Woodward (WWD) Q2 2026 earnings summary

Executive summary

• Achieved record Q2 sales exceeding $1.1 billion, up 23% year-over-year, with all-time highs in both aerospace and industrial segments driven by robust demand and strong execution.

• Year-to-date net sales were $2.1B, up 26%, and net earnings were $268M, up 37% compared to the prior year.

• Raised full-year sales and earnings guidance due to strong Q2 performance and continued demand strength.

• Continued portfolio optimization with the acquisition of Valve Research & Manufacturing and divestiture of the pilot controls product line.

• Ongoing investments in automation, capacity expansion, and innovation to support future growth, including a new manufacturing facility in South Carolina.

Financial highlights

• Q2 net sales reached $1.1 billion, a 23% increase year-over-year; adjusted net earnings were $139M (+35%), and adjusted EPS was $2.27 (+34%).

• Free cash flow for Q2 was $38 million; $109 million for the first half, up from $60 million.

• Aerospace segment sales grew 25% to $703 million; industrial segment sales rose 20% to $387 million.

• Returned over $355 million to shareholders via share repurchases and $36 million in dividends in H1 2026.

• Gross margin improved to 29.0% from 27.2% year-over-year, driven by higher volumes and price realization.

Outlook and guidance

• Raised 2026 guidance: total sales growth of 20%-23%, adjusted EPS of $9.15-$9.45.

• Aerospace sales growth expected at 21%-24% with margins of 23%-23.5%; industrial sales growth forecast at 18%-20% with margins of 18%-18.5%.

• Free cash flow guidance unchanged at $300-$350 million; capital expenditures to be ~$290 million.

• R&D costs expected to increase in FY26 and future years as next-generation aircraft programs develop.

• Management expects sufficient liquidity from operations and credit facilities for ongoing needs.