PSIX

Image source: The Motley Fool. Thursday, Aug. 6, 2026 at 5 p.m. ET Vice President and Corporate Controller - Ken Jenke Interim Chief Executive Officer and Chief Financial Officer - Xun Li Operator: Good afternoon and welcome to Power Solutions International Second Quarter 2026 Earnings Conference Call. [Operator Instructions] As a reminder, this conference is being recorded. I would now like to hand the conference over to Ken Jenke, VP, Corporate Controller, PSI. Sir, please go ahead. Ken Jenke: Good afternoon, and welcome to Power Solutions International's second quarter 2026 earnings conference call. I'm Ken Jenke, Vice President and Corporate Controller. And joining me today is Ken Li, our Interim Chief Executive Officer and Chief Financial Officer. Before we begin, I would like to remind everyone that today's prepared remarks and responses to questions may contain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These statements are based on current expectations and assumptions, speak only as of today and are subject to risks and uncertainties that could cause actual results to differ materially. Important factors include the timing and ultimate conversion of power systems orders into revenue, including data center-related orders, quarterly variability in product mix and the corresponding effect on gross profit and gross margin. The cost, pace, throughput and operational outcomes of capacity ramp-up activities at our Wisconsin operations' ability to execute operational improvement initiatives, the level and persistence of customer demand, including demand conditions in the oil and gas end market, supply chain and component availability, integration of recent acquisitions, including MTL Manufacturing & Equipment, macroeconomic, regulatory and trade conditions, including U.S. tariffs and trade restrictions, changes in management or other personnel and the outcome of pending or threatened litigation and other legal or regulatory matters. Additional information concerning factors that could cause actual results to differ materially is contained in the cautionary language in today's earnings release and in the factors and other cautionary disclosures in our most recent Form 10-K, subsequent 10-Qs and other SEC filings. Those disclosures are incorporated by reference for purposes of today's call and are available in the Investor Relations section of our website and at sec.gov. We undertake no obligation to update any forward-looking statements except as required by law. We will also reference certain non-GAAP financial measures in today's call. EBITDA margin represents EBITDA as a percentage of net sales. A definition of EBITDA and a reconciliation to net income appear in today's earnings release, which is available in the Investor Relations section of our website. With that, I will turn the call over to Ken. Xun Li: Thank you, Ken, and good afternoon, everyone. Thank you for joining us. Before we review the second quarter results, I would like to briefly address the leadership transition we announced on July 27. Richard Hu will become PSI's Chief Executive Officer on August 17. Richard brings more than 25 years of global industrial leadership experience, including 6 years at BorgWarner, most recently as Vice President and General Manager of the Americas region for its Turbo & Thermal Technologies business units, where he led a multi-billion dollar operation and a global team of approximately 3,900 employees across the United States, Mexico and Brazil. We look forward to welcoming him and working with him as PSI continues to execute its strategy. I will continue to serve as Interim Chief Executive Officer until Richard begins and will continue as Chief Financial Officer following the transition. Now, let me turn to our second quarter results. 2Q financials. Before I walk through the detailed financials, I want to briefly run the quarter. On a sequential basis, the second quarter showed a meaningful improvement in several key metrics. Sales of $152.5 million increased 18.6% from the first quarter, and the gross margin improved approximately 420 basis points to 27.1% from 22.9%. The gross margin improvements reflect in part the early benefits of ongoing operational improvement efforts in Wisconsin and was partially offset by unfavorable product mix. The strong operating cash flow also enabled us to reduce total debt by approximately $30.8 million during the quarter. Compared to the second quarter of 2025, net sales reflects the timing of certain power systems shipments and the softened demand in our oil and gas business. Gross margin reflects a lower mix of oil and gas products, together with elevated production costs associated with capacity ramp-up activities at our Wisconsin operations. Year-over-year comparisons in net income were also significantly affected by a nonrecurring $29.2 million, or $1.27 per diluted share, tax benefit in the prior year period, related to the release of a valuation allowance. Demand for our data center power solutions remains strong. Based on our current production schedule, we expect the second half 2026 sales to exceed the first half 2026 sales as larger power systems orders move into production. Although shipment timing and quarterly results may vary. The remainder of our remarks will cover results by end markets, gross margin drivers, operating expenses, cash flow and balance sheet and updates on MTL and our outlook. Net sales for the second quarter of 2026 were $152.5 million, a decrease of $39.4 million, or 21%, compared to the second quarter of 2025. Sequentially, sales increased 18.6% from the first quarter of 2026, exceeding our prior expectation that the second quarter revenue would be generally consistent with the first quarter. The year-over-year decrease was primarily driven by lower sales of $34.6 million in the power systems end markets, $3.0 million in the industrial end markets and $1.7 million in the transportation end markets. Within our power systems end markets, the year-over-year decline primarily reflects the uneven order patterns and the shipment timing for data center-related products, together with continued softness in our oil and gas business. We continue to see strong demand for our data center power solutions, and based on our current production schedule, we expect the second half of 2026 sales to exceed the first half of 2026 sales as larger power systems orders move into production and are recognized as revenue. At the same time, the timing and ultimate volume of revenue recognized from that demand remains subject to customer scheduling, manufacturing flow paths, supply chain factors and other variables, and we are not predicting any specific level of data center revenue in any future period. Gross profit for the second quarter of 2026 was $41.4 million, compared to $54.1 million in the second quarter of 2025. Gross margin was 27.1% in the quarter, compared to 28.2% in the prior year period. On a sequential basis, gross margin improved approximately 420 basis points from 22.9% in the first quarter to 27.1% in the second quarter. The improvements reflect in part the early benefits of our ongoing operational improvement efforts in Wisconsin and was partially offset by unfavorable product mix in the quarter. We are encouraged by that progress. For the first half of 2026, gross margin was 25.2%. I want to be clear about the outlook on gross margin. Our capacity ramp-up activities in Wisconsin are continuing, and we expect elevated production costs to persist. The trajectory of any future sequential improvements will depend on product mix, flow paths and other operational factors. We are not providing a specific gross margin outlook for 2026 at this time. Over the longer term, our goal is to focus on business opportunities that can support gross margin at or around the 25% level. Research and development expenses were $5.1 million in the second quarter, compared to $4.6 million in the prior year period. The increase was primarily driven by higher R&D program expenditures to support new programs in 2026 and the recovery of R&D costs from certain customers in 2025. Selling, general and administrative expenses were $12.1 million in the second quarter, a decrease of $4.6 million, or 27%, compared to the second quarter of 2025. The decrease was primarily attributable to lower compensation expense related to the revaluation of previously awarded stock appreciation rights, as well as lower costs associated with employee incentive programs, partially offset by incremental selling and administrative expenses associated with MTL Manufacturing & Equipment. Total operating expenses were $17.4 million in the quarter. Operating income was $23.9 million compared to $32.5 million in the second quarter of 2025. Interest expense was $1.6 million in the second quarter, compared to $1.7 million in the prior year period, reflecting lower overall effective interest rates. Income tax expense was $5.6 million in the second quarter of 2026, compared to an income tax benefit of $20.1 million in the prior year period. As noted at the outset, the prior year second quarter included a $29.2 million, or $1.27 per diluted share, nonrecurring tax benefit, related to the release of a valuation allowance on deferred tax assets. That one-time benefit is the primary driver of the significant year-over-year difference in net income, and investors should keep that context in mind when reading the year-over-year comparison. Net income was $16.9 million, or $0.73 per diluted share, in the second quarter of 2026, compared to net income of $51.2 million, or $2.22 per diluted share in the second quarter of 2025. On a sequential basis, net income increased $9.6 million and diluted earnings per share more than doubled from the first quarter. EBITDA for the second quarter was $25.7 million, compared to $34.1 million in the prior year period. EBITDA margin was 16.9% compared to 17.8% in the prior year period. On a sequential basis, EBITDA nearly doubled from $13.2 million in the first quarter, while EBITDA margin improved 670 basis points from 10.2% to 16.9%. The sequential increase reflects the higher sales and gross profit in the second quarter, together with lower operating expenses. Turning to cash flow, we generated $56.6 million of operating cash flow in the second quarter, compared to $20.2 million in the prior year period. For the first half of 2026, operating cash flow was $75.7 million, compared to $25.5 million in the first half of 2025, with favorable working capital movements and operational improvements contributing to the year-over-year increase. Capital expenditures were $0.8 million in the second quarter and $2.7 million for the first half of the year. Strong cash flow enabled us to reduce total debt by approximately $30.8 million during the quarter. We ended the second quarter with $70.1 million in cash and cash equivalents, and the total debt of approximately $72.6 million, including a $65 million drawn on our revolving credit facility. Total debt was approximately $103.4 million as of March 31, 2026. As of December 31, 2025, cash and cash equivalents were $41.3 million, and total debt was approximately $96.6 million. Our balance sheet is solid, and we believe our current liquidity position is sufficient to meet our anticipated cash needs. MTL updates. On January 9, 2026, we acquired MTL Manufacturing & Equipment Inc. MTL's operations contributed positively to our consolidated net income in the second quarter. The acquisition expanded PSI's vertical integration by adding in-house manufacturing capabilities for components used in power generation products, including fuel tanks and enclosure assemblies. We believe these capabilities will enhance supply chain control and manufacturing flexibility and support our future growth. 