Mayville Engineering Company, Inc. (MEC): Results of Operations and Financial Condition
Mayville Engineering Company, Inc. (MEC) filed an SEC Form 8-K — Results of Operations and Financial Condition. Exhibit 99.1 MAYVILLE ENGINEERING COMPANY ANNOUNCES SECOND QUARTER 2026 RESULTS MILWAUKEE, Wis., August 4, 2026 – Mayville Engineering Company (NYSE: MEC) (the “Company” or “MEC”), a leading value-added provider of design, prototyping and manufacturing solutions serving diverse e
How this was made
The 30-second read
Why it matters
Traders can reprice MEC based on the combination of revenue growth, datacenter end-market surge, $40M in secured project awards, and a stated full-year net sales guidance increase of about 5%, while monitoring margin and cash flow headwinds from launch costs and higher capex.
Market read
This is a primary earnings-and-guidance disclosure with specific order awards and segment performance, plus a capital raise and cash flow update.
What to watch
Interest expense rose to $3.5M from $1.4M year over year, and free cash flow was negative, which could temper valuation despite revenue growth.
Mayville Engineering Company announces second quarter 2026 results
Net sales increased 23.2% year over year and the Company raised full-year 2026 net sales guidance by approximately 5%, but the Company reported a net loss, Adjusted EBITDA declined, and free cash flow was negative.
Key metrics
as reported| Metric | Value | q/q | y/y |
|---|---|---|---|
| Net salesGAAP | $163.0 million | – | +23.2% y/y |
| Organic net sales growthother | +9.2% y/y | – | +9.2% y/y |
| Manufacturing marginGAAP | $17.7 million, or 10.9% of net sales | – | – |
| Bonuses and deferred compensation expenseGAAP | $4.8 million | – | – |
| Other selling, general and administrative expensesGAAP | $9.3 million | – | – |
| Interest expenseGAAP | $3.5 million | – | – |
| Net lossGAAP | $2.1 million, or ($0.09) per diluted share | – | – |
| Adjusted EBITDAnon-GAAP | $13.2 million | – | – |
| Adjusted EBITDA marginnon-GAAP | 8.1% of net sales | – | – |
| Adjusted Net Incomenon-GAAP | $1.6 million, or $0.07 per diluted share | – | – |
| Free cash flownon-GAAP | ($6.6) million | – | – |
| Net debt to trailing twelve-month Adjusted EBITDAnon-GAAP | 2.9x | – | – |
Segments
| Segment | Revenue | q/q | y/y |
|---|---|---|---|
| Commercial VehicleHigher OEM production of class 8 commercial vehicles, supported by improving freight market fundamentals and carrier profitability. | $50.8 million | – | increase of 3.4% versus the prior year period |
| Datacenter & Critical PowerAccelerating demand from legacy customers and revenues associated with the Accu-Fab acquisition. Organic net sales growth in this end market was 172.8% in the second quarter of 2026, when compared to the second quarter of 2025. | $29.0 million | – | increase of 476.5% versus the prior year period |
| Construction & AccessImproved non-residential construction demand. | $23.1 million | – | increase of 14.7% versus the prior year period |
| PowersportsSoft demand among ATV, UTV, and motorcycle OEMs resulting from ongoing offshoring initiatives. | $18.5 million | – | decrease of 6.0% versus the prior year period |
| AgricultureContinued demand softness for large agricultural equipment, partially offset by improved small agriculture equipment demand. | $9.0 million | – | decrease of 3.0% versus the prior year period |
| MilitaryProgram transition delays. | $6.5 million | – | decrease of 22.6% versus the prior year period |
| OtherStrong aluminum extrusion demand. | $26.1 million | – | increase of 25.6% versus the prior year period |
Q3 2026 and full-year 2026 outlook
- RevenueQ3 2026 Forecast: $160 million to $170 million; Mid: $165 million
- NoteQ3 2026 Adjusted EBITDA Forecast: $15.5 million to $18.5 million; Mid: $17.0 million
- NoteFull-year 2026 net sales guidance raised by approximately 5%.
