Qnity Electronics (Q) Q2 2026 earnings summary

Executive summary

• Achieved ninth consecutive quarter of strong, profitable organic growth, with Q2 2026 net sales reaching $1.43 billion, up 22% year-over-year, driven by innovation in semiconductor materials, advanced packaging, and robust AI-driven demand.

• Adjusted Operating EBITDA rose 24% year-over-year to $431 million, with adjusted EPS up 53% to $1.19; GAAP net income declined to $136 million due to higher SG&A, transformation charges, and tax rate.

• Raised full-year 2026 guidance across all key metrics, reflecting ongoing demand tailwinds, strong execution, and robust customer engagement.

• Launched a multi-year transformation plan in February 2026 to enhance productivity and optimize market presence, incurring significant charges.

• Authorized a $500 million share repurchase program, with $50 million repurchased in the first half of 2026.

Financial highlights

• Q2 2026 net sales were $1.43 billion, up 22% year-over-year and 9% sequentially; adjusted operating EBITDA was $431 million (24% YoY growth, 30.2% margin); adjusted EPS was $1.19 (up 53% YoY); adjusted free cash flow was $259 million.

• Semiconductor Technologies Q2 net sales were $744 million (up 16% YoY), with adjusted operating EBITDA of $253 million (up 12–13% YoY, 34% margin).

• Interconnect Solutions Q2 net sales were $685 million (up 30% YoY), with adjusted operating EBITDA of $197 million (up 44–45% YoY, 28.8% margin).

• Q2 2026 GAAP EPS was $0.59, down from $0.90 in Q2 2025; net income margin (GAAP) was 9.5%, down from 16.9% YoY.

• Cash and cash equivalents stood at $961 million as of June 30, 2026; long-term debt was $3.997 billion.

Outlook and guidance

• Full-year 2026 net sales guidance raised to $5.55–$5.65 billion; adjusted operating EBITDA to $1.675–$1.725 billion; adjusted EPS to $4.40–$4.60; adjusted free cash flow to $600–$700 million.

• Third quarter net sales expected to grow sequentially in the low single digits; ICS in the mid-single digits.

• At midpoint, expects 18% net sales growth, over 20% adjusted EBITDA growth, and 35% adjusted EPS growth for the year.

• Management expects continued strong demand in AI, advanced packaging, and high bandwidth memory markets.

• Transformation plan expected to drive operational efficiencies and cost savings over the next two years.