Array Technologies Q3 2026 Earnings Call Transcript

Array Technologies (NASDAQ:ARRY) reported third-quarter financial results on Wednesday. The transcript from the company’s third-quarter earnings call has been provided below.

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Summary

Array Technologies and Shoals Technologies Group announced a stock-for-stock merger, with Array as the surviving entity and Shoals shareholders owning approximately 65% of the combined company.

The merger is expected to accelerate revenue growth, enhance profitability, and increase strategic flexibility by combining Shoals’ electrical balance of systems (EBOS) with Array’s structural balance of systems (SBOS) and other innovations.

The combined company aims to achieve $100 million in annual incremental EBITDA from synergies by year three, with a focus on cross-selling opportunities, reducing public company costs, and leveraging tax assets.

The merger includes plans to redeem over 60% of Array’s preferred stock to improve financial flexibility and reduce future cash distributions.

The companies reported strong Q3 results, with Shoals achieving record revenue growth and Array maintaining a robust order book, indicating solid market performance and operational execution.

Future outlook includes expanding into battery energy storage and data center infrastructure markets, leveraging the combined product portfolio and international reach.

Full Transcript

OPERATOR

Over to Matt Trachtenberg, Vice President of Finance and Investor Relations for Shoals Technologies Group. Thank you. You may begin.

Matt Trachtenberg (Vice President of Finance and Investor Relations)

Thank you, Warren. Good morning, everyone, and thank you for joining us to discuss the agreement announced today between Shoals and Array to combine in a stock-for-stock merger, creating an integrated energy infrastructure platform. The transaction announcement and accompanying pro forma presentation are available on both companies’ investor relations websites and our joint transaction website at poweringforwardtogether.com. We also have issued separate releases this morning with each company’s third quarter results, which we will cover before taking your questions.

Joining today’s call is the Chairman of the Board for both Array and Shoals, Brad Forth; CEO of Shoals Technology Group, Brandon Moss; and CEO of Array Technologies, Kevin Hostetler. Dominic Bardos and Keith Jennings, CFOs of Shoals and Array, respectively, will also be available for Q&A following today’s prepared remarks. Before we begin, today’s discussion includes forward-looking statements based on current expectations and assumptions. These include statements regarding the proposed transaction, its expected timing and benefits, anticipated synergies, capital structure, and future financial performance. These statements are subject to risks and uncertainties, and actual results may differ materially. Please refer to the disclosures in today’s releases and presentation as well as each company’s filings with the SEC.

We will also discuss certain non-GAAP financial measures, including adjusted EBITDA. Please refer to the applicable earnings materials for definitions and reconciliations of historical non-GAAP measures to the most directly comparable GAAP measures as described in the transaction materials. The companies are not providing reconciliations of certain of these non-GAAP measures to the most directly comparable GAAP financial measure because certain information necessary to calculate such measures are not available without unreasonable effort in connection with the transaction.

The companies expect to file a registration statement and joint proxy statement and prospectus with the U.S. Securities and Exchange Commission. Investors should read those documents carefully when they become available because they will contain important information about the companies and the proposed transaction. We anticipate these filings will be available in the coming weeks. Brad, I’ll turn the call to you.

Brad Forth (Chairman of the Board)

Thank you, Matt. Good morning, everyone. I’m very pleased to announce the merger of Shoals and Array. I have had the privilege of serving as chairman of both companies since they became public, and over that time I have seen firsthand the strength of each business, the quality of each team, and the significant opportunity that could be unlocked by bringing these two platforms together. Customers across the utility-scale solar market are increasingly looking for partners that can simplify sourcing, reduce vendor complexity, accelerate project execution, and deliver greater value through innovation. We believe this combination is uniquely positioned to do exactly that. The timing is also right. Shoals has built the category-leading electrical balance of systems through its BLA solution. Array has assembled a highly differentiated structural balance-of-system platform including APA, a leading foundation solution; AWM, a leading wire management solution; and its latest innovation, DuraTrack D2. At the same time, both companies have strengthened their operations, expanded their capabilities, and built the foundation required to execute a transaction of this scale successfully.

