Second-quarter results weakened: Revenue fell 21% to $5.8 million and net loss widened to $2.2 million, primarily due to a 64% decline in product sales. Gross margin nevertheless improved to 37.8% from 33.8%. Data-center interest is growing: Tecogen conducted 12 demonstrations for operators representing more than 8 gigawatts of existing capacity, with management reporting positive feedback and preparing inventory of dual-power chillers and generation modules.
Backlog supports a potential third-quarter rebound: Base-business backlog exceeded $8 million, with another $2 million to $3 million of projects expected to close in coming months. Service revenue rose 10%, while cost reductions and expected product-sales growth could improve upcoming results. Tecogen (OTCMKTS:TGEN) reported lower second-quarter revenue and a wider net loss as product sales declined from the prior-year period, while management highlighted increased engagement with large data-center operators and a growing base-business backlog.
Total revenue for the second quarter of 2026 fell 21% to $5.8 million, compared with $7.3 million in the second quarter of 2025. Chief Financial Officer Roger Deschenes said the decline was driven mainly by lower product-segment revenue. Net loss widened to $2.2 million from $1.5 million a year earlier, while adjusted EBITDA loss increased to $1.7 million from $1.2 million. → Lumentum Just Delivered the AI Growth Investors Wanted Despite the revenue decline, total gross margin improved to 37.8%, up from 33.8% in the prior-year quarter, reflecting improved product-segment margins.
Gross profit declined 11.9% to $2.2 million because of the lower revenue base. Chief Executive Officer Abinand Rangesh said Tecogen has gained traction with larger data-center developers after pursuing a strategy that initially focused on smaller facilities. During the past two months, the company hosted 12 product demonstrations, including six in-person and six virtual demonstrations. → Ryman Checks Into a $1.38B Hospitality Upgrade Rangesh said eight of the 12 demonstrations involved prospective direct end customers, while the remaining visitors included engineers, partners and a chip manufacturer.
The data centers represented by attendees collectively have more than 8 gigawatts of operating capacity and multiple gigawatts under construction, according to the company. "The feedback has been extremely positive across the board," Rangesh said, adding that the discussions included specific projects and delivery dates. He said the company is beginning to build inventory of its dual power source chillers and power-generation modules in an effort to shorten delivery lead times for potential customers. → Joby's Defense Pivot Accelerates With $500M Resonant Sciences Deal Management did not provide details on the size or cost of the inventory build.
Rangesh said the company is attempting to balance working-capital requirements with the ability to respond quickly when projects advance to purchase orders and deposits. The company believes its equipment can address several issues facing data centers, including grid-power constraints, water use, noise and emissions. Rangesh said Tecogen's closed-loop dual power source chiller does not use water evaporation, while its equipment is designed to operate in noise-sensitive environments and has low nitrogen oxide and carbon monoxide emissions.
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