READING, PA — EnerSys (NYSE: ENS) posted a resilient second quarter for fiscal 2026, delivering stronger-than-expected revenue growth despite continued pressure on operating earnings and shifting demand across its global end markets. The company reported net sales of $951.3 million, up 7.7% from the same period last year and above its guidance range, driven by a combination of higher organic volume, improved pricing, acquisitions, and favorable currency impacts.
Adjusted earnings strengthened even as GAAP results softened. Diluted earnings per share came in at $1.80, down from $2.01 a year ago, reflecting restructuring charges and other non-recurring items. On an adjusted basis, diluted EPS rose 21% to $2.56, surpassing the company’s previous outlook. EnerSys said restructuring efforts and production tax credits under IRC 45X contributed to the improvement.
President and CEO Shawn O’Connell said the quarter underscores the early benefits of EnerSys’ new EnerGize strategic framework, an initiative aimed at tightening capital allocation, accelerating product development, and reducing operating costs. He described the company’s progress as evidence of “solid execution” and indicated that cost-reduction measures will gain further traction in the months ahead.
Profitability metrics showed similar mixed signals. Gross margin edged up to 29.1%. Adjusted operating earnings climbed to $129.5 million, up from $114.6 million a year ago, reflecting improvement across all major business lines. However, GAAP operating earnings fell to $92 million due to restructuring expenses.
EnerSys reinforced its balance sheet during the quarter, lowering its net leverage ratio to 1.3x EBITDA, compared with 1.6x a year earlier. Cash flow surged, bolstered by the receipt of a federal tax refund, producing $218 million in operating cash flow and $197 million in free cash flow—dramatically higher than the same period last year. The company returned $77.5 million to shareholders through repurchases and dividends.
CFO Andrea Funk said operational improvements are beginning to take hold, citing “early wins in process optimization and manufacturing performance.” While noting favorable momentum, she said the company will keep full-year quantitative guidance on pause due to macroeconomic uncertainty and its impact on customer spending patterns. EnerSys expects adjusted operating earnings growth—excluding 45X benefits—to outpace full-year revenue growth.
For the third quarter, EnerSys projects net sales between $920 million and $960 million and adjusted diluted EPS of $2.71 to $2.81, including IRC 45X benefits. Capital spending for the fiscal year is expected to total roughly $80 million. The company will outline additional long-term targets at its June 2026 Investor Day.
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