EnerSys Reports Second Quarter Fiscal Year 2027 Results
EnerSys (ENS) filed an SEC Form 8-K — Results of Operations and Financial Condition. Exhibit 99.1 PRESS RELEASE, DATED NOVEMBER 11th, 2026, OF ENERSYS REGARDING FINANCIAL RESULTS FOR THE SECOND QUARTER FISCAL 2027 EnerSys Reports Second Quarter Fiscal Year 2027 Results Delivers Gross Margin of 29.9% or 25.2% ex IRC 45X (1) and Diluted EPS of $2.42, +34% ($1.22, +
How this was made
The 30-second read
Why it matters
The earnings release provides fresh guidance on performance and strategic direction, offering traders actionable data.
Market read
First‑report earnings and acquisition news give traders a clear catalyst for ENS, with potential upside on the earnings beat and strategic expansion.
What to watch
Closing conditions for the Ultralife acquisition and potential integration risks.
EnerSys Q2 FY2027: net sales flat at $949.9 million, below guidance range, while GAAP diluted EPS rose to $2.42 and adjusted diluted EPS reached $3.22 within guidance range
Net sales were $949.9 million, down 0.1% and below the company's stated Q2 guidance range of $955 million to $995 million, which the company attributes to foreign currency translation. Adjusted diluted EPS of $3.22 sat inside the $3.15 to $3.25 guidance range cited in the release, GAAP diluted EPS rose to $2.42 from $1.80, gross margin expanded 80 bps to 29.9%, and free cash flow was $130.4 million. Industrial Mobility Solutions revenue fell 7.8% on material handling softness, which offsets the growth in other segments.
Key metrics
shortened, hover for the filing’s print| Metric | Value | q/q | y/y |
|---|---|---|---|
| Net sales (Q2 FY2027)GAAP | $949.9M | – | (0.1)% |
| Net sales (six months FY2027)GAAP | $1.89B | – | 2.2% |
| Gross profit (Q2 FY2027)GAAP | $284.4M | – | $7.2 million |
| Gross profit (six months FY2027)GAAP | $597.8M | – | $67.4 million |
| Adjusted gross profit (Q2 FY2027)non-GAAP | $285.5M | – | – |
| Adjusted gross profit (six months FY2027)non-GAAP | $598.9M | – | – |
| Gross margin (Q2 FY2027)GAAP | 29.9% | – | +80 bps |
| Gross margin (six months FY2027)GAAP | 31.7% | – | – |
| Adjusted gross margin (Q2 FY2027)non-GAAP | 30.0% | – | – |
| Adjusted gross margin (six months FY2027)non-GAAP | 31.8% | – | – |
| Gross margin excluding IRC 45X (Q2 FY2027)non-GAAP | 25.2% | – | +30 bps |
| Gross margin excluding IRC 45X (six months FY2027)non-GAAP | 26.8% | – | – |
| IRC 45X benefit (Q2 FY2027)non-GAAP | $44.4M | – | – |
| IRC 45X benefit (six months FY2027)non-GAAP | $91.6M | – | – |
| Operating expenses (Q2 FY2027)GAAP | $148.2M | – | – |
| Operating expenses (six months FY2027)GAAP | $299.5M | – | – |
| Restructuring and other exit charges (Q2 FY2027)GAAP | $20.7M | – | – |
| Restructuring and other exit charges (six months FY2027)GAAP | $31.4M | – | – |
| Operating earnings (Q2 FY2027)GAAP | $115.5M | – | $23.5 million |
| Operating earnings (six months FY2027)GAAP | $266.9M | – | $88.4 million |
| Operating margin (Q2 FY2027)GAAP | 12.2% | – | – |
| Operating margin (six months FY2027)GAAP | 14.2% | – | – |
| Adjusted operating earnings (Q2 FY2027)non-GAAP | $152.4M | – | $18.5 million |
| Adjusted operating earnings (six months FY2027)non-GAAP | $331.2M | – | $75.8 million |
| Adjusted operating margin (Q2 FY2027)non-GAAP | 16.0% | – | – |
| Adjusted operating margin (six months FY2027)non-GAAP | 17.6% | – | – |
| Interest (Q2 FY2027)GAAP | $10.1M | – | – |
| Interest (six months FY2027)GAAP | $20.7M | – | – |
| Earnings before income taxes (Q2 FY2027)GAAP | $102.6M | – | – |
| Income tax expense (Q2 FY2027)GAAP | $13M | – | – |
| Income tax expense (six months FY2027)GAAP | $31.5M | – | – |
| Net earnings attributable to EnerSys stockholders (Q2 FY2027)GAAP | $89.6M | – | $21.2 million |
