Sensata Technologies (ST) Q2 2026 earnings summary

Executive summary

• Q2 2026 revenue reached $991M, up 5% year-over-year, with organic growth of 4.4%–5% across all segments.

• Adjusted operating margin expanded 50 bps to 19.5%; adjusted EPS rose 12.6% to $0.98; GAAP EPS increased 70.7% to $0.70.

• Free cash flow was $186M in Q2, up 61% year-over-year, with a 130% conversion rate; year-to-date FCF conversion at 108%.

• Net leverage reduced to 2.4x trailing 12 months adjusted EBITDA, aided by $406M in long-term debt retirement.

• Growth momentum supported by three consecutive quarters of double-digit adjusted EPS growth and expanding data center and India automotive opportunities.

Financial highlights

• Q2 revenue: $991M (+5% YoY); organic revenue growth 4%–4.4%.

• Adjusted operating income: $193M (19.5% margin, up 50 bps YoY); adjusted EPS: $0.98, up 12.6%.

• Free cash flow: $186M in Q2, up 61% YoY; YTD FCF conversion at 108%.

• GAAP net income: $102.1M (10.3% margin); GAAP EPS: $0.70.

• ROIC for 12 months ended June 30, 2026: 11.3%, up 120 bps YoY.

Outlook and guidance

• Q3 2026 revenue guidance: $957M–$987M, up 3–6% YoY; adjusted EPS: $0.93–$0.97, up 4–9% YoY.

• Adjusted operating margin expected at 19.4%–19.6%; guidance includes $10M in tariff costs.

• Margin expansion expected to continue year-over-year into Q4, with sequential revenue expected to be flattish.

• Sufficient liquidity to fund operations, capex, dividends, share repurchases, and debt service for at least the next 12 months.