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Modine Q4 Earnings Beat Estimates on Data Center Demand
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Key Takeaways
MOD beat Q4 estimates as data center cooling demand lifted sales 47% year over year.
Climate Solutions sales surged 87% as Data Centers revenues jumped 158% from last year.
MOD expects fiscal 2027 sales growth of 20-35% with adjusted EBITDA of $650M-$680M.
Modine Manufacturing Company (MOD - Free Report) posted adjusted earnings of $1.71 per share for the fourth quarter of fiscal 2026, which increased 53% from the year-ago quarter and came above the Zacks Consensus Estimate of $1.51 by 13.2%. Net sales were $954.4 million, which rose 47% year over year and topped the consensus mark of $907 million by 5.2%.
Momentum in the company’s data center cooling business remained the key catalyst, with Data Centers revenues exceeding $400 million in the quarter, even after severe weather reduced production time.
Modine Manufacturing Company Price, Consensus and EPS Surprise
Modine delivered another quarter of outsized growth as demand for its thermal management solutions stayed strong in mission-critical applications. The quarter capped a fourth consecutive year of record revenues and adjusted EBITDA, underscoring the pace of its portfolio shift toward faster-growing end markets.
Despite supply chain constraints and weather-driven downtime across multiple locations, it still pushed meaningful volume through the system. That execution mattered because Modine is expanding capacity to meet rising needs from hyperscale data center customers.
Modine Absorbs Expansion Costs as Tariffs Bite
Profitability reflected the near-term cost of growth. Gross margin fell 320 basis points year over year to 22.5% due to temporary costs tied to the rapid capacity expansion for data center products. Higher tariffs and material costs also weighed on the quarter, while storm-related disruption added overtime and other temporary labor expenses.
Even with those headwinds, gross profit increased to $214.7 million, helped by the sharp pickup in sales. Operating income rose to $103.9 million from $74.5 million in the year-ago period, though results included restructuring expense of $5.2 million and $12.5 million of costs related to the pending spin-off of the Performance Technologies segment.
Climate Solutions was the clear engine of the quarter. Segment sales surged 87% year over year to $665.9 million, powered by strength across both data centers and HVAC technologies. Data Centers sales jumped 158% from the prior year, while HVAC Technologies sales increased 51%, including $38.2 million of incremental sales from acquired businesses.
The growth came with planned margin pressure as Modine accelerates manufacturing investments. Climate Solutions’ gross margin was 24.6%, down 510 basis points year over year, yet earnings still expanded meaningfully as scale improved. Segment operating income climbed 77% to $108.8 million, and adjusted EBITDA increased 63% to $124.3 million.
Performance Technologies Steadies Ahead of Spin-Off
Performance Technologies was largely stable on the top line. Segment sales were $294 million versus $294.8 million a year ago, as lower stationary power demand was mostly offset by higher volumes tied to automotive, commercial vehicle and off-highway customers.
Margins, however, tightened. Performance Technologies’ gross margin declined 390 basis points year over year to 16.5%, primarily due to higher material costs and tariffs. Operating income slipped 7% to $27.7 million, and adjusted EBITDA declined 15% to $37.4 million, reflecting the tougher cost backdrop as the business moves toward separation.
Modine's Cash Flow Supports Investment-Led Growth
Balance sheet and cash generation remained an important support as Modine ramps up capital spending to expand data center capacity. For fiscal 2026, net cash provided by operating activities increased to $248.7 million, while free cash flow was $105.4 million as working capital and higher capital expenditures absorbed cash.
As of March 31, 2026, cash and cash equivalents totaled $73.5 million, up from $71.6 million as of March 31, 2025. Total debt was $436.3 million, leaving net debt at $362.8 million, as borrowings funded working capital needs, acquisitions and capital expenditures during the year.
MOD Provides FY27 Outlook
The company’s fiscal 2027 outlook calls for another year of record performance, supported by customer relationships and a significant order book in Data Centers. Modine expects net sales growth of 20% to 35% for fiscal 2027, alongside adjusted EBITDA of $650 million to $680 million.
The company’s outlook includes Performance Technologies for all of fiscal 2027 and will be refreshed for the remaining business once the timing of the planned spin-off is finalized. Modine also expects to incur approximately $30 million to $40 million of additional costs during fiscal 2027 tied to the pending Reverse Morris Trust transaction with Gentherm.