What drove it
- Net sales growth was primarily due to organic growth in Datacenter & Critical Power, Commercial Vehicle, and Construction & Access, as well as the impact of the Accu-Fab acquisition completed in the third quarter of 2025.
- Manufacturing-margin improvement reflected higher-margin sales contribution from the Accu-Fab acquisition and improved capacity utilization as demand in several legacy end markets improved.
- The Company secured approximately $40 million of new Datacenter & Critical Power project awards.
- The qualified opportunity pipeline continues to exceed $125 million.
- Third-quarter sales guidance reflects continued recovery in Commercial Vehicle and Construction & Access and the ongoing ramp-up of Datacenter & Critical Power programs.
Concerns
- Adjusted EBITDA decreased to $13.2 million from $13.7 million, and Adjusted EBITDA margin declined to 8.1% of net sales from 10.3% of net sales.
- The Company absorbed $2.1 million of project launch costs and higher costs associated with ongoing workforce expansion to support demand.
- Bonuses and deferred compensation expense increased to $4.8 million from $1.5 million.
- Interest expense increased to $3.5 million from $1.4 million due to increased average borrowings and interest rate under the revolving credit facility and the timing of debt repayment during the second quarter of 2026.
- Free cash flow was ($6.6) million, compared with $12.5 million in the prior-year period, driven by lower cash flow from operations and higher capital expenditures.
- Powersports, Agriculture, and Military net sales declined year over year.
What to watch
- Execution and project launch costs associated with the ramp-up of new Datacenter & Critical Power programs.
- Conversion of the qualified opportunity pipeline that continues to exceed $125 million.
- Recovery in Commercial Vehicle demand through the remainder of the year.
- Planned incremental $50 million investment in organic growth initiatives across 2026 and 2027.
- Capital expenditures related to equipment investments supporting accelerating Datacenter & Critical Power demand.
Balance sheet and cash flow
- Quarterly Free Cash Flow of ($6.6) million.
- As of June 30, 2026, MEC had net debt outstanding of $134.7 million.
- Total cash and availability on its senior secured revolving credit facility was $108.5 million.
- The Company completed a common stock offering during the quarter, generating approximately $94 million in net proceeds.
- The proceeds were immediately used to reduce debt and strengthen the balance sheet.
- The Company intends to use a portion of the net proceeds from the offering to invest an incremental $50 million in organic growth initiatives across 2026 and 2027.
Analysis
MEC reported net sales of $163.0 million, up +23.2% y/y, with organic net sales increasing +9.2% y/y. Growth was led by Datacenter & Critical Power, where sales increased 476.5% versus the prior-year period, supported by accelerating legacy-customer demand and Accu-Fab revenue. Construction & Access increased 14.7%, Commercial Vehicle increased 3.4%, and Other increased 25.6%. Powersports, Agriculture, and Military sales declined, reflecting OEM offshoring initiatives, large-equipment demand softness, and program-transition delays, respectively.
Profitability improved at the manufacturing-margin level, which increased to $17.7 million, or 10.9% of net sales, from $13.6 million, or 10.3% of net sales. The increase reflected Accu-Fab's higher-margin sales contribution and better capacity utilization. However, $2.1 million of Datacenter & Critical Power project launch costs, workforce-expansion costs, incremental Accu-Fab SG&A expense, and increased gain sharing accruals weighed on earnings. Adjusted EBITDA declined to $13.2 million from $13.7 million, while margin declined to 8.1% from 10.3%.
The Company remained loss-making on a GAAP basis, reporting a net loss of $2.1 million, or ($0.09) per diluted share, versus a net loss of $1.1 million, or ($0.05) per diluted share. Adjusted Net Income declined to $1.6 million, or $0.07 per diluted share, from $3.4 million, or $0.16 per diluted share. Interest expense increased to $3.5 million from $1.4 million, which the Company attributed to increased average borrowings and interest rate under its revolving credit facility and the timing of debt repayment.
