Tupy (TUPY3) Q1 2026 earnings summary

Executive summary

• Net revenue reached R$2.3 billion in Q1 2026, down 7% year-over-year, mainly due to a 9% drop in sales volumes and currency appreciation, partially offset by growth in Manufacturing Contracts and Energy & Decarbonization units.

• Adjusted EBITDA was R$99 million (4.3% margin), down 60% year-over-year, with a net loss of R$94 million, reflecting weaker operating performance.

• Operating cash flow hit a record R$198 million for a first quarter, driven by working capital improvements and inventory reductions.

• Strategic restructuring and industrial footprint optimization are expected to yield recurring gains of R$100 million in 2026 and R$180 million annually from 2027.

• CEO transition: Rafael Lucchesi resigned; Harro Burmann appointed CEO effective June 1, 2026.

Financial highlights

• Gross margin dropped to 10.1% from 15.3% year-over-year, pressured by lower production volumes and cost inflation.

• Adjusted EBITDA margin at 4.3% (down from 10.0% in 1Q25); net loss margin at -4.1%.

• Net debt at R$2.1 billion, down 18% year-over-year; leverage increased to 4.02x due to lower EBITDA.

• Net financial expenses improved to R$50 million, reflecting lower indebtedness and positive FX effects.

• Investments in PP&E and intangibles totaled R$64 million, up 3% year-over-year.

Outlook and guidance

• Management expects recurring gains of R$100 million in 2026 and R$180 million annually from 2027, with order backlog and automaker outlooks indicating gradual recovery in North America and Europe.

• New projects and market share gains in Class 8 vehicles and other segments are expected to support growth in the second half.

• Double-digit EBITDA margin targeted for the second half of 2026, driven by volume and efficiency.

• Stronger market expected for 2027, with sustained demand in North America.