Hyliion Holdings shares surged more than 12% in overnight trading as CEO outlines strategy to power AI data centers with on-site KARNO generators.

CEO Thomas Healy said Hyliion is targeting commercialization of its KARNO generators by the end of the year, with about 10 early-adopter units planned. The company has nearly 750 KARNO cores under signed non-binding letters of intent, representing $400 million of potential revenue at current pricing.

KARNO is a fuel-agnostic linear heat generator that can run on natural gas, diesel, hydrogen, and propane to provide on-site electricity for data centers without relying on the grid. Hyliion acquired the technology from GE Additive in August 2022 for $37 million.

Hyliion is executing approximately $20 million in military contracts with the U.S. Navy's Office of Naval Research and expects to sign $40 million to $50 million in additional military contracts this year. In Q1 2026, the company posted 460% revenue growth at $2.8 million and is targeting about $10 million in full-year revenue.