Solaris Oilfield Infrastructure Inc.

11/06/2026 | Press release | Distributed by Public on 11/06/2026 14:34

Quarterly Report for Quarter Ending September 30, 2026 (Form 10-Q)

Management's Discussion and Analysis of Financial Condition and Results of Operations
References to "we," "us," "our," "Solaris" or the "Company" refer to Solaris Energy Infrastructure, Inc. (either individually or together with its subsidiaries, as the context requires). The following discussion and analysis of our financial condition and results of operations should be read in conjunction with the accompanying consolidated financial statements and related notes. The following discussion contains "forward-looking statements" that reflect our plans, estimates, beliefs and expected performance. Our actual results may differ materially from those anticipated as discussed in these forward-looking statements as a result of a variety of risks and uncertainties, including those described above in "Cautionary Statement Regarding Forward-Looking Statements" and "Risk Factors" included in our Annual Report on Form 10-K for the year ended December 31, 2025, as updated by our subsequent filings with the SEC, all of which are difficult to predict. In light of these risks, uncertainties and assumptions, the forward-looking events discussed may not occur. We assume no obligation to update any of these forward-looking statements except as otherwise required by law.
Executive Overview
We deliver comprehensive power infrastructure solutions including generation, distribution, site preparation, installation and commissioning, aftermarket support, and operations and maintenance. Headquartered in Houston, Texas, we serve multiple end markets, including data centers, energy, and other commercial and industrial sectors. We operate through two reportable business segments:
•Solaris Power Solutions: This segment delivers power generation, power control, and power distribution solutions, along with sales of power equipment, as well as refurbishment, aftermarket, and specialized engineering and construction services, for both our own generation assets and those owned by third parties. Our offerings support data center, energy, and other commercial and industrial sector customers by providing flexible, on-demand power infrastructure, including power control and distribution capabilities.
•Solaris Logistics Solutions: This segment designs and manufactures specialized equipment that enables the efficient management of raw materials used in the completion of oil and natural gas wells. Our equipment-based logistics services include field technician support, software solutions, and may also include last mile and mobilization services.
Recent Developments
Omega Acquisition
On September 1, 2026, we completed the acquisition of Omega Foundation Services LLC ("Omega"), a specialized engineering, procurement and construction firm with significant expertise in heavy civil construction across multiple end markets, including large-scale data centers, LNG facilities, industrial projects and government infrastructure (the "Omega Acquisition"). With the benefit of the Omega Acquisition, we are less reliant upon third-party engineering, procurement and construction contractors for early-stage site preparation, heavy civil construction and electrical substation development which could become a potential bottleneck for our projects and the industry overall. The acquisition extends our full-cycle power solutions offering, which now spans early-stage site services, front-end plant installation and commissioning services, and electrical substation development. Omega has historically performed work for a range of third-party customers across multiple end markets and is expected to continue to serve third-party customers following the Omega Acquisition in addition to performing work on our own power projects. Omega's work is performed principally under master service agreements and project-specific work orders, predominantly under fixed-price contracts.
The preliminary fair value of the total purchase consideration transferred was $275.2 million, consisting of cash and equity consideration, including 3,599,199 shares of our Class A common stock with an acquisition-date fair value of $178.7 million. See Note 4. "Acquisitions - Business Combinations" in the notes to our condensed consolidated financial statements for the components of the consideration transferred.
The acquisition was accounted for as a business combination, and the results of Omega's operations have been included in our condensed consolidated financial statements from the acquisition date. Omega contributed revenue of $57.9 million and pre-tax income of $9.8 million for the three and nine months ended September 30, 2026.
GESA Acquisition
On July 1, 2026, we completed the acquisition of Global Energy Services Alliance, Inc. ("GESA"), a full cycle power generation service provider formed through the combination of Baseload Power, a U.S. provider of power generation
aftermarket solutions, and Pro-Per Energy Services, a global provider of power plant installation and operations and maintenance services (the "GESA Acquisition"). The GESA Acquisition scales our in-house capabilities across the full life of a generation asset, spanning front-end plant installation and commissioning, long-term operations, and life-of-asset repair and maintenance. The GESA Acquisition also added more than 1 GW of installed generation capacity under operations and maintenance service arrangements across domestic and international markets.
