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ATI Q2 Earnings Beat Estimates on Aerospace Demand, Outlook Raised
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Key Takeaways
ATI's Q2 sales rose 10.6% as aerospace and defense demand, pricing and product mix drove growth.
Record backlog reached $4.4B, up 18%, reflecting sustained demand for aerospace and defense materials.
ATI raised 2026 adjusted EPS guidance to $4.90-$5.18 and free cash flow to $550-$600 million.
ATI Inc. (ATI - Free Report) posted adjusted earnings of $1.23 per share for the second quarter of 2026, up 66.2% from the year-ago quarter. The figure beat the Zacks Consensus Estimate of $1.03 by 19.4%.
Sales of $1.26 billion rose 10.6% year over year and topped the consensus estimate of $1.22 billion by 3.4%. Strong aerospace and defense demand, favorable pricing and an improved product mix supported the quarter. Backlog reached a record $4.4 billion, up 18% year over year, highlighting sustained demand for the company's aerospace and defense materials.
High Performance Materials & Components generated sales of $637.1 million in the second quarter, up 4.6% from $608.8 million in the year-ago period. However, the figure fell short of the consensus estimate of $669 million. The improvement primarily reflected strong demand and pricing for commercial jet engine products. The segment EBITDA margin was 24.1% compared with 23.7% a year ago. Higher volumes and favorable pricing supported the year-over-year margin improvement, partly offset by increased manufacturing and period costs.
Advanced Alloys & Solutions posted sales of $624 million, up 17.4% from $531.6 million in the prior-year quarter. The figure surpassed the consensus estimate of $550 million. Growth was primarily driven by aerospace and defense and conventional energy markets. The segment EBITDA margin expanded to 23.7% from 14.4%. Results included a $9.9 million gain from the sale of a previously closed manufacturing facility. Excluding that gain, stronger pricing and a favorable product mix supported the margin improvement.
Financials
ATI ended the second quarter with cash and cash equivalents of $783 million. Cash provided by operating activities was $131.8 million during the quarter, while capital expenditures totaled $68.6 million. Adjusted free cash flow came in at $68.6 million. Long-term debt stood at $1.81 billion at the end of the quarter.
Outlook
ATI expects third-quarter 2026 adjusted EBITDA in the range of $305-$315 million. Adjusted earnings are projected between $1.31 and $1.37 per share. Management expects momentum to continue into the second half, supported by contracted pricing improvements, a richer product mix and increasing production volumes.
For full-year 2026, ATI raised adjusted EBITDA guidance to $1.14-$1.2 billion from its previous outlook of $1.01-$1.06 billion. Adjusted earnings guidance was increased to $4.9-$5.18 per share from $4.2-$4.48 previously.
The company also lifted its full-year adjusted free cash flow forecast to $550-$600 million from the earlier range of $465-$525 million. Management expects targeted investments and operational execution to increase available capacity as demand for aerospace and defense materials remains strong.
ATI’s Price Performance
ATI’s shares are up 211.3% over a year compared with the 14.4% growth recorded by the industry.
Howmet Aerospace Inc. (HWM - Free Report) reported second-quarter 2026 adjusted earnings of $1.33 per share, up 46% year over year. The figure beat the Zacks Consensus Estimate of $1.23. For 2026, Howmet Aerospace raised its revenue outlook to $10-$10.1 billion. Adjusted EBITDA is now anticipated between $3.21 billion and $3.25 billion.
Axon Enterprise, Inc. (AXON - Free Report) reported second-quarter 2026 adjusted earnings of $1.88 per share, down 13.8% year over year. The figure missed the Zacks Consensus Estimate of $1.89 by 0.5%. AXON raised its full-year revenue outlook to 32-34% annual growth, up from 30-32% expected earlier. The updated view reflects continued momentum across the company’s connected devices and software offerings.
GE Aerospace (GE - Free Report) reported second-quarter 2026 adjusted earnings of $2.02 per share, up 22% year over year. The figure beat the Zacks Consensus Estimate of $1.86 by 8.6%. GE now expects 2026 adjusted revenue growth in the high-teens range, up from its prior low-double-digit outlook. Adjusted earnings are expected in the range of $7.65-$7.85 per share, up from $7.1-$7.4 expected earlier.
