Nordex SE (NRDXF) (Q3 2026) Earnings Call Highlights: EBITDA More Than Doubles as Margin ...

Negative Points

• Installations in Q3 were 22% below the previous year, totaling 2 GW, due to project delays on customer side and transportation permit delays in Germany.

• Turbine production output decreased to 367 turbines from 428 in Q3 2025, reflecting lower nacelle production.

• Gross margin declined to 26.7% from 28% in Q3 2025, impacted by higher costs and mix.

• Persistent industry bottlenecks in Germany, such as transportation permits, continue to cause installation delays and may affect revenue recognition.

• U.S. market faces uncertainty from Section 232 tariff and FAA permitting bottlenecks, which could delay order momentum despite tax credit sunset approaching.

Q & A Highlights

Q: Ajay Patel of Goldman Sachs asked about capital allocation priorities and when investors would get more detail on the use of the strong cash balance, including the minimum EUR15 million shareholder return indicated for the year. A: CFO Ilya Hartmann said the company will provide an update with its full-year results at the end of February, alongside guidance. Until then, priorities besides shareholder returns are protecting the balance sheet, de-risking operations and meaningful bolt-on investments.

Q: Ajay Patel also noted the implied Q4 margin of about 15% and asked whether Nordex could give any high-level indication for 2027 relative to its 10% to 12% midterm margin target. A: CEO Jose Blanco Dieguez declined to guide on 2027, saying Nordex is focused on executing the high Q4 volume and is in the middle of its budget planning. He cautioned that Q4 is a high-activity quarter and should not be taken as an early indicator for next year, with more detail to come early next year.

Q: Richard Dawson of Berenberg asked whether the service business's 20.6% EBIT margin could be treated as a new floor, and what drove the Q3 project margin upgrade from project risks that did not materialize. A: Blanco Dieguez said there is no reason to expect service profitability to deteriorate, with the business growing around 10% a year and only minor margin improvement expected, as profitability is largely set by the backlog. On projects, he said Nordex builds in contingencies given a global supply chain with much sourcing in Asia and delivery in Europe and North America, and that in the last two years evaluated risks did not fully materialize while opportunities outweighed them. He expects similar planning next year.

Q: John Kim of UBS asked how revenue rose sharply while turbine deliveries and installations were down, and how to unpack the revenue recognition. A: CFO Ilya Hartmann explained that Nordex uses cost-to-cost revenue recognition geared largely toward manufacturing, and that tower production was substantially up even though nacelle output was down, reflecting higher activity against binding contracts. Blanco Dieguez added that late installations due to customer delays or permitting and transport issues can delay revenue recognition, but there are no substantial liquidated damages for installation.

Q: John Kim also asked about underlying like-for-like pricing and what price increases Nordex needs to keep price-cost stable given cost inflation in 2027. A: Blanco Dieguez acknowledged substantial inflation in labor and procured services, but said Nordex has offset it through efficiency, supply chain, product and operational improvements. He said pricing is stable and that the real indicator is the gross margin on order intake, which Nordex cannot disclose for competitive reasons, but which it has protected despite inflation and pressure to lower tariffs in Germany.

Q: Alexander Jones of Bank of America asked what it would take for Nordex to raise or change its 10% to 12% midterm margin guidance, and about the net effect of U.S. market dynamics including Section 232 tariff uncertainty and FAA permitting. A: Blanco Dieguez said the midterm range is an over-the-cycle view and it is too early to comment, as the budget must be finalized and German legislation is still in process. On the U.S., he said Nordex has so far avoided Section 232 risk, and that FAA permits are the main bottleneck; he was unsure whether this would change after the elections. Hartmann added that U.S. orders have picked up generally, and that customers may delay decisions until closer to the tax credit sunset deadline.

Q: Vladimir Sergievskiy of Barclays noted a gap of more than 2.5 gigawatts between turbine production and installations over the past 12 months and asked where those roughly 400 turbines sit and whether delivery liability remains. A: Blanco Dieguez said those turbines have been produced, invoiced, paid for and are reflected in the company's cash balance. He confirmed delivery liability remains case by case, with production and installation obligation dates and associated liabilities, though completed production reduces overall project liability.

Q: Vladimir Sergievskiy also asked about the elevated level of provisioning in Q2 and Q3 and whether the risk profile or internal treatment of contract risks had changed. A: Hartmann said the increase reflects standard warranty provisions booked at order intake amid high order momentum, with no change in mechanics or in the quality and technology assessment of provisions. Blanco Dieguez said the roughly 4% level is reasonable, and Hartmann added that Nordex hopes execution will be better than the provisions assume.

Q: Sean McLoughlin of HSBC asked what drove the roughly 200 basis point year-on-year improvement in service margins and what further improvement remains. A: Blanco Dieguez attributed it to a mix of factors: not renewing contracts that were dragging profitability, a favorable mix of product types and geographies such as Germany, Turkey and Eastern Europe where profitability is above average, and scale effects.

Q: Sean McLoughlin also asked whether the Turkey blade issues are fully behind Nordex and where the company stands on delays in Q4, including customer-side and German transport permit delays. A: Blanco Dieguez said the Turkey issue is behind them after negotiating with the government and customers, with delays not expected to affect profitability or trigger liquidated damages. He said German transport permits are an industry-wide bottleneck amid a massive sector ramp-up, but Nordex has compensated within schedule buffers without entering substantial LD territory. He expects Q4 to be similar to Q3, with a high level of installations planned.

Q: William Mackie of Kepler Cheuvreux asked where the largest reductions in customer cost of energy will come from over the next three to five years, and whether it will be larger turbines or refining existing platforms. A: Blanco Dieguez said the N163, launched about nine years ago, remains Nordex's best-selling product, and he expects the N175 to gain internal share while the N149 remains stable for long-lead-time markets. He does not expect Nordex to install products materially different from the 149, 163, 175 and 193 platforms over the next five years, with the U.S. shifting from the 149 to the 163 and eventually the 175.

Q: William Mackie also asked how Nordex can sustain pricing and returns when expanding into APAC against Chinese manufacturers, and what makes it successful beyond price. A: Blanco Dieguez clarified that

For the complete transcript of the earnings call, please refer to the full earnings call transcript .