AMERICAN SUPERCONDUCTOR CORP /DE/

American Superconductor Corporation operates in the power control solutions industry, addressing the global demand for traditional and renewable energy, critical materials including semiconductors, electrification, industrial modernization, and power capacity expansion, as well as the electrification of naval and military capabilities. The Company estimates that the total annual addressable global market for its products and solutions is over $15 billion as of the fiscal year ended March 31, 2026 ¹. This addressable market is driven by a record global energy transition investment of $2.3 trillion in 2025, up 8% year over year, led by electrified transportation ($893 billion), renewable energy ($690 billion), and grid infrastructure ($483 billion) ². Approximately $110 billion was recorded in mining and materials investments and $185 billion in semiconductor capacity ³. In addition, the Company sees more than $47 billion of U.S. federal investment in military ship systems and capabilities ⁴. The Company's solutions address challenges including the need for modernized grids, the U.S. Navy's effort to upgrade in-board power systems, and the need for increased renewable sources of electricity.

The Company faces competition across its new energy systems product lines from companies like ABB, Hitachi, Ingeteam, Mitsubishi and Siemens ⁵. It faces more local competition in a subset of its business like power quality by companies that include Southern States, Controllix, Powerside, Elgin Power, Scott Manufacturing and QVARx ⁶, and competition on its power transformers and power supplies from companies like Friem, Dynapower, Nidec, Espey Manufacturing, Hammond, WEG S.A., and Kraft Powercon ⁷. The Company believes it is currently the only company that can offer HTS-based SPS products that have been fully qualified for use aboard U.S. Navy surface combatants ⁸. The primary competition for its SPS products is currently coming from defense contractors that provide the copper-based systems, with companies such as Ultra Maritime, L3 Harris, and Raytheon having the bulk of the business today ⁹. In the wind energy market, the Company faces indirect competition from global manufacturers of wind turbines, such as Siemens, Vestas, and Suzlon ¹⁰, and competition for the supply of wind turbine engineering design services from design engineering firms such as Aerovide and W2E ¹¹. The Company believes its competitive strengths include lead times, a scalable low-cost manufacturing platform, differentiated technologies, turnkey systems, an intellectual property portfolio, and unique solutions for the markets it serves.

The Company generates revenue through two market-facing business segments: Grid and Wind. The Grid business segment accounted for 84% of total revenues in both fiscal 2025 and 2024 ¹². Revenues in the Grid segment are derived from D-VAR product sales, NEPSI product sales, Neeltran product sales, NWL product sales, Comtrafo product sales, HTS wire sales, ship protection systems, government-sponsored electric utility projects and other prototype development contracts. The Wind business segment accounted for 16% of total revenues in both fiscal 2025 and 2024 ¹³. Revenues in the Wind segment are derived from wind turbine electrical control systems and core components, wind turbine license and development contracts, service contracts and consulting arrangements. The Company serves customers globally through a localized sales and field service presence in core target markets, and has served over 100 customers in the grid market since its inception ¹⁴.

The Company's Grid business segment enables electric utilities, industrial facilities, and traditional and renewable energy project developers to connect, transmit, transform and distribute power. Its solutions include D-VAR Systems, Transformers and DC Rectifiers, Power Supplies and Military-Grade Magnetics Applications, Power Factor Correction Solutions, actiVAR Systems, armorVAR Systems, D-VAR VVO, and REG Systems. The Grid business segment accounted for 84% of total revenues in both fiscal 2025 and 2024 ¹⁵. Grid revenues increased 34% to $251.3 million in fiscal 2025 from $187.2 million in fiscal 2024 ¹⁶. The increase in revenues was driven by higher new energy power systems revenues, higher ship protection systems revenues, and the contribution from the acquisition of Comtrafo in fiscal 2025 ¹⁷. The Grid business segment generated operating income of $8.5 million in fiscal 2025 and $1.8 million in fiscal 2024 ¹⁸.

The Company's Wind business segment enables manufacturers to field wind turbines with exceptional power output, reliability and affordability. It supplies advanced power electronics and control systems, licenses its highly engineered wind turbine designs, and provides extensive customer support services. The Company's design portfolio includes a broad range of drivetrains and power ratings of 2 megawatts and higher ¹⁹. To date, the Company has shipped core electrical components and complete ECS sufficient to power over 18,000 MWs of wind power ²⁰. The Wind business segment accounted for 16% of total revenues in both fiscal 2025 and 2024 ²¹. Revenues in the Wind business segment increased 34% to $47.8 million in fiscal 2025 from $35.6 million in fiscal 2024 ²². The increase over the prior year period was driven by additional shipments of electrical control systems in fiscal 2025 ²³. The Wind segment generated operating income of $7.1 million in fiscal 2025 and $3.8 million in fiscal 2024 ²⁴.

