Fluence Has a $6.4 Billion Backlog but Pushed $400 Million of Deliveries Out. Is the AI-Power Story Breaking?

In its latest financial results, Fluence Energy reported a $6.4 billion backlog of project deliveries, yet $400 million of those shipments were pushed into the fiscal year 2027. This discrepancy highlights the tension between demand and execution, which is crucial to understanding the company's stock performance. Fluence Energy, Inc. (NASDAQ:FLNC) has gained attention as an AI-power proxy, primarily due to the role batteries can play in securing capacity for data centers and stabilizing grids.

Despite a 7.9% revenue increase to $649.8 million, gross margins plummeted to 5.1% from 14.8% a year earlier, while net losses widened to $44.3 million. Management adjusted full-year revenue guidance from $3.4 billion to $3.0 billion and revised the adjusted EBITDA midpoint from a positive $50 million to a negative $10 million. Furthermore, insider investors increased their positions in Fluence Energy, with 39 hedge funds and large managers like Point72 Asset Management and D. E. Shaw adding to their holdings.

However, substantial short interest exists, with 25.45 million shares short as of August 14, up 13.9% from the previous month. The company's backlog and order intake, totaling $850 million, are rooted in data-center business, with $550 million tied to a hyperscaler, although the challenge remains in converting this demand into reliable margins and timely project delivery.

Investors must monitor gross margin by project mix, working-capital use, and the conversion rate of backlog each quarter to determine whether Fluence's current challenges are temporary or indicative of underlying weaknesses. While acknowledging Fluence's potential as an AI investment, analysts contend that other AI stocks offer greater upside potential and lower risk.