| Net earnings attributable to EnerSys stockholders (six months FY2027)GAAP | $206.1M | – | $80.2 million |
| Reported net earnings excluding IRC 45X benefit (Q2 FY2027)non-GAAP | $45.2M | – | – |
| Adjusted net earnings (Q2 FY2027)non-GAAP | $118.9M | – | – |
| Adjusted net earnings (six months FY2027)non-GAAP | $256.6M | – | – |
| Diluted EPS (Q2 FY2027)GAAP | $2.42 | – | $0.62 |
| Diluted EPS (six months FY2027)GAAP | $5.52 | – | $2.26 |
| Adjusted diluted EPS (Q2 FY2027)non-GAAP | $3.22 | – | $0.57 |
| Adjusted diluted EPS (six months FY2027)non-GAAP | $6.88 | – | $2.00 |
| Reported diluted EPS excluding IRC 45X benefit (Q2 FY2027)non-GAAP | $1.22 | – | +61% |
| Reported diluted EPS excluding IRC 45X benefit (six months FY2027)non-GAAP | $3.07 | – | – |
| Adjusted diluted EPS excluding IRC 45X benefit (Q2 FY2027)non-GAAP | $2.02 | – | +25% |
| Adjusted diluted EPS excluding IRC 45X benefit (six months FY2027)non-GAAP | $4.43 | – | – |
| EBITDA (Q2 FY2027)non-GAAP | $141.6M | – | $25.0 million |
| EBITDA (six months FY2027)non-GAAP | $317.7M | – | $97.2 million |
| Adjusted EBITDA (Q2 FY2027)non-GAAP | $170.4M | – | $19.9 million |
| Adjusted EBITDA (six months FY2027)non-GAAP | $365.6M | – | $84.9 million |
| Net cash provided by operating activities (Q2 FY2027)GAAP | $142.8M | – | – |
| Net cash provided by operating activities (six months FY2027)GAAP | $372.8M | – | – |
| Capital expenditures (Q2 FY2027)GAAP | $12.4M | – | – |
| Capital expenditures (six months FY2027)GAAP | $24.8M | – | – |
| Free cash flow (Q2 FY2027)non-GAAP | $130.4M | – | – |
| Free cash flow (six months FY2027)non-GAAP | $348M | – | – |
| Share repurchases (Q2 FY2027)GAAP | $130M | – | $62.3 million |
| Share repurchases (six months FY2027)GAAP | $180M | – | $(37.8) million |
| Dividend per share (Q2 FY2027)GAAP | $0.2875 | – | $0.015 |
| Dividend per share (six months FY2027)GAAP | $0.55 | – | $0.0375 |
| Total capital returned to stockholders (Q2 FY2027)GAAP | $140.3M | – | $62.8 million |
| Total capital returned to stockholders (six months FY2027)GAAP | $199.9M | – | $(36.8) million |
| Net leverage ratio (end of Q2 FY2027)non-GAAP | 0.8 X EBITDA | – | – |
| Total net debt (end of Q2 FY2027)non-GAAP | $554.9M | – | – |
Segments
| Segment | Revenue | q/q | y/y |
|---|---|---|---|
| Network & Infrastructure Solutions (Q2 FY2027)Company states the segment delivered 3% growth against an unusually high second quarter prior year comparison, driven by double-digit growth in data centers (CEO). Adjusted operating earnings were $50.1 million vs $36.3 million, with adjusted operating margin of 11.2% vs 8.3%. Company describes improved volumes and favorable price/mix in NIS (CFO). | $449M | – | 3.3% |
| Industrial Mobility Solutions (Q2 FY2027)Company cites material handling softness within IMS (CFO). Adjusted operating earnings were $37.5 million vs $43.3 million, with adjusted operating margin of 9.5% vs 10.1%. Company expects Transportation growth to outpace higher margin Material Handling growth in Q3, with IMS margin pressure. | $397.1M | – | (7.8)% |
| Precision Power Solutions (Q2 FY2027)CEO states PPS delivered more than 20% year-over-year sales growth, supported by strong demand for soldier power and munitions. Adjusted operating earnings were $22.7 million vs $15.8 million, with adjusted operating margin of 21.9% vs 18.5%. Company notes the project nature of PPS creates quarter-to-quarter fluctuation and a tough Q3 comparison. | $103.8M | – | 21.0% |
| Network & Infrastructure Solutions (six months FY2027)Six-month segment revenue as printed. Adjusted operating earnings were $95.1 million vs $66.2 million, with adjusted operating margin of 10.8% vs 8.0%. | $877.3M | – | 6.2% |
| Industrial Mobility Solutions (six months FY2027)Six-month segment revenue as printed. Adjusted operating earnings were $75.2 million vs $85.4 million, with adjusted operating margin of 9.4% vs 10.0%. | $803.9M | – | (5.6)% |
