Fortrea (FTRE) Q2 2026 earnings summary

Executive summary

• Achieved four consecutive quarters of strong commercial, operational, and financial execution, with improved customer satisfaction and Net Promoter Scores.

• Increased full-year 2026 revenue and adjusted EBITDA guidance, reflecting confidence in ongoing performance and transformation toward growth and margin expansion.

• Book-to-bill ratio remained above 1.0x for the quarter and trailing 12 months, indicating healthy demand and strong commercial momentum, especially in biotech.

• Continued focus on commercial excellence, operational delivery, and financial discipline, supported by investments in technology and AI.

• CFO transition underway due to legal proceedings, with interim leadership ensuring continuity.

Financial highlights

• Q2 2026 revenue was $678.2 million, down 4.5% year-over-year, mainly due to lower passthrough costs and FSP headwinds, partially offset by growth in clinical pharmacology.

• Adjusted EBITDA for Q2 2026 was $58.7 million, up from $54.9 million in Q2 2025; margin improved to 8.7% from 7.7%.

• Net loss for Q2 2026 was $13.2 million, a significant improvement from a $374.9 million loss in Q2 2025, which included a large non-cash goodwill impairment.

• Adjusted net income for Q2 2026 was $22.7 million ($0.23 per diluted share), up from $17.6 million ($0.19 per diluted share) in Q2 2025.

• Operating cash flow was $28.9 million and free cash flow was $19.9 million in Q2 2026, both up year-over-year.

Outlook and guidance

• Full-year 2026 revenue guidance raised to $2,620–$2,690 million; adjusted EBITDA guidance increased to $205–$220 million.

• On track to deliver FY 2026 cost optimization targets of $70–80 million gross and $40–50 million net savings.

• Expectation to remain free cash flow positive for the remainder of 2026 and the full year.

• Guidance reflects confidence in backlog mix, operational optimization, and ongoing cost discipline.

• Management expects existing cash, cash flows from operations, and credit facilities to be sufficient for at least the next 12 months.