On December 5, 2025, the Company entered into a Stock Exchange Agreement to purchase all of the issued and outstanding shares of Comtrafo Indústria de Transformadores Elétricos S.A. for (a) (i) 300.0 million Brazilian Real in cash; and (b) 2,417,142 restricted shares of the Company's common stock, $0.01 par value per share ²⁵. In addition, the Company purchased certain real estate assets and transportation assets of Comtrafo for 155.6 million Brazilian Real and 13.4 million Brazilian Real, respectively, in cash ²⁶. The Company has agreed to pay the selling stockholders up to an additional 382.5 million Brazilian Real in cash upon the achievement of specified EBITDA objectives during the three years following the closing ²⁷. On August 1, 2024, the Company acquired all of the issued and outstanding shares of Megatran Industries, Inc. for aggregate consideration of $61.4 million, including a cash payment of $25.0 million in cash on hand, and 1,297,600 restricted shares of the Company's common stock ²⁸. On September 23, 2024, the Company paid an additional $8.3 million to the selling stockholders ²⁹. In June 2025, the Company completed an offering of 4,743,750 shares of its common stock at a public offering price of $28.00 per share, receiving aggregate net proceeds of approximately $124.6 million after deducting underwriting discounts and commissions and offering expenses ³⁰.

Total revenues increased by 34% to $299.2 million in fiscal 2025 from $222.8 million in fiscal 2024 ³¹. Gross margin increased to 31% in fiscal 2025 from 28% in fiscal 2024 ³². Operating income was $11.4 million in fiscal 2025, compared to an operating loss of $1.1 million in fiscal 2024 ³³. Net income was $133.8 million in fiscal 2025, compared to $6.0 million in fiscal 2024 ³⁴. The improvement in net income was driven primarily by the non-cash tax benefit from the release of the majority of the valuation allowance against deferred tax assets, higher revenues and improved gross margins in fiscal 2025 ³⁵. The Company recorded an income tax benefit of $117.1 million in fiscal 2025, compared to $3.7 million in fiscal 2024 ³⁶. Non-GAAP net income was $158.1 million, or $3.68 per share, for fiscal 2025, compared to $24.0 million, or $0.65 per share, for fiscal 2024 ³⁷.

The Company's Grid business is positioned to benefit from the Trump administration's energy policy focused on boosting domestic energy production, revitalizing U.S. manufacturing, and strengthening military readiness, which presents potential opportunities for the Company's power systems and naval solutions ³⁸. The administration's focus on revitalizing the defense sector and maintaining a world-class Navy further amplifies demand for reliable power supplies in military applications and mission-critical solutions ³⁹. The Company's Grid product solutions are well-positioned to support power quality in energy-intensive industries such as artificial intelligence, data centers, steel, automotive, chemicals, and semiconductors ⁴⁰. The Company also sees a potentially favorable opportunity to help power facilities in ways that scale without adding complexity or size ⁴¹. In the marine market, the U.S. Navy's 2025 shipbuilding plan covering government fiscal years 2025 to 2054 calls for a larger and more distributed fleet, with the Navy planning to buy 364 ships over the 2025–2054 period: 293 combat ships and 71 combat logistics and support ships ⁴². Recent shipbuilding initiatives, including the Navy's FY27 budget request, suggest that spending levels and the goals for numbers of ships will further increase ⁴³.

The Company's Wind business is positioned to benefit from the growing proportion of renewable energy, including wind power, in the global energy mix. According to the Global Wind Energy Council, approximately 151 GW of wind generation capacity was expected worldwide in calendar 2025, as compared to nearly 117 GW in calendar 2024 ⁴⁴. GWEC anticipates that more than 162 GW of additional capacity will be added in 2026 ⁴⁵. According to GlobalData, annual wind installations in India for calendar 2025 were 6.3 GW and for calendar 2026 are estimated to be above 6 GW ⁴⁶. The Company's strategy includes pursuing emerging overseas markets and serving key markets locally, focusing sales efforts on overseas markets that are investing aggressively in traditional energy, renewable energy and power grid projects ⁴⁷. The Company currently serves target markets such as Australia, Canada, Brazil, Chile, France, India, Japan, Mexico, New Zealand, Peru, Singapore, South Africa, South Korea, Taiwan, the United Kingdom, and the United States ⁴⁸.The Company's operational outlook includes a focus on its manufacturing capabilities, engineering expertise, and streamlined execution to enable delivery of solutions with shorter lead times ⁴⁹. The Company's manufacturing of proprietary wind turbine electrical control systems and power electronics products are primarily assembly operations with minimal fixed costs ⁵⁰. The Company's proprietary manufacturing technique for Amperium superconductor wire is modular in nature, which allows it to expand manufacturing capacity at a relatively low incremental cost ⁵¹. The Company's primary facilities include locations in Ayer, Massachusetts; Bordentown, New Jersey; Cornélio Procópio, Brazil; Klagenfurt, Austria; New Milford, Connecticut; Pewaukee, Wisconsin; Queensbury, New York; Richland, Washington; Florence, New Jersey; Silesian, Poland; and Westminster, Massachusetts ⁵². As of March 31, 2026, the Company employed 1,195 employees ⁵³.

