Ralliant (RAL) Q1 2026 earnings summary

Executive summary

• Q1 2026 revenue grew 11% year-over-year to $535 million, exceeding guidance and prompting a full-year outlook raise, driven by strong Test & Measurement growth and a defense backlog surpassing $1 billion.

• Profitable growth strategy is supported by secular demand in electrification and defense, with productivity initiatives and the Enterprise Productivity Program underway, targeting $50–$60 million annualized savings by 2028.

• Net earnings were $44 million (EPS $0.39), with adjusted net earnings of $65 million (adjusted EPS $0.57), reflecting higher standalone public company costs and increased employee expenses.

• Capital returns to shareholders increased, with a $500 million repurchase authorization, $50–$100 million repurchased in Q1, and a $100 million accelerated buyback planned for Q2.

• Operating profit margin declined to 12.7% from 15.3% year-over-year, reflecting higher SG&A and R&D expenses.

Financial highlights

• Q1 revenue was $535 million, up 11% year-over-year; organic growth was 9%.

• Adjusted EBITDA margin reached 18.6%, a 270 bps improvement year-over-year on a normalized basis.

• Adjusted EPS was $0.57, up 39% year-over-year on a normalized basis.

• Trailing 12-month free cash flow conversion was 105%; Q1 free cash flow was $10 million.

• Cash and equivalents at quarter-end were $268 million; long-term debt was $1.15 billion.

Outlook and guidance

• Q2 2026 revenue expected at $540–$556 million, with 7–10% organic growth; adjusted EBITDA margin guided at 18.5%–19.5%; adjusted EPS $0.58–$0.64.

• Full-year 2026 guidance raised: revenue $2.185–$2.245 billion, adjusted EBITDA margin 19.5%–20.5%, adjusted EPS $2.53–$2.69.

• Defense & Space expected to maintain double-digit growth in 2026, moderating to mid-single digits in out years.

• FY 2026 productivity program savings of $10–$12 million anticipated.

• Guidance assumes stable geopolitical environment and continued offset of known tariffs.