NASDAQ: SHLS

We also provide technical support during installation and the transition to operations and maintenance. Given the custom nature of both our system solutions and individual components and the long development cycle for solar energy and BESS projects, we typically have 12 months or more of lead time to quote, engineer, produce and ship orders we receive, and we do not stock large amounts of finished goods. We believe our system solutions are unique in our industry because they integrate design and engineering support, proprietary components and innovative installation methods into a single offering. Since electrical infrastructure is the backbone of a solar or BESS project, we believe our products play a mission-critical role in the quality, safety, reliability, and efficiency of energy projects, which we believe are key factors customers consider when selecting EBOS solutions.

We have a focus in two end-markets: (1) clean, grid connected energy and (2) data center + mission-critical electrical infrastructure. This market diversification seeks to capitalize on the growing global demand for energy and the need to accelerate electrification.

The Energy Opportunity

The energy landscape has changed drastically over the last decade. Solar now accounts for the majority of new generation being brought onto the grid, BESS has evolved from a “nice to have” into a necessity co-located with utility solar projects, and specialized labor shortages have become more prevalent. In addition, we are seeing an acceleration of artificial intelligence (AI) adoption, driving an unprecedented increase in energy demand as each new data center gets built. While this phenomenon grows, constraints on grid capacity and interconnection remain, causing hyperscalers to rethink their energy strategy. Increasingly, those hyperscalers are building their own power plants alongside their data warehouses, making scalability, quality and speed-to-deployment critical considerations.

Our Solutions

Solar

We offer a full range of EBOS solutions to meet the needs of domestic and international utility scale solar projects, commercial, community and industrial (“CC&I”) projects, and other customers as an OEM of solar components.

Our solutions include homeruns, interconnection and extension solutions, combiners and recombiners, load break disconnects and transition solutions, wireless performance monitoring systems, and solar OEM components. Critical to our solar solution suite of products is our Big Lead Assembly (“BLA”) trunk bus , which introduced a foundational shift in solar project design, simplifying construction while improving safety and reliability. We have eliminated the need for individual wire runs from each string of a solar panel to combiner boxes. Our products connect multiple strings within each row of a solar field using specialized wire harnesses with integrated fuses. These harnesses are connected to a proprietary above-ground aluminum feeder cable which is the BLA. The BLA and the integration of fuses dramatically reduces the number of wire runs required compared to other infrastructures and eliminates the need for combiner boxes. Our patented design includes connection points that incorporate a double molding system, permanently sealing out any moisture or particulates that would otherwise compromise the system. BLA delivers meaningful value to our customers which includes:

•cost savings by leveraging aluminum, which is often 80% less expensive than copper;

•above ground installation, which eliminates the need for conduits, trenching, environmental issues, and difficult maintenance;

•installation designed for general labor, minimizing the need for licensed electricians;

•reduction in the overall number of wire runs by up to 95%;

•elimination of combiner boxes, which speeds installation, lowers material and shipping costs, reduces the number of failure points, and is beneficial to the environment as less copper, aluminum, and plastics are consumed;

•lower maintenance costs over time; and

•increased energy generation enabled by reduced electrical resistance.

Battery Energy Storage and Data Center Solutions

Shoals has expanded our EBOS offerings to support the growing deployment of BESS, leveraging its established experience in large-scale solar infrastructure and DC power architectures. As energy storage becomes increasingly integral to renewable generation, grid stability, and system resilience, Shoals’ custom, semi-custom & standardized energy storage infrastructure solutions are designed to support efficient integration, scalability, and long-term operational performance across solar-plus-storage, standalone storage and data center projects.

A core component of Shoals’ BESS portfolio is the Recombiner platform. It is energy input agnostic and enables the aggregation of multiple DC inputs from solar arrays, battery storage systems, and other DC microgrid components into a single DC output, allowing batteries to charge and discharge consistent power to the grid. This system-level approach supports DC-coupled architectures and provides flexibility as battery technologies evolve, allowing customers to adapt system designs over time without significant infrastructure changes. By reducing inverter counts and shifting labor-intensive electrical work from the field to a controlled manufacturing environment, the Recombiner contributes to improved installation efficiency, enhanced system reliability, and reduced operational complexity.