Cash generation weakened as quarterly free cash flow was ($6.6) million, compared with $12.5 million in the prior-year period. MEC attributed the change to lower cash flow from operations and higher capital expenditures for equipment investments supporting accelerating Datacenter & Critical Power demand. During the quarter, the Company completed a common stock offering that generated approximately $94 million in net proceeds, used immediately to reduce debt. At June 30, 2026, net debt was $134.7 million, total cash and revolver availability was $108.5 million, and net debt to trailing twelve-month Adjusted EBITDA was 2.9x.
Management guided for Q3 2026 net sales of $160 million to $170 million and Adjusted EBITDA of $15.5 million to $18.5 million. The Company also raised full-year 2026 net sales guidance by approximately 5%, citing improving Commercial Vehicle trends, steady Construction & Access activity, and the ongoing Datacenter & Critical Power ramp. The principal execution issue is whether growing Datacenter & Critical Power volume, including approximately $40 million of new project awards, can offset launch costs and support improved profitability while MEC invests an incremental $50 million in organic growth initiatives across 2026 and 2027.
Management, verbatim
Our second quarter results reflect stronger-than-expected order activity within our Commercial Vehicle end market and continued momentum across our Datacenter & Critical Power end market.
Jag Reddy, President and Chief Executive Officer
During the quarter, we secured approximately $40 million of new Datacenter & Critical Power project awards as customer demand remained robust.
Jag Reddy, President and Chief Executive Officer
Reflecting these favorable trends, we are raising our full-year 2026 net sales guidance by approximately 5%.
Jag Reddy, President and Chief Executive Officer
Not in the filing
stated, not guessed- Full-year 2026 guidance ranges and midpoint were not included in the provided filing text.
- Q3 2026 guidance for gross margin, operating expenses, and tax rate was not reported in the provided filing text.
- GAAP gross margin was not reported.
- GAAP operating income was not reported.
- GAAP operating cash flow and capital expenditures were not reported.
- Cash balance, gross debt, debt maturities, and revolver borrowing availability as separate line items were not reported.
- Share repurchases and dividends were not reported.
- Prior-quarter comparisons were not reported.
- Prior guidance was not provided, so actual performance versus prior guidance cannot be assessed.
AlphaAI analysis generated from the company’s SEC earnings filing (Form 8-K Item 2.02, or Form 6-K for a foreign private issuer). Every figure was cross-checked against the filing text; consensus estimates, price targets and share-price reactions are not shown because they are not in the filing. AI-generated research, not investment advice.
Background
SEC 8-K Item 2.02 with Exhibit 99.1 reporting Mayville Engineering’s Q2 2026 results for the three months ended June 30, 2026.
Ticker impact
Mayville Engineering reported Q2 2026 net sales of $163.0M (+23.2% y/y) and raised full-year 2026 net sales guidance by about 5%.
Near-term upside bias on guidance raise and order awards, with some profit-taking risk from weaker free cash flow and margin pressure from launch costs.
The filing discloses a concrete guidance increase, $40M datacenter project awards, and improved capacity utilization, but also shows quarterly free cash flow of -$6.6M and adjusted EBITDA margin down to 8.1%.
Market effects
Signals improving demand in datacenter power infrastructure and commercial vehicle production, relevant to industrial suppliers with similar end-market exposure.
Limited direct regional read-through; company-specific execution and end-market demand dominate.
Datacenter capex momentum can support broader industrial supply chains, but impact is primarily company-specific here.
Counterpoint
The guidance raise may be partially offset by ongoing datacenter program ramp costs, keeping margins and cash flow volatile into 2H.
Key entities
- issuerMayville Engineering Company, Inc.
NYSE-listed manufacturer of design, prototyping, and manufacturing solutions; reported Q2 2026 results and raised FY 2026 net sales guidance.
- business_segmentDatacenter & Critical Power end market
Reported 476.5% y/y net sales growth to $29.0M in Q2 and $40M in secured project awards.
- capital_marketsCommon stock offering
Company completed a common stock offering during the quarter, generating about $94M net proceeds used to reduce debt and fund growth initiatives.