2026 outlook. Given ongoing variability in order timing and market conditions, we are not providing formal full-year guidance at this time. Based on our current production schedule and information available as of today, we expect the second half 2026 sales to exceed the first half 2026 sales and to be approximately in line with sales in the second half of 2025 as larger power systems orders move into production and are recognized as revenue. The timing and ultimate volume of these shipments remain subject to customer scheduling, manufacturing flow paths, supply chain factors and other variables, and there can be no assurance that those orders will translate to a uniformly strong second half. Continued softness in oil and gas end markets is expected to weigh on quarterly revenue trends. Capacity ramp-up activities at our Wisconsin operations, and the related cost effects on gross margin are expected to continue. Key takeaways. Let me close our prepared remarks with 3 key takeaways from the second quarter. First, we delivered a meaningful sequential improvement in revenue and gross margin with sales up 18.6% from the first quarter and gross margin improved approximately 420 basis points. The gross margin improvements reflect in part the early benefits of our ongoing operational improvement efforts in Wisconsin, although capacity ramp-up activities and related costs continue. Second, our financial position is stronger. Operating cash flow of $56.6 million in the quarter enabled us to reduce total debt by approximately $30.8 million. We ended the quarter with roughly balanced cash and debt and increased financial flexibility to support our growth. Third, demand for our data center power solutions remains strong. Based on our current production schedule, we expect the second half of 2026 sales to exceed the first half of 2026 sales as larger power system orders move into production. Although shipment timing and quarterly results may vary, we remain focused on operational execution and converting that demand into revenue. With that, operator, we are ready to open the line for questions. Operator: [Operator Instructions] Our first question comes from the line of Eric Stine with Craig-Hallum Capital Group. Eric Stine: So maybe we could just talk a little bit more in depth about Q2. I mean, clearly it came in ahead of your internal projections. So maybe some clarity, because you still got softness in oil and gas, how far you are through the ramp in the enclosure business? And I would guess that goes hand in hand with the gross margin improvement, which -- this is a level that we haven't seen in several quarters and is a level that you achieved back when oil and gas was strong, and it's your highest margin business. So I'm just trying to get my arms around how that improvement came about in Q2, both revenues and margins. Xun Li: Yes. Eric, thanks for the question. So if you compare the Q2 sales, $152 million versus Q1, $128 million, the total increase is about $24 million. And I would say most of the increase is from the power systems. And definitely the Wisconsin operation increased the production and the sales. And if you look back at the past performance, we started to have some challenge headwind on Wisconsin operations second half last year. And our gross margin in 3Q last year was like 23.9% and 4Q last year, 21.9%. And the 1Q, we made improvement, 22.9%. So since then, we implemented various operation improvement initiatives in Wisconsin, and we see improvements in productivity, efficiency, flow paths and also material availability, which enable us to increase the production and also sales for enclosures. And also, when we produce more, it has positive impacts on the fixed cost absorption. So definitely, Wisconsin gross margin is also improving. So all of these together helped us to deliver a quite improvement in the second quarter. But going forward, we continue to see, I would say, softness in the oil and gas. We're not seeing any sign for significant improvement. But we do have some larger custom orders for the AI data center product. And the team is working on transforming the order into production and sales. So we expect the second half sales will exceed the first half. And our internal expectation is the second half will be consistent with the second half last year. But our sales team is working closely with our customer to generate more sales initiatives, and operation team is working with supply chain to make sure on-time delivery and material availability. So we are doing our best to increase or improve sales in the second half, and we try to exceed our expectation. Eric Stine: And then maybe, I guess, for my follow-up, just more on the competitive front in that data center enclosure business. And frankly, this is a question that I've been getting increasingly from investors, shareholders and not. And that is -- so I know that you got Generac, and they're using the Baudouin engines, and clearly that's a Weichai engine, but you got PSI also uses a Weichai engine. So I'm just kind of curious if you can speak to the differences between what is being used by you and your competitors in terms of size, price and performance. And I am also curious what that means for your future product roadmap. Xun Li: Yes, we serve different customers, right? Weichai engine, the Baudouin, they sell the engine gensets to Generac, and we sell to a different customer. And I -- frankly, I'm not so clear which type of engine gensets they sell to Generac, but I think there's some difference. And we deal with different customers. We work with our customers very closely. As you might know, there's some trend change on the AI data center power system. Historically, the data center used the utility grid plus the diesel genset as standby. And right now, the trend is more towards using gas gensets for prime and use the diesel for standby and the battery for instantaneous response. So we focus on our product development and serve our customer needs. Eric Stine: Okay. So -- I mean, so these are different engines or different sizes or I mean, just maybe -- if there's a way to just kind of get my arms around that a little bit, but... Xun Li: Yes. I think with the diesel gensets, maybe it's similar, and -- but we are also working on potentially gas gensets. And we have different customers. They sell to Generac. We sell to a different customer. So I don't think we're in the direct competition. And based on our meeting with our customer, we see a strong demand for our products for this year and also for next year. Eric Stine: Okay. I guess, I'll just take the rest of this offline. Operator: [Operator Instructions] Our next question comes from the line of Alan Lau with Jefferies. Alan Lau: Congratulations on the great results in the second quarter. I would like to follow up on the previous question. I wonder if there's any guidance into 2027, especially given that we are in the second half of 2026, and there seems to be progress in gas engines as well. So I wonder if there's any color into 2027. Yes. Xun Li: Thank you, Alan, for the question. So, Alan, we are not providing formal guidance for the sales outlook for '26 or '27. But as you know, our part is serving the mission-critical AI data center, and the capacity for the power system for the data center is constrained. So there's a high demand for the system -- power system, which is reliable, emission-certified, and also scalable power system. So what I can see is we have high demand of our products for 2026. And our sales team is working closely with our customer to secure more orders for 2027. And the demand for our product, remember, is strong. And after we get more visibility for the 2027 sales information, and we will share with all investors, maybe in 4Q. Alan Lau: So my follow-up question would be -- so the margins of the second quarter have significantly improved. So we'd like to know, how would you comment on the drag from oil and gas? Because the -- in your previous remarks, it seems that the growth in data center-related products are partially offset by oil and gas. And I wonder if you would call this bottoming, or how would you describe the trends in oil and gas segment? Xun Li: Yes. The oil and gas market still remains soft. In our current forecast, we assume that the softness will continue at least for this year, right? And the oil and gas products usually carry a relatively high gross margin for our products. And definitely, we grow our sales for the data center business and offsets the sales drop from oil and gas. So for this quarter, we still see quarter-by-quarter sales growth. And I will say, we are still -- we are not providing a very detailed quantitative outlook, but we still think the second half sales definitely will exceed the first half sales. And our internal expectation is the second half will be consistent with the second half we had last year. Alan Lau: We'll take this offline. Operator: [Operator Instructions] Our next question will come from the line of Dilyara Sailaubayeva with Freedom Finance Global. Dilyara Sailaubayeva: I just would like to know some updates on Wisconsin. Like, do you currently have enough capacity in Wisconsin to support the expected data center ramp? Or would additional capacity expansion be needed if demand continues to grow into 2027? Xun Li: Okay, thank you. So, for Wisconsin, definitely I say we're making measurable improvements, right? So that's the reason we see the sales growth and also gross margin improvements. And the team put up lots of resources, adding people and also implemented some process improvement initiatives, and we added capacity. In Wisconsin, previously, we had about 150,000 square feet, right? Now, it's about 800,000 square feet. And what I can see now is, at the current capacity, we can support the current demand, and for next year, as needed, definitely, we can spend the capital to increase more capacity to serve our customers. And what I see is, over the past several months, the team did a great job, improved lots of different areas, the labor efficiency, the cost structure and also the material availability. And going forward, I will continue to expect the team to deliver more process improvements in Wisconsin, right? Dilyara Sailaubayeva: Okay. So just to follow up on that. So given the sequential improvement in gross margins, how should investors think about the normalized gross margin potential of the business once your Wisconsin operations stabilize? Xun Li: Yes, we saw pretty significant gross margin improvements in 2Q. And as you know, there are many things that could impact the quarterly gross margin. It could be impacted by mix, pricing and variable efficiency, fixed cost absorption, all these kinds of things. And if you see our year-to-date, the gross margin is 25.2%. And we will continue to make process improvements in Wisconsin. And also, hopefully, we can have favorable mix for the remainder of the year. I will not give you a specific number for the outlook, but I will say, in the longer term, our business goal is to have a gross margin at a 25% range. Operator: Thank you, and I would now like to hand the conference back over to Kenneth Li for closing remarks. Xun Li: Okay. I just want to thank everyone who joined the call today, and I appreciate your continued interest in PSI. And we look forward to giving you another update for the next quarter's meeting. Thank you. Operator: This concludes today's conference call. Thank you for participating, and you may now disconnect. Everyone have a great day. Before you buy stock in Power Solutions International, consider this: The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and Power Solutions International wasn’t one of them. The 10 stocks that made the cut could produce monster returns in the coming years. Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you’d have $400,209!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you’d have $1,375,393!* Now, it’s worth noting Stock Advisor’s total average return is 964% — a market-crushing outperformance compared to 215% for the S&P 500. Don't miss the latest top 10 list, available with Stock Advisor, and join an investing community built by individual investors for individual investors. See the 10 stocks » *Stock Advisor returns as of August 13, 2026. This article is a transcript of this conference call produced for The Motley Fool. While we strive for our Foolish Best, there may be errors, omissions, or inaccuracies in this transcript. As with all our articles, The Motley Fool does not assume any responsibility for your use of this content, and we strongly encourage you to do your own research, including listening to the call yourself and reading the company's SEC filings. Please see our Terms and Conditions for additional details, including our Obligatory Capitalized Disclaimers of Liability. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. Power Solutions International (PSIX) Q2 2026 Earnings Call Transcript was originally published by The Motley Fool