| Precision Power Solutions (six months FY2027)Six-month segment revenue as printed. Adjusted operating earnings were $41.0 million vs $28.2 million, with adjusted operating margin of 20.1% vs 16.9%. | $204.3M | – | 22.3% |
Q3 fiscal 2027 and full fiscal 2027 outlook
- RevenueQ3 net sales: $935M to $975M
- NoteQ3 adjusted diluted EPS: $3.05 to $3.15 (footnoted as inclusive of IRC 45X Advanced Manufacturing Production Credits)
- NoteFull fiscal 2027 capital expenditures: ~$70M
- NoteOutlook does not reflect the proposed Ultralife acquisition, which is expected to close in the fourth fiscal quarter of 2027, or the impact of any IEEPA tariff refunds or customer reimbursements
Capital returns
- Q2 FY2027: total capital returned $140.3 million, including $130.0 million of share repurchases (679K shares) and $10.3 million of dividends paid.
- Six months FY2027: total capital returned $199.9 million, with share repurchases of $180.0 million, vs $236.7 million in the prior year six months.
- Quarterly cash dividend of $0.2875 per share approved, payable December 31, 2026 to holders of record as of December 18, 2026.
- Balance sheet treasury stock rose to $(1,542,647) thousand at October 4, 2026 from $(1,361,585) thousand at March 31, 2026.
What drove it
- Company states the Q2 net sales decrease and the sales shortfall below guidance were the result of foreign currency translation.
- Six-month net sales growth of 2.2% was attributed by the company to a 1% increase in pricing and a 1% increase in organic volume.
- Company states improved volumes and favorable price/mix in PPS and NIS balanced the impact of material handling softness within IMS (CFO).
- Company states gross margin expansion reflects operating discipline and higher-value solutions (CFO); GAAP gross margin rose 80 bps to 29.9%.
- Company reports the Q2 IRC 45X benefit was $44.4 million vs $39.6 million; ex-45X gross margin was 25.2% vs 24.9%.
- Company reports GAAP diluted EPS of $2.42 included an unfavorable highlighted net of tax impact of $29.3 million, or $0.80 per diluted share, vs $32.4 million, or $0.85, in the prior year quarter.
- Company states the Q2 one-time impact of ($2M) or ($0.04) per share from tariff refund adjustments was recorded in corporate unallocated and other; six-month impact is $29M or $0.59 per share.
- Company states the NIS segment and PPS segment results reflect the project nature of the businesses and quarter-to-quarter fluctuations, which create tough comparisons in Q3.
- Company states the decline in Q2 operating cash flow reflects the prior year receipt of a U.S. federal tax refund.
Concerns
- Net sales of $949.9 million were below the company's Q2 guidance range of $955 million to $995 million, as stated in the release.
- Industrial Mobility Solutions net sales fell 7.8% to $397.1 million, with company-cited material handling softness; IMS adjusted operating earnings fell 13.4% and adjusted operating margin declined to 9.5% from 10.1%.
- Company expects IMS margin pressure in Q3 as Transportation outpaces higher margin Material Handling growth.
- Company states PPS and NIS face tough Q3 comparisons because both delivered exceptionally strong margins in the prior year and prior quarter.
- Q2 operating cash flow fell to $142.8 million from $218.0 million, and free cash flow fell to $130.4 million from $197.1 million, which the company ties to the prior year federal tax refund.
- Share repurchases in Q2 of $130.0 million exceeded the prior year quarter's $67.7 million, while the six-month repurchase total of $180.0 million was below the prior year's $217.8 million.
- Cash and cash equivalents declined to $275.5 million from $438.7 million at March 31, 2026, per the balance sheet.