I also want to thank Kevin. Kevin had the foresight to build Array into a much broader platform through both strategic M&A and through significant investment in a global supply chain and a state-of-the-art manufacturing facility. Together those steps have assembled a portfolio and an operating base that we believe have significant embedded potential. In many ways he has created the equivalent of a coiled spring, and we believe this combination is the catalyst that will allow that platform to reach its full potential.

I am also very excited about Brandon’s leadership of the combined company. Since joining Shoals, Brandon has brought a higher level of execution across nearly every discipline in the organization, growing our customer relationships, diversifying the business into adjacent markets, and building a world-class manufacturing campus. I believe he is the right leader for the combined company and its next phase of growth. With that, I’ll turn it over to Brandon to walk you through the transaction.

Kevin Hostetler (Chief Executive Officer)

Thanks, Brandon. One of the things we have been working on at Array Technologies over the past few years is upgrading our commercial organization and increasing the level and quality of engagement we have with customers. We’ve taken steps to make Array a more customer-centric organization. We’ve changed the way we engage with customers through improved responsiveness and investments in customer service resources, commercial processes, project management capabilities and engineering support.

On top of these efforts, we intend to leverage Shoals’ customer engagement excellence. The company has built a reputation for being responsive, customer-focused and highly effective in helping customers solve execution challenges that creates a major opportunity for our combined company. By doubling down on the voice-of-customer mindset and continuing to invest in AI-enabled capabilities, we believe we can enhance customer satisfaction and accelerate the progress already underway at Array. The entire organization is excited about what this means and we believe the combined commercial team can improve its competitive position and win share in the tracker market. This slide helps put the tracker share opportunity into context. In the U.S. market, even relatively small share gains can have a significant impact on the combined company’s financial results.

For example, winning just two additional projects per year can move our U.S. market share by roughly 2 percentage points or more. We believe the combined commercial organization can deliver those types of gains and potentially more over time, and the resulting EBITDA upside is also meaningful. Using the two-point share gain example, that would translate into nearly $20 million of incremental EBITDA. The third commercial priority is international expansion. Array has historically moved faster than Shoals in penetrating markets outside the United States. Array has built an established international footprint, customer relationships and market knowledge that would take Shoals significant time and investment to replicate on its own. This creates a very attractive opportunity. We can use Array’s existing international sales infrastructure and relationships to introduce Shoals products into markets where Shoals has not yet had the same level of presence.

This should allow us to expand Shoals’ reach more quickly while avoiding much of the expense and time required to build that infrastructure from scratch. The logic is straightforward. Array brings the global platform, Shoals brings a highly differentiated EBOS offering, and together we can approach international customers with a broader and more valuable solution. With that, I will turn it back to you, Brandon.

Brandon Moss (Chief Executive Officer)

Thanks, Kevin. Let me now turn to our financial priorities, starting with synergies. Synergies were one of the driving forces behind this transaction and achieving our targets is our number one financial priority. We expect to achieve $35 million of run-rate synergies in year one, ramping to more than $100 million by year three. In year one we expect more than half of those synergies to come from cost savings. By year three we expect roughly one third of our savings from cost and two thirds from commercial synergies.

On the cost side, we expect savings from eliminating duplicate public company cost, consolidating corporate overhead, improving procurement leverage, and creating operating efficiencies across the combined organization. On the revenue side, the largest opportunities are cross-selling the combined portfolio into existing customer relationships, increasing Array tracker share through stronger customer engagement, expanding Shoals internationally through Array’s global footprint, and developing integrated products that allow us to capture more content per project.

We are confident in these targets because many of the cost opportunities are within our control and many of the commercial opportunities are rooted in relationships and projects where one of the two companies is already present. This is not a synergy case that depends on entering new markets or building a new customer base, but rather it’s based on doing more with customers, products and capabilities we already have. We believe the upside for our shareholders is very significant.

I’ll pass it back to Kevin to discuss the treatment of Array Technologies’ preferred stock.

Kevin Hostetler (Chief Executive Officer)

Thanks, Brandon. Our second financial priority is reducing the preferred stock outstanding. As we mentioned earlier, we have heard investors clearly on this point. They would like to see the combined company reduce the amount of outstanding preferred stock and we agree that doing so will create value. As part of this transaction, Array Technologies has reached an agreement with the preferred shareholders and that includes several important elements.

