TAT TECHNOLOGIES LTD (TATT): Financial results for Q2 2026
TAT TECHNOLOGIES LTD (TATT) furnished an SEC Form 6-K — earnings release. SIGNATURE Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized. TAT TECHNOLOGIES LTD. (Registrant) By: /s/ Ehud Ben-Yair Ehud Ben-Yair Chief Financi
How this was made
The 30-second read
Why it matters
Earnings beat and record backlog could trigger short‑term buying pressure; watch cash flow trends.
Market read
First‑report earnings release for a micro‑cap aerospace supplier; modest but actionable impact on its stock.
What to watch
Cash flow from operations turned negative; reliance on one-time minority interest sale.
TAT Technologies Reports Record Second Quarter 2026 Results Revenue Increases 22.8% as Demand Remains Strong and Supply Chain Conditions Ease; Backlog and Long-Term Agreements Reach Record $615 Million
Second-quarter revenue, gross profit, operating income and Adjusted EBITDA increased year over year, while backlog and long-term agreements reached approximately $615 million. Reported net income included a $4.3 million net-of-tax non-operating gain, and operating cash flow was negative in the quarter.
Key metrics
as reported| Metric | Value | q/q | y/y |
|---|---|---|---|
| RevenueGAAP | $52.9 million | – | 22.8% increase |
| Gross profitGAAP | $13.3 million | – | 23.0% increase |
| Gross marginGAAP | 25.2% of revenues | – | – |
| Research and development, netGAAP | $535 | – | – |
| Selling and marketingGAAP | $2,530 | – | – |
| General and administrativeGAAP | $4,632 | – | – |
| Operating expensesGAAP | $7,697 | – | – |
| Operating incomeGAAP | $5.6 million | – | 26.8% increase |
| Operating marginGAAP | 10.6% of revenues | – | – |
| Gain on sale of equity investmentGAAP | $4,324 | – | – |
| Interest expensesGAAP | $(182) | – | – |
| Other financial expenses, netGAAP | $(368) | – | – |
| Income before taxes on incomeGAAP | $9,397 | – | – |
| Provision for income taxesGAAP | $1,911 | – | – |
| Share in profits of equity investment of affiliated companiesGAAP | $585 | – | – |
| Net incomeGAAP | $8.1 million | – | – |
| Basic earnings per shareGAAP | $0.62 | – | – |
| Diluted earnings per shareGAAP | $0.61 | – | – |
| Adjusted net incomenon-GAAP | $4,655 | – | – |
| Adjusted basic earnings per sharenon-GAAP | $0.36 | – | – |
| Adjusted diluted earnings per sharenon-GAAP | $0.35 | – | – |
| Adjusted EBITDAnon-GAAP | $7.4 million | – | 22.7% increase |
| Adjusted EBITDA marginnon-GAAP | 14.0% of revenues | – | – |
| Net cash used in operating activitiesGAAP | $(0.6) million | – | – |
| Purchase of property and equipmentGAAP | $(1,139) | – | – |
| Net cash provided by investing activitiesGAAP | $3,354 | – | – |
| Net cash provided by financing activitiesGAAP | $292 | – | – |
| Six months ended June 30, 2026 revenueGAAP | $94.1 million | – | 10.4% increase |
| Six months ended June 30, 2026 gross profitGAAP | $23.4 million | – | 12.4% increase |
| Six months ended June 30, 2026 gross marginGAAP | 24.8% of revenues | – | – |
| Six months ended June 30, 2026 operating incomeGAAP | $8.6 million | – | – |
| Six months ended June 30, 2026 operating marginGAAP | 9.1% of revenues | – | – |
| Six months ended June 30, 2026 net incomeGAAP | $11.5 million | – | – |
| Six months ended June 30, 2026 diluted earnings per shareGAAP | $0.87 | – | – |
| Six months ended June 30, 2026 adjusted net incomenon-GAAP | $8,055 | – | – |
| Six months ended June 30, 2026 adjusted diluted earnings per sharenon-GAAP | $0.61 | – | – |
| Six months ended June 30, 2026 Adjusted EBITDAnon-GAAP | $12.3 million | – | 4.1% increase |
| Six months ended June 30, 2026 net cash provided by operating activitiesGAAP | $1.4 million | – | – |
Segments
| Segment | Revenue | q/q | y/y |
|---|---|---|---|
| ProductsRevenue was $15,329 for the three months ended June 30, 2026, compared to $12,463 for the three months ended June 30, 2025. | $15,329 | – | – |
| ServicesRevenue was $37,609 for the three months ended June 30, 2026, compared to $30,641 for the three months ended June 30, 2025. | $37,609 | – | – |
What drove it
- Revenue increased 22.8% to $52.9 million, with both products and services revenue higher than the prior-year quarter.
