PHILADELPHIA, PA — Carpenter Technology Corporation (NYSE: CRS) reported higher third-quarter fiscal 2026 earnings and increased its full-year outlook, driven by growth in aerospace and defense demand and improved margins in its Specialty Alloys Operations segment.
Operating income rose to $186.5 million for the quarter ended March 31, up from $137.8 million a year earlier. Earnings per diluted share increased to $2.77 from $1.88.
Net sales increased 12% to $811.5 million from $727.0 million in the prior-year period. Sales excluding surcharge rose 10% to $655.6 million.
The Specialty Alloys Operations segment reported operating income of $208.0 million, up 37% year over year and 19% sequentially. Adjusted operating margin in the segment expanded to 35.6% from 29.1% a year earlier.
The company said bookings in the commercial aerospace structural market increased sequentially, reflecting rising production activity and demand in the aerospace and defense sector.
Cash provided by operating activities rose to $193.5 million from $74.2 million a year earlier. Adjusted free cash flow increased to $124.8 million from $34.0 million.
Capital expenditures were $68.7 million, up from $40.2 million in the prior-year quarter, primarily related to expansion projects.
The company repurchased 145,000 shares for $52.7 million during the quarter under its $400 million share repurchase program. As of March 31, $164.2 million remained available.
Total liquidity was $793.8 million, including $294.8 million in cash and $499.0 million in available borrowing capacity.
For the fourth quarter, Carpenter expects operating income between $205 million and $210 million.
The company raised its full-year fiscal 2026 operating income outlook to $700 million to $705 million and expects adjusted free cash flow of about $350 million.
Chief Executive Officer Tony Thene said, “Demand in our Aerospace and Defense end-use market continues to accelerate as customers gain confidence in higher build rates.”
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