EnerSys (ENS) Q1 2027 earnings summary

Executive summary

• Achieved record Q1 FY2027 results with net sales of $936 million, up 5% year-over-year, driven by favorable price mix, higher volumes, and strong performance in data center, communications, and defense markets.

• Adjusted diluted EPS rose 65% to $3.66, with net earnings more than doubling to $116.5 million; gross margin improved by 510 basis points to 33.5%.

• Free cash flow reached $218 million, a $250 million year-over-year increase, with conversion at 187%; net leverage improved to 0.8x.

• Announced DOE grant and Board approval for a new U.S. lithium cell manufacturing facility, with $150 million in DOE grants and $200 million in state/local incentives.

• Returned $60 million to shareholders through $50 million in share repurchases and increased quarterly dividend by 10% to $0.2875 per share.

Financial highlights

• Adjusted operating earnings rose 47% to $179 million; adjusted EBITDA up 50% to $196 million; gross profit reached $313 million, up 24%.

• Q1 gross margin was 33.5%, up 510 basis points; excluding one-time tariff refunds, gross margin rose 180 basis points.

• Operating cash flow was $230.2 million, up from $1.0 million in the prior year.

• Received $115 million U.S. federal tax refund and $31 million in tariff refunds during the quarter.

• Cash and equivalents increased to $531 million; net debt reduced to $521.5 million.

Outlook and guidance

• Q2 net sales expected between $955 million and $995 million; adjusted diluted EPS forecasted at $3.15–$3.25, up 21% year-over-year at midpoint.

• Excluding 45X/IRC 45X benefits, adjusted diluted EPS expected at $1.95–$2.05, up ~25% year-over-year.

• FY27 capital expenditures projected at ~$70 million; margin expansion expected to drive earnings growth in 1H FY27, with topline growth in 2H.

• Stronger revenue growth anticipated in the second half of fiscal 2027, driven by material handling recovery and continued momentum in key markets.