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ATI Q2 Earnings Beat Estimates on Aerospace Demand, Outlook Raised
Key Takeaways
ATI Inc. (ATI - Free Report) posted adjusted earnings of $1.23 per share for the second quarter of 2026, up 66.2% from the year-ago quarter. The figure beat the Zacks Consensus Estimate of $1.03 by 19.4%.
Sales of $1.26 billion rose 10.6% year over year and topped the consensus estimate of $1.22 billion by 3.4%. Strong aerospace and defense demand, favorable pricing and an improved product mix supported the quarter. Backlog reached a record $4.4 billion, up 18% year over year, highlighting sustained demand for the company's aerospace and defense materials.
ATI Inc. Price, Consensus and EPS Surprise
ATI Inc. price-consensus-eps-surprise-chart | ATI Inc. Quote
Segment Highlights
High Performance Materials & Components generated sales of $637.1 million in the second quarter, up 4.6% from $608.8 million in the year-ago period. However, the figure fell short of the consensus estimate of $669 million. The improvement primarily reflected strong demand and pricing for commercial jet engine products. The segment EBITDA margin was 24.1% compared with 23.7% a year ago. Higher volumes and favorable pricing supported the year-over-year margin improvement, partly offset by increased manufacturing and period costs.
Advanced Alloys & Solutions posted sales of $624 million, up 17.4% from $531.6 million in the prior-year quarter. The figure surpassed the consensus estimate of $550 million. Growth was primarily driven by aerospace and defense and conventional energy markets. The segment EBITDA margin expanded to 23.7% from 14.4%. Results included a $9.9 million gain from the sale of a previously closed manufacturing facility. Excluding that gain, stronger pricing and a favorable product mix supported the margin improvement.
Financials
ATI ended the second quarter with cash and cash equivalents of $783 million. Cash provided by operating activities was $131.8 million during the quarter, while capital expenditures totaled $68.6 million. Adjusted free cash flow came in at $68.6 million. Long-term debt stood at $1.81 billion at the end of the quarter.
Outlook
ATI expects third-quarter 2026 adjusted EBITDA in the range of $305-$315 million. Adjusted earnings are projected between $1.31 and $1.37 per share. Management expects momentum to continue into the second half, supported by contracted pricing improvements, a richer product mix and increasing production volumes.
For full-year 2026, ATI raised adjusted EBITDA guidance to $1.14-$1.2 billion from its previous outlook of $1.01-$1.06 billion. Adjusted earnings guidance was increased to $4.9-$5.18 per share from $4.2-$4.48 previously.
The company also lifted its full-year adjusted free cash flow forecast to $550-$600 million from the earlier range of $465-$525 million. Management expects targeted investments and operational execution to increase available capacity as demand for aerospace and defense materials remains strong.
ATI’s Price Performance
ATI’s shares are up 211.3% over a year compared with the 14.4% growth recorded by the industry.
Image Source: Zacks Investment Research
ATI’s Zacks Rank & Other Aerospace Releases
ATI currently sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Howmet Aerospace Inc. (HWM - Free Report) reported second-quarter 2026 adjusted earnings of $1.33 per share, up 46% year over year. The figure beat the Zacks Consensus Estimate of $1.23. For 2026, Howmet Aerospace raised its revenue outlook to $10-$10.1 billion. Adjusted EBITDA is now anticipated between $3.21 billion and $3.25 billion.
Axon Enterprise, Inc. (AXON - Free Report) reported second-quarter 2026 adjusted earnings of $1.88 per share, down 13.8% year over year. The figure missed the Zacks Consensus Estimate of $1.89 by 0.5%. AXON raised its full-year revenue outlook to 32-34% annual growth, up from 30-32% expected earlier. The updated view reflects continued momentum across the company’s connected devices and software offerings.
GE Aerospace (GE - Free Report) reported second-quarter 2026 adjusted earnings of $2.02 per share, up 22% year over year. The figure beat the Zacks Consensus Estimate of $1.86 by 8.6%. GE now expects 2026 adjusted revenue growth in the high-teens range, up from its prior low-double-digit outlook. Adjusted earnings are expected in the range of $7.65-$7.85 per share, up from $7.1-$7.4 expected earlier.