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ROP Q3 Earnings Beat Estimates on Solid Organic Growth
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Key Takeaways
Roper Technologies posted Q3 adjusted EPS of $5.89, up 15% year over year, beating estimates by 1.7%.
Organic revenues grew 7%, led by software momentum and 10% growth in Technology Enabled Products.
Roper raised its 2026 adjusted EPS outlook to $22.35-$22.40 and expects revenue growth above 8%.
Roper Technologies (ROP - Free Report) reported third-quarter 2026 adjusted earnings of $5.89 per share, surpassing the Zacks Consensus Estimate of $5.79 by 1.7%. The bottom line increased 15% on a year-over-year basis.
Roper's net revenues of $2.17 billion missed the consensus estimate of $2.177 billion by 0.2%. The top line increased 8% year over year. Organic revenues grew 7%, driven by solid momentum across its three business segments. Acquisitions boosted sales by 1%.
ROP's Segmental Performance in Q3
The company reports under three segments, namely Application Software, Network Software and Technology Enabled Products.
Application Software's revenues totaled $1.24 billion, representing 57.1% of the quarter's top line. The segment's revenues increased 7% on a year-over-year basis. Organic revenues increased 6%, while acquisitions contributed 1% to sales growth.
Solid momentum in the company's Aderant, Vertafore and Deltek businesses supported the segment's performance. Aderant expanded its Artificial Intelligence (AI) agent platform, while Vertafore witnessed continued annual recurring revenue growth and introduced six additional AI agents. Deltek benefited from strength in its private-sector business.
Roper's Network Software Business Gains Momentum
Network Software generated revenues of $446.1 million, accounting for 20.5% of the quarterly top line. Segmental revenues increased 8% year over year. Organic revenues grew 5%, while acquisitions boosted sales by 3%.
Strong momentum in the DAT, SoftWriters and Foundry businesses supported the segment's performance. DAT benefited from network expansion, higher average revenue per user and continued adoption of its digital freight marketplace solutions.
SoftWriters witnessed growing adoption of its AI-based order entry solution, while Foundry continued to register revenue growth and achieved record annual recurring revenues. The company also completed the Origo bolt-on acquisition for its iPipeline business.
ROP's Technology Enabled Products Sales Rise
The Technology Enabled Products segment generated revenues of $486 million, representing 22.4% of the quarter's top line. Segmental revenues increased 10% on a year-over-year basis, entirely driven by organic growth.
Strong demand for precision measurement solutions boosted the performance of the NDI business. Verathon witnessed strength across its BFlex, GlideScope and BladderScan product families. Its newly launched CFlex single-use cystoscope also received a positive customer response.
The segment benefited from solid execution and growth across CIVCO, FMI, Inovonics and rf IDEAS. However, Neptune's performance was affected by an unfavorable sales mix.
Roper Technologies, Inc. Price, Consensus and EPS Surprise
Roper's cost of sales increased 5.6% year over year to $649.2 million. Gross profit increased 8.5% to $1.52 billion, while the gross margin expanded 60 basis points to 70.1% from 69.5% in the year-ago quarter.
Selling, general and administrative expenses increased 8.4% year over year to $899.4 million. Adjusted EBITDA was $864 million, reflecting year-over-year growth of 7%. The adjusted EBITDA margin contracted 40 basis points to 39.8%.
Roper's net interest expenses increased 19% year over year to $106.7 million.
ROP's Balance Sheet and Cash Flow
Exiting the third quarter of 2026, Roper had cash and cash equivalents of $311 million compared with $297.4 million at the end of December 2025. Long-term debt (net of current portion) was $8.30 billion compared with $8.60 billion at the end of 2025.
Roper generated net cash of $1.88 billion from operating activities in the first nine months of 2026, reflecting an increase of 4.4% from the year-ago level. Capital expenditures totaled $35.4 million compared with $37.6 million in the year-ago period.