The fair value of the total purchase consideration transferred was $263.1 million, consisting of cash and contingent consideration and 2,880,682 shares of our Class A common stock with an acquisition-date fair value of $211.5 million. See Note 4. "Acquisitions - Business Combinations" in the notes to our condensed consolidated financial statements for the components of the consideration transferred.
The acquisition was accounted for as a business combination, and the results of GESA's operations have been included in our condensed consolidated financial statements from the acquisition date. GESA contributed revenue of $89.9 million and pre-tax income of $17.0 million for the three and nine months ended September 30, 2026.
Recent Contracts
On October 29, 2026, we entered into a 15-year agreement, with an option to extend for an additional 15 years, to provide approximately 900 megawatts ("MW") of power generation, associated balance of plant equipment, and operations and maintenance services. The agreement is with an existing customer, a leading global, investment-grade, diversified industrial and technology company. Deployments are expected to begin in the first half of 2027 and scale through 2028.
In September 2026, we signed a new 7-year operating and maintenance agreement to manage approximately 400 MW of generation capacity owned by an existing customer.
In July 2026, a large energy customer expanded its contracted capacity to approximately 80 MW from 60 MW and extended the contract tenor from four years to six years.
In July 2026, we signed additional agreements to a contract entered into in April 2026 with a new customer to provide approximately 640 MW of power generation equipment and balance of plant to support the customer's power demand for artificial intelligence computing needs at its data center, which expand the scope of the original contract to now include additional balance of plant and energy storage assets as well as management of natural gas on a cost-plus basis. The new customer is an affiliate of an investment grade, global technology company in the evolving artificial intelligence space. The agreement provides for an initial rental term of ten years, with an option to extend for an additional five years. Deployments are scheduled to commence in late 2026 and scale through 2028.
On February 12, 2026, we entered into a power capacity agreement with Hatchbo, LLC, an affiliate of an investment-grade global technology company, initially providing approximately 530 MW of power generation equipment. In the second quarter of 2026, we amended the agreement to add incremental generation capacity and balance of plant equipment, including batteries. In July 2026, we signed a further amendment converting the original power capacity agreement with Hatchbo, LLC into a final operating agreement, expanding the scope of services to include the delivery and operation of a full turnkey power plant of approximately 660 MW with balance of plant, batteries and energy management systems designed to manage artificial intelligence workloads. In connection with the amendment, the contract tenor was extended to up to 18 years (10-year base plus an 8-year extension option) from up to 15 years (10-year base plus a 5-year extension option). We expect the increased capacity and expanded scope to result in a substantial increase in contracted revenue and earnings from the contract over the term of the agreement relative to the original February 2026 agreement, as well as increased capital expenditures to fund the expanded scope. Revenue recognition and deployments are expected to commence in the first quarter of 2027 and scale through 2028.
Additional Capacity
Since the second quarter of 2026, we have secured 15 turbines that are expected to add approximately 390 MW of power generation capacity, most of it beginning in the first quarter of 2027. These include nine turbines bought from private parties for approximately $277.0 million in cash, and six turbines from suppliers that are subject to milestone payments. Approximately $114.0 million of these payments were made in the third quarter of 2026.
7.000% Senior Notes due 2032
On October 1, 2026, Solaris Energy Infrastructure, LLC ("Solaris LLC"), a consolidated subsidiary of the Company, issued $1.25 billion aggregate principal amount of 7.000% Senior Notes due 2032 (the "2032 Senior Notes") at par in a private placement. The offering resulted in net proceeds of approximately $1.23 billion. The net proceeds from the offering
will be used for general corporate purposes and growth capital expenditures, in addition to paying for fees and expenses related to the offering. The 2032 Senior Notes are not reflected in the Company's condensed consolidated balance sheets or condensed consolidated statements of operations as of or for the three and nine months ended September 30, 2026. See Note 20. "Subsequent Events" in the notes to our condensed consolidated financial statements.
First Amendment to Credit Agreement
On October 1, 2026, we entered into the first amendment (the "First Amendment") to the credit agreement with MUFG Bank, Ltd., as administrative agent, and the lenders party thereto (the "Credit Agreement"), primarily to increase the aggregate revolving commitments under the senior secured revolving credit facility (the "Revolving Credit Facility") by $200.0 million, from $650.0 million to $850.0 million, through the exercise in full of the incremental commitment feature under the Credit Agreement, and also to increase the sublimit for the issuance of letters of credit under the Revolving Credit Facility from $150.0 million to $325.0 million. See Note 20. "Subsequent Events" in the notes to our condensed consolidated financial statements.
