Second Quarter 2026
Filed Aug 10, 2026Helios Technologies Reports Second Quarter 2026 Results; Profitable Sales Growth Momentum Continues, Raising Full Year 2026 Outlook
Sales, gross profit, operating income, net income, diluted EPS, adjusted EBITDA and adjusted diluted EPS all increased year over year, while the Company raised its FY2026 sales and adjusted diluted EPS outlook.
Key metrics
as reported| Metric | Value | q/q | y/y |
|---|---|---|---|
| Net salesGAAP | $231.9 million | – | 9% |
| Gross profitGAAP | $80.2 million | – | 19% |
| Gross marginGAAP | 34.6% | – | 280 bps |
| Operating incomeGAAP | $32.5 million | – | 48% |
| Operating marginGAAP | 14.0% | – | 370 bps |
| Adjusted operating marginnon-GAAP | 17.8% | – | 280 bps |
| Net incomeGAAP | $21.9 million | – | 92% |
| Diluted EPSGAAP | $0.66 | – | 94% |
| Adjusted net incomenon-GAAP | $29.2 million | – | 50% |
| Adjusted diluted EPSnon-GAAP | $0.88 | – | 49% |
| Adjusted EBITDAnon-GAAP | $49.3 million | – | 25% |
| Adjusted EBITDA marginnon-GAAP | 21.2% | – | 260 bps |
| Hydraulics gross profitGAAP | $50.6 million | – | 9% |
| Hydraulics gross marginGAAP | 34.6% | – | 160 bps |
| Hydraulics SEA expensesother | $21.7 million | – | 1% |
| Hydraulics operating incomeGAAP | $28.9 million | – | 16% |
| Hydraulics operating marginGAAP | 19.7% | – | 200 bps |
| Electronics gross profitGAAP | $29.6 million | – | 41% |
| Electronics gross marginGAAP | 34.6% | – | 530 bps |
| Electronics SEA expensesother | $18.4 million | – | 22% |
| Electronics operating incomeGAAP | $11.2 million | – | 90% |
| Electronics operating marginGAAP | 13.1% | – | 490 bps |
| Cash from operationsother | $42 million | – | 13% |
| Free cash flowother | $31 million | – | – |
| Net-debt-to-adjusted EBITDA leverage ratioother | 1.4x | – | – |
Segments
| Segment | Revenue | q/q | y/y |
|---|---|---|---|
| HydraulicsAmericas net sales were $57.2 million, EMEA net sales were $51.8 million, and APAC net sales were $37.4 million. The release stated Hydraulics grew 14% on a pro-forma basis for divestiture and foreign exchange impact. | $146.4 million | – | 4% |
| ElectronicsAmericas net sales were $63.0 million, EMEA net sales were $9.1 million, and APAC net sales were $13.4 million. The release stated Electronics grew 19%. | $85.5 million | – | 19% |
FY2026 and 3Q26 outlook
- RevenueFY2026 sales: $880 to $900 million; 3Q26 sales: $215 to $222 million
- NoteFY2026 adjusted EBITDA margin: 20.2% to 21.0%
- Note3Q26 adjusted EBITDA margin: 19.8% to 20.6%
- NoteFY2026 adjusted diluted EPS: $3.05 to $3.25
- Note3Q26 adjusted diluted EPS: $0.70 to $0.77
- NoteThis assumes constant currency, based on ending second quarter 2026 foreign exchange rates.
Capital returns
- Paid 118th consecutive cash dividend to shareholders.
- Repurchased $6.0 million of Company's common stock in second quarter.
- Total dollars returned to shareholders over the last twelve months up 71% over prior period.
What drove it
- Second-quarter sales grew 16% on a pro-forma basis for divestiture and foreign exchange impact.
- Gross profit included a $1 million benefit from net IEEPA tariff refunds.
- Management attributed margin expansion to volume outperformance, innovative products, and operating leverage gains.
- Management cited new business wins and visibility into near-term demand in support of the increased full-year outlook.
- The Company described this as its fourth consecutive quarter of double-digit pro-forma sales and order intake growth.
Concerns
- Management cited tougher comparisons in the back half.
- Management cited geopolitical uncertainty, tariff dynamics, and broader inflationary pressures.