Initially, we will redeem $161.3 million of our preferred stock at $0.93 on the dollar within 90 days following the closing of the merger. This initial redemption captures seven points of discount, or approximately $11.3 million, and improves free cash flow by reducing future distributions by more than $60 million over the next five years. Next, we have committed to redeem an additional $156.3 million of preferred stock over the next three years at $0.96 on the dollar in amounts of not less than $52 million on each of the first, second and third anniversaries of the initial redemption. Together with the initial redemption that will save the company nearly $100 million in distributions over the next five years. Importantly, that is the minimum schedule; we may elect to redeem more or redeem earlier.

We have the option to redeem the balance of preferred stock in excess of $317.5 million at $0.96 on the dollar, provided that the redemptions occur within 48 months of closing. That effectively builds an attractive discount if we choose to accelerate the reduction of the preferred. Finally, the structure enables regular redemptions using available free cash flow by reducing the minimum amount that we could redeem at one time from $200 million to $50 million.

Brandon Moss (Chief Executive Officer)

Our third financial priority is to maintain balance sheet flexibility. This page shows our current estimate of the combined company’s year-end 2026 balance sheet pro forma for the merger and the initial $161.3 million preferred stock redemption. The key point is this transaction is structured to preserve financial flexibility. We do not expect to issue new debt to complete the merger and the combined company is expected to have both manageable leverage and solid liquidity at closing.

On a pro forma basis, we expect 2026 net debt to adjusted EBITDA to be 2.6 times, with leverage declining to less than 2 times in 2027. The flexibility is strategically important. It allows us to continue investing in the business, fund innovation, support customer growth, reduce the remaining preferred stock over time and pursue additional M&A opportunities that can further diversify and strengthen the platform. In short, we believe this combination creates a larger, more capable company without over-levering the balance sheet and that positions us well for the next phase of growth.

This is a summary of the key figures and preliminary 2027 outlook for the combined company. On the balance sheet, the figures are presented on an indicative pro forma basis assuming the transaction closed on December 31, 2026. For the combined company, our preliminary estimated 2027 revenues range between $2.2 billion and $2.4 billion and adjusted EBITDA, including synergies, ranges between $410 and $480 million. This indicative revenue estimate is supported by the combined company’s significant backlog and awarded orders as of September 30th of approximately $3.4 billion.

We will provide more details in the S-4, which will be filed in the coming weeks. Turning briefly to our Q3 results, Shoals had an exceptional quarter delivering revenue and adjusted EBITDA well above our guided range. Revenue of $195.3 million, a company record, grew 44% from the prior year. This was driven by meaningful productivity improvements made on our factory floor. Congratulations to the team for a great quarter. Gross profit percentage came in at 31.9, a 160 basis point improvement from the second quarter. The commercial team added approximately $186 million in new orders, the third highest bookings period on record.

Book-to-bill, given our strong revenue performance, was approximately 1.0. Adjusted EBITDA was approximately $40 million, representing 20.4% of revenue, and we delivered healthy operating cash flow of $28.9 million, enabling us to pay down $33 million of our revolving credit facility in the period. Guidance for our fourth quarter can be found in the earnings release issued this morning. Kevin

Kevin Hostetler (Chief Executive Officer)

Thank you, Brandon. Q3 was a quarter of strong execution for Array operationally, commercially and strategically. We delivered an order book of $2.6 billion, up 42% year over year, a record for the fourth consecutive quarter. We booked well over $400 million of new orders for the fifth consecutive quarter, bringing trailing 12-month new orders to more than $1.8 billion and our book-to-bill to 1.6 times. New products now represent nearly 60% of the order book, evidence that our innovation investments are translating into adoption.

Revenue came in at $330 million, including our first month of contribution from Affordable Wire Management, or AWM, which we closed on August 31. Excluding AWM, revenue was $321 million, driven by strong domestic tracker execution. Adjusted gross margin was 22.8%, which included a 330 basis point charge for a long-dated 45X rebate reserve with a certain supplier. Our year-to-date adjusted gross margin stands at 27.8%, 30 basis points higher than the same period last year.

Finally, adjusted EBITDA was $32 million, a 10% margin. AWM’s first month was accretive to both our margins and our earnings—an early validation of the investment thesis we laid out last quarter. I’ll now turn it back to Brandon for some closing remarks.