Solaris Energy Infrastructure, Inc. SEI reported second-quarter 2026 adjusted earnings of 39 cents per share, up 14.7% year over year, and beat the Zacks Consensus Estimate of 31 cents by 25.81%. The outperformance was driven by the exceptional results of the Power Solutions segment. Revenues of $219 million increased 47% year over year and topped the consensus estimate of $198 million by 10.78%, driven by higher leasing and service revenues. The company’s leasing and service revenues increased 70.8% and 30% year over year, respectively. Solaris Energy Infrastructure, Inc. price-consensus-eps-surprise-chart | Solaris Energy Infrastructure, Inc. Quote Net income reported by SEI was $25.2 million in the quarter. On a non-GAAP basis, adjusted EBITDA was $108.3 million, up from $60.6 million in the year-ago period, driven primarily by higher Power Solutions activity levels and a lift in Logistics profitability. On Aug. 4, 2026, the company’s board of directors approved a third-quarter 2026 dividend of 12 cents per share, payable on Sept. 25 to its shareholders of record as of Sept. 15. Solaris Power Solutions:Power Solutions revenues increased to $158.3 million compared with $75.6 million in the year-ago period. Capacity earning revenues in the segment averaged 950 MW during the quarter. Adjusted EBITDA from the segment increased to $96.4 million, driven by increased ancillary service revenues. Solaris Logistics Solutions: Logistics Solutions delivered revenues of $61 million, decreasing 17.2% from the year-ago period. Adjusted EBITDA from the segment increased year over year to $24.7 million, driven by increased system activity and a more favorable project mix. Solaris Energy expanded three long-term contracts that are expected to add more than $100 million of annual adjusted EBITDA. The expanded Hatchbo agreement now covers a turnkey, roughly 660-MW power plant, including balance-of-plant equipment, batteries and operating services. The contract term was extended to as long as 18 years, and revenues are expected to begin in January 2027. SEI also broadened the scope of its April 2026 agreement with a global technology customer to include balance of plant, energy storage and natural gas procurement and management. Separately, a large energy customer increased contracted microgrid capacity to about 80 MW from 60 MW and extended the agreement to six years from four years. The acquisition of Global Energy Services Alliance, or GESA, expands SEI’s installation, commissioning, operations, maintenance and aftermarket capabilities. GESA added more than 600 skilled employees and brings project experience spanning more than 30 countries. Management sees the acquisition as a way to improve project execution while expanding third-party service opportunities. Solaris Energy also has approximately 800 MW of open capacity with relatively near-term delivery timelines and said it is in advanced discussions with multiple customers regarding long-term deployments. For the third quarter of 2026, the Zacks Rank #5 (Strong Sell) company raised adjusted EBITDA guidance to $90-$105 million from $80-$95 million previously, and established fourth-quarter adjusted EBITDA guidance of $100-$120 million. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here. At quarter-end, Cash and cash equivalents attributable to Solaris Energy were $888.5 million, while long-term debt attributable to SEI (net of current portion) was $1.6 billion, with a debt-to-capitalization of 58%. During the quarter, the company completed an inaugural $1.3 billion senior, unsecured notes offering and secured a new, undrawn $650 million credit facility. While we have discussed SEI’s second-quarter results in detail, let’s see how some other oilfield service companies have fared this earnings season. NOV Inc. NOV reported second-quarter 2026 adjusted earnings of 31 cents per share, which beat the Zacks Consensus Estimate of 16 cents. The bottom line also increased 6.9% from the year-ago quarter’s 29 cents, driven by outperformance of the Energy Equipment segment. The oil and gas equipment and services company’s total revenues of $2.1 billion beat the Zacks Consensus Estimate by $39 million. However, NOV’s revenues fell 2.5% from the year-ago quarter’s figure of $2.2 billion due to lower year-over-year revenues from the Energy Products and Services segment. As of June 30, 2026, the backlog for Energy Equipment capital orders was $4.1 billion, reflecting a $220 million decrease from the prior year. Liberty Energy Inc. LBRT reported a second-quarter 2026 adjusted net profit of 9 cents per share, beating the Zacks Consensus Estimate of 7 cents. The outperformance was driven by the company’s focus on AI-driven technology advancements and strong operational execution. However, the bottom line decreased from the year-ago quarter’s profit of 12 cents due to increased year-over-year costs and expenses. LBRT's revenues totaled $1.2 billion, which beat the Zacks Consensus Estimate of $1.1 billion. The top line also increased from the prior-year quarter’s $1 billion by 14%, supported by record utilization and a modest pricing uplift along with higher product sales. As of June 30, Liberty Energy had approximately $555.4 million in cash and cash equivalents. The pressure pumper’s long-term debt of $1.3 billion represented a debt-to-capitalization of 39.5%. Further, the company’s total liquidity, including availability under the credit facility, amounted to $1 billion. Oceaneering International, Inc. OII reported second-quarter 2026 earnings of 65 cents per share, up from 54 cents in the year-ago quarter. Higher year-over-year operating income from the company's Subsea Robotics, Manufactured Products, Offshore Projects Group and Aerospace and Defense Technologies segments contributed to this improvement. Total revenues of $768.2 million increased approximately 10% from the year-ago quarter’s $698.2 million. This increase reflected revenue growth across all segments except Integrity Management & Digital Solutions. As of June 30, 2026, OII had cash and cash equivalents worth $629.5 million and $688.9 million, respectively, along with a long-term debt of about $490.2 million. The debt-to-capitalization was 29.6%. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Solaris Energy Infrastructure, Inc. (SEI) : Free Stock Analysis Report NOV Inc. (NOV) : Free Stock Analysis Report Oceaneering International, Inc. (OII) : Free Stock Analysis Report Liberty Energy Inc. (LBRT) : Free Stock Analysis Report This article originally published on Zacks Investment Research (zacks.com). Zacks Investment Research

This article first appeared on GuruFocus. Revenue: EUR4.7 billion, an increase of 26% year-on-year, driven by strong growth in Power Solutions of 37%. EBIT Margin: 9.4%, a strong profitability improvement driven by both onshore and offshore. Earnings Per Share (EPS): EUR1.1 per share, growing 46% year-on-year. Order Intake: 3.3 gigawatts, an increase of 67% year-on-year, driven by commercial traction in both EMEA and the Americas. Power Solutions Revenue: Increased by 37% year-on-year, driven mainly by higher megawatt delivered in both onshore and offshore. Power Solutions EBIT Margin: 10.4% in Q2, up more than 10 percentage points year-on-year. Service Revenue: Decreased by 5% year-on-year, including a 1% currency headwind. Service EBIT: EUR149 million, equivalent to an EBIT margin of 16.6%. SG&A Costs: Amounted to 7% of revenue on a last 12-month basis, an improvement of 0.4 percentage points compared to a year ago. Net Working Capital: Negative EUR2.3 billion, as a percentage of last 12 months revenue, amounted to negative 11.1%. Operating Cash Flow: Positive by EUR419 million in the quarter, a significant improvement compared to Q2 in prior year. Adjusted Free Cash Flow: EUR94 million in the quarter, an improvement compared to last year. Net Cash Position: EUR92 million at the end of the quarter. Warranty Costs: EUR141 million in the quarter, corresponding to 3% of revenue. Share Buyback: New share buyback of EUR400 million, beginning August 13 and running until the end of the year. Outlook: Revenue kept at EUR20 billion to EUR22 billion; EBIT margin guidance raised to 7% to 9% from 6% to 8%. Warning! GuruFocus has detected 4 Warning Signs with VWDRY. Is VWDRY fairly valued? Test your thesis with our free DCF calculator. Release Date: August 12, 2026 For the complete transcript of the earnings call, please refer to the full earnings call transcript. Strong revenue growth of 26% year-on-year, driven by a 37% increase in Power Solutions. EBIT margin improved significantly to 9.4%, up nearly 8 percentage points year-on-year. Order intake surged 67% year-on-year to 3.3 GW, with strong commercial traction in EMEA and the Americas. Raised full-year EBIT margin guidance to 7%-9% from 6%-8%, reflecting strong Q2 performance and improved visibility. Announced a new EUR400 million share buyback program, returning cash to shareholders. Service revenue decreased by 5% year-on-year, partly due to a 1% currency headwind. Warranty costs remain elevated at EUR141 million, corresponding to 3% of revenue. The TRIR safety metric worsened to 2.9 from 2.6, indicating increased workplace injuries. Offshore business is still loss-making, with profitability expected only in 2027. Geopolitical and trade volatility, including tariffs, continue to create an uncertain environment. Q: Can you provide more color on the strength of the momentum in the offshore business, given the strong Q2 performance and the expectation that it could turn to a black number in 2027?A: Henrik Andersen (Group President & CEO) stated that while he cannot provide specific guidance for 2027, the company expects offshore to be profitable next year. The improvement is driven by the ramp-up in manufacturing, reduced takt times, better efficiency, and improved installation times. He emphasized that the scale of operations is reducing marginal costs and that the team is executing well, which is a key reason for raising the 2026 guidance. Q: The Q2 Power Solutions margin was exceptionally strong. Can you explain what drove this performance and whether it is sustainable into the second half of the year?A: Henrik Andersen (Group President & CEO) attributed the strong 10.4% EBIT margin to outstanding project execution, lower-than-expected project costs, and a favorable mix of projects in markets where Vestas has deep experience. He cautioned that Q2 was an exceptional quarter and that the second half will not be as back-loaded as in previous years, partly due to the growing offshore business, which has a more even quarterly distribution. The raised guidance of 