Consistent with Shoals’ “Inventing Simple” philosophy, our BESS solutions are designed to meet evolving customer challenges, offering:

• configurable and modular design to adapt to project-specific needs, giving developers confidence in every system layout;

• Simplified project layouts with fewer required materials and components, up to 75% reduction in number of inverters needed on a project;

• accelerated installation with consolidated DC inputs and plug-and-play, easy-to-connect components;

• enhanced safety for critical infrastructure and maintenance personnel;

• high-quality construction reducing risks with fewer points of failure and delivering reliable power for a secure operating environment; and

• modular, high-input design supports future site expansion and augmentation

Shoals’ broader BESS offerings include prefabricated wiring systems, disconnect switches, and multi-load break disconnect solutions, designed to improve safety, reduce field variability, and support resilient system operation. These solutions emphasize standardization and repeatability, which are increasingly important as storage deployments scale and projects face workforce, schedule, and long-term maintenance considerations.

Data centers represent an emerging application for Shoals’ DC power and BESS expertise. As data center operators integrate energy storage to support resilience, manage load growth, and mitigate grid constraints, Shoals’ experience in DC power distribution and system-level EBOS design positions the company to address these requirements. In addition to the BESS Recombiner, the company is actively evaluating and developing additional offerings tailored to data center power systems, consistent with its strategy to extend proven EBOS platforms into adjacent mission-critical infrastructure markets.

Sales and Marketing Strategy

On a global scale, demand for renewable energy solutions, energy storage capabilities, and electrical infrastructure continues to grow. In response, we have introduced a suite of products and continue to develop new technologies tailored to meet these evolving needs. We believe our track record as an innovator and leading developer of EBOS technologies positions us to deliver tailored solutions that enhance performance and cost-effectiveness across solar, energy storage, and data center projects. By expanding into new geographic regions, markets, and applications, we aim to strengthen our competitive position and drive long-term growth.

Our value proposition is delivering solutions that simplify installation and lower installation costs, improve safety and reliability, extend asset life, and reduce long-term maintenance costs. We use a range of marketing strategies, including direct marketing campaigns, white papers, independent third-party studies, thought-leadership content, social media, and participation in industry conferences and events.

Our sales process is a highly consultative approach that involves working with developers, engineers, EPCs, subcontractors, and OEM firms. We work collaboratively with all project stakeholders to understand the complexities and goals of each project to ensure continuity throughout the decision-making process. This involves us collaborating on site design, product selection, value engineering and optimization. Our project management team supports the process after a sale is completed by providing the customer submittals for approval, real-time shipping information, and any additional items that may be needed to complete the installation and commissioning. Our customer care continues after a project’s completion, with our team

providing technical and maintenance support for the life of the project. We believe that our consultative top-down and bottom-up approach fosters brand loyalty with all stakeholders and results in customer retention.

We have manufacturing facilities located in Tennessee and Alabama. We have national sales leaders in the United States that are supported by our engineering staff in Tennessee. Internationally, we have sales personnel located in Spain and Australia. Our team in Spain services Europe, Latin-America, and Africa regions while our personnel in Australia supports Asia-Pacific. These sales representatives are supported by our engineering teams in the United States to ensure that we comply with local codes and regulations.

Our Customers

Traditionally, and for the year ended December 31, 2025, we primarily sold our EBOS solutions and OEM components to customers in the United States, while also fulfilling orders for international utility-scale solar projects. Specifically, we primarily sold to engineering, procurement and construction firms (“EPCs”) for use in large solar and BESS projects designed to generate electricity and feed it directly into the electric grid, typically with a generation capacity of 1 megawatt or greater. These EPCs work with owners and developers of solar assets to build energy infrastructure projects. However, given the mission-critical nature of EBOS (as further described below), the decision to use our products typically involves input from both the EPC and the owner/developer of the energy infrastructure energy project.

For the year ended December 31, 2025, our largest customer contributed approximately 19.1% of our total revenue and was one of two customers contributing 10% or greater of total revenue.

Competition

Our offerings are highly specialized and patented products that are specific to the solar industry. The unique expertise required to design EBOS, BESS, data center, and OEM solutions, as well as customers’ reluctance to try unproven products, has confined the number of companies that produce such EBOS, BESS and OEM products to a relatively small number. Our principal competitors include Construction Innovation, Hikam America, Inc., Nextpower Inc. (via acquisition of Bentek), Premier PV, TerraSmart, LLC (formerly SolarBOS, Inc.), and Voltage, LLC. We compete on the basis of product performance and features, installation cost, reliability and duration of product warranty, sales and distribution capabilities, packaging and transportation, and training and customer support, as well as the ability to provide system solutions rather than individual components.

Seasonality

We have experienced seasonal and quarterly fluctuations in the past as a result of seasonal fluctuations in our customers’ business. Our end users’ ability to install energy systems is affected by weather, as installation and construction projects slow during the colder winter months in the U.S. Such installation delays can impact the timing of orders for our products.

