Hyliion Holdings Reports Second-Quarter 2026 Results and Advances KARNO Power Platform
Hyliion Holdings Corp. (NYSE American: HYLN), a developer of modular power plant technology, has reported its financial results for the second quarter ended June 30, 2026, while highlighting significant progress in the commercialization and development of its KARNO™ Power Module platform. The company said the quarter marked several important milestones across its military, commercial, manufacturing and financial activities as it works to position KARNO for larger-scale power applications.
Among the most significant developments was Hyliion’s award of a $41.7 million contract from the U.S. Navy to develop and supply multi-megawatt KARNO Power Modules for shipboard and military base applications. The company also announced plans to conduct KARNO Core sea trials aboard the U.S. Navy’s USX-1 Defiant vessel, further expanding the technology’s potential applications in naval operations.
Hyliion reported that it is also making substantial progress in additive manufacturing. Recent advancements are expected to improve printing speed and manufacturing throughput by as much as three times for certain components. The company believes these improvements can play an important role in increasing production capacity while maintaining a capital-efficient manufacturing model.
Under its planned manufacturing scale-up strategy, Hyliion expects each megawatt of annual production capacity to require approximately $1.5 million in one-time capital investment. At current pricing levels, the company estimates that each megawatt of annual capacity could support approximately $2.5 million to $3.0 million in annual revenue. This approach is designed to allow Hyliion to expand production in line with customer demand without requiring disproportionately large capital expenditures.
During the quarter, Hyliion also executed a beta machine agreement with Colibrium Additive, a GE Aerospace company, to support development of the next generation of additive manufacturing systems. The collaboration is expected to contribute to the company’s efforts to improve production capabilities and increase the efficiency of manufacturing KARNO components.
Another key milestone was Hyliion’s demonstration of multiple KARNO Power Modules operating together as a single larger power plant. The capability is particularly important as the company pursues applications requiring higher levels of power output. By combining individual modular systems, Hyliion expects KARNO technology to provide a scalable approach for customers with power requirements that extend beyond the capacity of a single module.
Stronger Financial Outlook
Hyliion’s second-quarter financial performance also contributed to a stronger outlook for 2026. The company reported second-quarter revenue of $4.9 million, representing an increase of more than three times compared with the same quarter of 2025.
Following the quarter’s performance and progress across its business pipeline, Hyliion raised its full-year 2026 revenue guidance by 50%, increasing its outlook from $10 million to $15 million. The company also ended the quarter with $132.4 million in cash and investments and improved its year-end 2026 cash and investment outlook to between $115 million and $120 million, compared with its previous guidance of approximately $100 million.
Thomas Healy, founder and chief executive officer of Hyliion, said the company’s latest quarter demonstrated progress on several important fronts. He highlighted the $41.7 million military contract, the higher revenue outlook and advances in additive manufacturing as evidence of growing momentum for the KARNO platform.
Healy also pointed to increasing interest from data center customers. According to the company, discussions with hyperscalers and independent data center developers are expanding toward potential requirements ranging from tens to hundreds of megawatts. Hyliion believes the combination of modular power generation, scalable output and manufacturing improvements positions KARNO to address growing demand for reliable power.
Expanding Military Applications
The U.S. Navy contract represents the largest military award in Hyliion’s history. Under the agreement, the company will deliver two multi-megawatt systems. One system will be rated above 2 megawatts, while the other will exceed 3 megawatts. Both systems are based on the modular 800-kilowatt architecture that Hyliion is currently developing.
The contract is intended to expand KARNO’s potential military applications beyond smaller power requirements. The larger systems could ultimately be used aboard larger naval vessels as well as at military bases and other defense facilities requiring substantial power generation capacity.
The agreement also includes funding to advance Hyliion’s additive manufacturing capabilities. Work associated with the program is expected to take place primarily during 2027 and 2028, providing an opportunity for the company to continue improving its manufacturing platform as it moves toward larger-scale deployments.
Hyliion expects to pursue additional military opportunities during 2026, including a potential contract with another branch of the U.S. military. If the anticipated award is secured, the company expects total new military funding awarded during 2026 to approach $50 million. That would place the company at the upper end of its previously stated objective of securing between $40 million and $50 million in military funding during the year.
The company is also preparing for sea trials of the KARNO Core aboard the U.S. Navy’s USX-1 Defiant. The vessel will be used to demonstrate the technology for both ship propulsion and auxiliary power applications. The 800-kilowatt KARNO Power Module being developed for the vessel under existing Office of Naval Research contracts is currently in assembly and is expected to be completed during 2026.
Commercialization and Data Center Opportunities
Hyliion remains on track to complete approximately 10 early adopter customer units during 2026. The company said it is accumulating operating hours across multiple systems simultaneously as it prepares the units for field deployment. Initial deliveries to customer sites are expected to begin during the next quarter.
For 2027, Hyliion plans to focus on deliveries associated with existing military contracts while also deploying additional 200-kilowatt KARNO Power Modules with commercial customers. Data center operators are expected to represent an important target market for these deployments.
The company believes deploying the smaller commercial systems will provide customers with opportunities to evaluate KARNO’s performance in real-world operating environments. At the same time, these projects are expected to help Hyliion accelerate adoption within the data center industry and develop a larger pipeline of potential customers.
As part of this strategy, commercialization of the 200-kilowatt KARNO Power Module is now expected to begin in 2027. Hyliion said interest from customers continues to increase across military and commercial markets, with data center demand showing particularly strong momentum.
The company is currently engaged in discussions with multiple hyperscalers and leading independent data center developers regarding potential deployments requiring tens to hundreds of megawatts of power. Hyliion has also executed non-binding letters of intent covering approximately 750 KARNO Cores. More than half of those commitments are associated with data center providers, underscoring the importance of the sector to the company’s long-term growth strategy.
The ability to combine multiple KARNO Power Modules into a larger integrated power system is expected to be particularly valuable for these customers. During the second quarter, Hyliion successfully demonstrated multi-module operation, achieving an important 2026 development milestone.
This capability allows individual KARNO Power Modules to operate together as a larger scalable power plant. The technology could enable Hyliion to address customers whose power requirements exceed the output of a single module while retaining the modular characteristics of the KARNO platform.
Overall, Hyliion enters the second half of 2026 with stronger financial guidance, a major new U.S. Navy contract, continued progress in additive manufacturing and growing interest from the data center sector. With early adopter units expected to move toward deployment and larger multi-megawatt systems under development, the company is positioning the KARNO Power Module platform for broader commercial and military applications in the years ahead.
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