7% to 9% reflects the best current estimate for the full year. Q: Given the strong H1 performance, the upper end of the new guidance implies only modest margin expansion for the rest of the year. Are you being overly cautious?A: Henrik Andersen (Group President & CEO) explained that the guidance reflects the non-linear nature of project execution. While Q2 benefited from exceptional execution and some one-off positive cost factors, the company sees more risk in the H2 project mix. He noted that the pricing on some projects scheduled for Q3 and Q4 is not as high as in Q2, and that a single negative event on a large project could impact results. He reiterated that the 7% to 9% guidance is a solid outcome and that the company will strive to do better. Q: Can you give an indication of the onshore and offshore margin split within Power Solutions, and how much of the guidance upgrade is driven by each?A: Henrik Andersen (Group President & CEO) declined to provide a specific breakdown, but confirmed that both onshore and offshore contributed positively to the strong Q2 performance. He reiterated that offshore is expected to be loss-making for the full year 2026 but should turn profitable in 2027. The positive momentum in both segments is a key reason for the raised guidance. Q: What is driving the lower-than-expected project costs in the quarter? Is this a broad trend or project-specific?A: Henrik Andersen (Group President & CEO) stated that the lower costs are due to normal project factors coming together well, including no delays, full site access, and the availability of assets and cranes. The company is also benefiting from executing in markets with very experienced operators. While there are always some one-offs, the overall execution was exceptionally clean in Q2. Q: Can you update us on the blade incident at the He Dreiht offshore wind project and any financial implications?A: Henrik Andersen (Group President & CEO) confirmed an incident occurred on July 22, but no one was hurt and debris was contained with the help of the German coast guard. The company is conducting a root cause analysis. He noted that the final turbine (number 64) was completed on Saturday, and the remaining part of the damaged blade will be removed. He declined to provide further details, citing partnership confidentiality, but emphasized the professional handling of the situation. Q: You announced a larger EUR400 million share buyback covering two quarters. Does this signal better visibility on future results and cash flow?A: Jakob Wegge-Larsen (CFO) clarified that the decision is based on the strong first-half performance and improved visibility into the second half. The EUR400 million program, combined with previous buybacks, brings the total to EUR650 million for the year, consistent with the company's policy of returning at least 40% of net profit to shareholders. Q: Where are you in the Service recovery plan, and when will the cost takeout start translating into higher margins?A: Jakob Wegge-Larsen (CFO) stated that the recovery plan is on track and delivering as expected on both cost and commercial fronts. There are two more quarters of the recovery plan ahead, and the company will discuss the outlook for 2027 in the Q4 call. Henrik Andersen (Group President & CEO) added that the long-term ambition for Service remains a 25% EBIT margin, but it will take time to complete the recovery and achieve that target. Q: Are you seeing any signs of pent-up demand being released in the US market, given the recent court rulings on permitting and the tariff backdrop?A: Henrik Andersen (Group President & CEO) said the underlying demand and fundamentals in the US are very strong, with offtakers ready to sign immediately when projects get approved. He noted that a recent court ruling on permitting is positive and could accelerate activity. While some uncertainties like Section 232 remain, the company is confident in its ability to navigate the challenges. Q: How are you managing inflation and rising raw material costs, and what does this mean for pricing?A: Jakob Wegge-Larsen (CFO) explained that Vestas has learned from history and now locks in costs for firm projects, either through contractual risk-sharing with customers or by hedging through treasury and procurement tools. This approach ensures the company is better protected against inflation and raw material price changes than in the past. For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Atmus Filtration Technologies Inc. reported past second-quarter 2026 results with record sales of US$527.9 million and net income of US$63.9 million, and raised its full-year 2026 net sales guidance to a range of US$1.98 billion to US$2.03 billion. The quarter highlighted the contribution from the Koch Filter acquisition and Power Solutions growth, alongside active capital returns through share repurchases and dividends while the company continued to integrate Koch Filter and pursue industrial filtration expansion. We’ll now examine how the raised full-year guidance and Koch Filter-driven growth affect Atmus Filtration Technologies’ broader investment narrative. Invest in the nuclear renaissance through our list of 89 elite nuclear energy infrastructure plays powering the global AI revolution. To own Atmus, you generally need to believe its filtration know‑how can stay relevant as engines and industrial needs change, while it gradually reduces dependence on Cummins and the internal combustion aftermarket. The latest record quarter and raised 2026 sales guidance support the near term catalyst around Koch Filter and Power Solutions growth, but do not remove the longer term risk that structurally lower replacement rates and electrification could weigh on its core aftermarket exposure. The most relevant recent announcement here is Atmus raising its full year 2026 net sales outlook to US$1.98 billion to US$2.03 billion, following record Q2 revenue of US$527.9 million. That update ties directly into the nearer term catalyst of Koch Filter driven industrial filtration expansion and Power Solutions momentum, which management is using to offset a weaker U.S. first fit market and uncertainty around emissions and tariff policies. Yet, against this stronger guidance, investors should be aware that high aftermarket dependence still leaves Atmus exposed if replacement cycles shorten and electrification accelerates... Read the full narrative on Atmus Filtration Technologies (it's free!) Atmus Filtration Technologies' narrative projects $2.2 billion revenue and $295.2 million earnings by 2029. Uncover how Atmus Filtration Technologies' forecasts yield a $66.40 fair value, a 30% upside to its current price. Four fair value estimates from the Simply Wall St Community currently span roughly US$35 to US$72 per share, showing how differently individual investors are sizing up Atmus. When you set those views against the company’s raised 2026 sales guidance and the ongoing risk from a potentially shrinking engine replacement aftermarket, it underlines why checking several perspectives on the stock’s prospects can be useful. Explore 4 other fair value estimates on Atmus Filtration Technologies - why the stock might be worth 32% less than the current price! Don't just follow the ticker - dig into the data and build a conviction that's truly your own. A great starting point for your Atmus Filtration Technologies research is our analysis highlighting 3 key rewards and 2 important warning signs that could impact your investment decision. Our free Atmus Filtration Technologies research report provides a comprehensive fundamental analysis summarized in a single visual - the Snowflake - making it easy to evaluate Atmus Filtration Technologies' overall financial health at a glance. The market won't wait. These fast-moving stocks are hot now. Grab the list before they run: The future of work is here. Discover the 36 top robotics and automation stocks leading the charge in AI-driven automation and industrial transformation. Find 51 companies with promising cash flow potential yet trading below their fair value. Uncover the next big thing with 20 elite penny stocks that balance risk and reward. This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned. Companies discussed in this article include ATMU. Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email [email protected]

Our analysts just identified a stock with the potential to be the next Nvidia. Tell us how you invest and we'll show you why it's our #1 pick. Tap here. Performance in Q2 was characterized by a significant sequential recovery, with revenue growing 18.6% and gross margins expanding 420 basis points compared to Q1 2026. The margin expansion was primarily driven by the early benefits of operational improvement initiatives at the Wisconsin facility, which enhanced productivity, efficiency, and material availability. Management attributed the year-over-year revenue decline to uneven order patterns and shipment timing for data center products, alongside persistent softness in the oil and gas sector. Strategic vertical integration through the MTL acquisition is already contributing positively to net income by providing in-house manufacturing for fuel tanks and enclosures. The company is navigating a shift in the data center market where customers are increasingly moving toward gas gensets for prime power and diesel for standby. Strong operating cash flow of $56.6 million enabled a $30.8 million debt reduction, resulting in a nearly balanced cash-to-debt position. Management expects second-half 2026 sales to exceed first-half levels as larger power systems orders move into production and revenue recognition. The company projects second-half revenue to be approximately in line with the second half of 2025, though timing remains subject to customer scheduling and supply chain variables. Elevated production costs related to the Wisconsin capacity ramp-up are expected to persist through the remainder of the year. Long-term strategic goals target a normalized gross margin at or around the 25% level, contingent on product mix and operational stabilization. The company anticipates continued softness in the high-margin oil and gas end market for the duration of 2026, which will act as a headwind to overall revenue trends. A non-recurring $29.2 million tax benefit in the prior year period (Q2 2025) created a difficult year-over-year net income comparison. The company announced a leadership transition with Richard Hu set to become CEO on August 17, 2026, bringing 25 years of industrial experience. Wisconsin manufacturing footprint has expanded significantly from 150,000 square feet to approximately 800,000 square feet to support data center demand. SG&A expenses decreased 27% year-over-year, largely due to the revaluation of stock appreciation rights and lower incentive program costs. One stock. Nvidia-level potential. 30M+ investors trust Moby to find it first. Get the pick. Tap here. Management noted that most of the $24 million sequential revenue increase came from power systems and the Wisconsin operations. Improved fixed cost absorption and better flow paths in Wisconsin were cited as the primary catalysts for the 420 basis point margin jump. Management clarified that while competitors may use similar engines, PSI serves different customer segments and is not in direct competition with certain major peers. The company is focusing on the trend toward gas gensets for prime power in AI data centers to differentiate its product roadmap. Current capacity at the 800,000 square foot Wisconsin facility is sufficient for present demand, but management is prepared to expand capital expenditure for more capacity in 2027 if needed. Visibility for 2027 orders is currently being secured by the sales team, with more detailed information expected in the fourth quarter.

