Tenaris (TEN) Q1 2026 earnings summary

Executive summary

• Net sales for Q1 2026 reached $3.1 billion, up 6% year-over-year and 4% sequentially, despite Middle East disruptions and the closure of the Strait of Hormuz.

• Net income rose 22% sequentially and 9% year-over-year to $564 million, driven by improved results below the operating line.

• Operating income increased to $584 million, up 5% sequentially and year-over-year.

• Free cash flow was $503 million, with a net cash position of $3.8 billion after $90 million in share buybacks.

• The company maintained operations in Saudi Arabia and UAE, while activity in Kuwait, Qatar, and Iraq was significantly reduced.

Financial highlights

• EBITDA reached $735 million, up 3% sequentially, with an EBITDA margin of 23.7%–24%.

• Gross profit for Q1 2026 was $1.05 billion, up from $1.0 billion year-over-year.

• Operating cash flow was $618 million, and capital expenditure totaled $114 million.

• Earnings per share were $0.54, up from $0.47 year-over-year; earnings per ADS grew 14% year-over-year to $1.07.

• Share buybacks totaled $90 million in the quarter.

Outlook and guidance

• Q2 revenues are expected to decline mid to high single digits sequentially due to Middle East disruptions, with EBITDA margin contraction of a couple of points.

• Higher logistics costs of $32 million are anticipated in Q2, with $8 million from alternative shipping routes and $24 million from increased global fuel prices.

• Recovery in volumes and margins is expected in the second half of 2026, with Q4 likely to approach Q1 levels if the Strait of Hormuz reopens.

• North American activity and pricing are expected to improve in the second half, with rig count projected to rise by about 10%.

• Proposed annual dividend of $0.89 per share (or $1.78 per ADS), totaling approximately $0.9 billion, pending shareholder approval.