Additional Borrowings under Stateline Term Loan
Subsequent to September 30, 2026, Stateline drew an additional $25.0 million under the Stateline term loan facility, increasing the outstanding balance to $433.2 million. The proceeds were used to fund growth-related capital expenditures. Refer to Note 11. "Debt" and Note 20. "Subsequent Events" in the notes to our condensed consolidated financial statements.
Market Trends and Outlook
In the third quarter of 2026, Solaris Power Solutions continued to drive the Company's growth, contributing 83% of total revenue and 84% of total segment Adjusted EBITDA. For the nine months ended September 30, 2026, Solaris Power Solutions revenue contributed 75% of total revenue and 80% of total segment Adjusted EBITDA. Capital expenditures should remain heavily weighted towards Solaris Power Solutions as we intend to grow our capacity and deploy more power assets with customers. We believe continued demand for our power assets will drive Solaris Power Solutions to remain the dominant segment contributor to revenue and Adjusted EBITDA.
Demand for Solaris Power Solutions is predominantly influenced by accelerating needs for power in the U.S. Solaris' power offerings are configurable and can be scaled to match power demand on a "behind-the-meter" or "distributed" basis in a shorter timeline than many grid-based alternatives, and can stay on site longer term to provide integrated primary and backup power as a complement to the grid or other co-located power solutions. These power solutions support data center, energy, and other commercial and industrial sector customers.
Since the second quarter of 2026, the company has secured over 300 MW of additional generation capacity. The Company's power generation capacity is now expected to reach a total of more than 3,500 MW by the end of 2029 based on expected deliveries under our contracted orders. The majority of this capacity is currently committed to customers under commercial agreements that primarily range in tenor from two to fifteen years, with extension options ranging from five to fifteen years. Each of these commercial agreements include distinct product specifications, such as product type, quantity, delivery period, and price, as well as standard terms and conditions with respect to acceptance, delivery, transportation, inspection, assignment, taxes and performance failure.
We expect remaining total company capital expenditures in 2026 of approximately $1 billion on a consolidated basis, of which approximately $110 million should be incurred by Stateline. The majority of these capital expenditures are to support additional growth in Solaris Power Solutions. Capital expenditures for Solaris Logistics Solutions represent less than $20 million of our total expected annual capital expenditures.
We intend to fund the majority of our current planned capital expenditures with available cash, cash flows from operations, remaining net proceeds from the 2031 Senior Notes offering and the 2032 Senior Notes offering, borrowing availability under our Revolving Credit Facility, and proceeds from delayed draw term loans under the Stateline Term Loan facility. In addition to these sources, subject to market conditions and the availability of fleet growth opportunities, we may meet our cash requirements through the issuance of additional securities and/or the entry into additional debt financing agreements. Even if we are unable to secure the financing of our planned capital expenditures, we generally have the ability to cancel the committed purchase orders (other than certain non-cancellable obligations), subject to the payment of cancellation fees.
Sustainability of this favorable supply-demand dynamic in the power sector depends on multiple factors, including continued demand growth for generative artificial intelligence computing, supply chain availability for electrical equipment, potential regulatory changes, overall economic activity levels, the level and pace at which the industry can invest in and deploy infrastructure, and the pace of continued electrification-driven demand growth.
For Solaris Logistics Solutions, demand is predominantly influenced by the level of oil and natural gas well drilling and completion activity in the U.S. The level of demand over the longer term will depend on multiple factors, including commodity price levels, customer consolidation that can drive activity and procurement strategy changes and industry efficiency gains, geopolitical risk, economic activity, potential regulatory changes and potential impacts from geopolitical disruptions.
