Regal Rexnord (RRX) Q1 2026 earnings summary

Executive summary

• Net sales rose 4.3% year-over-year to $1,479.1 million, with organic sales up 1.6% and strong demand in data center, automation, and general industrial markets.

• Adjusted EBITDA was $304.4 million (20.6% margin), slightly down from $309.5 million year-over-year; adjusted gross margin was 37.7%.

• Adjusted diluted EPS increased to $2.17, up ~1% year-over-year; GAAP net income rose to $64.3 million.

• Free cash flow was negative at $(2.5) million, reflecting normal seasonality and working capital investments.

• CEO transition announced, with Aamir Paul to succeed Louis Pinkham by July 2026, bringing experience from Schneider Electric.

Financial highlights

• Daily orders increased 8.5% year-over-year; backlog up 6.7% sequentially; net sales reached $1,479.1M.

• Adjusted EBITDA margin was 20.6%; adjusted gross margin at 37.7%; operating income was $152.7 million.

• Adjusted EPS was $2.17, up from $2.15 in Q1 2025; diluted EPS grew to $0.96.

• Cash and cash equivalents at quarter-end were $401.0 million; working capital increased to $1,485.0 million.

• Free cash flow was $(2.5) million, down from $85.5 million in the prior year.

Outlook and guidance

• 2026 sales guidance set at $6.10–$6.20B, with sales growth guidance raised to ~4.5%.

• Adjusted EBITDA margin forecast at 22.2% for 2026; adjusted EPS guidance range of $10.20–$11.00, implying ~10% growth at midpoint.

• Free cash flow guidance for 2026 remains at ~$650 million.

• Tariff impact estimate lowered to $127 million annually; cost neutrality targeted by mid-2026 and margin neutrality by year-end.

• Capital expenditures for 2026 expected to be approximately $120 million.