Mobileye Global Inc. (MBLY - Free Report) reported first-quarter 2026 results on April 23. It posted earnings of 12 cents per share, beating the Zacks Consensus Estimate of 8 cents by 58.52%. The bottom line rose 50% year over year, driven by higher shipments of EyeQ system-on-chip. The company posted revenues of $558 million, which beat the Zacks Consensus Estimate of $520 million by 7.36% and increased 27.4% year over year.
Operating cash flow was $75 million, reflecting the company’s ability to convert its ADAS scale into cash generation.
Mobileye also approved a share buyback program of up to $250 million. By the end of the first quarter, MBLY had $1.21 billion in cash, after spending $591 million (net of cash received) on the Mentee Robotics acquisition.
Gentex Corporation (GNTX - Free Report) reported first-quarter 2026 results on April 24. It posted adjusted earnings of 48 cents per share, which beat the Zacks Consensus Estimate of 44 cents by 8.28%. The figure increased 11.6% from 43 cents a year ago. Net sales came in at $675 million, topping the consensus mark of $647 million by 4.36%. Revenues rose 17.1% from $577 million in the year-ago quarter, aided by contributions from VOXX and a richer mix of advanced features.
Liquidity improved during the quarter. As of March 31, 2026, GNTX’s cash and cash equivalents were $164.8 million compared with $145.6 million as of Dec. 31, 2025. Short-term investments increased to $10.3 million from $5.4 million.
PACCAR Inc. (PCAR - Free Report) reported first-quarter 2026 results on April 28. It reported earnings of $1.15 per share, beating the Zacks Consensus Estimate of $1.13 by 1.8%. The bottom line decreased 21.2% from $1.46 in the year-ago quarter. Consolidated revenues (including trucks and financial services) were $6.78 billion, down from $7.44 billion in the corresponding quarter of 2025. The decline reflected lower industry volumes.
On the balance sheet, cash and marketable securities were $8.60 billion as of March 31, 2026, compared with $9.25 billion as of Dec. 31, 2025, while stockholders’ equity increased to $19.76 billion from $19.26 billion over the same span.
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Modine Q4 Earnings Beat Estimates on Data Center Demand
Key Takeaways
Modine Manufacturing Company (MOD - Free Report) posted adjusted earnings of $1.71 per share for the fourth quarter of fiscal 2026, which increased 53% from the year-ago quarter and came above the Zacks Consensus Estimate of $1.51 by 13.2%. Net sales were $954.4 million, which rose 47% year over year and topped the consensus mark of $907 million by 5.2%.
Momentum in the company’s data center cooling business remained the key catalyst, with Data Centers revenues exceeding $400 million in the quarter, even after severe weather reduced production time.
Modine Manufacturing Company Price, Consensus and EPS Surprise
Modine Manufacturing Company price-consensus-eps-surprise-chart | Modine Manufacturing Company Quote
MOD Leans on Climate Solutions for Strong Finish
Modine delivered another quarter of outsized growth as demand for its thermal management solutions stayed strong in mission-critical applications. The quarter capped a fourth consecutive year of record revenues and adjusted EBITDA, underscoring the pace of its portfolio shift toward faster-growing end markets.
Despite supply chain constraints and weather-driven downtime across multiple locations, it still pushed meaningful volume through the system. That execution mattered because Modine is expanding capacity to meet rising needs from hyperscale data center customers.
Modine Absorbs Expansion Costs as Tariffs Bite
Profitability reflected the near-term cost of growth. Gross margin fell 320 basis points year over year to 22.5% due to temporary costs tied to the rapid capacity expansion for data center products. Higher tariffs and material costs also weighed on the quarter, while storm-related disruption added overtime and other temporary labor expenses.
Even with those headwinds, gross profit increased to $214.7 million, helped by the sharp pickup in sales. Operating income rose to $103.9 million from $74.5 million in the year-ago period, though results included restructuring expense of $5.2 million and $12.5 million of costs related to the pending spin-off of the Performance Technologies segment.
MOD's Climate Solutions Drives Profitability Higher
Climate Solutions was the clear engine of the quarter. Segment sales surged 87% year over year to $665.9 million, powered by strength across both data centers and HVAC technologies. Data Centers sales jumped 158% from the prior year, while HVAC Technologies sales increased 51%, including $38.2 million of incremental sales from acquired businesses.