- Management cited continued strong demand, solid execution and improving supply chain conditions that enabled conversion of previously constrained customer demand into revenue.
- Backlog and long-term agreements were approximately $615 million as of June 30, 2026, compared to approximately $580 million on March 31, 2026.
- TAT became the sole authorized distributor of spare parts for the 331-200 auxiliary power unit platform, extended its MRO license through 2036, and acquired three Honeywell Aerospace 131-9A APUs to expand its leasing business.
- Gross profit increased 23.0% to $13.3 million and gross margin was 25.2% of revenues, compared to 25.1% of revenues in Q2 2025.
- Adjusted EBITDA increased 22.7% to $7.4 million, while Adjusted EBITDA margin was 14.0% of revenues in both periods.
Concerns
- Second-quarter cash flow used in operations was $(0.6) million, compared to $6.9 million provided by operations in Q2 2025.
- Reported net income included a $4.3 million, net of tax, non-operating gain from the sale of a minority interest in an unconsolidated entity.
- Operating income for the first half was $8.6 million, the same as the first half of 2025, while operating margin was 9.1% of revenues compared to 10.1% of revenues.
- Supply chain conditions have not fully normalized, according to management.
- The filing identifies risks related to airline-industry business conditions, order timing and cancellations, supply continuity and component prices, war and hostilities between Israel and Hamas, Hezbollah and Iran, and regional shipping disruptions.
What to watch
- Conversion of approximately $615 million of backlog and long-term agreements into revenue.
- Whether improving supply chain conditions continue to support the conversion of customer demand into revenue.
- Operating cash flow and working-capital movements, including trade accounts receivable and inventory.
- The earnings contribution from the expanded Honeywell Aerospace relationship, the 331-200 APU spare-parts distribution authorization, MRO license extension and additional leased APUs.
- The durability of gross margin and Adjusted EBITDA margin as product and services revenue develop.
Balance sheet and cash flow
- Cash and cash equivalents were $54,629 as of June 30, 2026, compared to $51,259 as of December 31, 2025.
- Accounts receivable, net were $38,813 as of June 30, 2026, compared to $33,420 as of December 31, 2025.
- Inventory was $85,189 as of June 30, 2026, compared to $75,549 as of December 31, 2025.
- Current maturities of long-term debts were $164 as of June 30, 2026, compared to $2,227 as of December 31, 2025.
- Long-term debts, net were $11,018 as of June 30, 2026, compared to $9,485 as of December 31, 2025.
- Total shareholders' equity was $188,935 as of June 30, 2026, compared to $176,391 as of December 31, 2025.
- Cash flow used in operations was $(0.6) million in the second quarter, compared to $6.9 million provided by operations in Q2 2025.
- The cash flow statement reported an $(8,342) change in trade accounts receivable and an $(3,453) increase in inventory during the three months ended June 30, 2026.
- Proceeds from sale of equity investment were $4,493 during the three months ended June 30, 2026.
- Repayments of long-term debts were $(10,721) and proceeds from long term debt, net were $10,877 during the three months ended June 30, 2026.