This article first appeared on GuruFocus. Release Date: August 07, 2026 For the complete transcript of the earnings call, please refer to the full earnings call transcript. Record second-quarter sales of $528 million, up 16.4% year-over-year, driven by the Cook Filter acquisition and strong Power Solutions performance. Adjusted EBITDA reached $109 million (20.7% margin), with adjusted EPS of $0.82 and strong free cash flow of $67 million. Successful integration of Cook Filter, with over 95% of transition services agreements exited and completion expected in Q3, positioning for growth in industrial filtration. Continued market share gains in both aftermarket and first fit, supported by the multi-channel distribution strategy and improved on-shelf availability. Positive outlook for Power Solutions with expected volume growth of flat to 2%, pricing tailwinds of 1.5%, and favorable FX of 2%, leading to revenue growth of ~4.5% at the midpoint. Strong balance sheet with net debt to adjusted EBITDA of 1.9x, allowing for balanced capital allocation including share repurchases and debt reduction. Aftermarket conditions remain flat year-over-year, with subdued demand in Europe, Middle East, and Asia Pacific outside China, despite improving US sentiment. Ongoing Middle East conflict is driving inflationary pressures on raw materials (chemicals, plastics) and negatively impacting joint venture income, particularly in India. Second-half margins are expected to soften due to moderating pricing, higher commodity costs, and weaker JV income, leading to a narrowed EBITDA margin guidance of 19.75%-20.25%. Industrial Solutions segment EBITDA margin declined sequentially to 18.9% due to one-time operational inefficiencies and redundant expenses from TSA transition. Tariff-related pricing rollbacks and an immaterial amount of tariff refunds received create uncertainty, with net tariff impact expected to be substantially neutral but requiring ongoing management. First fit market recovery is only beginning, with customers indicating a stronger second half, but the company has yet to see a significant inflection in freight activity. Warning! GuruFocus has detected 6 Warning Signs with MSIF. Is ATMU fairly valued? Test your thesis with our free DCF calculator. Q: Could you discuss how aftermarket and first-fit revenues performed in the quarter and give an estimate for how much share gains contributed in Power Solutions?A: Steph Fisher, CEO: In Power Solutions, we delivered revenue growth of 7.1%, broken down between 3% price, 2% volume, and 2% FX. Aftermarket conditions remain flattish globally, with stronger sentiment in the US and Mexico but subdued conditions in Europe, the Middle East, and Asia Pacific outside China. We continue to deliver strong share gains within our 1% to 2% outlook. In first-fit, we started to see the anticipated cyclical recovery in the second quarter, with a balanced performance between market improvement and share gains through our "winning with the winners" strategy. Q: Could we get an updated view on price-cost expectations for the year, and is 2% price the right way to think about it for the full year?A: Jack Hinsler, CFO: We saw good price realization through the first half at just over 2%, but our full-year guide is 1.5%, reflecting a mix of carryover pricing and anticipated moderating price realization in the third and fourth quarters. We continue to see some elevation in our cost base associated with commodities, largely driven by the ongoing Middle East conflict, which is the biggest headwind embedded in our second-half outlook. This, along with lower joint venture income from India, contributes to the implied softening in second-half margins compared to the first half. Q: Did you catch up on any of the lost sales from the first quarter related to the Middle East, and what's embedded in the guide for the second half?A: Steph Fisher, CEO: We didn't fully catch up the Middle East in the second quarter as the conflict is ongoing. We're still seeing underperformance in our Middle East business driven by market conditions, and we anticipate it recovering into the second half. It's a smaller proportion of our business at about 2% of overall revenues. We're also seeing subdued conditions in Europe that may be related to the conflict, and challenges in our India business through the joint venture line. Q: Can you confirm there's no tariff refunds in second-quarter results, and how much of a drag is the rollback of tariff pricing in the second half?A: Jack Hinsler, CFO: As of the end of the second quarter of 2026, we received an immaterial amount of tariff refunds. We continue to expect the net impact on EBITDA from a tariff perspective to be substantially neutral. Our strategy remains unchanged: availing ourselves of exemptions, optimizing our supply chain, and passing on the impact through pricing. From a pricing perspective, it's hard to parse out given the moving pieces, but price realization is moderating in the third and fourth quarters to just over 0.5% compared to prior year periods. Q: Is the Industrial Solutions quarterly sales run rate versus Cook Filter's 2025 flows a good overlay, and is there any seasonality to consider?A: Steph Fisher, CEO: Industrial Solutions is performing right where we would expect it. We've talked about 1% price, 1% to 2% market share, and overall market impact closely linked to GDP at around 3%. The guide remains at $155 to $165 million for the full year, and we think it's pretty steady over the quarters without any specific cyclicality. We're confident and pleased with the ongoing performance relative to our original business case assumptions. Q: Can you provide an update on the Cook Filter integration and speak to some of the exciting growth initiatives for Industrial Solutions?A: Jack Hinsler, CFO: We're through about 95% of the transition services agreements and plan to fully exit those in the third quarter. We're very excited about the growth prospects for the business, including cultivating new market share opportunities through distributor relationships, launching new products to fill coverage gaps, and exposing the business to high-growth end markets such as data centers and healthcare. The team has a lot of energy around complementing the strong attributes Cook Filter brings to the table. Q: You narrowed the EBITDA margin guide with the top end coming down by 25 basis points. Is that because first-fit expectations are now better, creating a mix headwind?A: Jack Hinsler, CFO: We've seen strong operational execution through the first half with year-to-date margins at about 20.3%. The guidance implies more favorability in the first half from pricing and FX than in the second half. We expect the ancillary effects of the Middle East conflict to persist longer than anticipated, driving inflationary pressures on raw materials like chemicals and plastics. We also lowered our joint venture income outlook due to the conflict impacting India. There is a little bit of a mix dynamic with strengthening first-fit relative to aftermarket, but it's a combination of factors. Q: The Industrial Solutions EBITDA margin was sequentially down almost 200 basis points. Is that seasonality, and how should we think about the back half?A: Jack Hinsler, CFO: Year-to-date margin performance is about 20%, which continues to be our guide for the third and fourth quarters. The second-quarter sequential step down to 18.9% was driven by some one-off impacts that caused inefficiencies, including operational efficiencies as volumes moved around and some redundant expenses associated with the transition off the TSA. We expect these to be one-time and not repeating in nature, and we remain confident in our full-year guide for that business. Q: How have your expectations for the North America truck aftermarket changed from the beginning of the year, and what are you seeing currently?A: Steph Fisher, CEO: Our guide remains the same as we came out from a market perspective on aftermarket in the US. We're reading improving sentiment, which gives us optimism, but we are not yet seeing that translate into an uptick in market conditions based on the visibility we have. We don't have a lot of forward visibility in aftermarket orders, but at this stage, we see it as really flat year-over-year. We'll continue to deliver share gains as previously guided, but it's not significantly changed from where we started the year. Q: Is there a way to help us think about the margin impact from the Middle East conflict on the quarter and the moving pieces?A: Jack Hinsler, CFO: The commodity cost impacts take a little while to work through the system, so it's more of a second-half dynamic than For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Interested in NN, Inc.? Here are five stocks we like better. NN delivered strong second-quarter growth: Sales rose 19% to $128.8 million, while adjusted EBITDA increased 36% to $17.9 million as margins expanded in both Power Solutions and Mobile Solutions. The company strengthened its balance sheet: A $124 million preferred-equity refinancing retired most preferred stock, converted about $19 million into common shares, and is expected to reduce annual PIK interest expense by approximately $13 million. NN raised its 2026 outlook to $460 million–$480 million in sales and $55 million–$65 million in adjusted EBITDA, supported by growth initiatives in data centers, defense and medical markets and $80 million–$100 million in expected new-business awards. NN (NASDAQ:NNBR) reported second-quarter sales growth of 19% and adjusted EBITDA growth of 36%, while raising its full-year outlook and completing a refinancing transaction that retired a substantial portion of its preferred stock. President and Chief Executive Officer Harold Bevis said the company’s first-half performance exceeded expectations, supported by growth in both reporting segments, new program launches and