Parker-Hannifin (PH) Q4 2026 earnings summary

Executive summary

• Achieved record FY 2026 sales of $21.5 billion, up 8.3% reported and 6.6% organic, with adjusted EPS up 18% to $32.31 and net income of $3.65 billion.

• Q4 FY26 sales reached $5.8 billion (+10% YoY), adjusted EPS $9.27 (+21% YoY), and net income $1.19 billion (+20% YoY).

• Surpassed FY29 adjusted segment margin target, raising FY31 target to 30%.

• Strategic acquisitions (Curtis Instruments, Filtration Group, CIRCOR Aerospace & Defense) enhanced portfolio and growth prospects.

• Returned nearly $2 billion to shareholders via dividends and share repurchases, increasing the annual dividend for the 70th consecutive year.

Financial highlights

• FY26 adjusted segment operating margin reached 27.3% (+120 bps YoY); Q4 margin at 28.0% (+110 bps YoY); adjusted EBITDA margin 28.6% in Q4.

• FY26 cash flow from operations was $4.4 billion (+16% YoY); free cash flow $3.9 billion (+17% YoY), with 107% conversion and 18.2% margin.

• Net debt to adjusted EBITDA reduced to 1.4x from 1.7x last year.

• Backlog reached a record $12.8 billion, up 16% year-over-year, with Q4 order rates up 19% overall.

• Q4 adjusted net income $1.2 billion (21% return on sales); Q4 EPS up 19% to $8.54; adjusted EPS up 21% to $9.27.

Outlook and guidance

• FY27 reported and organic sales growth guided at 5.5%–8.5% (7% midpoint), targeting ~$23 billion in sales.

• Adjusted segment operating margin guidance at 27.5%–27.9% (up 40 bps), with adjusted EPS of $34.25–$35.25 (up 8%).

• Free cash flow expected at $3.4–$3.9 billion with ~100% conversion.

• All market verticals guided to positive sales growth, with Aerospace & Defense leading at high single-digit organic growth.

• New long-term targets: 30% adjusted segment operating margin by FY31, 4%–6% organic growth, 17% free cash flow margin, >10% adjusted EPS growth over the cycle.