Analysis
TAT reported a strong second quarter, with revenue of $52.9 million, up 22.8% from $43.1 million. Both reported revenue categories increased versus the prior-year period: products revenue was $15,329 versus $12,463, and services revenue was $37,609 versus $30,641. Management attributed the result to continued customer demand, solid execution and improving supply chain conditions that allowed the company to convert previously constrained demand into revenue.
Profitability improved at the operating level. Gross profit increased 23.0% to $13.3 million and gross margin was 25.2% of revenues, compared with 25.1% in Q2 2025. Operating income increased 26.8% to $5.6 million and operating margin reached 10.6% of revenues, compared with 10.3% in the prior-year quarter. Adjusted EBITDA rose 22.7% to $7.4 million, while its margin remained 14.0% of revenues.
Reported net income was $8.1 million and diluted EPS was $0.61, but these results included a $4.3 million net-of-tax non-operating gain from the sale of a minority interest in an unconsolidated entity. Excluding that item, adjusted net income was $4.66 million and adjusted diluted EPS was $0.35. For the first half, operating income was $8.6 million, equal to the first half of 2025, while operating margin was 9.1% of revenues compared with 10.1% of revenues in the prior-year half.
Cash conversion was weaker in the quarter. Cash flow used in operations was $(0.6) million, compared with $6.9 million provided by operations in Q2 2025, amid an $(8,342) change in trade accounts receivable and a $(3,453) increase in inventory. Cash and cash equivalents were $54,629 at June 30, 2026, while inventory was $85,189 and long-term debts, net were $11,018.
The demand outlook described in the release is supported by approximately $615 million of backlog and long-term agreements as of June 30, 2026, up from approximately $580 million at March 31, 2026. TAT also expanded its Honeywell Aerospace relationship through spare-parts distribution authorization for the 331-200 APU platform, an MRO license extension through 2036 and the acquisition of three Honeywell Aerospace 131-9A APUs for leasing. The company did not provide quantitative forward guidance.
Management, verbatim
Continued strong demand and solid execution drove nearly 23% revenue growth and continued profitability improvements.
Igal Zamir, CEO and President
This performance reflects our strategic position in the market, targeting high-demand services backed by established and solid relationships with OEMs.
Igal Zamir, CEO and President
We believe the combination of historically high customer demand, expanding platform coverage, and a record backlog, combined with improving supply chain conditions, positions TAT well for continued profitable growth,
Igal Zamir, CEO and President
Not in the filing
stated, not guessed- Quantitative forward guidance for revenue, gross margin, operating expenses, tax rate and other metrics was not provided.
- Previous-release outlook was not provided.
- Free cash flow was not reported.
- Share repurchases and dividends were not reported.
- Quarter-over-quarter comparisons for revenue, profitability, EPS, Adjusted EBITDA and segment revenue were not reported.
- Percentage changes for product and services revenue were not reported.
- A reported tax rate was not provided.
- A separate segment operating-profit or segment-margin disclosure was not provided.
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
TAT Technologies is a NASDAQ‑listed supplier of aerospace and defense components, reporting its Q2 2026 earnings via a Form 6‑K filing.
Ticker impact
TAT Technologies reported Q2 2026 results with 22.8% revenue growth and record backlog of $615M.
Potential upside of 5‑10% as investors price in higher growth outlook.
Revenue and earnings both rose sharply; non‑recurring gain highlighted; guidance not provided but backlog suggests visibility.
Market effects
Boosts aerospace and defense MRO sector sentiment.
Positive for U.S. and Israeli aerospace suppliers.
Limited to niche aerospace component market.
Counterpoint
Backlog growth may mask margin pressure if supply chain issues persist.
Key entities
- CompanyTAT Technologies Ltd.
NASDAQ‑listed aerospace and defense component supplier.
- ExecutiveEhud Ben‑Yair
Chief Financial Officer who signed the filing.