During the same period, ROP rewarded its shareholders with dividend payments of $281.4 million, up 5.8% year over year. It repurchased shares worth $2.73 billion.
Third-quarter adjusted free cash flow declined 4% year over year to $805 million. However, trailing 12-month adjusted free cash flow increased 4% to $2.53 billion.
Roper's Outlook
For 2026, Roper expects adjusted earnings per share to be in the range of $22.35-$22.40 compared with $22.15-$22.30 projected earlier. Total revenues are expected to increase more than 8%, while organic revenues are anticipated to grow approximately 6% year over year.
For the fourth quarter of 2026, Roper anticipates adjusted earnings in the range of $5.95-$6.00 per share. The company expects mid-single-digit or better organic growth in its Application Software and Network Software segments, while Technology Enabled Products is projected to record mid-single-digit organic growth.
TTM Technologies, Inc. (TTMI - Free Report) came out with quarterly earnings of $1.46 per share in the third quarter of 2026, beating the Zacks Consensus Estimate of $1.25 per share. This compares with earnings of 67 cents per share a year ago.
TTMI posted revenues of $1.2 billion for the quarter ended September 2026, surpassing the Zacks Consensus Estimate by 6.6%. This compares with year-ago revenues of $752.74 million.
Badger Meter, Inc. (BMI - Free Report) came out with quarterly earnings of $1.24 per share in the third quarter of 2026, beating the Zacks Consensus Estimate of $1.21 per share. This compares with earnings of $1.19 per share a year ago.
Badger Meter posted revenues of $235.94 million for the quarter ended September 2026, missing the Zacks Consensus Estimate by 1.95%. This compares with year-ago revenues of $235.65 million.
International Business Machines Corporation (IBM - Free Report) reported strong third-quarter 2026 results, with adjusted earnings rising 11% year over year to $2.95 per share. The figure beat the Zacks Consensus Estimate of $2.88 by 2.4%.
Revenues increased 4.7% to $17.10 billion, surpassing the consensus mark of $16.87 billion by 1.4%.
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ROP Q3 Earnings Beat Estimates on Solid Organic Growth
Key Takeaways
Roper Technologies (ROP - Free Report) reported third-quarter 2026 adjusted earnings of $5.89 per share, surpassing the Zacks Consensus Estimate of $5.79 by 1.7%. The bottom line increased 15% on a year-over-year basis.
Roper's net revenues of $2.17 billion missed the consensus estimate of $2.177 billion by 0.2%. The top line increased 8% year over year. Organic revenues grew 7%, driven by solid momentum across its three business segments. Acquisitions boosted sales by 1%.
ROP's Segmental Performance in Q3
The company reports under three segments, namely Application Software, Network Software and Technology Enabled Products.
Application Software's revenues totaled $1.24 billion, representing 57.1% of the quarter's top line. The segment's revenues increased 7% on a year-over-year basis. Organic revenues increased 6%, while acquisitions contributed 1% to sales growth.
Solid momentum in the company's Aderant, Vertafore and Deltek businesses supported the segment's performance. Aderant expanded its Artificial Intelligence (AI) agent platform, while Vertafore witnessed continued annual recurring revenue growth and introduced six additional AI agents. Deltek benefited from strength in its private-sector business.
Roper's Network Software Business Gains Momentum
Network Software generated revenues of $446.1 million, accounting for 20.5% of the quarterly top line. Segmental revenues increased 8% year over year. Organic revenues grew 5%, while acquisitions boosted sales by 3%.
Strong momentum in the DAT, SoftWriters and Foundry businesses supported the segment's performance. DAT benefited from network expansion, higher average revenue per user and continued adoption of its digital freight marketplace solutions.
SoftWriters witnessed growing adoption of its AI-based order entry solution, while Foundry continued to register revenue growth and achieved record annual recurring revenues. The company also completed the Origo bolt-on acquisition for its iPipeline business.
