Lincoln Electric (LECO) Q2 2026 earnings summary

Executive summary

• Achieved record Q2 2026 results with net sales of $1.22 billion, up 12% year-over-year, driven by organic growth, improved demand in the Americas, and the Alloy Steel acquisition.

• Adjusted EPS reached $2.93, up 13% year-over-year, with strong cash flow from operations at $254 million and 138% cash conversion.

• Returned $120 million to shareholders through dividends and share repurchases.

• Six consecutive months of favorable macro data in the Americas, strong order rates, and a record backlog support confidence in industrial recovery.

• All segments reported year-over-year sales and profit growth, with Americas Welding leading in absolute profit.

Financial highlights

• Net sales grew 12% to $1.22 billion, with 8% higher price, 2% higher volumes, 1.5% from acquisition, and FX benefit; organic sales up 10%.

• Adjusted operating income margin improved by 50 bps to 18.4%; adjusted EBIT for Q2 was $223.9 million.

• Adjusted EPS rose 13% to $2.93; gross profit margin slightly decreased by 50 bps to 36.8% due to inflation and mix.

• Record $254 million in operating cash flow, 138% cash conversion for the quarter, and free cash flow of $222 million.

• Capital expenditures for the first half totaled $70.6 million; Q2 capex was $31.4 million.

Outlook and guidance

• Raised full-year net sales growth outlook to low double digits, with organic sales expected in the high single-digit to low double-digit range (one-third volume, two-thirds price).

• Adjusted operating income margin expected to improve at a mid-20% incremental margin; neutral price/cost expected in H2 2026.

• Capex guidance set at $110–130 million; 100% cash conversion targeted.

• Maintaining assumptions on interest expense, tax rate, and cash conversion.

• Management is optimistic about continued demand and capital spending in key regions, supported by ongoing strategic initiatives.