Donaldson Q2 EPS Misses by 7¢ While Revenues Rise 3% to $896.3M
Donaldson reported adjusted EPS of $0.83 in Q2 FY2026, missing the $0.90 consensus estimate and flat year-over-year. Revenue rose 3% to $896.3 million, narrowly trailing the $898 million estimate, with Mobile Solutions up 1.6%, Industrial Solutions up 2.4% and Life Sciences up 16.2%.
1. Second-Quarter Results
Donaldson reported adjusted EPS of $0.83 for fiscal Q2 ended Jan 31, 2026, compared with the $0.90 consensus, representing flat year-over-year earnings. Revenues totaled $896.3 million, up 3% from last year but slightly below the $898 million projection.
2. Regional and Segment Revenue
By geography, net sales in the US/Canada declined 4.7%, while EMEA rose 16% and Asia Pacific increased 8.7%; Latin America sales fell 5.2%. Segment sales: Mobile Solutions ($556.6M, +1.6%), Industrial Solutions ($259.7M, +2.4%), Life Sciences ($80M, +16.2%).
3. Profitability and Cash Generation
Gross profit slipped 2% to $299.8M, driving gross margin down 170bps to 33.5% due to production inefficiencies and footprint optimization costs. Operating margin fell 120bps to 13.2% as operating profit decreased 5.6% to $118.7M. Cash and equivalents rose to $194.4M; long-term debt increased to $674.3M.
4. Full-Year Outlook
For fiscal 2026, Donaldson projects adjusted EPS of $3.93–$4.01 (up from $3.68), revenue growth of 1–5% with positive pricing of 1%, segment sales growth ranges of 2–6% for Mobile, (1)–3% for Industrial and 5–9% for Life Sciences. Capex guidance is $60–$75M; interest expense ~$26M and free cash flow conversion of 85–95%.