improved product mix. NN secured $65 million in new business awards during the first half and said awards had reached $80 million through July. → Meta’s Earnings Drop Shows Wall Street Wants More Than Ad Growth NN reported second-quarter net sales of $128.8 million, an increase of $20.8 million, or roughly 19%, from the prior-year period. First-half sales rose 16% to $247.2 million. Chief Financial Officer Chris Bohnert said quarterly growth was driven by new business launches, volume gains, higher precious-metal pass-through pricing and slightly favorable foreign-exchange translation. Adjusted gross margin dollars increased 24% to $26.1 million, while adjusted gross margin rose 80 basis points year over year to 20.3%. → 4 Oil and Gas ETF Plays as Prices Stay Sky-High Second-quarter adjusted EBITDA was $17.9 million, up $4.7 million, or 36%, from a year earlier. Adjusted EBITDA margin expanded 170 basis points to 13.9%. For the first six months of 2026, adjusted EBITDA increased 35% to $32.1 million, with the year-to-date margin reaching 13%, compared with 11.1% in the first half of 2025. Bohnert said earnings growth reflected higher sales, improved mix, volume leverage from prior cost-reduction actions and ongoing cost-out initiatives, partly offset by higher selling, general and administrative expenses. Power Solutions: Quarterly sales rose 40% to $62.3 million, driven by higher precious-metal pass-through pricing and volumes. Adjusted EBITDA increased 40% to $12.7 million, and the segment posted a 20% adjusted EBITDA margin. Mobile Solutions: Quarterly sales increased 5% to $66.6 million, supported by new program launches and favorable foreign exchange. Adjusted EBITDA rose 13% to $9.8 million, while adjusted EBITDA margin increased 100 basis points to 14.7%. → Ulta's Growth Is Real, But So Are the Risks Following the quarter, NN completed a $124 million refinancing transaction focused on its preferred equity. The company previously raised $75 million through a private investment in public equity, or PIPE, transaction. Bohnert said NN used $70 million in PIPE proceeds to redeem a large portion of the outstanding preferred stock and converted approximately $19 million of preferred equity into common shares. The remaining preferred balance of roughly $35 million will carry a 10% paid-in-kind interest rate for one year, down from 14.5%. NN can also receive a $5 million discount on the remaining preferred balance if it is repaid or refinanced by Dec. 31, 2026. The company expects the transaction to reduce annual PIK interest by about $13 million. It does not affect NN’s existing term loan. Bohnert said management is considering options for the term loan and other debt, but did not announce a specific refinancing plan or timeline. During the question-and-answer session, Bohnert said the preferred conversion added approximately 5.5 million common shares. Bevis said the company had 82.6 million shares outstanding following the swap. Bevis said NN’s automotive exposure has fallen to about 40% of the business, with a longer-term goal of approximately one-third as other markets grow faster. The company is concentrating its commercial and capital-allocation efforts on five areas: data centers and electric grid infrastructure, defense electronics, medical products, high-value vehicle parts and high-value stamping applications. The company’s data-center and electric-grid business generated about $80 million in trailing-12-month sales, according to Bevis, who said NN is targeting $120 million in the near term. The company supplies components including transformer parts, busbar parts, test probes, liquid connectors and cold-plate-related products. NN has about 50 machines being brought online to support data-center opportunities, including about 25 already in-house, Bevis said. The company is evaluating approximately 100,000 square feet of additional space near its Wuxi, China, facility and said it needs to complete the expansion within 12 months. Bevis said sales from certain data-center program wins are expected to ramp in the second half and into early 2027. Defense and electronics represented about $60 million of trailing-12-month sales, with a near-term target of $90 million. NN recently secured a multiyear agreement to produce weapon components that Bevis said could generate an additional $12 million to $15 million with one customer. The company also cited a $75 million working pipeline in the market. NN’s medical business totaled about $15 million in trailing-12-month sales, and management is targeting $40 million. The company has received initial purchase orders for surgical tips and other components used in robotic surgery systems, with production ramping at its Kentwood, Michigan, plant. NN raised its full-year guidance, now expecting 2026 sales of $460 million to $480 million and adjusted EBITDA of $55 million to $65 million. The company also lifted its new-business-award outlook to $80 million to $100 million. Bevis said the company expects new programs in data centers, defense and medical to contribute more meaningfully in the second half. He noted that the fourth quarter has historically been NN’s lightest period, though new program ramps could offset some of that seasonal pattern. Looking beyond the current year, Bevis said management sees longer-term adjusted EBITDA margin potential in the range of 14% to 16%, driven primarily by improved sales mix. He added that new business wins have maintained gross-margin floors of 25% and internal-rate-of-return floors of 25% when capital spending is required. NN, Inc (NASDAQ: NNBR) is a diversified industrial manufacturing company specializing in engineered metal components, powder metal parts and friction materials. Through its subsidiaries, the company develops and produces precision-rolled products for powertrain and chassis applications, engineered friction products for brake and transmission systems, and various metal powders used in automotive, industrial and energy markets. Its offerings span a wide range of component sizes and complexity, from thin‐gauge strips for hybrid and electric vehicle applications to high‐volume sintered parts for commercial and consumer products. The company's operations are organized into three business segments. This instant news alert was generated by narrative science technology and financial data from MarketBeat in order to provide readers with the fastest reporting and unbiased coverage. Please send any questions or comments about this story to [email protected]. The article "NN Q2 Earnings Call Highlights" was originally published by MarketBeat. View MarketBeat's top stocks for August 2026.

Our analysts just identified a stock with the potential to be the next Nvidia. Tell us how you invest and we'll show you why it's our #1 pick. Tap here. Achieved record quarterly sales of $528 million, a 16.4% increase driven by the Koch Filter acquisition and strong Power Solutions performance. Successfully exited more than 95% of transition services agreements (TSAs) for Koch Filter, with full integration expected by the third quarter. Observed a cyclical recovery in first-fit markets starting in late Q2, with Atmus seeing demand upticks 4 to 6 weeks ahead of vehicle OEM builds. Maintained a flat outlook for the global aftermarket as stronger sentiment in the U.S. and Mexico is offset by subdued conditions in Europe, the Middle East, and Asia Pacific. Launched 'Lean the Atmus Way' production system to standardize management and improve productivity, with the Mexico site being the first to achieve certification. Attributed Power Solutions growth of 7.1% to a balanced mix of 3% pricing, 2% volume, and 2% favorable foreign exchange. Anticipates total company revenue between $1.975 billion and $2.03 billion for 2026, representing approximately 13.5% growth at the midpoint. Expects Power Solutions volume growth to remain flat to 2%, assuming continued market share gains despite a lack of significant inflection in the freight market. Assumes a moderating pricing environment in the second half of the year, with full-year price realization expected at approximately 1.5%. Projects second-half margins will be pressured by persistent Middle East conflict impacts on raw material costs (chemicals, plastics) and lower joint venture income from India. Intends to allocate surplus cash toward paying down gross debt to enhance balance sheet flexibility for future industrial filtration M&A. Identified the ongoing Middle East conflict as a primary headwind, impacting both supply chain costs and joint venture performance in India. Noted that U.S. EPA regulatory clarity regarding 2027 emission standards may ease some pre-buy pressure by allowing current engines to be sold with penalties. Reported that Industrial Solutions margins dipped to 18.9% in Q2 due to one-time operational inefficiencies and redundant expenses during the TSA transition. Confirmed that the net impact of tariffs on EBITDA remains substantially neutral, with the company seeking refunds and adjusting pricing to offset costs. One stock. Nvidia-level potential. 30M+ investors trust Moby to find it first. Get the pick. Tap here. Aftermarket remains flattish globally, representing 85% of Power Solutions revenue, while first-fit is seeing a cyclical upturn. Management confirmed they are maintaining their target of 1% to 2% for annual market share gains. Price realization is expected to moderate to just over 0.5% in Q3 and Q4 compared to the 2%+ seen in the first half. Inflationary pressures from the Middle East conflict are affecting chemicals and plastics, which will impact the second-half margin profile. The sequential margin drop was attributed to non-repeating transition costs and volume shifts; full-year margins are still targeted at 20%. Growth focus for Koch Filter includes expanding distributor relationships and targeting high-growth end markets like data centers and healthcare.