Brandon Moss (Chief Executive Officer)

Thanks, Kevin. In closing, this transaction is about creating something neither company could build as quickly or as effectively on its own. Together we will have leading products across SBOS and EBOS, deeper customer relationships, greater scale, stronger financial capacity, and a platform that can grow well beyond solar. We see a significant opportunity ahead of us and we have a clear roadmap to turn that opportunity into growth, earnings and long-term shareholder value.

We could not be more excited about the future of the combined company. With that, operator, let’s take your questions.

OPERATOR

We will now begin the question and answer session. Please limit yourself to one question and one follow-up. If you would like to ask a question, please press star one to raise your hand. To withdraw your question, press star one. Again, we ask that you pick up your handset when asking a question to allow for optimum sound quality. If you are muted locally, please remember to unmute your device. Please stand by while we compile the Q&A roster. Your first question comes from the line of Brian Lee with Goldman Sachs and Company.

Your line is open. Please go ahead.

Brian Lee (Analyst)

Hey, good morning. Congrats. A lot went into this deal, I’m sure, so kudos to you guys. A couple questions for me. Just if I look at the pro forma guide, it implies, I guess, 12% revenue growth at the midpoint. Just be curious how much of that is organic because I know there was a bit of M&A here for Array this year. And then how should we think about what’s embedded in that combined view for the company in terms of share gain, revenue synergy, if any, and then just market growth next year?

And then I had a follow-up.

Kevin Hostetler (Chief Executive Officer)

Yeah, Brian, good morning. Thank you for the question. Just as a reminder to you and everybody, there will be more detail that is available in the S-4, but I think the way that I would consider that revenue range is it is organic growth. There is obviously some overlap for the AWM business that will be picked up in 2027 versus 2026, about three quarters, 10 months, something like that. So organic growth in that number. As far as the market growth potential is, as we’ve discussed over the last couple quarters at least on the Shoals side, we are big believers in the market right now. We have said again and again, stronger for longer. So, you know, I think we’ve seen market forecasts adjust in the out years of the decade up and, you know, we believe that the market will be a high 30s, low 40s gigawatt market for the foreseeable future.

Brian Lee (Analyst)

Okay, that’s helpful. And then just second question, just bigger-picture strategy. You know, you guys outlined a lot of the key drivers of why this deal makes sense. But just if we think about it simplistically, how much of this is maybe a competitive response to the inroads from, you know, peer Nextracker? Maybe just give us a sense of how, you know, this combination positions you competitively. And then beyond the cost synergies in year one, what are sort of the most immediate benefits we should be looking out for?

Whether it’s, you know, product synergy, revenue synergy, international. Just trying to understand where you guys see the most inroads from a competitive perspective beyond the cost in year one. Thank you.

Brandon Moss (Chief Executive Officer)

Yeah, Brian, great question. Look, probably at a high level, most importantly, there’s a big belief these companies are better together than separate. And I think what differentiates us, and I’m not denying any consolidation in the marketplace because there’s obviously trends there, both at the peer level, customer level — it’s across the industry. Right. But I think what makes this special is it truly builds a comprehensive solution of category leaders.

If you think about the suite of products this company has, it’s very exciting. I mean, you’ve got category leaders in each of the market and it’s going to give us the ability to really do three things that we talked about in the prepared remarks. We believe we can drive faster revenue growth together. There is an unbelievable cross-sell opportunity. A lot of the research that we did, you know, in preparation for the deal looked back at past projects, our order books, and to really see how many of the same products were appearing on projects together. And there’s tremendous opportunity. About 80% of the projects only had one of our products between the two companies. So that unlocks a marketplace cross-sell opportunity of $2.5 billion, which is larger than the combined revenue of the two companies today.

So we’re really excited about that. Additionally, it drives greater profitability and free cash flow. There’s an amazing profit pool out there to get. Kevin’s done a great job of adding businesses that are accretive. We are really excited about the AWM acquisition — you know, arguably it’s maybe more synergistic with EBoS than it is EBoS. So that’s very, very exciting for us. And one point I do want to make just longer-term strategy: This is not a departure from our strategy to diversify. We have communicated at Shoals a strategy of, one, protecting and growing our core business, which this certainly does. Right. We’re going to protect our core domestic solar market; and two, to diversify into new end markets. And there are some really exciting things to help us do that with this transaction as it relates to AWM and APA foundations when you think about data centers.