Results of Operations
Three and Nine Months Ended September 30, 2026 Compared to Three and Nine Months Ended September 30, 2025
Revenues
Three Months Ended
September 30, 		Nine Months Ended
September 30,
2026 2025 Change 2026 2025 Change
(in thousands) (in thousands)
Revenues
Solaris Power Solutions $ 284,211 $ 104,939 $ 179,272 $ 571,091 $ 229,939 $ 341,152
Solaris Logistics Solutions 56,878 61,904 (5,026) 185,637 212,564 (26,927)
Total revenues $ 341,089 $ 166,843 $ 174,246 $ 756,728 $ 442,503 $ 314,225
Solaris Power Solutions. Solaris Power Solutions revenues were $284.2 million and $571.1 million in the three and nine months ended September 30, 2026, respectively. Solaris Power Solutions revenues were $104.9 million and $229.9 million in the three and nine months ended September 30, 2025, respectively. The increase in revenues for each of the 2026 periods was primarily due to the acquisition of GESA and Omega, as well as an increase in the MW capacity deployed during each period. Deployed capacity increased to weighted averages of 818 MW and 892 MW, respectively, in the three and nine months ended September 30, 2026, compared to weighted averages of 760 MW and 590 MW, respectively, in the three and nine months ended September 30, 2025.
Solaris Logistics Solutions. Solaris Logistics Solutions revenues decreased by $5.0 million, or 8%, to $56.9 million for the three months ended September 30, 2026, compared to $61.9 million for the three months ended September 30, 2025. This decrease was primarily due to lower last-mile transportation activity, despite an increase in the weighted average number of fully utilized systems to 104 in the three months ended September 30, 2026 from 84 in the three months ended September 30, 2025.
Solaris Logistics Solutions revenues decreased by $26.9 million, or 13%, to $185.6 million for the nine months ended September 30, 2026, compared to $212.6 million for the nine months ended September 30, 2025. This decrease was primarily due to lower last-mile transportation activity, despite an increase in the weighted average number of fully utilized systems to 105 in the nine months ended September 30, 2026 from 92 in the nine months ended September 30, 2025.
Cost of Revenue, exclusive of depreciation and amortization
Three Months Ended
September 30, 		Nine Months Ended
September 30,
2026 2025 Change 2026 2025 Change
(in thousands) (in thousands)
Cost of revenue (exclusive of depreciation and amortization)
Solaris Power Solutions $ 143,683 $ 44,417 $ 99,266 $ 253,758 $ 89,194 $ 164,564
Solaris Logistics Solutions 33,683 44,386 (10,703) 115,498 146,568 (31,070)
Total cost of revenue (exclusive of depreciation and amortization) $ 177,366 $ 88,803 $ 88,563 $ 369,256 $ 235,762 $ 133,494
Solaris Power Solutions. Solaris Power Solutions cost of revenue was $143.7 million and $253.8 million in the three and nine months ended September 30, 2026, respectively. Solaris Power Solutions cost of revenue was $44.4 million and $89.2 million in the three and nine months ended September 30, 2025, respectively. The increase in each of the 2026 periods was due to the acquisition of GESA and Omega, as well as higher deployed MW capacity and related activity levels.
Solaris Power Solutions cost of revenue (exclusive of depreciation and amortization) as a percentage of revenue was 51% and 44% for the three and nine months ended September 30, 2026, respectively, compared to 42% and 39% for the three and nine months ended September 30, 2025, respectively.
Solaris Logistics Solutions. Solaris Logistics Solutions cost of revenue decreased by $10.7 million to $33.7 million for the three months ended September 30, 2026, compared to $44.4 million for the three months ended September 30, 2025. Solaris Logistics Solutions cost of revenue decreased by $31.1 million to $115.5 million for the nine months ended September 30, 2026, compared to $146.6 million for the nine months ended September 30, 2025. The decrease in both 2026 periods was primarily driven by lower last-mile transportation activity, partially offset by higher labor costs to support an increase in fully utilized system counts in comparison to the prior year periods.
Solaris Logistics Solutions cost of revenue (exclusive of depreciation and amortization) as a percentage of revenue was 59% and 62% for the three and nine months ended September 30, 2026, respectively, compared to 72% and 69% for the three and nine months ended September 30, 2025, respectively.
