Flowserve (FLS) Q2 2026 earnings summary

Executive summary

• Achieved Q2 2026 bookings of $1.35 billion, up 26% year-over-year, with record aftermarket bookings and robust operating margin expansion, despite ongoing Middle East conflict headwinds.

• Adjusted EPS reached $0.95, exceeding expectations, and adjusted operating margin expanded to 15.3%.

• Major acquisitions included Trillium Flow Technologies' Valves Division, full ownership of FAMCO, and Greenray Turbine Solutions, expanding product and service offerings.

• Aftermarket sales increased to 58% of total sales, supporting margins amid lower original equipment demand.

• Realignment and portfolio optimization programs continued, with $69.7M in charges YTD and expected annualized cost savings of $140M upon completion.

Financial highlights

• Q2 2026 bookings grew 26% year-over-year to $1.35 billion; book-to-bill ratio at 1.15x.

• Q2 2026 sales were $1.17 billion, down 1.6% year-over-year; organic sales down 3.3%.

• Adjusted gross margin expanded 100 bps to 35.9%; adjusted operating margin up 70 bps to 15.3%.

• Q2 2026 adjusted EPS was $0.95, up 4% year-over-year; reported EPS was $0.77.

• Cash from operations for Q2 was $129 million; free cash flow was 92% of adjusted net earnings.

Outlook and guidance

• 2026 organic sales growth expected to be down ~1%, with total sales growth of ~3% including acquisitions and FX.

• Adjusted EPS guidance raised to $4.05–$4.20, reflecting confidence in double-digit EPS growth.

• Full-year adjusted operating margin expansion of ~100 bps expected.

• Backlog at June 30, 2026 was $3.3 billion, up 16.9% year-over-year, supporting second half growth.

• Middle East headwinds expected to persist in H2; Trillium acquisition to benefit reported growth.