ATMU earnings analysis
What we found in ATMU's 10-Q: the parts that mattered, the offsets in the same document, and what the company said about what comes next.
Our reading of the filing · Free to read, no account needed
Atmus delivered a strong Q2, with revenue of $527.9 million, diluted EPS of $0.78 and free cash flow of $64.8 million, all improving materially year over year and exceeding consensus EPS and revenue estimates. Gross and operating margins expanded, supported by pricing, currency, volume and the Koch Filter acquisition, although higher interest expense and acquisition-related leverage are notable offsets. Management continues to expect soft aftermarket conditions through the remainder of 2026 and did not provide updated numeric guidance in the 10-Q.
The parts that mattered.
Pulled out of the filing itself, with the figures the company reported.
- Revenue Beat and Strong Growth
- Q2 net sales were $527.9 million, up $74.4 million or 16.4% year over year and above the $505.5 million consensus estimate. Management attributed the increase to $42.4 million from Koch Filter, $12.9 million of pricing, $10.8 million of favorable currency and $8.3 million of volume.
- Margins and EPS Improved
- Gross margin increased to 29.2% from 28.9% year over year, while operating margin rose to 18.4% from 18.0% based on operating income of $97.2 million versus $81.7 million. Q2 diluted EPS was $0.78 versus $0.72, above the $0.77 consensus estimate.
- Free Cash Flow Accelerated
- Free cash flow was $64.8 million in Q2 versus $32.4 million in the prior-year quarter. Six-month free cash flow was $90.3 million versus $48.7 million, while capital expenditures remained approximately 3% of six-month net sales at $25.6 million.
- Koch Filter Adds Industrial Scale
- The newly established Industrial Solutions segment generated $42.4 million of Q2 sales and $8.0 million of Segment Adjusted EBITDA. The Koch Filter acquisition contributed $10.7 million of incremental gross margin in Q2.
- Operating Cash Generation Improved
- Operating cash flow increased to $115.9 million for the first six months from $73.1 million a year earlier, a $42.8 million improvement. Management cited $24.7 million of higher net income and non-cash adjustments and $13.5 million of lower working-capital requirements.
- Liquidity Remains Available
- Cash and cash equivalents increased to $259.0 million from $236.4 million at December 31, 2025. The company also retained $500.0 million of undrawn revolving-credit capacity as of June 30, 2026.
And the other side of it.
The offsets in the same document — the things a summary that only listed the good news would have left out.
- Tariff and Trade Policy Volatility
- The filing materially updates the tariff risk discussion: tariffs and related trade measures created $12.9 million of favorable Q2 pricing, but unfavorable material and freight costs totaled $3.2 million. Management states that tariff refunds, trade restrictions and customer pass-through treatment remain uncertain.
- Higher Leverage and Interest Exposure
- Debt increased to $998.3 million from $570.0 million at December 31, 2025, primarily to fund the $453.9 million Koch Filter acquisition. A 0.125% change in SOFR would affect annual interest expense by approximately $1.3 million.
- Soft End-Market Demand
- Management reports that aftermarket demand remained soft during the first six months of 2026 and expects slow global aftermarket growth to continue through the remainder of 2026; first-fit demand remains depressed, with recovery expected only in the latter half of 2026. The company estimates that 86% of 2025 sales were aftermarket and 14% were first-fit.
What they reported.
What the company itself reported, taken out of the document.
- Earnings per share
- $0.78
- Gross margin
- 29.2%
- Operating margin
- 18.4%
- Segment
- Power Solutions: $485.5 million, up $32.0 million or 7.1% year over year; Segment Adjusted EBITDA was $101.1 million versus $95.1 million.
- Segment
- Industrial Solutions: $42.4 million of revenue and $8.0 million of Segment Adjusted EBITDA, primarily reflecting the Koch Filter acquisition; prior-year segment results were immaterial.
What they said about what is next.
The 10-Q provides no explicit numeric revenue or EPS guidance and does not state that the prior 2026 outlook of $1.945 billion-$2.015 billion revenue and $2.75-$3.00 EPS was changed. Management expects aftermarket demand to remain soft through the remainder of 2026, with first-fit recovery expected in the latter half of 2026.
The filing reads better than the one before it.
What came before.
- 10-Q · May 1, 2026
- Atmus Filtration Technologies posted Q1 2026 financial results with a notable increase in net sales, reaching $477.5 million, a 14.6% rise from $416.5 million in Q1 2025. Diluted EPS was reported at $0.59, reflecting an…
- 10-K · February 13, 2026
- Atmus reported full-year 2025 Net sales of $1,764.3 million, Net income of $207.4 million and Adjusted EBITDA of $353.5 million, driven by an 86% aftermarket mix and 46% of sales outside the U.S. & Canada. The company…
- 10-Q · May 3, 2024
- Atmus reported Q1 net sales of $426.6 million, up $8.0 million versus $418.6 million in Q1 2023, while gross margin rose to $111.8 million. Net income and diluted EPS declined to $45.5 million and $0.54 (from $52.7…
- 10-K · February 14, 2024
- Atmus reported $1,628.1 million in net sales, $171.3 million in net income and $302.3 million in Adjusted EBITDA for the year ended December 31, 2023. The business emphasizes a durable recurring aftermarket (≈81% of…
This is our reading of a public filing, not the filing. Read the original on SEC.gov · Educational only. Nothing here is investment advice.
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