The growth came with planned margin pressure as Modine accelerates manufacturing investments. Climate Solutions’ gross margin was 24.6%, down 510 basis points year over year, yet earnings still expanded meaningfully as scale improved. Segment operating income climbed 77% to $108.8 million, and adjusted EBITDA increased 63% to $124.3 million.
Performance Technologies Steadies Ahead of Spin-Off
Performance Technologies was largely stable on the top line. Segment sales were $294 million versus $294.8 million a year ago, as lower stationary power demand was mostly offset by higher volumes tied to automotive, commercial vehicle and off-highway customers.
Margins, however, tightened. Performance Technologies’ gross margin declined 390 basis points year over year to 16.5%, primarily due to higher material costs and tariffs. Operating income slipped 7% to $27.7 million, and adjusted EBITDA declined 15% to $37.4 million, reflecting the tougher cost backdrop as the business moves toward separation.
Modine's Cash Flow Supports Investment-Led Growth
Balance sheet and cash generation remained an important support as Modine ramps up capital spending to expand data center capacity. For fiscal 2026, net cash provided by operating activities increased to $248.7 million, while free cash flow was $105.4 million as working capital and higher capital expenditures absorbed cash.
As of March 31, 2026, cash and cash equivalents totaled $73.5 million, up from $71.6 million as of March 31, 2025. Total debt was $436.3 million, leaving net debt at $362.8 million, as borrowings funded working capital needs, acquisitions and capital expenditures during the year.
MOD Provides FY27 Outlook
The company’s fiscal 2027 outlook calls for another year of record performance, supported by customer relationships and a significant order book in Data Centers. Modine expects net sales growth of 20% to 35% for fiscal 2027, alongside adjusted EBITDA of $650 million to $680 million.
The company’s outlook includes Performance Technologies for all of fiscal 2027 and will be refreshed for the remaining business once the timing of the planned spin-off is finalized. Modine also expects to incur approximately $30 million to $40 million of additional costs during fiscal 2027 tied to the pending Reverse Morris Trust transaction with Gentherm.
MOD currently has a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Key Releases From Auto Space
Mobileye Global Inc. (MBLY - Free Report) reported first-quarter 2026 results on April 23. It posted earnings of 12 cents per share, beating the Zacks Consensus Estimate of 8 cents by 58.52%. The bottom line rose 50% year over year, driven by higher shipments of EyeQ system-on-chip. The company posted revenues of $558 million, which beat the Zacks Consensus Estimate of $520 million by 7.36% and increased 27.4% year over year.
Operating cash flow was $75 million, reflecting the company’s ability to convert its ADAS scale into cash generation.
Mobileye also approved a share buyback program of up to $250 million. By the end of the first quarter, MBLY had $1.21 billion in cash, after spending $591 million (net of cash received) on the Mentee Robotics acquisition.
Gentex Corporation (GNTX - Free Report) reported first-quarter 2026 results on April 24. It posted adjusted earnings of 48 cents per share, which beat the Zacks Consensus Estimate of 44 cents by 8.28%. The figure increased 11.6% from 43 cents a year ago. Net sales came in at $675 million, topping the consensus mark of $647 million by 4.36%. Revenues rose 17.1% from $577 million in the year-ago quarter, aided by contributions from VOXX and a richer mix of advanced features.
Liquidity improved during the quarter. As of March 31, 2026, GNTX’s cash and cash equivalents were $164.8 million compared with $145.6 million as of Dec. 31, 2025. Short-term investments increased to $10.3 million from $5.4 million.
PACCAR Inc. (PCAR - Free Report) reported first-quarter 2026 results on April 28. It reported earnings of $1.15 per share, beating the Zacks Consensus Estimate of $1.13 by 1.8%. The bottom line decreased 21.2% from $1.46 in the year-ago quarter. Consolidated revenues (including trucks and financial services) were $6.78 billion, down from $7.44 billion in the corresponding quarter of 2025. The decline reflected lower industry volumes.
On the balance sheet, cash and marketable securities were $8.60 billion as of March 31, 2026, compared with $9.25 billion as of Dec. 31, 2025, while stockholders’ equity increased to $19.76 billion from $19.26 billion over the same span.