What to watch
- Q3 FY2027 net sales of $935M to $975M and adjusted diluted EPS of $3.05 to $3.15, both of which the company says exclude the Ultralife acquisition and IEEPA tariff refunds or customer reimbursements.
- Whether IMS Material Handling returns to year-on-year growth, as the CFO stated is expected to transform IMS revenue to year-on-year growth in Q3.
- Progress on the proposed Ultralife acquisition, announced October 27, 2026 and expected to close in the fourth fiscal quarter of 2027, subject to customary closing conditions including regulatory approvals.
- Full-year FY2027 capital expenditures of approximately $70M, against six-month capital expenditures of $24.8 million.
- Sustainability of IRC 45X benefit: $44.4 million in Q2 and $91.6 million in the six months, which the company presents separately as a non-GAAP item.
- Ramp of new products: first order for DataSafe Noir lithium solution and initial sales from second-generation lithium offering for material handling, as stated by the CEO.
- Continued use of cash for share repurchases and dividends, given the Q2 capital returned of $140.3 million.
Balance sheet and cash flow
- Cash and cash equivalents: $275.5 million at October 4, 2026 (balance sheet: $275,500 thousand vs $438,675 thousand at March 31, 2026).
- Net debt as defined by the credit facility: $554.9 million at October 4, 2026, vs $842.0 million at September 28, 2025 per the LTM table.
- Net leverage ratio: 0.8 X at end of Q2 FY2027, down from 1.3 X in the prior year period, which the company attributes to lower debt and increased earnings.
- Long-term debt, net: $786,186 thousand at October 4, 2026 vs $1,079,782 thousand at March 31, 2026. Short-term debt: $28,661 thousand vs $29,201 thousand.
- Total assets: $3,698,378 thousand at October 4, 2026 vs $4,003,324 thousand at March 31, 2026. Total equity: $1,909,756 thousand vs $1,908,872 thousand.
- Q2 operating cash flow of $142.8 million vs $218.0 million: the company states the decrease in operating cash flow and free cash flow was driven by receipt of the U.S. federal tax refund in the prior year quarter.
- Six-month operating cash flow of $372.8 million vs $219.0 million, and free cash flow of $348.0 million vs $165.1 million: the company attributes the increase to improved earnings, disciplined capital allocation and targeted emphasis to optimize primary operating capital (POC).
- Free cash flow conversion (as printed in the reconciliation): 145.6% for Q2 FY2027 vs 288.2% prior year; 168.9% for six months vs 131.1%. The CFO cites FCF conversion of 146%.
Analysis
EnerSys reported Q2 FY2027 net sales of $949.9 million, essentially flat against $951.3 million a year earlier and below the company's stated Q2 guidance range of $955 million to $995 million. The company attributes the decline and the shortfall to foreign currency translation. Six-month net sales rose 2.2% to $1,885.5 million, which the company attributes to a 1% increase in pricing and a 1% increase in organic volume. Segment mix was uneven: Precision Power Solutions grew 21.0% to $103.8 million, Network and Infrastructure Solutions grew 3.3% to $449.0 million, and Industrial Mobility Solutions declined 7.8% to $397.1 million, with the company citing material handling softness.
Profitability improved on a reported and adjusted basis. GAAP gross margin rose to 29.9% from 29.1%, and GAAP operating earnings rose to $115.5 million from $92.0 million. Adjusted operating earnings rose to $152.4 million from $133.9 million, and adjusted operating margin reached 16.0% vs 14.1%. Operating expenses fell to $148.2 million from $164.1 million. GAAP diluted EPS was $2.42 vs $1.80, and adjusted diluted EPS was $3.22 vs $2.65. The company states GAAP diluted EPS included highlighted items with an unfavorable net of tax impact of $29.3 million, or $0.80 per diluted share. Adjusted diluted EPS of $3.22 falls within the $3.15 to $3.25 Q2 guidance range that the release states was given on August 12, 2026. The IRC 45X benefit was $44.4 million in Q2 vs $39.6 million, and ex-45X gross margin was 25.2%, which the company reports separately.
