Q2 2026 ITT Inc Earnings Call Transcript
Key Points
- ITT Inc (ITT) delivered a record quarter with revenue up 51% total and 13% organically, alongside a 53% increase in orders and a book-to-bill of 1.1.
- The company raised its full-year 2026 adjusted EPS guidance to $8.22 at the midpoint, a $0.37 increase, with the low end of the range exceeding the prior high end.
- CCT segment orders surged 59% organically, driven by kSARIA's 168% order growth and record bookings in July, providing strong multiyear visibility.
- Flow Technologies delivered 21% organic revenue growth, with pump project sales up 45% and valves up 19%, while Svanehøj is projected to grow revenue 32% annually on average since acquisition.
- ITT Inc (ITT) paid down $124 million in debt in Q2, achieving a leverage ratio of 2.5x six months ahead of schedule, and expects to reach approximately 2.3x by year-end.
- SPX FLOW integration is progressing well, with orders up 9% in Q2 and a book-to-bill of 1.13, while cost synergies are ahead of plan.
- The company raised its full-year free cash flow guidance to $565 million at the midpoint, reflecting strong operational performance and a Q2 free cash flow margin of 11%.
- Organic orders in Flow Technologies declined 3% year-over-year due to deferred orders in the Middle East and tough comparisons from large oil and gas orders in the prior year.
- Flow Technologies operating margin declined 160 basis points to 21.4% due to the full quarter impact of SPX FLOW, which diluted overall margins.
- Motion Technologies faces ongoing cost inflation pressures, with price recovery not fully offsetting input cost increases, though the company expects to be price/cost positive overall.
- The Middle East orders delay is expected to impact regional growth in the coming quarters, despite strong first-half revenue from backlog delivery.
- Year-to-date free cash flow of $176 million was impacted by $71 million in one-time acquisition-related expenses, reducing overall cash generation.
- The company noted that Q4 2026 will have four fewer days than Q4 2025, creating a headwind to year-over-year organic growth comparisons in the second half.
- SPX FLOW's margin contribution is expected to be a drag in the near term, with the company relying on cost synergies and productivity actions to expand margins sequentially through the remainder of 2026.
Welcome to ITT's 2026 second quarter conference call. Today is Thursday, August 6, 2026. Today's call is being recorded and will be available for replay beginning at 12:00 PM Eastern Time. (Operator Instructions)
It is now my pleasure to turn the floor over to Carleen Salvage, Vice President, Investor Relations and FP&A. You may begin.
Thank you, Liz, and good morning. Joining me in Stamford today are Luca Savi, ITT's Chief Executive Officer and President; and Mike Savinelli, Interim Chief Financial Officer. Today's call will cover ITT's financial results for the three-month period ended July 4, 2026, which we announced this morning.
Please refer to Slide 2 of the presentation available on our website, where we note that today's comments will include forward-looking statements that are based on our current expectations. Actual results may differ materially due to several risks and uncertainties, including those described in our 2025 annual report on Form 10-K and
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