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ROK Beats Q2 Earnings Estimates on Higher Volume, Hikes FY26 View
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Key Takeaways
ROK Q2 EPS rose 32% y/y to $3.30, beating estimates as revenues grew 11.9% to $2.24 billion.
Rockwell Automation saw 9% organic growth, 6% ARR gains and strength in the higher-margin segments.
ROK raised its FY26 EPS view to $12.50-$13.10, and lifted sales growth and margin guidance.
Rockwell Automation, Inc. (ROK - Free Report) has delivered adjusted earnings of $3.30 per share in the second quarter of fiscal 2026, up 32% from the year-ago quarter’s $2.50. The figure beat the Zacks Consensus Estimate of $2.89.
Quarterly revenues rose 11.9% year over year to $2.24 billion and topped the consensus mark of $2.11 billion by 6.3%. Results have reflected solid execution as organic sales increased 9%. Our model predicted organic growth to rise 5.3% in the quarter.
Rockwell Automation, Inc. Price, Consensus and EPS Surprise
ROK’s Growth Broadens With Organic Gains & FX Tailwinds
Rockwell Automation’s fiscal second quarter featured a healthier demand backdrop across more end markets. Currency translation increased 3% year over year, surpassing our prediction of 0.7% growth.
The company also highlighted momentum in recurring revenues. Total Annual Recurring Revenue (ARR) increased 6% year over year, with software ARR up in the high-single digits, reinforcing the shift toward more durable revenue streams.
Segmental performance was led by the two higher-margin platforms. Intelligent Devices posted sales of $1 billion compared with $0.9 billion a year ago, whereas Software & Control increased to $684 million from $568 million. We predicted sales for Intelligent Devices for the quarter to be $983 million and Software & Control’s sales to be $851 million.
The Intelligent Devices segment posted operating earnings of $211 million in the fiscal second quarter, which marked a year-over-year increase of 32.7%, while Software & Control’s operating earnings improved 39.8% to $239 million.
Lifecycle Services was comparatively steady, with sales of $547 million compared with $537 million in the prior-year quarter. We predicted sales of $557 million for the segment. The segment posted operating earnings of $80 million compared with $78 million in the prior-year quarter.
The cost of sales increased 8.3% year over year to $1.11 billion. The gross profit grew 15.8% to $1.12 billion. Selling, general and administrative expenses moved up 1.9% to $478 million.
Profitability improved sharply as Rockwell Automation converted higher volumes into stronger margins. The enterprise operating margin increased 350 basis points year over year to 22.5% in the quarter, alongside a pretax margin of 19.7%.
At the segment level, Intelligent Devices delivered a 20.9% operating margin, up 320 basis points year over year, and Software & Control reached 34.9%, up 480 basis points. Lifecycle Services was essentially flat year over year at 14.6%.
Rockwell Automation’s Cash Position & Balance Sheet Updates
Cash generation strengthened alongside earnings. Cash provided by operating activities was $320 million in the quarter compared with $199 million in the year-ago period.
The free cash flow improved to $275 million from $171 million. Rockwell Automation’s adjusted income was $373 million and free cash flow conversion was 74% for the quarter.
Cash and cash equivalents were $423 million at the quarter end, down from $468 million at the end of fiscal 2025.
Long-term debt stood at $2.57 billion, modestly below $2.61 billion at the end of fiscal 2025. The balance sheet positioning gives Rockwell Automation flexibility as it navigates portfolio actions, including the Sensia dissolution-related impacts discussed in its materials.
ROK Raises Its FY26 Earnings View
The company lifted its full-year outlook following the strong quarter. ROK raised both its reported and organic sales growth view to 5-9% year over year and expects an Enterprise operating margin of 21.5%, up from the prior mentioned 20%.
Rockwell Automation also increased its adjusted earnings guidance to $12.50-$13.10 per share from $11.40-$12.20. The updated view reflects broadening demand and execution, while the company noted the guidance does not include sales, earnings or cash flows related to the divested Sensia joint venture businesses in the second half of fiscal 2026.
Rockwell Automation Stock’s Price Performance
In the past year, ROK shares have gained 60.1% compared with the industry’s 79.5% surge.
Teradyne, Inc. (TER - Free Report) delivered first-quarter 2026 adjusted earnings of $2.56 per share, up 241.3% year over year and beating the Zacks Consensus Estimate by 21.43%. Teradyne’s revenues climbed 86.9% from the year-ago quarter to $1.282 billion, beating the Zacks Consensus Estimate by 5.15%.
KLA Corporation (KLAC - Free Report) reported third-quarter fiscal 2026 adjusted earnings of $9.40 per share, up 11.8% year over year, beating the Zacks Consensus Estimate by 2.60%. KLA Corp’s revenues rose 11.5% year over year to $3.42 billion, and topped the consensus mark by 0.91%.
The Timken Company (TKR - Free Report) is anticipated to release first-quarter 2026 results on May 6.
The Zacks Consensus Estimate for Timken’s earnings per share is pegged at $1.50 for the first quarter, implying an increase of 7.1% from the year-ago reported figure. The consensus estimate for Timken’s total sales is pinned at $1.17 billion, indicating a year-over-year increase of 2.9%.