But also we’re going to continue to push to grow our best business and get our AirLink product line launched in 2027. Thanks, Brian. Next question, please.

OPERATOR

Your next question comes from the line of Julian Dumoulin-Smith with Jefferies LLC. Your line is open. Please go ahead.

Julian Dumoulin-Smith (Analyst)

Excellent, guys. Thank you and good morning. Nicely done. Congratulations on bringing this together. Look, maybe just ask you explicitly — talk about this $100 million type synergy number. How does it transpose that 25% overlap? What does that bring you to pro forma when you think about getting to that cross-sell and are there early wins that you can potentially point to here? As well as when you think about the ability to integrate the product, how do you think about the timeliness of providing that product to the market in as much as it fully capitalizes on the ability to easily integrate and, quote-unquote, snap together, if you will, the two different product portfolios here?

And then finally, how do you think about what other categories you may want to enter into? And as much as this really seems like it’s going up toe to toe with your closest peer here in providing a one-stop shop, if you will, what other end markets do you really need to enter into? If you think about that from that perspective, you got a lot here already. Thanks.

Kevin Hostetler (Chief Executive Officer)

Thanks, Charlie. And a lot to unpack there. I guess I’ll tackle the synergies first and try to take these one by one. So when you think about our synergies near term, say one year, more than half of those committed synergies will come from redundant public company costs — you know, call it more low-hanging fruit. As we advance, you think of it in year three, those synergies change to skew more commercial. So you can think about the synergies in year three being roughly two-thirds commercial and one-third cost.

And we have outlined, you know, really specific areas where to get not only the cost synergies, but the commercial synergies. There is very little overlap in our business in terms of, again, in terms of projects that have more than one product on there. If you look at it from a customer standpoint, there are immediate opportunities for pull-through on both sides of the table. What is specifically exciting is I think there’s an opportunity leveraging our market share and our customer engagement to pull through Array trackers. And, you know, the math is pretty simple, right?

If we can drive, you know, 1 gigawatt of additional tracker sales, it’s about $100 million in revenue and $30 million in EBITDA. So when you break that down to a project perspective, we don’t have to make miracles to make these synergies come through. I mean, you pick up two, three projects, you’re in really good shape. We also, just thinking about customer engagement in general with top EPCs — since this announcement has come out this morning, I’ve gotten a couple texts from top-tier, top 10 EPCs saying, hey, we need to hook up and find ways to do more business together. So I think the value that this can unlock is really exciting.

OPERATOR

What about Julian? Your next question comes from the line of Philip Shen with Roth Capital. Your line is open. Please go ahead.

Philip Shen (Analyst)

Hey guys, congrats as well and thanks for taking the questions. Hey Brandon, on that last point, wanted to dig into that a bit more in terms of the conversations you’ve had with EPCs post-announcements. You know, you highlighted earlier also that 80% of the projects that you guys are out there on only had one of your products. Can you talk to us about why that was the case and did customers affirm that if you guys were together then they would have bought more?

You know, so the sales process for your respective core products are different slightly in the sense that EBOS is almost exclusively selling to EPCs, while tracker is selling not just to EPCs but also very much so to IPPs. And so wanted to see if you guys could help us understand, you know, the difference in go-to-market strategy and then how you combine that and then ultimately, you know, could the customers have bought much more and did they actually affirm that?

Brandon Moss (Chief Executive Officer)

Yeah, Phil. Our goal is to give customers choice of top-tier products. And I think starting with project design, starting early stages in the sales cycle, there’s a tremendous amount of benefit not only for the EPC, but also the developer. Depending on what path we take to market, you know, our products longer term can be designed to be interoperable, number one. So that’s a longer-term view, but I think just short term, when you think about project execution, delivery, enhanced response — maybe specifically around warranty — there is a lot of value to present to our customers short term.

In terms of channel to market — Kevin, feel free to speak up here — while Shoals has been primarily an EPC go-to-market, we’re excited about the way that Array goes to market through developers. We think there’s a lot of opportunity there to come in and meet those guys together. And then on the other side of the coin, Array still does a lot of business direct with EPCs as well. Maybe talk about that.

