Eos Energy Mixed 2Q Results, Record Backlog, FY26 Guide Lowered for Operational Improvement Investments

Research evidence excerpt

J P M O R G A N

North America Equity Research

05 August 2026

Eos Energy

Mixed 2Q Results, Record Backlog, FY26 Guide

Lowered for Operational Improvement Investments

Neutral

EOSE, EOSE US

Price (04 Aug 26):$4.35

▼Price Target (Dec-27):$5.00

Prior (Dec-26):$6.00

EOSE reported 2Q26 results roughly in line on revenue but below expectations on

gross profit and PF EBITDA, with the shortfall driven by temporary

manufacturing ramp costs at Thorn Hill and accelerated field service spending.

FY26 revenue guidance was narrowed towards the lower half of the prior range,

which management framed explicitly as a proactive manufacturing consolidation

decision rather than an operational setback. 2Q bookings activity, as well as postquarter commercial wins, including the Golden Dome contract and a European

distribution agreement, are encouraging. The new CFO also offered a more

detailed margin improvement roadmap for the first time, pointing to double-digit

gross margin within the next 12 months, though the aforementioned manufacturing

consolidation pushes back the inflection into positive margin slightly vs our prior

expectations. We are establishing a Dec 2027 price target of $5, down from our $6

Dec 2026 price target, and lowering our estimates for the out years. Maintain

Neutral.

2Q results in line on revenue, miss on EBITDA. EOSE generated a PF

EBITDA loss of $71.4mm (JPMe: $64mm loss/Street: $47mm loss) on

revenue of $68.8mm (JPMe: $69mm/ Street: $68mm), in-line with its

previously announced preliminary results. Two items drove the earnings

shortfall: (1) underutilization of Thorn Hill as Line 2 ramped compressing

operating leverage and (2) an acceleration of DawnOS upgrades across the

legacy fleet, increasing field service spending. Management noted both

pressures are expected to ease significantly by 4Q. Gross margin of ~(70.9)%

marks the seventh consecutive quarter of sequential improvement. Backlog

reached a record $807mm, driven by orders from four new and two repeat

customers. The commercial pipeline expanded to $24.6bn (~112 GWh), with

51% of the pipeline consisting of 8+ hr duration and 32% data center-related.

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