Manufacturing

Our manufacturing facilities are located in Tennessee and Alabama. Our Alabama facility is Internation Organization for Standardization 9001:2015 certified. In 2025, we invested substantial capital as part of the process to expand and consolidate our existing Tennessee-based manufacturing and distribution operations to a new, larger facility in Portland, Tennessee. During the second half of 2025, we received a certificate of occupancy, and began to move operations to the new facility.

Research and Development

We continually devote resources to research and development (“R&D”), with the objective of developing innovative new products that reduce the cost and improve the reliability and safety of renewable energy.

Our development strategy is to identify features that bring value to our customers and differentiate us from our competitors. We measure the effectiveness of our R&D using a number of metrics, beginning with a market requirements definition, which includes a program budget, financial payback, resource requirements, and time required to launch the new product, system, or service into the market. We employ a stringent engineering review process that ensures all R&D programs are meeting their stated objectives from inception to deployment.

We have a strong R&D team with significant experience in solar energy as well as expertise in electrical engineering, systems/control engineering and power electronics. As needed, we collaborate with academia, national laboratories, and consultants to further enhance our capabilities and confirm results independently.

Intellectual Property

The success of our business depends, in part, on our ability to maintain and protect our proprietary technologies, information, processes and know-how. We rely primarily on patent, trademark, copyright and trade secret laws in the U.S., confidentiality agreements and procedures and other contractual arrangements to protect our technology. As of December 31, 2025, we had 25 U.S. trademark registrations, 3 pending U.S. trademark applications, 39 issued U.S. patents, 4 issued non-U.S. patents, and 49 global patent applications pending examination. Many of our patents relate to more efficient electrical wiring and power transmission from solar panels to power inverters at solar installations. Our current U.S. issued patents are scheduled to expire from 2031 to 2043. The majority of our issued U.S. patents are not set to expire until 2035 or later. When patents expire, we lose the protection and competitive advantages they provide, which could negatively impact our operating results; however, we continue to pursue further intellectual property protection through U.S. and foreign patent applications, non-disclosure agreements, and under trade secret laws.

The term of individual patents in our portfolio vary, depending on, for example, the date of filing or date of patent issuance and the legal term of the patents in the jurisdictions in which they are obtained. Utility patents issued from U.S. patent applications are generally granted for a term of 20 years from the earliest effective filing date of a non-provisional patent application to which the application claims priority. In certain instances, this term may be adjusted to account for United States Patent and Trademark Office delay. The duration of patents outside of the U.S. varies in accordance with provisions of applicable local law, but typically is also 20 years from the earliest effective filing date. The actual protection afforded by a patent varies on a country-to-country basis and depends upon many factors, including the type of patent, the scope of its coverage, the availability of legal remedies in a particular country, and the validity and enforceability of the patent.

We also rely on trade secrets and seek to protect and maintain the confidentiality of proprietary know-how to protect aspects of our business that are not amenable to, or that we do not consider appropriate for, patent protection. These aspects of our business include proprietary know-how, technology or data that are not covered by patents or patent applications, including technical processes, test equipment designs, algorithms and procedures. Our policy is to require research and development employees to enter into confidentiality and proprietary information agreements with us to address intellectual property protection issues and to assign to us all of the inventions, designs and technologies they develop during the course of employment with us. However, we might not have entered into such agreements with all applicable personnel,

and such agreements might not be self-executing. Moreover, such individuals could breach the terms of such agreements.

We also require our customers and business partners to enter into confidentiality agreements before we disclose any sensitive aspects of our technology or business plans.

Government Regulation

Environmental Laws and Regulations

We are subject to standard environmental, health and safety, and pollution‑control laws and regulations in the jurisdictions where we operate. We do not believe the costs of complying with these requirements will be material to our business or operations. While certain facilities may involve limited use or handling of regulated substances in connection with product development, testing, or manufacturing, these activities are not a significant part of our operations. Any failure to properly manage or address such materials, however limited, could expose us to liabilities, remediation obligations, monetary damages, fines, or operational disruptions.

Government Incentives

Federal, state, local and foreign government bodies provide incentives to owners, end users, distributors and manufacturers of solar energy systems to promote solar electricity. These incentives take the form of rebates, tax credits and other financial incentives such as system performance payments, payments for renewable energy credits associated with renewable energy generation, and either an exclusion of solar energy systems from property tax assessments or a reduction in the property tax rate. The range and duration of these incentives varies widely by geographic market.