Kevin Hostetler (Chief Executive Officer)

Yeah, I think, Phil, you’re hitting on one of the things that we think is a really compelling advantage of this merger. So as we’ve talked publicly many times over the last three years or so, we’ve shifted our order book much more where we’ve given the commentary about over 50% of the order book is direct to tier ones, and those are largely tier one developers and direct to utilities. So our ability to partner with Shoals and get specified far early in the process, we think, is really going to enhance this.

Right. We could come in together, get specified on the foundations, get specified on the EBoS, on the trackers, on the wire management, and offer an integrated design selection process to those developers and utilities. And we think that’s going to be a really compelling advantage, because we’re going to be doing that with all tier ones. The developers recognize these brands, they love these brands, and they would love for them to be integrated and sold together.

Brandon Moss (Chief Executive Officer)

Thanks, Phil. Next question, please.

OPERATOR

Your next question comes from the line of Moses Sutton with BNP Paribas. Your line is open. Please go ahead.

Heidi (Analyst)

Good morning, this is Heidi on for Moses. Thank you for taking my question and congrats on the merger. I have just two questions. So the first, you outlined potential for future M&A. But how should we think about the combined company’s capital allocation priorities between further M&A versus paying down the remaining preferred, specifically the roughly $190 million outstanding beyond the existing commitment? Do you expect to prioritize paying down the full Series A before any incremental M&A, for example?

Kevin Hostetler (Chief Executive Officer)

I think the important thing is we’ve got balance sheet flexibility. That is probably first and foremost. We’ve got optionality to do either of those. The most important thing for us near term is going to be being successful in capturing $100 million in synergies that we’ve outlined by year three. So M&A is a potential way for us to grow, as always, but I think the prioritization is capturing those synergies in the near term.

Brandon Moss (Chief Executive Officer)

Thank you, Heidi. Next question.

OPERATOR

Your next question comes from the line of John Windham with UBS. Your line is open. Please go ahead.

John Windham (Analyst)

Hey, perfect. Thanks for taking the questions and congratulations on the merger. I guess my question would be just to get your thoughts around why now. Obviously you both have sort of a shared history with a similar chair — the same chairman of the board — believe you were both part of the same private equity fund at some point. What makes today the right time for this deal? And again, congratulations. Thanks for taking the questions.

Brandon Moss (Chief Executive Officer)

Thanks, John. As you know and probably everybody else on the call, this idea has been around since I joined Shoals and probably before Kevin joined Array. So it’s always been out there. You know, we are two companies that have always been close. Kevin and I have been close since I joined the industry. Our teams know each other. We have similar cultures. I think, you know, again, as I started with, we’re both believers in the market. We think there’s a fantastic market backdrop for us to execute against. And to be honest, both of our companies right now are in a position of strength. We have unbelievably strong order books. Kevin has brought a bunch of new products to market that are getting well positioned for deployment in future projects this year, as has Shoals.

So there’s just a tremendous amount of synergistic value between the two companies. And again, I think we can unlock more significant shareholder value together than we can separately. So we felt, you know, now was the right time to come together.

Matt Trachtenberg (Vice President of Finance and Investor Relations)

Thank you. Keep going, please.

OPERATOR

Your next question comes from the line of Joseph Osha with Guggenheim Securities. Your line is open. Please go ahead.

Joseph Osha (Analyst)

Thank you. And thanks for taking my question. As I look at the pro forma here, I see about $30 million in cash post-transaction, which is perhaps a little thin for a two-and-a-half-billion-dollar company. So I’m wondering what level of liquidity you think would be appropriate on an ongoing basis for the entity, and what type of incremental operating cash facilities you might have. Thank you.

H. Keith Jennings (Chief Financial Officer)

Yeah, Joe, one of the reasons that we structured the deal the way that we did was to take advantage of the balance sheet of both companies. So, you know, we continue to work with our lending syndicate and we’ll do so post-close to make sure there’s ample liquidity for the combined company. Probably most importantly, both of these organizations are strong cash generators. You’re seeing that in the back part of the year for Shoals. You’ll see that probably more so in the first part of the year for Array.

