Parker-Hannifin (PH) Q1 2026 earnings summary

Executive summary

• Achieved record Q1 sales of $5.1 billion, with 5% organic growth and 170 basis points of margin expansion, resulting in a 27.4% adjusted segment operating margin.

• Adjusted EPS grew 16% year-over-year to $7.22, and cash flow from operations reached a record $782 million.

• Net income rose to $808 million, or $927 million adjusted, with record safety performance and a 20% reduction in incident rate.

• Completed the $1.0 billion acquisition of Curtis Instruments, expanding technology offerings and capabilities in electric and hybrid vehicle technologies.

• Strong performance attributed to operational excellence, decentralized structure, and the win strategy.

Financial highlights

• Sales up 4%–5% year-over-year; organic growth +5%, currency +1%, divestitures -2%.

• Adjusted segment operating margin at 27.4%, up 170 basis points; adjusted EBITDA margin at 27.3%, up 240 basis points.

• Adjusted net income $927 million (18.2% return on sales); free cash flow $693 million (13.6% of sales), up 7% year-over-year.

• Share repurchases totaled $475 million in the quarter.

• Net income as a percent of sales was 15.9%, up from 14.2% year-over-year.

Outlook and guidance

• FY26 organic sales growth guidance raised to 4% at midpoint; reported sales growth guidance increased to 4%–7%.

• Adjusted segment operating margin guidance raised to 27.0% for the year, a 90 basis point increase over prior year.

• Adjusted EPS guidance raised to $29.60–$30.40, up 10% year-over-year; free cash flow guidance raised to $3.1–$3.5 billion.

• Q2 FY26 guidance: reported sales +6.5%, organic growth +4%, adjusted segment operating margin 26.6%, adjusted EPS $7.10.

• Fiscal 2026 effective tax rate expected at approximately 22.5%.