Interested in Atmus Filtration Technologies Inc.? Here are five stocks we like better. Record Q2 performance: Atmus Filtration Technologies reported sales of $528 million, up 16.4% year over year, with adjusted EBITDA of $109 million and adjusted EPS of $0.82. Growth was driven by the Koch Filter acquisition and a 7% increase in Power Solutions revenue. Koch Filter integration is nearly complete: Atmus has exited more than 95% of related transition-service activities, while the new Industrial Solutions segment generated $42 million in sales and $8 million in adjusted EBITDA. The company is now evaluating additional industrial filtration acquisitions, particularly in industrial air. 2026 outlook maintained but margins narrowed: Atmus kept its total revenue guidance at $1.975 billion to $2.03 billion and adjusted EPS guidance at $2.85 to $3, while narrowing adjusted EBITDA margin expectations to 19.75%–20.25%. The company plans to repurchase $20 million to $40 million of shares and reduce debt using surplus cash. Atmus Filtration Technologies (NYSE:ATMU) reported record second-quarter sales of $528 million, up 16.4% from $454 million a year earlier, driven by the acquisition of Koch Filter and growth in its Power Solutions business. The company also reported adjusted EBITDA of $109 million, adjusted earnings per share of $0.82, and adjusted free cash flow of $67 million. Chief Executive Officer Steph Disher said the company’s results reflected progress across its four-pillar growth strategy: expanding first-fit market share, accelerating profitable aftermarket growth, transforming the supply chain, and building an industrial filtration platform. → Meta’s Earnings Drop Shows Wall Street Wants More Than Ad Growth “We achieved record sales in the second quarter and delivered strong results among our key metrics, including adjusted EBITDA, free cash flow, and EPS,” Disher said. Atmus said it has exited more than 95% of the transition service agreement activities associated with its Koch Filter acquisition, which closed earlier in 2026. The company expects to complete the remaining integration work during the third quarter. → 4 Oil and Gas ETF Plays as Prices Stay Sky-High The acquisition established Atmus’ Industrial Solutions segment, which recorded $42 million in second-quarter sales and $8 million in adjusted EBITDA, representing an 18.9% margin. The company said Industrial Solutions is performing in line with expectations, and it continues to target full-year revenue of $155 million to $165 million for the segment. Disher said Atmus is shifting attention toward growth initiatives in industrial filtration, particularly industrial air. The company is evaluating bolt-on acquisition opportunities to build scale around Koch Filter while remaining open to potential industrial water and liquid-filtration investments that could provide an anchor for a broader platform. → Sandisk Just Delivered a Blowout Quarter—Here's Why the Stock Is Falling Chief Financial Officer Jack Kienzler said the company sees opportunities to expand Koch Filter’s distributor relationships, introduce products to address coverage gaps, and target higher-growth end markets including data centers and healthcare. Power Solutions, Atmus’ larger operating segment, generated $486 million in second-quarter revenue, up 7% from the prior-year period. Kienzler attributed the increase to 3% higher pricing, 2% volume growth and a 2% favorable foreign-exchange effect. Disher said the company’s aftermarket conditions remained broadly flat during the quarter, though it is seeing stronger sentiment in the U.S. and Mexico. The aftermarket represents approximately 85% of Power Solutions revenue, with roughly half of that business located in the U.S., according to Disher. Markets in Europe, the Middle East and Asia-Pacific excluding China remained subdued, she said. Atmus continues to expect market-share gains of roughly 1% to 2%, supported by its multi-channel distribution strategy, product availability and customer relationships. In first-fit markets, the company began seeing the cyclical recovery it had anticipated at the end of the second quarter. Disher said Atmus tends to see changes in its supply-chain activity about four to six weeks ahead of vehicle production data. The first-fit improvement reflected a mix of stronger market conditions and share gains, she said. The U.S. Environmental Protection Agency has also provided more clarity around 2027 emissions standards, the company said. The agency has proposed allowing current engines to be sold into 2027 with a non-conformance penalty, a development Atmus expects could reduce some pre-buy pressure. Still, customers have indicated a stronger second half as market conditions improve and the industry moves through a cyclical recovery. Second-quarter gross margin increased to 29.2% from 28.9% a year earlier. Atmus cited favorable pricing, Koch Filter’s incremental margin contribution, foreign exchange, higher volumes and the end of one-time separation costs. Those benefits were partly offset by higher material and manufacturing expenses. Adjusted EBITDA margin was 20.7%, compared with 21% in the year-earlier quarter. Power Solutions adjusted EBITDA totaled $101 million, or 20.8% of segment sales. Kienzler said the company expects margin comparisons to moderate in the second half as pricing and foreign-exchange benefits become less favorable than in the first half. Atmus also expects continued commodity-cost pressure tied to the Middle East conflict, particularly in chemicals and plastics. The conflict has also affected business conditions in India and the Middle East. Joint venture income was $8 million, unchanged from the prior-year quarter, as strong performance in China offset weaker conditions in India. Disher said the company did not fully recover lost Middle East sales during the second quarter and expects recovery during the second half. The Middle East represents about 2% of overall revenue, she said. Atmus received an immaterial amount of tariff refunds through the end of the second quarter, Kienzler said. The company has applied for refunds it believes it is entitled to receive and continues to expect the overall tariff impact on EBITDA to be substantially neutral. Atmus maintained its Power Solutions revenue outlook of $1.82 billion to $1.865 billion for 2026. The company expects Power Solutions volume to range from flat to up 2%, with pricing contributing about 1.5% and foreign exchange providing an approximately 2% tailwind. The company expects total 2026 revenue of $1.975 billion to $2.03 billion, representing approximately 13.5% growth at the midpoint. It narrowed its adjusted EBITDA margin outlook to 19.75% to 20.25% and maintained adjusted EPS guidance of $2.85 to $3. During the quarter, Atmus invested $13 million in capital expenditures and returned $18 million to shareholders, including $13 million in share repurchases and $5 million in dividends. The company said it expects 2026 share repurchases of $20 million to $40 million and intends to direct surplus cash toward reducing gross debt. Atmus estimated its net-debt-to-adjusted-EBITDA ratio at 1.9 times for the trailing 12 months ended June 30. Disher said the company’s cash generation provides flexibility to fund growth investments, return capital to shareholders and reduce debt over time. Atmus Filtration Technologies is a global developer and manufacturer of high-performance filter media and filtration solutions. The company designs and produces advanced materials that capture airborne particles across a range of applications, from heating, ventilation and air-conditioning (HVAC) systems to industrial and cleanroom environments. By focusing on proprietary meltblown and nanofiber technologies, Atmus delivers media that balances efficiency, airflow and durability for both original equipment manufacturers (OEMs) and aftermarket customers. The company’s product portfolio encompasses pleated and panel filter media, depth filtration products and specialty laminates used in industries such as commercial buildings, healthcare, transportation and power generation. This instant news alert was generated by narrative science technology and financial data from MarketBeat in order to provide readers with the fastest reporting and unbiased coverage. Please send any questions or comments about this story to [email protected]. The article "Atmus Filtration Technologies Q2 Earnings Call Highlights" was originally published by MarketBeat. View MarketBeat's top stocks for August 2026.

Second Quarter Net Sales of $152.5 millionSecond Quarter Net Income of $16.9 millionDiluted EPS of $0.73 for the QuarterTotal Debt Reduced by Approximately $30.8 million During the Quarter WOOD DALE, Ill., Aug. 06, 2026 (GLOBE NEWSWIRE) -- Power Solutions International, Inc. (the “Company” or “PSI”) (Nasdaq: PSIX), a leader in the design, engineering and manufacture of emission-certified engines and power systems, today announced its financial results for the second quarter of 2026. Financial Highlights Kenneth Li, Interim Chief Executive Officer and Chief Financial Officer, said: “Our second quarter results reflect continued progress as we execute our strategy and invest in the long-term growth of the business. Second quarter sales increased 18.6% from the first quarter, and gross margin improved approximately 420 basis points to 27.1%. The gross margin improvement reflected in part the early benefits of ongoing operational improvement efforts at our Wisconsin facility and was partially offset by unfavorable product mix. Strong operating cash flow also enabled us to reduce total debt by approximately $30.8 million during the quarter, strengthening our balance sheet and financial flexibility. “Compared with a strong prior-year quarter, revenue reflected the timing of certain Power Systems shipments and softer demand in our oil and gas business. Looking ahead, demand for our data center power solutions remains strong. Based on our current production schedule, we expect second-half sales to exceed first-half sales as larger Power Systems orders move into production, although shipment timing and quarterly results may vary.” Second Quarter 2026 Results Net sales for the second quarter of 2026 were $152.5 million, a decrease of $39.4 million, or 21%, compared with the second quarter of 2025. The decrease reflected lower sales of $34.6 million, $3.0 million and $1.7 million in the power systems, industrial and transportation end markets, respectively. Sales in the power systems end market declined primarily due to uneven order patterns and shipment timing for data center-related products, together with softness in oil and gas markets. The Company continues to see strong demand for data center power solutions. However, the timing and ultimate volume of revenue recognized from that demand remain subject to customer scheduling, manufacturing throughput, supply chain factors and other variables, and the Company is not predicting any specific level of data center revenue in any future period. Based on the current production schedule, the Company expects second-half 2026 sales to exceed first-half 2026 sales as larger Power Systems orders move into production, although shipment timing and quarterly results may continue to vary. Gross profit for the second quarter of 2026 was $41.4 million, a decrease of $12.7 million, or 24%, compared with the second quarter of 2025. Gross margin in the second quarter of 2026 was 27.1%, compared with 28.2% in the same period last year. Gross margin reflected a lower mix of oil and gas products, together with elevated production costs associated with capacity ramp-up activities supporting data center-related applications at the Company’s Wisconsin operations. On a sequential basis, gross margin improved by approximately 420 basis points compared with the first quarter of 2026. The improvement reflected in part the early benefits of the Company’s ongoing operational improvement efforts in Wisconsin and was partially offset by unfavorable product mix in the second quarter. The Company’s capacity ramp-up activities at its Wisconsin operations are continuing, and the Company