- Hydraulics APAC net sales declined 8% to $37.4 million.
What to watch
- 3Q26 sales guidance of $215 to $222 million.
- 3Q26 adjusted EBITDA margin guidance of 19.8% to 20.6%.
- 3Q26 adjusted diluted EPS guidance of $0.70 to $0.77.
- Execution against the raised FY2026 sales outlook of $880 to $900 million.
- Whether Hydraulics APAC sales recover from the reported 8% decline.
Balance sheet and cash flow
- Generated a second quarter record $42 million in cash from operations, up 13%.
- Generated $31 million of free cash flow in the second quarter.
- Reduced net-debt-to-adjusted EBITDA leverage ratio to 1.4x down from 2.6x in the prior-year period.
Analysis
Helios delivered profitable sales growth in the second quarter. Net sales were $231.9 million, up 9%, while gross profit increased 19% to $80.2 million. Gross margin expanded 280 bps to 34.6%, and operating income rose 48% to $32.5 million. The gross-profit increase included a $1 million benefit from net IEEPA tariff refunds, while management also cited volume outperformance, innovative products and operating leverage gains as contributors to margin expansion.
Both operating segments grew, with Electronics the principal reported growth contributor. Electronics sales increased 19% to $85.5 million, gross margin improved 530 bps to 34.6%, and operating income rose 90% to $11.2 million. Hydraulics sales increased 4% to $146.4 million, with Americas and EMEA growth partly offset by an 8% APAC sales decline. Hydraulics operating margin still improved 200 bps to 19.7%.
Earnings growth outpaced reported sales growth. GAAP net income rose 92% to $21.9 million and diluted EPS increased 94% to $0.66. Adjusted EBITDA increased 25% to $49.3 million, with adjusted EBITDA margin expanding 260 bps to 21.2%. Adjusted diluted EPS rose 49% to $0.88. The combination of sales growth and broad margin expansion produced the stronger earnings outcome described by management.
Cash generation and capital allocation were also notable. The Company generated a second-quarter record $42 million in cash from operations, up 13%, and $31 million of free cash flow. It reduced net-debt-to-adjusted EBITDA leverage to 1.4x from 2.6x in the prior-year period, repurchased $6.0 million of common stock, and paid its 118th consecutive cash dividend.
Management raised FY2026 sales guidance to $880 to $900 million from $840 to $870 million, raised adjusted diluted EPS guidance to $3.05 to $3.25 from $2.75 to $3.00, and increased the lower end of adjusted EBITDA margin guidance to 20.2% from 19.5%. The 3Q26 outlook calls for sales of $215 to $222 million, adjusted EBITDA margin of 19.8% to 20.6%, and adjusted diluted EPS of $0.70 to $0.77. Investors should monitor the tougher back-half comparisons, geopolitical uncertainty, tariff dynamics, inflationary pressures, and the Hydraulics APAC sales trend.
Management, verbatim
We extended the momentum we built to start the year and delivered another strong quarter, with second quarter sales at the high end of our guidance range and adjusted earnings exceeding the top end of our guidance.
Sean Bagan, President & Chief Executive Officer of Helios
While we remain mindful of the tougher comparisons in the back half and ongoing external factors, including geopolitical uncertainty, tariff dynamics, and broader inflationary pressures, our confidence in the business, new business wins, and our visibility into near-term demand support raising the full year outlook for sales and earnings.
Jeremy Evans, Executive Vice President, Chief Financial Officer
Not in the filing
stated, not guessed- Prior-quarter comparisons for reported consolidated and segment metrics were not provided.
- Consolidated operating expenses were not provided.
- GAAP tax rate was not provided.
- Cash balance was not provided.
- Debt balance was not provided.
- Net debt balance was not provided.
- Prior-year dollar amount for cash from operations was not provided.
- Prior-year and prior-quarter free cash flow figures were not provided.
- Cash dividend amount was not provided.
- Prior-period total dollars returned to shareholders and current total dollars returned to shareholders were not provided.
- GAAP gross-margin, operating-expense and tax-rate guidance were not provided.
- GAAP EPS guidance was not provided.
- A previous quarterly release outlook for comparison with reported second-quarter actual results 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.