Ecolab (ECL) Q1 2026 earnings summary

Executive summary

• Achieved double-digit adjusted EPS growth of 13% year-over-year, with reported diluted EPS at $1.52 and adjusted diluted EPS at $1.70, and net sales up 10% to $4.07B, driven by strong performance in Life Sciences, Global High-Tech, Institutional, and Specialty.

• Operating income increased 12% to $622.0 million; adjusted operating income up 15% to $679.7 million, with margin expansion supported by disciplined execution and growth engines like Global High-Tech and digital growing over 20%.

• Life Sciences accelerated to 11% growth, led by bioprocessing and pharmaceutical, and Pest Elimination grew 7%–8% with new digital offerings and customer wins.

• Core portfolio performed well, with Institutional and Specialty segments gaining share and Food & Beverage growing 5%.

• Major acquisitions included Ovivo Electronics (completed) and pending $4.75B CoolIT Systems acquisition, expected to close in Q3 2026.

Financial highlights

• Reported sales: $4,066.1M (+10% year-over-year); organic sales: $3,957.3M (+4%).

• Reported operating income: $622.0M (+12%); adjusted operating income: $679.7M (+15%).

• Adjusted EPS: $1.70 (+13%); reported EPS: $1.52 (+8%).

• Gross margin was 43.6% reported and 44.2% adjusted, with margin slightly lower due to M&A and higher commodity costs.

• SG&A as % of sales improved by 130 bps to 27.1%, driving strong leverage year-over-year.

Outlook and guidance

• Maintains 2026 adjusted diluted EPS outlook of $8.43–$8.63 (+12%–15% year-over-year), excluding pending CoolIT Systems acquisition.

• Q2 2026 adjusted diluted EPS expected at $2.02–$2.12 (+7%–12% year-over-year).

• Organic sales growth expected to accelerate to 6%–7% in the second half of 2026, with adjusted operating income margin projected to expand to ~19%.

• Energy surcharge implemented to offset rising energy and supply chain costs.

• Pending CoolIT Systems acquisition expected to close in Q3 2026, funded by a new $4.75B term loan.