AMRC Q3 Deep Dive: Data Center Demand and Infrastructure Backlog Anchor Outlook

Energy and renewable energy projects company Ameresco (NYSE:AMRC) reported Q3 CY2025 results exceeding the market’s revenue expectations, with sales up 5% year on year to $526 million. Its GAAP profit of $0.35 per share increased from $0.33 in the same quarter last year.

Is now the time to buy AMRC? Find out in our full research report (it’s free for active Edge members).

StockStory’s Take

Ameresco’s third quarter results were met with a negative market reaction despite surpassing revenue expectations. Management attributed the performance to robust execution across its energy infrastructure and asset business lines, highlighting new opportunities stemming from surging electricity demand, particularly from data centers and industrial clients. CEO George Sakellaris emphasized Ameresco’s ability to tailor solutions for diverse customer segments, while President Nicole Bulgarino noted strong project backlog growth and recent wins with large-scale power and battery storage solutions. The company also pointed to its expanding international presence as a contributor to the quarter’s results.

Looking ahead, Ameresco’s reaffirmed guidance is underpinned by continued demand for resilient energy infrastructure, especially from data center and industrial customers seeking rapid, large-scale power deployment. Management highlighted the firm’s growing pipeline of projects, including the Lemoore data center initiative and additional battery storage deployments. CFO Mark Chiplock cautioned that while a prolonged federal government shutdown could shift project timelines, Ameresco does not anticipate a material impact on year-end results. Sakellaris stated, “Our strong visibility, along with favorable industry dynamics, supports our confidence in delivering long-term growth targets.”

Key Insights from Management’s Remarks

Management attributed third quarter growth to elevated demand for robust energy infrastructure in emerging sectors like data centers and industrial manufacturing, alongside disciplined project execution and expanded international activity.

• Data center momentum: Ameresco’s entry into large-scale data center power solutions, such as the Lemoore initiative with CyrusOne, is creating new growth opportunities. Management indicated these projects combine firm energy (fuel cells), solar, and battery storage to meet stringent 24/7 power demands from hyperscale computing customers.
• Industrial and utility diversification: The company is extending its reach beyond federal and municipal clients, securing projects with industrial customers like Nucor, where behind-the-meter battery storage and solar are being deployed to support resilient electricity supply for expanding operations.
• Project backlog expansion: Total project backlog grew substantially this quarter, fueled by $450 million in new awards and a 33% increase in contracted backlog. Management highlighted this as increasing long-term revenue visibility and supporting multi-year growth.
• International joint venture progress: The partnership with Sunel continues to play a key role in Ameresco’s European expansion, contributing to both revenue and diversification of the project portfolio.
• Disciplined cost and liquidity management: The company improved gross margins through a focus on higher-margin projects and maintained financial flexibility by funding growth with nonrecourse project debt and partner capital, preserving corporate capacity for future investments.

Drivers of Future Performance

Ameresco’s outlook for the coming quarters is driven by expanding demand for energy infrastructure from data centers and industrial customers, with project execution and supply chain management as key priorities.

• Data center project pipeline: Management underscored a significant pipeline of data center projects, driven by rapid growth in AI and high-density computing, which require resilient and scalable power infrastructure. The company expects these opportunities to support its long-term revenue and EBITDA growth targets.
• Battery storage and supply chain: With batteries now making up a larger share of the project backlog, Ameresco is focusing on diversifying supply sources and navigating potential tariffs. Management believes falling battery costs may offset some supply chain risks and help maintain project margins.
• Operational adaptability: The company is increasing headcount and technical capabilities to manage larger, more complex projects. Management stated that past experience with federal projects positions Ameresco to deliver on demanding timelines and customer requirements in new end markets.

Catalysts in Upcoming Quarters

Looking ahead, the StockStory team will be tracking (1) the conversion rate of Ameresco’s expanding data center and industrial project pipeline into signed contracts, (2) execution on delivering complex, large-scale projects within targeted timelines and budgets, and (3) the impact of regulatory developments—such as tariffs and federal funding—on supply chain reliability and project economics. Progress in international markets and battery storage deployments will also be important indicators.

Ameresco currently trades at $39.20, down from $40.02 just before the earnings. Is there an opportunity in the stock?See for yourself in our full research report (it’s free for active Edge members).

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