Depreciation and Amortization
Depreciation and amortization increased by $29.1 million, or 130%, to $51.5 million in the three months ended September 30, 2026, compared to $22.4 million in the same period of 2025. Depreciation and amortization increased by $55.0 million, or 90%, to $115.8 million in the nine months ended September 30, 2026, compared to $60.8 million in the same period of 2025. The increase for each 2026 period was driven by the addition of depreciable assets acquired from the Genco Acquisition completed in March 2026 and the addition of depreciable assets associated with the Solaris Power Solutions segment placed in service since the third quarter of 2025, as well as additional depreciable assets acquired from GESA and Omega in the third quarter of 2026.
Selling, General and Administrative Expenses
Selling, general and administrative expenses increased by $27.1 million, or 174%, to $42.6 million in the three months ended September 30, 2026, compared to $15.5 million in the same period of 2025. The increase was primarily driven by a $15.5 million increase in salaries, wages and benefits, including stock-based compensation, resulting from an increase in average headcount, as well as higher employee and office costs associated with supporting a larger workforce and higher legal expenses as our Solaris Power Solutions segment has expanded. Selling, general and administrative expenses increased by $47.8 million, or 105%, to $93.5 million in the nine months ended September 30, 2026, compared to $45.7 million in the same period of 2025. The increase was primarily driven by a $28.6 million increase in salaries, wages and benefits, including stock-based compensation, resulting from an increase in average headcount, as well as higher employee and office costs associated with supporting a larger workforce and higher legal expenses as our Solaris Power Solutions segment has expanded.
Other Operating Expenses, net
Other operating expenses, net were $2.6 million and $2.2 million, respectively, for the three months ended September 30, 2026 and 2025. Other operating expenses, net were $4.1 million and $4.7 million, respectively, for the nine months ended September 30, 2026 and 2025. The three and nine months ended September 30, 2026 primarily included expenses related to transaction costs and credit allowances. The three and nine months ended September 30, 2025 included the recognition of an additional $3.0 million related to the Tax Receivable Agreement liability, as well as credit allowances.
Interest Expense
Interest expense was $22.9 million and $44.6 million in the three and nine months ended September 30, 2026, respectively, compared to $10.2 million and $23.5 million in the three and nine months ended September 30, 2025, respectively. The increase was primarily due to higher average debt outstanding as a result of the issuance of the 2031 Senior Notes in the second quarter of 2026.
Interest Income
Interest income was $6.2 million and $14.4 million in the three and nine months ended September 30, 2026, respectively, compared to $1.2 million and $3.8 million in the three and nine months ended September 30, 2025, respectively. The increase was primarily due to higher interest income earned on higher cash balances primarily resulting from the issuance of the 2031 Notes in October 2025 and the 2031 Senior Notes in May 2026.
Loss on Debt Extinguishment
Loss on debt extinguishment was $16.1 million for the nine months ended September 30, 2026, related primarily to the write-off of unamortized debt financing costs associated with the extinguishment of the Bridge Term Loan, the Stonebriar Term Loan and Caterpillar Term Loans in the second quarter of 2026, as well as the BofA Revolving Facility in the first quarter of 2026. See Note 11. "Debt" in the notes to our condensed consolidated financial statements. There was no loss on debt extinguishment for the three and nine months ended September 30, 2025.
Provision for Income Taxes
During the three months ended September 30, 2026, we recognized a combined United States federal and state expense for income taxes of $9.8 million, an increase of $5.8 million as compared to the $4.1 million income tax expense we recognized during the three months ended September 30, 2025. During the nine months ended September 30, 2026, we recognized a combined United States federal and state expense for income taxes of $30.0 million, an increase of $16.1 million as compared to the $13.9 million income tax expense we recognized during the nine months ended September 30, 2025. This change was attributable to changes in operating gains and mix of states where we operate. The effective combined United States federal and state income tax rates were 20.0% and 14.1% for the three months ended September 30, 2026 and September 30, 2025, respectively. The effective combined United States federal and state income tax rates were 23.7% and 18.4% for the nine months ended September 30, 2026 and September 30, 2025, respectively.
For the three months ended September 30, 2026 our effective tax rate differed from the statutory rate primarily due to the impact of the non-controlling interest and mix of states where we operate. Our effective tax rate differed from the statutory rate for the nine months ended September 30, 2026, primarily due to the impact of the non-controlling interest, the executive compensation deduction limitation and mix of states where we operate.
