TransDigm Group (TDG) Q1 2026 earnings summary

Executive summary

• Q1 FY2026 net sales reached $2,285 million, up 13.9% year-over-year, with organic growth of 7.4% and EBITDA As Defined of $1,197 million (52.4% margin).

• Adjusted EPS rose 5.1% to $8.23, while GAAP EPS was $6.62, both impacted by dividend equivalent payments.

• Growth was driven by strong demand in commercial OEM, aftermarket, and defense segments, with record passenger load factors and increased aircraft production.

• Three major acquisitions announced: Stellant Systems ($960M), Jet Parts Engineering, and Victor Sierra Aviation ($2.2B combined), with Simmonds and Servotronics acquisitions completed.

• Strategy remains focused on proprietary aerospace businesses, value-based operations, and disciplined capital allocation.

Financial highlights

• Gross profit was $1,352 million (59.2% margin), with Q1 EBITDA As Defined up 12.8% to $1,197 million and operating cash flow exceeding $830 million.

• Net income attributable to common stockholders was $445 million, down from $493 million year-over-year due to higher interest expense.

• Net interest expense increased 25.7% to $475 million, reflecting additional debt.

• Ended Q1 with $2.5 billion in cash; total debt was $30.0 billion, with net debt to EBITDA at 5.7x.

• Share repurchases exceeded $100 million during Q1.

Outlook and guidance

• FY2026 revenue guidance midpoint raised to $9.94 billion, up 13% year-over-year.

• FY2026 EBITDA As Defined guidance midpoint is $5.21 billion (52.4% margin), up 9% year-over-year.

• Adjusted EPS guidance midpoint is $38.38; free cash flow guidance unchanged at $2.4 billion.

• Guidance excludes pending acquisitions until closing.

• Capital expenditures expected at $280–$310 million; net interest expense ~$1.90 billion.