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ROK Beats Q2 Earnings Estimates on Higher Volume, Hikes FY26 View
Key Takeaways
Rockwell Automation, Inc. (ROK - Free Report) has delivered adjusted earnings of $3.30 per share in the second quarter of fiscal 2026, up 32% from the year-ago quarter’s $2.50. The figure beat the Zacks Consensus Estimate of $2.89.
Quarterly revenues rose 11.9% year over year to $2.24 billion and topped the consensus mark of $2.11 billion by 6.3%. Results have reflected solid execution as organic sales increased 9%. Our model predicted organic growth to rise 5.3% in the quarter.
Rockwell Automation, Inc. Price, Consensus and EPS Surprise
Rockwell Automation, Inc. price-consensus-eps-surprise-chart | Rockwell Automation, Inc. Quote
ROK’s Growth Broadens With Organic Gains & FX Tailwinds
Rockwell Automation’s fiscal second quarter featured a healthier demand backdrop across more end markets. Currency translation increased 3% year over year, surpassing our prediction of 0.7% growth.
The company also highlighted momentum in recurring revenues. Total Annual Recurring Revenue (ARR) increased 6% year over year, with software ARR up in the high-single digits, reinforcing the shift toward more durable revenue streams.
Rockwell Automation’s Segment Mix Supports Profit Expansion
Segmental performance was led by the two higher-margin platforms. Intelligent Devices posted sales of $1 billion compared with $0.9 billion a year ago, whereas Software & Control increased to $684 million from $568 million. We predicted sales for Intelligent Devices for the quarter to be $983 million and Software & Control’s sales to be $851 million.
The Intelligent Devices segment posted operating earnings of $211 million in the fiscal second quarter, which marked a year-over-year increase of 32.7%, while Software & Control’s operating earnings improved 39.8% to $239 million.
Lifecycle Services was comparatively steady, with sales of $547 million compared with $537 million in the prior-year quarter. We predicted sales of $557 million for the segment. The segment posted operating earnings of $80 million compared with $78 million in the prior-year quarter.
ROK’s Margin Upside Reflects Pricing & Operating Leverage
The cost of sales increased 8.3% year over year to $1.11 billion. The gross profit grew 15.8% to $1.12 billion. Selling, general and administrative expenses moved up 1.9% to $478 million.
Profitability improved sharply as Rockwell Automation converted higher volumes into stronger margins. The enterprise operating margin increased 350 basis points year over year to 22.5% in the quarter, alongside a pretax margin of 19.7%.
At the segment level, Intelligent Devices delivered a 20.9% operating margin, up 320 basis points year over year, and Software & Control reached 34.9%, up 480 basis points. Lifecycle Services was essentially flat year over year at 14.6%.
Rockwell Automation’s Cash Position & Balance Sheet Updates
Cash generation strengthened alongside earnings. Cash provided by operating activities was $320 million in the quarter compared with $199 million in the year-ago period.
The free cash flow improved to $275 million from $171 million. Rockwell Automation’s adjusted income was $373 million and free cash flow conversion was 74% for the quarter.
Cash and cash equivalents were $423 million at the quarter end, down from $468 million at the end of fiscal 2025.
Long-term debt stood at $2.57 billion, modestly below $2.61 billion at the end of fiscal 2025. The balance sheet positioning gives Rockwell Automation flexibility as it navigates portfolio actions, including the Sensia dissolution-related impacts discussed in its materials.
ROK Raises Its FY26 Earnings View
The company lifted its full-year outlook following the strong quarter. ROK raised both its reported and organic sales growth view to 5-9% year over year and expects an Enterprise operating margin of 21.5%, up from the prior mentioned 20%.
Rockwell Automation also increased its adjusted earnings guidance to $12.50-$13.10 per share from $11.40-$12.20. The updated view reflects broadening demand and execution, while the company noted the guidance does not include sales, earnings or cash flows related to the divested Sensia joint venture businesses in the second half of fiscal 2026.
Rockwell Automation Stock’s Price Performance
In the past year, ROK shares have gained 60.1% compared with the industry’s 79.5% surge.
Image Source: Zacks Investment Research
ROK’s Zacks Rank
Rockwell Automation currently carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Rockwell Automation’s Peer Performances
Teradyne, Inc. (TER - Free Report) delivered first-quarter 2026 adjusted earnings of $2.56 per share, up 241.3% year over year and beating the Zacks Consensus Estimate by 21.43%. Teradyne’s revenues climbed 86.9% from the year-ago quarter to $1.282 billion, beating the Zacks Consensus Estimate by 5.15%.
KLA Corporation (KLAC - Free Report) reported third-quarter fiscal 2026 adjusted earnings of $9.40 per share, up 11.8% year over year, beating the Zacks Consensus Estimate by 2.60%. KLA Corp’s revenues rose 11.5% year over year to $3.42 billion, and topped the consensus mark by 0.91%.
Electronics - Miscellaneous Products Stock Awaiting Results
The Timken Company (TKR - Free Report) is anticipated to release first-quarter 2026 results on May 6.
The Zacks Consensus Estimate for Timken’s earnings per share is pegged at $1.50 for the first quarter, implying an increase of 7.1% from the year-ago reported figure. The consensus estimate for Timken’s total sales is pinned at $1.17 billion, indicating a year-over-year increase of 2.9%.