ROP's Technology Enabled Products Sales Rise
The Technology Enabled Products segment generated revenues of $486 million, representing 22.4% of the quarter's top line. Segmental revenues increased 10% on a year-over-year basis, entirely driven by organic growth.
Strong demand for precision measurement solutions boosted the performance of the NDI business. Verathon witnessed strength across its BFlex, GlideScope and BladderScan product families. Its newly launched CFlex single-use cystoscope also received a positive customer response.
The segment benefited from solid execution and growth across CIVCO, FMI, Inovonics and rf IDEAS. However, Neptune's performance was affected by an unfavorable sales mix.
Roper Technologies, Inc. Price, Consensus and EPS Surprise
Roper Technologies, Inc. price-consensus-eps-surprise-chart | Roper Technologies, Inc. Quote
Roper's Margin Profile
Roper's cost of sales increased 5.6% year over year to $649.2 million. Gross profit increased 8.5% to $1.52 billion, while the gross margin expanded 60 basis points to 70.1% from 69.5% in the year-ago quarter.
Selling, general and administrative expenses increased 8.4% year over year to $899.4 million. Adjusted EBITDA was $864 million, reflecting year-over-year growth of 7%. The adjusted EBITDA margin contracted 40 basis points to 39.8%.
Roper's net interest expenses increased 19% year over year to $106.7 million.
ROP's Balance Sheet and Cash Flow
Exiting the third quarter of 2026, Roper had cash and cash equivalents of $311 million compared with $297.4 million at the end of December 2025. Long-term debt (net of current portion) was $8.30 billion compared with $8.60 billion at the end of 2025.
Roper generated net cash of $1.88 billion from operating activities in the first nine months of 2026, reflecting an increase of 4.4% from the year-ago level. Capital expenditures totaled $35.4 million compared with $37.6 million in the year-ago period.
During the same period, ROP rewarded its shareholders with dividend payments of $281.4 million, up 5.8% year over year. It repurchased shares worth $2.73 billion.
Third-quarter adjusted free cash flow declined 4% year over year to $805 million. However, trailing 12-month adjusted free cash flow increased 4% to $2.53 billion.
Roper's Outlook
For 2026, Roper expects adjusted earnings per share to be in the range of $22.35-$22.40 compared with $22.15-$22.30 projected earlier. Total revenues are expected to increase more than 8%, while organic revenues are anticipated to grow approximately 6% year over year.
For the fourth quarter of 2026, Roper anticipates adjusted earnings in the range of $5.95-$6.00 per share. The company expects mid-single-digit or better organic growth in its Application Software and Network Software segments, while Technology Enabled Products is projected to record mid-single-digit organic growth.
ROP’s Zacks Rank
The company currently carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Performance of Other Companies
TTM Technologies, Inc. (TTMI - Free Report) came out with quarterly earnings of $1.46 per share in the third quarter of 2026, beating the Zacks Consensus Estimate of $1.25 per share. This compares with earnings of 67 cents per share a year ago.
TTMI posted revenues of $1.2 billion for the quarter ended September 2026, surpassing the Zacks Consensus Estimate by 6.6%. This compares with year-ago revenues of $752.74 million.
Badger Meter, Inc. (BMI - Free Report) came out with quarterly earnings of $1.24 per share in the third quarter of 2026, beating the Zacks Consensus Estimate of $1.21 per share. This compares with earnings of $1.19 per share a year ago.
Badger Meter posted revenues of $235.94 million for the quarter ended September 2026, missing the Zacks Consensus Estimate by 1.95%. This compares with year-ago revenues of $235.65 million.
International Business Machines Corporation (IBM - Free Report) reported strong third-quarter 2026 results, with adjusted earnings rising 11% year over year to $2.95 per share. The figure beat the Zacks Consensus Estimate of $2.88 by 2.4%.
Revenues increased 4.7% to $17.10 billion, surpassing the consensus mark of $16.87 billion by 1.4%.