So we think we’re in a very good position to, one, handle the pref as we’ve outlined in the call. But also, you know, we still feel very strong about available liquidity in the future.

Matt Trachtenberg (Vice President of Finance and Investor Relations)

Thank you, Joe. I think we have time for just a couple more.

OPERATOR

Your next question comes from the line of Colin Rush with Oppenheimer Co. Inc. Your line is open. Please go ahead.

Colin Rush (Analyst)

Thanks so much, guys. You know, as you look at the sales synergies, can you just talk a little bit about how quickly you might see some of those synergies overseas and the order of magnitude of the mix really around synergies in the U.S. versus synergies outside the U.S.?

Sid

Yeah, Colin, it’s a great question. We’re really excited about leveraging Array’s infrastructure overseas. As you know, Shoals has made some inroads the last couple years, and our order book has grown to about $100 million of international projects. But to be fair, we have not penetrated some of the regions that Array has and has some potential wins on the books. I think Kevin has talked about some opportunities in Eastern Europe on prior calls. So I think there’s an opportunity there to really combine our strong team internationally, which, honestly, is significantly smaller than what the Array team has, and bring a full suite of products together to international customers. Kevin, I don’t know if you’ve got anything to add there.

Kevin Hostetler (Chief Executive Officer)

No. Thank you, Sid.

OPERATOR

Thank you. Your next question comes from the line of Dylan Nassano with Wolfe Research. Your line is open. Please go ahead.

Dylan Nassano (Analyst)

Yeah. Hey guys, thank you. So, just wanted to touch on the data center exposure. I know Shoals already is a little closer to that market via the battery offering and Airlink. Just, is there anything to note on how this could expand the opportunity set more from the Array side to get closer to data centers?

Kevin Hostetler (Chief Executive Officer)

Yeah, it’s a great question. There is some obvious product synergy there, both when you think about the traditional battery energy storage infrastructure on a data center. Affordable Wire Management has a lot of cable fastening products that can be paired with our BLA products on site, which is very exciting. And then there’s also products from the APA side related to foundations. So that’s great for the data center infrastructure side. The other really exciting potential synergy is on our Airlink product. If you’ve seen pictures of our Airlink product and designs, a lot of what makes that product special is the way that it is fastening and affixed in a data center. And those are all products that AWM can certainly help us out with, help design. They’re experts in free-air rating, which is one of the key points to our Airlink product. So we think that there’s just a tremendous amount of value there between the two companies.

Matt Trachtenberg (Vice President of Finance and Investor Relations)

Thank you.

OPERATOR

Your final question comes from the line of Dimple Gosai with Piper Sandler. Your line is open. Please go ahead.

Dimple Gosai (Analyst)

Hi, good morning and congratulations. I have a question here. Can you talk a little bit about how the combination of the two entities can help deepen or broaden your customer reach and the type of new customers this could potentially allow in? And then secondly, are there any obvious and natural new products that this would be a good fit for, given that we’ve already put these two pieces together — the tracker and the eBOS?

Kevin Hostetler (Chief Executive Officer)

Yeah, well, that’s a great question. I think one of the beautiful things about this transaction is we are not required to go find new customers. We are not required to go find new markets. We have the same customers either on the Shoals side or the Array side. So we just need to leverage those relationships, get closer to those customers, and help them understand the value of buying full stack from us to sell more product. So there’s not an additional customer acquisition cost here as a way to think about it.

In terms of new products for the future, there is a lot of potential between the tracker, the wire management system, and eBOS to build products that are more easily installed in the field, reduce labor hours, improve safety by maybe taking drilling out of the equation for projects. So tremendous upside, and that is probably one of the most exciting pieces of this transaction — to get our two respective engineering teams together and really start executing on the product roadmap that we articulated in the prepared remarks.

Matt Trachtenberg (Vice President of Finance and Investor Relations)

Thanks, Dimple. That’s going to be our last question for today. To our audience, please note that both companies have several opportunities for you to meet with management, including at RA this month. If you have questions about where and when, please see our respective websites or reach out to the IR teams for more information. Thanks for joining us today. Have a great day, everyone.

OPERATOR

This concludes today’s call. Thank you for attending. You may now disconnect.

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