Generac Holdings has entered into a long-term supply agreement with Amazon covering backup generators for Amazon data centers, with Generac’s regulatory filing describing potential aggregate gross payments of up to $8 billion over the arrangement.
Initial deliveries under the agreement are expected to total approximately $2.4 billion during 2027 and 2028.
Alongside the supply agreement, Generac issued Amazon.com NV Investment Holdings, a wholly owned Amazon subsidiary, a warrant giving it the right to acquire as many as 1,693,745 Generac common shares at an exercise price of $200.9266 per share.
Of those shares, 307,954 vested immediately.
The remaining warrant shares will vest in multiple tranches based on aggregate gross payments, net of certain offsets, received by Generac and its global affiliates from Amazon and its affiliates for backup generators supplied to Amazon data centers. The milestones extend up to $8 billion of payments.
The structure aligns additional Amazon equity participation in Generac with the amount of business generated through the supply relationship.
Amazon can exercise vested portions of the warrant through either a cash or cashless exercise through September 16, 2033, subject to the conditions contained in the warrant and transaction agreement.
The warrant’s exercise price and share count are also subject to customary anti-dilution adjustments, and Generac granted Amazon registration rights covering the warrant shares.
For Generac, the agreement represents a significant expansion of its role supplying backup power equipment for hyperscale data center infrastructure.
The scale of the initial $2.4 billion delivery program for 2027 and 2028, combined with potential payments reaching $8 billion, makes the Amazon relationship a potentially substantial source of future data center-related demand.
