Cloud vendors rush to secure energy storage supply, Fluence Energy's stock price soars by 104% in 7 days

Energy storage system supplier Fluence Energy (Nasdaq: FLNC) experienced a dramatic increase in its stock price this week, with a consecutive 7-day rise, accumulating a gain of 104%

The demand for high-quality energy storage infrastructure from artificial intelligence data centers is transforming Fluence from a traditional clean energy company into an indispensable provider of electrical infrastructure in the AI era.

Leading the Pack from 26 Competitors

Fluence disclosed this week that it has signed a Master Service Agreement (MSA) with two large hyperscale cloud service providers, establishing its position as a qualified supplier. It is reported that this qualification review involved 26 BESS suppliers, with Fluence being the first to complete all technical certifications and becoming the first to sign the contract.

The news was disclosed in conjunction with the company's financial results for the second quarter of the fiscal year 2026. Despite logistics delays affecting the deferral of approximately $80 million in revenue to the next quarter, with quarterly revenue of $465 million slightly below market expectations, the management maintained the annual guidance unchanged and emphasized that data center demand is accelerating.

The management attributed this achievement to the technical advantages of its Smartstack product - smaller physical footprint, more advanced grid control systems, and the ability to stably output in high power fluctuation scenarios, which perfectly meets the data center's strict requirements for power quality.

Data center customers need more than just energy storage; they require millisecond-level responses to grid frequency and voltage. Suppliers who can pass this certification process are essentially granted a long-term pass.

The first batch of purchase orders is expected to be finalized this quarter (F3Q26), about a quarter earlier than previously expected by the management. Analysts estimate that the relevant revenue will be officially booked in the fiscal year 2027.

The Market Space Leaps from GW to TW

The value of this technical barrier lies in the rapid expansion of the market space behind it. The global BESS market is expected to add 353 GWh of new installations in 2026, with the main driving force being the explosive electricity demand of AI data centers. From 2026 to 2030, the annual global deployment of practical scale energy storage is expected to continue to exceed 150GW.

Fluence currently has about 22 GW of installed or contracted capacity globally, with a data center pipeline of about 12GW, most of which is related to the aforementioned two hyperscale cloud service providers. What is more noteworthy is that the company's overall pipeline has expanded from $30.1 billion in the last quarter to $31.5 billion, with the growth momentum mainly coming from the domestic U.S. market, which is highly synergistic with its domestic manufacturing strategy.

Measured by current valuation, the company still holds an early share in a market that is moving towards the TW level.

Active Response in the Cell Revolution

While the market is focused on commercial breakthroughs, there is also a noteworthy event on the supply chain side.

On March 31st of this year, Fluence's cell supplier AESC sold the majority of its factory shares to Fixx Energy. Fluence promptly signed a new supply agreement with the new shareholder to ensure the continuity of domestic cell production qualifications, in order to meet the requirements for domestic U.S. content manufacturing.

The company has additionally secured a second domestic cell supplier to support delivery demands for F2027 and is currently evaluating incremental supply options for F2027 and beyond.

In the current trade policy environment, a fully U.S.-made supply chain is a moat that competitors find hard to replicate quickly.

Significant Margin of Safety from Backlog Orders

Fluence's order data provides another layer of support. As of the latest quarter, the backlog of orders has reached a historical high of about $5.6 billion, and the management expects it to continue to increase next quarter. Orders signed so far this year have reached $2 billion, a year-on-year increase of about 100%.

Measured against the current market value of $4.4 billion, the ratio of market value to backlog orders is about 0.79 times - on the lower end in the high-growth infrastructure sector, which means the company has a large number of contracts to be executed on its books, supporting revenue visibility for more than three years ahead.

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