Liquidity and Capital Resources
Overview
Our primary sources of liquidity consist of cash flows from operations, remaining net proceeds from the 2031 Senior Notes offering and 2032 Senior Notes offering, borrowing availability under our Revolving Credit Facility and proceeds from delayed draw term loans under the Stateline Term Loan.
We believe these sources will be sufficient to meet our short-term and long-term financial obligations, including existing purchase commitments and budgeted capital expenditures. In addition to these sources, subject to market conditions and the availability of fleet growth opportunities, we may meet our cash requirements through the issuance of additional securities and/or the entry into additional debt financing agreements. Even if we are unable to secure the
financing of our planned capital expenditures, we have the ability to cancel the committed purchase orders, subject to the payment of cancellation fees.
2032 Senior Notes
The 2032 Senior Notes were issued on October 1, 2026 and are not reflected in the Company's condensed consolidated balance sheet or condensed consolidated statements of operations as of or for the three and nine months ended September 30, 2026. The net proceeds of the 2032 Senior Notes were approximately $1.23 billion and will be used for general corporate purposes and growth capital expenditures, in addition to paying for fees and expenses related to the offering. The 2032 Senior Notes will mature on April 1, 2032, and interest on the 2032 Senior Notes is payable semi-annually at a rate of 7.000% per annum.
2031 Senior Notes
As of September 30, 2026, the outstanding principal amount of the 2031 Senior Notes totaled $1.3 billion. The 2031 Senior Notes will mature on May 15, 2031. The Company used a portion of the net proceeds from the 2031 Senior Notes to repay certain of the Company's outstanding borrowings and to pay related fees and expenses (described below) and used the remaining net proceeds for general corporate purposes, including to fund growth capital expenditures. Interest on the 2031 Senior Notes is payable semi-annually at a rate of 6.375% per annum, and estimated interest payments will be approximately $83.6 million over the subsequent twelve months, based on the outstanding principal amount as of September 30, 2026.
Revolving Credit Facility
Our Revolving Credit Facility originally provided for borrowings of up to $650.0 million, including a sublimit for the issuance of letters of credit in an amount up to $150.0 million. At the Company's option, and subject to the satisfaction of certain conditions precedent, the Revolving Credit Facility could be increased by up to $200.0 million, which incremental capacity was utilized in full pursuant to the First Amendment described below. As of September 30, 2026, no borrowings were outstanding, standby letters of credit with an aggregate face amount of $125.0 million had been issued, and remaining availability under the Revolving Credit Facility was $525.0 million.
On October 1, 2026, we entered into the first amendment (the "First Amendment") to the Credit Agreement to primarily increase the aggregate revolving commitments under the Revolving Credit Facility by $200.0 million, from $650.0 million to $850.0 million and also increase the sublimit for the issuance of letters of credit under the Revolving Credit Facility from $150.0 million to $325.0 million. We intend to use any future borrowings for working capital and other general corporate purposes and to pay transaction expenses.
Stateline Term Loan
Stateline maintains a delayed draw term loan facility with an estimated total capacity of $518.5 million, based on its current capital plan, to fund power generation equipment for its approximately 900 MW data center project. As of September 30, 2026, outstanding borrowings under the Stateline Term Loan totaled $408.2 million, of which $18.7 million was classified as current. The Stateline Term Loan provides significant funding flexibility for Stateline's capital needs. We estimate interest payments of approximately $41.4 million over the subsequent twelve months, which will increase as additional amounts are drawn. Subsequent to September 30, 2026, Stateline drew an additional $25.0 million to fund growth-related capital expenditures, increasing the outstanding balance to $433.2 million. The remaining capacity of $85.3 million is expected to be drawn through the first quarter of 2027, depending on the timing of progress payments and equipment deliveries.
Convertible Senior Notes
On May 2, 2025, we issued $155.0 million aggregate principal amount of 4.75% Convertible Senior Notes due 2030 (the "2030 Notes"). The net proceeds were used primarily to support the growth of our Solaris Power Solutions segment. Interest on the 2030 Notes is payable semi-annually, with estimated payments of approximately $7.4 million over the subsequent twelve months.
In October 2025, we issued $747.5 million aggregate principal amount of 0.25% Convertible Senior Notes due 2031 (the "2031 Notes"). The net proceeds from the issuance were used, in part, to repay and terminate our then existing term loan, fund capped call transactions to hedge potential dilution, and support continued growth of our Solaris Power
Solutions segment. Interest on the 2031 Notes is payable semi-annually, with estimated payments of approximately $1.9 million over the subsequent twelve months.