The 2022 Inflation Reduction Act (“IRA”) in the U.S. made significant changes to the tax credit regime that applies to solar facilities. The IRA allowed U.S. taxpayers making capital investments in solar projects to claim certain Investment Tax Credits (“TC”) for the installation of these solar projects. The IRA also generally allowed U.S. taxpayers to elect to receive a production tax credit (“PTC”) in lieu of the TC for qualified solar facilities if the construction began before January 1, 2025, among other requirements. In the case of projects placed in service after 2024, each of the TC and PTC was replaced by similar “technology neutral” tax credit incentives that mimic the TC and PTC but also require that projects satisfy a “zero greenhouse gas emissions” standard (which solar does) in order to qualify for the credits.

In 2025, H.R. 1, the One Big Beautiful Bill Act, was enacted into law. H.R.1 modified aspects of the IRA. These changes included a placed in service deadline, for solar and wind projects, of December 31, 2027 and updated compliance requirements under the Foreign Entity of Concern (“FEOC”) provisions of Section 48E of the Internal Revenue Code. Additional guidance around FEOC provisions is still forthcoming and expected to be finalized in 2026. Future federal solar and energy incentives remain uncertain.

Trade Regulation and Import Tariffs

Our business activities are subject to numerous laws and regulations in the jurisdictions in which we operate. Particularly, our exports and imports are subject to complex trade and customs laws, tax requirements and tariffs set by governments through mutual agreements or unilateral actions. Changes in tax policies or trade regulations, the disallowance of tax deductions on imported merchandise, or the imposition of new tariffs on imported products, could have an adverse effect on our business and results of operations.

Our Human Capital and Culture

As of December 31, 2025, we had approximately 1,480 full-time and temporary employees. The vast majority of our employees are located in the United States.

We foster a collaborative, team-oriented culture that values open communication and candor among all our employees. We also focus on listening, learning, and responding to our employees’ concerns to help ensure that we can provide a world-class workplace today and into the future. Our goal is to cultivate a company culture where everyone feels welcomed, valued, treated fairly and respected. We consider these elements crucial to our pursuit of operational excellence and lead to success. We actively seek individuals who share our passion, dedication and entrepreneurial mind set to contribute to a dynamic work environment.

We also encourage our employees to operate by a common set of principles, which includes:

•Responsibility – We integrate quality and safety into everything;

•Integrity – We do the right thing, in the right way, for the right reason;

•Agility – We are quick and flexible at our core;

•Innovation – We lead from the front by simplifying the complex;

•Dedication – We hold ourselves accountable and we never quit; and

•Commitment – We care for people and the planet by investing locally and globally.

We believe that operating with purpose, passion and creativity benefits our customers, stockholders, employees, and suppliers, as well as the communities where we operate and the environment.

None of our employees are represented by a labor union. We have not experienced any employment-related work stoppages, and we consider relations with our employees to be good.

Employee Training and Development

We recognize the benefits that training can have on building and growing our workforce. We encourage our employees to participate in continuing education and to pursue professional certifications.

We encourage our leaders to provide continuous guidance and feedback to our employees. We believe it is the responsibility of every person in a position of leadership – be it a team lead, supervisor, or manager – to serve as a resource and support for each of our team members.

Compensation and Benefits

We provide a comprehensive suite of rewards and benefits. Our benefits program is designed to provide coverage for our employees’ overall health and wellbeing. Our program includes medical and dental coverage, life, and disability insurance. We also offer retirement saving plans through our 401(k) plan, which is available to all full-time employees on their hire date.

Health and Safety

The safety and wellbeing of our employees is at the forefront of everything we do. We strive to have a zero accident culture and our safety management system is built upon that principle. Our occupational health and safety program is designed to drive a proactive safety culture beginning with our management setting the tone for our safety culture and ensuring that everyone feels a sense of ownership for each other’s safety and well-being.

The key to preventing injuries begins with establishing the risk profile in our facilities through effective risk assessment and incident reporting and analysis processes. This process enables the organization to implement proactive safety measures, including ergonomic improvements, behavioral and unsafe condition audits, and near miss reporting and assessments, as leading indicators towards our journey to zero accidents.

Available Information

Shoals files annual reports on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K and amendments of such reports with the Securities and Exchange Commission (“SEC”). Any document Shoals files may be inspected, without charge, at the SEC’s website at http://www.sec.gov. In addition, through our corporate website at www.shoals.com, Shoals provides a hyperlink to a third-party SEC filing website which posts these filings as soon as reasonably practicable, where they can be reviewed without charge. The information found on our website is not a part of this Annual Report on Form 10-K or any other report we file with or furnish to the SEC.