EnerSys reported adjusted diluted EPS of $2.77 for the quarter ended December 28, 2025, surpassing the Zacks Consensus Estimate of $2.73 and down from $3.12 a year earlier. GAAP diluted EPS came in at $2.40, reflecting a $0.37 net of tax charge related to restructuring and other one-time items. Net sales rose 1.4% year-over-year to $919.1 million, driven by a 3% increase in price/mix and a 2% favorable currency impact, offset by a 4% decline in organic volume. Motive Power volumes remained under pressure but were partially offset by strong demand in specialty battery and energy storage systems.

Gross profit for the quarter was $276.3 million, translating to a 30.1% gross margin, down from 32.9% a year ago but up sequentially on disciplined pricing and cost control. Adjusted operating earnings improved to $142.3 million, a 50 basis-point margin expansion year-over-year. Operating cash flow surged to $184.6 million, contributing to free cash flow of $171.3 million, more than triple the prior-year period. Capital expenditures fell to $13.3 million, and the net leverage ratio improved to 1.2X, down from 1.5X a year ago. The company returned $93.7 million to shareholders via $84.1 million in share repurchases and $9.6 million in dividends.

Management highlighted progress on the EnerGize framework, noting realignment savings and the formation of Centers of Excellence to accelerate execution and drive returns. For Q4, the company expects net sales between $960 million and $1.00 billion and adjusted diluted EPS of $2.95 to $3.05, including IRC 45X benefits. Excluding those benefits, EPS is forecast at $1.91 to $2.01. Full-year capital expenditures are projected at approximately $80 million. The leadership team emphasized confidence in secular demand trends for energy security and high-performance storage solutions, while maintaining disciplined expense and pricing discipline in a mixed industrial end market environment.