Equipment Financing
In connection with the Omega Acquisition and GESA Acquisitions, we acquired $38.9 million of financing agreements, primarily related to equipment. These financing agreements bear interest at various rates ranging from 0.0% to 16.50% per annum and are payable in monthly installments. These financing agreements mature beginning in the first quarter of 2027 through April 2031 and are secured by the underlying financed equipment.
Repayment of Assumed Debt
In connection with the Omega Acquisition and the GESA Acquisition, we acquired $14.0 million of debt which we subsequently repaid in full following the closing of each acquisition. The fair value recognized for this debt at the acquisition date approximated its carrying amount, and thus no extinguishment gain or loss was recognized for the subsequent repayment. The repayments are included in "Repayments of debt financing" on the condensed consolidated statements of cash flows.
Debt Extinguishment
On May 12, 2026, concurrently with the issuance of the 2031 Senior Notes and entry into the new Credit Agreement, we used a portion of the net proceeds to repay in full and terminate the Bridge Term Loan, Stonebriar Term Loan, and Caterpillar Term Loans, which had an aggregate outstanding principal balance of $463.9 million. We recorded a loss on extinguishment of debt of $14.8 million, consisting of $8.8 million in unamortized debt financing costs and $6.0 million in prepayment penalties, which was recognized in the condensed consolidated statements of operations during the second quarter of 2026.
On March 16, 2026, concurrently with the closing of the Bridge Term Loan, we terminated our revolving credit facility agreement with Bank of America, N.A. (the "BofA Revolving Facility"). The BofA Revolving Facility had a borrowing base of up to $75.0 million. As of the date of termination, there were no outstanding borrowings under the BofA Revolving Facility. The extinguishment of the BofA Revolving Facility resulted in a loss on extinguishment of debt of $1.3 million, primarily consisting of the write-off of unamortized debt financing costs, which was recognized in the condensed consolidated statements of operations during the first quarter of 2026.
Capital Commitments
We have entered into purchase commitments for power generation equipment that are critical to our long-term strategic initiatives. As of September 30, 2026, short-term purchase commitments due within the subsequent twelve months totaled $824.0 million. Long-term purchase commitments that extend beyond one year total $499.9 million, of which $92.2 million is scheduled to be fulfilled during 2027, $367.4 million is scheduled to be fulfilled during 2028, and the remaining $40.3 million is due in 2029. Other than our obligations under the Baker Hughes Turbine Supply Contract, which are non-cancellable, these commitments are cancellable but subject to significant termination penalties, ranging from 5% to 90% of the purchase price, depending on the timing of the cancellation.
Liquidity Position
As of September 30, 2026, cash and cash equivalents totaled $399.5 million, and we had $525.0 million of available capacity under our Revolving Credit Facility after $125.0 million of outstanding letters of credit. We believe that our cash reserves, projected operating cash flows, remaining net proceeds from the 2031 Senior Notes offering and 2032 Senior Notes offering, borrowing availability under the Revolving Credit Facility, and access to delayed draw term loans under the Stateline Term Loan facility provide adequate liquidity to meet our obligations for the next twelve months and beyond. These resources are expected to fund debt service obligations, dividend payments, capital expenditures and related purchase commitments, as well as to support future strategic initiatives.
See Note 11. "Debt" in the notes to our condensed consolidated financial statements for additional information regarding our outstanding debt facilities, including terms, covenants, maturity schedules, and the debt extinguishments that occurred during the period.
Share Repurchase Program
The Company's board of directors authorized a share repurchase program on March 1, 2023, with an approved limit of $50.0 million and no set term limits. During the three and nine months ended September 30, 2026, we did not repurchase nor retire any shares of Class A common stock under the share repurchase program. As of September 30, 2026, we have collectively repurchased and retired 4,272,127 shares of Class A common stock for $34.6 million, or $8.09 per share, resulting in $15.4 million remaining under the authorized share repurchase program.
All purchases made pursuant to the authorized share repurchase plan were made in accordance with applicable securities laws from time to time in the open-market or through private transactions, depending on market conditions. Going forward, future purchases may be made pursuant to a trading plan meeting the requirements of Rule 10b-18 or Rule 10b5-1 under the Exchange Act, and may be discontinued at any time.
