Hexagon (HEXA) Q2 2026 earnings summary

Executive summary

• Achieved 12% organic growth, the highest in five years, driven by strong demand in aerospace, defence, electronics, and general manufacturing, with all business areas contributing and strong order intake building backlog.

• Completed the separation of Octave, simplifying and focusing the business portfolio, and announced the acquisition of Waygate Technologies, expanding into nondestructive testing.

• Cost restructuring programme nearly complete, delivering significant savings and margin improvements ahead of schedule.

• Entering Q3 with high order intake, positive end-market trends, and strong momentum across all business areas.

• Acquisitions of Inertial Sense and ITRES enhanced autonomous navigation and mapping capabilities.

Financial highlights

• Net sales reached EUR 1,050.2 million, up 12% year-over-year, with organic growth and positive contributions from all segments.

• EBITAC margin improved to 24.3%, up from 22.3% year-over-year, driven by operational leverage and cost savings.

• Gross margin remained stable at 62.3% despite currency headwinds and a strong hardware sales mix.

• Cash conversion was exceptionally strong at 149%, with operating cash flow pre-tax of EUR 364.3 million.

• Adjusted EPS was EUR 0.078, impacted by a one-time gain from Cadence share sales.

Outlook and guidance

• Group targets for 2026–2030: organic growth of 4–6%, EBITAC margin of 24–26%, and cash conversion of 90–100%.

• High order intake and backlog position the business for continued momentum into Q3, with robust end-market trends expected.

• Restructuring program to reach full run rate by end of Q3, further supporting margins.

• Robotics commercialization expected by year-end 2026, with costs expected to rise as sales scale up.

• Waygate acquisition expected to close in H2 2026, with integration and margin improvement plans in place.