On August 11, Hyliion Holdings Corp. (NYSEAMERICAN:HYLN) reported second-quarter results that read less like a modular power plant startup and more like a company suddenly courted by both the Pentagon and the data center industry. A $41.7 million Navy contract, a 50% jump in full-year revenue guidance, and a cash pile still north of $130 million make this a quarter of real progress, even as the company remains years from turning a profit.
A Business Finally Landing Contracts
Hyliion’s KARNO Power Module business is starting to convert years of development work into actual contracts. Second-quarter revenue came in at $4.9 million, more than triple the $1.5 million booked in the same quarter of 2025, and management now expects $15 million for the full year, up from an earlier $10 million target. Much of the near-term momentum traces back to the US Navy, which awarded Hyliion a $41.7 million contract, the largest military deal in the company’s history, to scale the KARNO system into multi-megawatt configurations for shipboard and base power. The Navy also selected the USX-1 Defiant as the vessel for KARNO Core sea trials, giving the technology a real-world test beyond the lab.
The manufacturing story is filling in too. Hyliion says recent additive manufacturing gains could boost printing speed and throughput by up to 3 times, and it now estimates that every $1.5 million spent on new manufacturing capacity can support $2.5 million to $3 million of annual revenue once a megawatt of production comes online. The company also demonstrated multiple KARNO modules running together as a single larger power plant, a capability data center customers will need for their biggest projects. Non-binding letters of intent covering roughly 750 KARNO Cores, more than half from data center operators, hint at where that next leg of demand could come from. With $132.4 million in cash and investments on hand, Hyliion raised its year-end cash outlook to $115 million to $120 million.
The Losses Aren’t Slowing Down
None of that changes the fact that Hyliion is still deeply unprofitable. The company posted a second-quarter net loss of $13.9 million, actually a touch wider than the $13.4 million loss a year earlier, even as revenue tripled. Cost of revenue of $4.6 million left gross profit at just $0.4 million on $4.9 million of sales, a reminder that the R&D work driving today’s revenue is not yet a real product business. Operating expenses of $15.7 million were essentially flat with last year, and SG&A actually rose about 8%.
The bigger commercial opportunity is also sliding further out. Hyliion now expects to commercialize its 200-kilowatt KARNO module with data center customers in 2027 rather than sooner, and most of the work tied to the new Navy contract will not happen until 2027 and 2028. The 750 KARNO Cores represented in letters of intent are non-binding, meaning none of that demand is locked in as revenue yet. And while net cash spending of $6.9 million in the quarter marks a big improvement from $13.5 million a year earlier, Hyliion still burned through $25.7 million in the first half of 2026, so the cash pile is a clock as much as it is a cushion.
What The Trading Crowd Sees
Hedge fund interest in Hyliion is heading in the right direction, with the number of funds holding the stock climbing from 11 to 18 in the most recent quarter, a sign of building conviction. Short interest tells a more skeptical story, sitting at 12.70% of the float, which is heavy enough to reflect a real bear camp still betting against the company.
Two Timelines, One Stock
Hyliion’s quarter leaves two timelines running side by side. One is near-term and reassuring: rising revenue, raised guidance, a bigger cash cushion, and a marquee Navy contract. The other stretches out to 2027 and 2028, when the bulk of the military work and the data center push are actually supposed to show up in results. Whether the early adopter units and additive manufacturing gains keep landing on schedule will decide how much confidence that near-term story deserves.
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