The Company's capital allocation strategy includes research and development spending, which increased by 38% to $15.7 million in fiscal 2025, compared to $11.4 million in fiscal 2024 ⁵⁴. Purchases of property, plant and equipment were $4.9 million in fiscal 2025, compared to $2.4 million in fiscal 2024 ⁵⁵. In June 2025, the Company completed an offering of 4,743,750 shares of its common stock at a public offering price of $28.00 per share, receiving aggregate net proceeds of approximately $124.6 million after deducting underwriting discounts and commissions and offering expenses ⁵⁶. The Company has never paid cash dividends on its common stock and currently intends to retain earnings to fund the development and growth of its business, not anticipating paying cash dividends for the foreseeable future ⁵⁷. The Company has a shelf registration statement on Form S-3 that allows it to offer and sell from time-to-time up to $250 million of common stock, debt securities, warrants or units ⁵⁸.

The Company faces structural headwinds including the ongoing wars between Russia and Ukraine and in the Middle East, tariffs, trade restrictions and resulting trade conflicts, labor force availability, sourcing, material delays and global supply chain disruptions, which could have a material adverse effect on its business, financial condition and results of operations ⁵⁹. The Company's international operations are subject to risks including potentially longer payment cycles, difficulties in collecting accounts receivable, difficulties in staffing and managing foreign offices, additional withholding taxes or other taxes, imposition of or changes in foreign laws, increased exposure to foreign currency exchange rate risk, reduced protection for intellectual property rights, and natural disasters, pandemics, political unrest, war or acts of terrorism ⁶⁰. The Company also faces risks related to changes in U.S. government defense spending, which could negatively impact its financial position, results of operations, liquidity and overall business ⁶¹.

The Company's growth plan faces execution risks including the failure to implement its business strategy successfully, which could harm its financial performance ⁶². The Company may not realize all of the sales expected from its backlog of orders and contracts ⁶³. The Company relies upon third-party suppliers for the components and subassemblies of many of its Grid and Wind products, making it vulnerable to supply shortages and price fluctuations ⁶⁴. The Company may acquire additional complementary businesses or technologies, which may require it to incur substantial costs for which it may never realize the anticipated benefits ⁶⁵. A significant portion of the Company's Wind segment revenues are derived from a single customer, Inox Wind Limited, which accounted for 15% of total revenues in fiscal 2025 ⁶⁶. If this customer's business is negatively affected, it could adversely impact the Company's business ⁶⁷.

A significant portion of the Company's Wind segment revenues are derived from a single customer, Inox Wind Limited, which accounted for 15% of total revenues in fiscal 2025 ⁶⁸. If this customer's business is negatively affected, it could adversely impact the Company's Wind segment ⁶⁹. The Company's contracts with the U.S. and Canadian governments are subject to audit, modification or termination by such governments, and the continued funding of such contracts may remain subject to annual legislative appropriation ⁷⁰. The Company's performance on contracts with the U.S. Department of Defense may result in restrictions to its ability to repurchase its common stock or U.S. government denial of Foreign Military Sales ⁷¹. The Company relies upon third-party suppliers for components and subassemblies, making it vulnerable to supply shortages and price fluctuations ⁷². The Company has operations in, and depends on sales in, emerging markets including Brazil and India, and changes in these countries' political, social, regulatory and economic environments may affect its financial performance ⁷³. The Company's technology and products could infringe intellectual property rights of others, which may require costly litigation and could cause it to pay substantial damages and disrupt its business ⁷⁴.

Management's message emphasizes the Company's role as a leading provider of power control solutions that apply innovation and creativity to address today's challenges and enable a more resilient and sustainable energy future ⁷⁵. The key themes include powering partners, powering innovation, powering resilience, and powering sustainability ⁷⁶. Management's strategic priorities for the period ahead include driving revenue growth and enhancing operating results through increasing customer adoption of products by targeting high-growth segments with commercial and system-level products as well as identifying and completing opportunistic acquisitions ⁷⁷. The Company plans to focus on powering partners by designing, deploying and supporting fit-to-purpose solutions that enhance capability without adding complexity or size ⁷⁸. Management also emphasizes powering innovation by delivering innovative ways to harmonize the world's desire for clean energy with the need for reliable power delivery ⁷⁹. The Company's strategy includes pursuing emerging overseas markets and serving key markets locally, focusing sales efforts on overseas markets that are investing aggressively in traditional energy, renewable energy and power grid projects ⁸⁰.