Cash Flows
The following table summarizes our cash flows for the periods indicated:
Nine Months Ended
September 30,
2026 2025 Change
(in thousands)
Net cash provided by operating activities $ 478,004 $ 113,167 $ 364,837
Net cash used in investing activities (1,601,510) (422,077) (1,179,433)
Net cash provided by financing activities 1,268,163 255,747 1,012,416
Net change in cash, cash equivalents and restricted cash $ 144,657 $ (53,163) $ 197,820
Significant Sources and Uses of Cash Flows
Operating Activities. Net cash provided by operating activities increased to $478.0 million for the nine months ended September 30, 2026, compared to $113.2 million in the same period of 2025, representing an increase of $364.8 million. This increase was primarily driven by higher revenue, largely attributable to continued growth in business activity and the acquisition of Omega and GESA within our Solaris Power Solutions segment. Consequently, our net income, adjusted for non-cash items, increased by $143.6 million for the nine months ended September 30, 2026, compared to the prior comparable period. In addition, cash provided by working capital increased $217.6 million for the nine months ended September 30, 2026, compared to the prior comparable period.
Investing Activities. Net cash used in investing activities was $1,601.5 million for the nine months ended September 30, 2026, an increase from $422.1 million during the same period of 2025. Net cash used in investing activities during the nine months ended September 30, 2026 includes $211.5 million paid for the acquisitions of Omega, GESA and Genco, as well as $1,373.9 million paid for turbines and ancillary equipment to support the growth and operations of Solaris Power Solutions, including $131.2 million paid for the NovaLT16 Turbine Acquisition. Net cash used in investing activities during the nine months ended September 30, 2025 included $29.4 million paid for the acquisition of HVMVLV, LLC and $386.8 million paid for turbines and ancillary equipment.
Financing Activities. For the nine months ended September 30, 2026, net cash provided by financing activities totaled $1,268.2 million. This amount primarily reflects $1,367.9 million from net debt financing, partially offset by $44.2 million paid for debt financing costs, $5.9 million in debt extinguishment fees, $16.0 million paid for cancelled shares withheld for taxes from vesting of restricted stock, $22.8 million in quarterly dividends to Class A common stock shareholders, $4.9 million in distributions to Solaris LLC unitholders and $1.7 million in Tax Receivable Agreement payments. In comparison, net cash provided by financing activities was $255.7 million for the nine months ended September 30, 2025. This amount primarily reflects $222.9 million of net debt financing and $86.0 million of capital contributions from non-controlling interest in Stateline, partially offset by $13.1 million paid for debt financing costs, $10.5 million paid for cancelled shares withheld for taxes from vesting of restricted stock, $15.4 million in quarterly dividends to Class A common stock shareholders, $10.3 million in distributions to Solaris LLC unitholders and $3.6 million in Tax Receivable Agreement payments.
Future Uses of Cash
Our significant cash commitments primarily relate to our capital expenditures under our power generation fleet growth program and debt service on our 2031 Senior Notes, 2032 Senior Notes and Stateline term loan facility. In addition, we are obligated to make semi-annual interest payments on the 2030 Notes and 2031 Notes, with the principal amount due at maturity in 2030 and 2031, respectively. At our election, the 2030 Notes and 2031 Notes may be settled in cash, shares of Class A common stock, or a combination of both.
Additional expected uses of cash include obligations under our Tax Receivable Agreement, scheduled payments under finance and operating lease agreements, insurance premium financing agreements, any dividend payments (timing and amount subject to the discretion of the board), and other routine operating obligations.
Off-Balance Sheet Arrangements
Refer to Note 18. "Commitments and Contingencies - Purchase Commitments" included in the notes to our condensed consolidated financial statements contained herein for a discussion of our off-balance sheet arrangements.
Critical Accounting Policies and Estimates
For detailed information, please refer to Part II, Item 7 of our Annual Report on Form 10-K for the year ended December 31, 2025. Beginning in the third quarter of 2026, significant estimates also include the estimated total costs to complete contracts for which revenue is recognized over time using a cost-to-cost method. There have been no other changes to our critical accounting estimates since December 31, 2025.
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