expects related production costs to persist; the trajectory of any further sequential improvement remains subject to product mix, throughput and other operational factors. Research and development expenses during the three months ended June 30, 2026 and 2025 were $5.1 million and $4.6 million, respectively. The increase was primarily driven by higher R&D program expenditures to support new programs in 2026 and the recovery of R&D costs from certain customers in 2025. Selling, general and administrative expenses were $12.1 million during the second quarter of 2026, a decrease of $4.6 million, or 27%, compared to the same period in the prior year. The decrease was primarily attributable to lower compensation expense related to the revaluation of previously awarded stock appreciation rights (“SARs”), lower costs associated with employee incentive programs, partially offset by incremental selling and administrative expenses associated with MTL Manufacturing and Equipment. Interest expense was $1.6 million in the second quarter of 2026, compared to $1.7 million in the same period in the prior year, primarily due to lower overall effective interest rates. Income tax expense was $5.6 million in the second quarter of 2026, compared to an income tax benefit of $20.1 million in the same period of the prior year. The prior-year period included a $29.2 million, or $1.27 per diluted share, tax benefit resulting from the release of a valuation allowance on deferred tax assets. Balance Sheet Update The Company’s cash and cash equivalents were approximately $70.1 million, and total debt was approximately $72.6 million, as of June 30, 2026. Total debt decreased by approximately $30.8 million from March 31, 2026, when total debt was approximately $103.4 million. As of December 31, 2025, cash and cash equivalents were approximately $41.3 million and total debt was approximately $96.6 million. Total debt as of June 30, 2026 included borrowings of $65.0 million under the Company’s Revolving Credit Agreement. MTL Update On January 9, 2026, the Company acquired MTL Manufacturing & Equipment, Inc. MTL’s operations contributed positively to the Company’s consolidated net income in the second quarter. The acquisition expanded PSI’s vertical integration by adding in-house manufacturing capabilities for components used in power generation products, including fuel tanks and electrical enclosure panels. The Company believes that these capabilities can enhance supply chain control and manufacturing flexibility and support future growth. Outlook for 2026 Given ongoing variability in order timing and market conditions, the Company is not providing formal full-year guidance at this time. Based on the current production schedule and information available as of the date of this release, the Company expects second-half 2026 sales to exceed first-half 2026 sales and to be approximately in line with sales in the second half of 2025, as larger Power Systems orders move into production and are recognized as revenue. However, the timing and ultimate volume of those shipments remain subject to customer scheduling, manufacturing throughput, supply chain factors and other variables. There can be no assurance that those orders will translate to a uniformly stronger second half. Continued softness in the oil and gas end market is expected to weigh on quarterly revenue trends, and capacity ramp-up activities at the Company’s Wisconsin operations and their related cost effects on gross margin are expected to continue. About Power Solutions International, Inc. Power Solutions International, Inc. (PSI) is a leader in the design, engineering and manufacture of a broad range of advanced, emission-certified engines and power systems. PSI provides integrated turnkey solutions to leading global original equipment manufacturers and end-user customers within the power systems, industrial and transportation end markets. The Company’s in-house design, prototyping, engineering and testing capabilities allow PSI to customize high-performance engines using a fuel-agnostic strategy to run on a wide variety of fuels, including natural gas, propane, gasoline, diesel and biofuels. PSI develops and delivers complete power systems that are used worldwide in stationary and mobile power generation applications supporting standby, prime, demand response, and microgrid solutions, as well as products and packages supporting the growing data center markets. PSI’s industrial end market provides engine and battery powertrain solutions to serve applications such as forklifts, agricultural and turf, arbor care, industrial sweepers, aerial lifts, irrigation pumps, ground support, and construction equipment. PSI’s transportation end market provides engine powertrain solutions to specialized applications such as terminal tractors, port equipment, military vehicles, and other non-road vocational vehicles. For more information on PSI, visit www.psiengines.com. Cautionary Note Regarding Forward-Looking Statements This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 and Section 21E of the Securities Exchange Act of 1934, as amended. These forward-looking statements reflect the Company’s current expectations and assumptions regarding future events. Words such as “anticipate,” “believe,” “budget,” “contemplate,” “continue,” “estimate,” “expect,” “forecast,” “guidance,” “intend,” “may,” “outlook,” “plan,” “position,” “project,” “prospect,” “should,” “target,” “will,” “would” and similar expressions are intended to identify forward-looking statements, although not all forward-looking statements contain such identifying words. Forward-looking statements are not guarantees of future performance and are subject to risks, uncertainties and assumptions that could cause actual results to differ materially from those expressed in or implied by such statements. Important factors that could cause actual results to differ materially include, without limitation: the timing and ultimate conversion of Power Systems orders into revenue, including data-center-related orders, and the volume and timing of related shipments; quarterly variability in product mix and the corresponding effect on gross profit and gross margin; the cost, pace, throughput and operational outcomes of capacity ramp-up activities at the Company’s Wisconsin operations, including the duration and magnitude of related production costs; the Company’s ability to execute operational improvement initiatives on the anticipated timetable; the level and persistence of customer demand in the power systems, industrial and transportation end markets; volatility in oil and gas prices and corresponding demand for related products; supply-chain disruptions, component availability and supplier performance; macroeconomic, regulatory and trade conditions, including U.S. tariffs and trade restrictions; integration of recent and future acquisitions, including the acquisition of MTL Manufacturing and Equipment; the outcome of pending or threatened litigation and regulatory inquiries, including the previously disclosed putative federal securities class action; changes in management or other personnel, including the timing of any related disclosures; the ability to recruit and retain key employees; the impact of changes in our effective tax rate or applicable tax legislation; and the other risks and uncertainties described in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2025 and in the Company’s subsequent filings with the U.S. Securities and Exchange Commission, all of which are incorporated by reference into this press release. The Company’s forward-looking statements speak only as of the date of this release. Except as required by law, the Company expressly disclaims any intention or obligation to revise or update any forward-looking statement, whether as a result of new information, future events or otherwise. Investors are cautioned not to place undue reliance on any forward-looking statements. Results of operations for the three and six months ended June 30, 2026, compared with the three and six months ended June 30, 2025 (UNAUDITED): NM  Not meaningful *      See reconciliation of non-GAAP financial measures to GAAP results below Non-GAAP Financial Measures In addition to the results provided in accordance with accounting principles generally accepted in the United States (“U.S. GAAP”) above, this press release also includes non-GAAP (adjusted) financial measures. Non-GAAP financial measures provide insight into selected financial information and should be evaluated in the context in which they are presented. These non-GAAP financial measures have limitations as analytical tools and should not be considered in isolation from, or as a substitute for, financial information presented in compliance with U.S. GAAP, and non-GAAP financial measures as reported by the Company may not be comparable to similarly titled amounts reported by other companies. The non-GAAP financial measures should be considered in conjunction with the consolidated financial statements, including the related notes, and Management’s Discussion and Analysis of Financial Condition and Results of Operations within the Company’s Form 10-Q for the quarter ended June 30, 2026. Management does not use these non-GAAP financial measures for any purpose other than the reasons stated below. The Company believes that Adjusted net income, Adjusted net income per share – diluted, EBITDA, and Adjusted EBITDA provide relevant and useful information, which is widely used by analysts, investors and competitors in its industry as well as by the Company’s management in assessing the performance of the Company. Adjusted net income is defined as net income as adjusted for certain items that the Company believes are not indicative of its ongoing operating performance. Adjusted net income per share – diluted is a measure of the Company’s diluted earnings per common share adjusted for the impact of special items. EBITDA provides the Company with an understanding of earnings before the impact of investing and financing charges and income taxes. Adjusted EBITDA further excludes the effects of other non-cash charges and certain other items that do not reflect the ordinary earnings of the Company’s operations. Adjusted net income, Adjusted net income per share – diluted, EBITDA, and Adjusted EBITDA are used by management for various purposes, including as a measure of performance of the Company’s operations and as a basis for strategic planning and forecasting. Adjusted net income, Adjusted net income per share – diluted, and Adjusted EBITDA may be useful to an investor because these measures are widely used to evaluate companies’ operating performance without regard to items excluded from the calculation of such measures, which can vary substantially from company to company depending on the accounting methods, the book value of assets, the capital structure and the method by which the assets were acquired, among other factors. They are not, however, intended as alternative measures of operating results or cash flow from operations as determined in accordance with U.S. GAAP. The following table presents a reconciliation from Net income to Adjusted net income for the three and six months ended June 30, 2026 and 2025 (UNAUDITED): The following table presents a reconciliation from Net income per share – diluted to Adjusted net income per share – diluted for the three and six months ended June 30, 2026 and 2025 (UNAUDITED): The following table presents a reconciliation from Net income to EBITDA and Adjusted EBITDA for the three and six months ended June 30, 2026 and 2025 (UNAUDITED): Amounts reflect non-cash stock-based compensation expense for the three and six months ended June 30, 2026 and 2025. Amounts include severance expense of less than $0.1 million and $0.1 million for the three and six months ended June 30, 2026 and 2025, respectively, as well as executive recruiting expense of $0.4 million for each period presented. Amounts include legal settlements for the three and six months ended June 30, 2026. CONTACT: Contact Power Solutions International, Inc. Kenneth Li Chief Financial Officer 630-284-9719 [email protected]