Hammond Power Solutions: 2Q First Take: Capacity Expansion Fuels Big Beat as Data Center Demand Stays Robust

Research evidence excerpt

Hammond Power Solutions: 2Q First Take: Capacity Expansion Fuels Big Beat as Data Center Demand Stays Robust

J P M O R G A N North America Equity Research

30 July 2026

Hammond Power Solutions Overweight

HPS/A, HPS/A CN

2Q First Take: Capacity Expansion Fuels Big Beat as Price (30 Jul 26):C$251.52

Data Center Demand Stays Robust

North America Small and Mid Cap

Hammond delivered excellent 2Q26 results driven by strong performance in US Industrials

& Mexico that was slightly offset by deterioration in Canada and India. Adjusted Tomohiko Sano AC

EPS of $2.76 (vs. consensus $2.11) and net sales of $325M (vs. consensus $286M) (1-212) 622-1099

mark YoY changes of 61% and 45% respectively. Adjusted EBITDA of $53M grew tomohiko.sano@jpmorgan.com

~60% YoY, with margins increasing 151bps driven by price realization, operating Brendan Shea, CFA

leverage at the new Mexican facility, and a higher portion of custom sales. We (1-212) 622-0770

brendan.shea@jpmorgan.com

expect the stock reaction to be positive, as concerns over potential weakness in data

Ethan Coyle

center-driven demand appear unfounded as backlog increased 97% YoY and

(1-212) 270-0613

remains robust, despite stronger conversion in 2Q. ethan.coyle@jpmchase.com

J.P. Morgan Securities LLC

• Data Centers Drive US & Mexico Higher: HPS posted adjusted EPS of $2.76

(vs. consensus $2.11) on net sales of $325M (vs. consensus $286M). Sales

were up 45% YoY versus our estimate of 33%, with strength driven by data

center investment and increased capacity at the new Mexico plant. Adjusted

EBITDA was $53M (vs. consensus $41M and our estimate of $47M), implying

a margin of 16.4% (vs. 14.9% in 2Q25). Canada generated revenue of $45M

(consensus $65M), United States & Mexico posting $273M (consensus