Cash generation and capital allocation are central to this read. Q2 operating cash flow was $142.8 million vs $218.0 million, and free cash flow was $130.4 million vs $197.1 million; the company states this decline was driven by the prior year federal tax refund. Six-month operating cash flow rose to $372.8 million from $219.0 million, and six-month free cash flow rose to $348.0 million from $165.1 million, which the company attributes to improved earnings, disciplined capital allocation and emphasis on primary operating capital. Q2 capital returns were $140.3 million, including $130.0 million of repurchases. Net debt fell to $554.9 million from $842.0 million, and the net leverage ratio was 0.8 X vs 1.3 X. Cash fell to $275.5 million from $438,675 thousand at March 31, 2026, and long-term debt, net, fell to $786,186 thousand from $1,079,782 thousand.
The outlook calls for Q3 FY2027 net sales of $935M to $975M and adjusted diluted EPS of $3.05 to $3.15, with full-year capital expenditures of about $70M. The company excludes the pending Ultralife acquisition, expected to close in the fourth fiscal quarter of 2027, and any IEEPA tariff refunds or customer reimbursements. The CFO expects IMS revenue to return to year-on-year growth in Q3 while IMS margins face pressure from mix, and describes tough comparisons for PPS and NIS. Figures that deserve attention are the IMS revenue and margin trend, the reliance on the IRC 45X benefit in reported gross margin, the Q2 sales shortfall against guidance, and the Q2 decline in cash flow that the company attributes to the prior year tax refund.
Management, verbatim
Precision Power Solutions delivered more than 20% year-over-year sales growth, supported by strong demand for soldier power and munitions, while Network and Infrastructure Solutions delivered 3% growth against an unusually high second quarter prior year comparison, driven by double-digit growth in data centers.
Shawn O'Connell, President and Chief Executive Officer
Improved volumes and favorable price/mix in our PPS and NIS segments, balanced the impact of material handling softness within our IMS segment. We again delivered strong free cash flow, with FCF conversion of 146%.
Andrea Funk, Chief Financial Officer
From a margin perspective, we expect IMS to see pressure as Transportation outpaces higher margin Material Handling growth, largely offsetting the margin lift from incremental volume.
Andrea Funk, Chief Financial Officer
Not in the filing
stated, not guessed- No prior-period outlook was provided with the request, so vs_prior_guidance is empty. The release itself cites Q2 guidance of net sales $955 million to $995 million and adjusted diluted EPS of $3.15 to $3.25 given on August 12, 2026, but no separate prior outlook document was supplied.
- Q3 FY2027 gross margin, operating expenses and tax rate guidance are not printed.
- Prior-year quarter comparisons for Q2 operating expenses, operating cash flow and capex change percentages are not printed as changes.
- Prior-period comparison for cash and cash equivalents is printed only against March 31, 2026 (fiscal year end), not against a prior quarter or prior-year quarter.
- Prior-quarter (Q1 FY2027) figures are not printed in the release, so qoq_change is null throughout.
- Q2 operating margin change, interest expense change, and income tax change in percentage or dollar form are not printed.
- Adjusted gross profit and adjusted gross margin prior-year changes beyond the printed 0.1% adjustment are not printed.
- Corporate and other unallocated segment has no revenue line; it is not listed as a revenue segment.
- Share price reaction, consensus estimates and analyst expectations are not provided in the documents.
Written by an AI language model from the company’s SEC earnings filing (Form 8-K Item 2.02, or Form 6-K for a foreign private issuer). Every figure is checked against the filing text, and a metric the filing does not print, or whose value, prior period and change do not add up, is dropped from the metrics. The model can still misread a table, in the metrics or in the text, so check a number in the filing before you rely on it. 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
EnerSys filed an 8‑K reporting its Q2 FY2027 financials and a pending acquisition of Ultralife.
Ticker impact
EnerSys reported Q2 FY2027 results with $950M net sales, 34% EPS growth to $2.42 and announced a proposed acquisition of Ultralife.
potential upside as investors price in the earnings beat and acquisition news
The beat on EPS and margin suggests earnings strength, while the acquisition could add growth upside, likely supporting a modest rally.
Market effects
Positive for the industrial battery and defense power storage sector as EnerSys signals growth and acquisition activity.
U.S. industrial and defense suppliers may see modest buying pressure.
Limited to markets tracking battery and defense supply chains.
Counterpoint
Sales miss guidance and modest top‑line growth could weigh on the stock despite EPS beat.
Key entities
- CompanyEnerSys
Industrial battery and power solutions provider (NYSE: ENS).
- CompanyUltralife
Target of EnerSys' proposed acquisition to expand defense battery portfolio.
