Ralliant (RAL) Q3 2026 earnings summary

Executive summary

• Q3 revenue was $620.1M, up 17.2% reported and organically; both segments grew at double-digit organic rates, with book-to-bill above 1.1 in each segment.

• Normalized adjusted EBITDA margin rose 400 bps to 23.5%; adjusted EPS was $0.93, up 64% on a normalized basis. Results exceeded Q3 guidance and FY2026 guidance was raised.

• Strong backlog, defense and utility demand, and accelerated productivity savings underpin confidence in continued growth and margin expansion.

Financial highlights

• Revenue was $620.1M versus $529.1M; operating profit was $117.5M versus $52.0M, and net earnings were $86.1M versus $39.9M.

• Adjusted gross margin was 53.1%, up 190 bps; adjusted EBITDA was $145.8M, with a 23.5% margin versus 19.5% normalized in Q3 2025.

• Adjusted net earnings were $104.5M; adjusted EPS was $0.93 versus $0.60 on a normalized basis. GAAP diluted EPS was $0.77 versus $0.35.

• Operating cash flow was $111.3M and free cash flow was $101.9M; TTM free cash flow was $303.0M, with 93.5% conversion (reported as 94%).

• Excluding the $7M Q3 IEEPA tariff refund, adjusted gross margin expanded 75 bps and adjusted EBITDA margin expanded ~290 bps.

Outlook and guidance

• FY2026 revenue guidance rose to $2.34B–$2.36B, with 13%–14% organic growth; the midpoint increased $75M from prior guidance.

• FY2026 adjusted EBITDA margin guidance is ~21.5%, with ~340 bps YoY expansion; adjusted EPS guidance is $3.10–$3.16, up 47%–50% on a normalized basis.

• Q4 guidance: revenue $620M–$640M, 12%–15% organic growth; adjusted EBITDA margin 23.5%–24.5%; adjusted EPS $0.93–$0.99.

• Guidance includes IEEPA tariff refunds of $2M in Q2, $7M in Q3 and $5M in Q4; these benefits are not expected to recur in 2027.

• EPP savings outlook rose to $16M–$18M in-year for 2026 and $30M–$35M annualized exiting 2026, toward a $50M–$60M annualized target by 2028.