10-Q · June 25, 2026
Acuity Brands reported Q3 results showing a revenue increase of 1.6% year-over-year to $1.20 billion, exceeding estimates. EPS rose by 46.2% to $4.56, reflecting improved margins and lower interest expense. While the…
Earnings analysis · 10-K
AYI earnings analysis
Filed October 23, 2026 · Our reading of the company's report
The latest report
Acuity delivered a strong fiscal 2026, with revenue up 6.8%, operating margin expanding to 15.4%, diluted EPS rising 36.1% to $17.05, and implied free cash flow of approximately $747.9 million. AIS, supported by QSC and…
Read full summary
Acuity delivered a strong fiscal 2026, with revenue up 6.8%, operating margin expanding to 15.4%, diluted EPS rising 36.1% to $17.05, and implied free cash flow of approximately $747.9 million. AIS, supported by QSC and Distech, was the principal growth and margin driver, while ABL revenue declined modestly. The outlook is favorable given operating leverage, technology-platform positioning, buybacks, and rapid debt reduction, although the results benefited from $51.3 million of tariff refunds and face meaningful labor, acquired-asset, and core ABL execution risks.
Gross and operating margin
How much of each revenue dollar the business keeps.
One point per quarterly or annual filing. Both margins are shares of that report's revenue.
From revenue to operating profit
Where each $100 of revenue went in this report.
Cost of sales, operating expenses, and what remained. Figures are rounded to whole dollars.
Where revenue came from
The business segments reported by the company.
Shares of the segments disclosed in this filing, largest first.
How we read each report
Our analysis across the last few reports.
Our model's reading of each filing, not the share price or the market's reaction. Annual and quarterly reports each occupy one position.
Reported figures
- Earnings per share
- $17.05
What stood out
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Strong growth with substantial margin expansion
Fiscal 2026 net sales increased 6.8% to $4.64 billion, while gross profit rose 13.1% to $2.35 billion. Gross margin expanded 280 basis points to 50.6%, and operating margin increased 240 basis points to 15.4%.
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AIS is the primary growth engine
AIS revenue increased 44.8% to $1,106.6 million, driven primarily by the QSC acquisition and higher Distech sales. AIS operating profit rose 145.1% to $186.5 million, with operating margin expanding from 10.0% to 16.9%.
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Technology-led platform positioning
Acuity describes itself as a market-leading industrial technology company focused on products and services spanning lighting, controls, building management, and audio, video, and control. AIS highlights edge-with-cloud network effects, data-driven growth, and a global operating model as strategic differentiators.
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Earnings and per-share growth accelerated
Net income increased 34.0% to $531.3 million and diluted EPS rose 36.1% to $17.05 from $12.53. Diluted weighted-average shares declined to 31.151 million from 31.641 million.
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Cash generation improved materially
Operating cash flow increased to $825.6 million from $601.4 million. After $77.7 million of capital expenditures, implied free cash flow was approximately $747.9 million, compared with approximately $533.0 million in fiscal 2025.
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Aggressive deleveraging alongside buybacks
Capital deployment included $287.2 million of common-stock repurchases and $23.8 million of dividends paid. The company also repaid $400.0 million of term-loan borrowings during fiscal 2026 and subsequently repaid the remaining $200.0 million credit-agreement balance on September 10, 2026.
What to watch
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Core ABL sales remained under pressure
ABL sales declined 1.0% to $3,576.4 million, with lower revenue in the direct sales network and OEM and other channel. This remains a material offset to AIS growth and indicates pressure in the core lighting business.
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One-time tariff refunds lifted margins
Fiscal 2026 gross profit benefited from $51.3 million of IEEPA tariff refunds, including $38.2 million attributed to ABL and $13.1 million to AIS. The refund was a favorable, non-recurring contributor, creating comparability and potential tariff-cost risk for future periods.
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Restructuring and portfolio actions continue
The company recognized $23.7 million of special charges tied primarily to productivity actions, including product-portfolio, supply-chain, operating-footprint, and labor-cost initiatives. A fourth-quarter brand elimination also triggered $2.9 million of intangible-asset impairment and a discontinued leased facility generated a $3.1 million impairment.
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Significant near-term labor-renewal exposure
Approximately 59% of the total workforce is covered by collective bargaining agreements, and agreements covering approximately 54% of the workforce expire within one year, primarily through annual negotiations in Mexico. Labor negotiations could affect costs, production, or operations.
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Large acquired-asset valuation exposure
Goodwill was $1,493.5 million and indefinite-lived trade names totaled $132.6 million at the fiscal 2026 testing date. Goodwill valuations used discount rates of approximately 10% to 11%; weaker projected revenue, profitability, or market conditions could result in future impairment charges.
Management's outlook
The 10-K does not provide quantitative revenue or EPS guidance. Annual outlook was not included in the filing and may be addressed in the earnings press release or call.
Earlier filings 4
10-Q · April 2, 2026
Acuity reported Q2 net sales of $1,055.7 million (up $49.4M, +4.9% vs. Q2 FY2025) with gross profit of $520.4 million and operating profit of $133.0 million. Gross margin expanded to 49.3% and diluted EPS rose to $3.09…
10-K · October 26, 2023
Acuity Brands positions itself as a market-leading industrial technology company organized around two reporting segments — Acuity Brands Lighting and Lighting Controls (ABL) and the Intelligent Spaces Group (ISG) —…
10-Q · June 30, 2022
Acuity Brands reported a strong quarter with net sales of $1,060.6M (up $160.9M or ~17.9% vs $899.7M) and diluted EPS of $3.07 (up $0.70 vs $2.37). Gross profit increased to $445.1M but gross margin compressed slightly;…
This is our reading of a public filing, not the filing itself. Analysis can contain errors; check the source document for full context.