in success for its products and services.

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Operating Margin

Although American Superconductor was profitable this quarter from an operational perspective, it’s generally struggled over a longer time period. Its expensive cost structure has contributed to an average operating margin of negative 2.5% over the last five years. Unprofitable industrials companies require extra attention because they could get caught swimming naked when the tide goes out.

On the plus side, American Superconductor’s operating margin rose by 33.5 percentage points over the last five years, as its sales growth gave it operating leverage. Still, it will take much more for the company to show consistent profitability.

This quarter, American Superconductor generated an operating margin profit margin of 10.5%, up 2.7 percentage points year on year. The increase was encouraging, and because its gross margin actually decreased, we can assume it was more efficient because its operating expenses like marketing, R&D, and administrative overhead grew slower than its revenue.

Earnings Per Share

We track the long-term change in earnings per share (EPS) for the same reason as long-term revenue growth. Compared to revenue, however, EPS highlights whether a company’s growth is profitable.

American Superconductor’s full-year EPS flipped from negative to positive over the last five years. This is a good sign and shows it’s at an inflection point.

Like with revenue, we analyze EPS over a more recent period because it can provide insight into an emerging theme or development for the business.

American Superconductor’s EPS grew at an astounding 362% compounded annual growth rate over the last two years, higher than its 43.6% annualized revenue growth. This tells us the company became more profitable on a per-share basis as it expanded.

We can take a deeper look into American Superconductor’s earnings to better understand the drivers of its performance. American Superconductor’s operating margin has expanded over the last two years. This was the most relevant factor (aside from the revenue impact) behind its higher earnings; interest expenses and taxes can also affect EPS but don’t tell us as much about a company’s fundamentals.

In Q2, American Superconductor reported adjusted EPS of $0.17, down from $0.29 in the same quarter last year. This print missed analysts’ estimates, but we care more about long-term adjusted EPS growth than short-term movements. Over the next 12 months, Wall Street expects American Superconductor’s full-year EPS to shrink by 66.1% from $3.42 to $1.16.

Key Takeaways from American Superconductor’s Q2 Results

We were impressed by how significantly American Superconductor blew past analysts’ revenue expectations this quarter. On the other hand, its EPS missed and its EPS guidance for next quarter fell short of Wall Street’s estimates. Overall, this quarter could have been better. The stock traded down 7.1% to $30.69 immediately after reporting.

American Superconductor didn’t show its best hand this quarter, but does that create an opportunity to buy the stock right now? The latest quarter does matter, but not nearly as much as longer-term fundamentals and valuation, when deciding if the stock is a buy. We cover that in our actionable full research report which you can read here (it’s free).