Allient Inc. Q2FY26 Results: Net profit up 85% YoY, revenue rises 10%
- Revenue increased 10% YoY to $153.8 million, driven by industrial automation and data center demand.
- Net income rose 85% YoY to $10.4 million ($0.61 per diluted share), aided by lower interest costs.
- Gross margin hit a record 34.9%, expanding 170 basis points due to favorable mix and STAN efficiencies.
- Orders surged 49% YoY to a record $201.3 million, yielding a 1.31x book-to-bill ratio.
- Data center revenue grew 60% YoY, now representing 10.6% of total sales.
*this image is generated using AI for illustrative purposes only.
Allient Inc. reported a strong second quarter with revenue rising 10% year over year to $153.8 million, driven by robust demand in industrial automation and data center infrastructure.
The company’s net income increased 85% to $10.4 million, or $0.61 per diluted share, reflecting improved operating leverage and lower interest expenses. Gross margin expanded 170 basis points to a record 34.9%, supported by favorable mix and operational efficiencies under the STAN initiative.
Key Financial Metrics
| Metric | Q2FY26 | Q2FY25 | Change |
|---|---|---|---|
| Revenue | $153.8 million | N/A | +10% |
| Gross Profit | $53.6 million | N/A | +170 bps margin |
| Operating Income | $15.6 million | $11.7 million | +33% |
| Net Income | $10.4 million | N/A | +85% |
| Adjusted EBITDA | $23.7 million | N/A | +18% |
| Diluted EPS | $0.61 | N/A | +85% |
Order Momentum and Backlog Strength
Order intake surged 49% year over year to a record $201.3 million, resulting in a book-to-bill ratio of 1.31 times. This significant increase provides enhanced visibility for the remainder of fiscal 2026, with most backlog expected to convert to revenue within three to nine months.
Key verticals driving growth include:
- Industrial: Up 17%, led by automation and power quality solutions for data centers.
- Aerospace and Defense: Up 16%, despite the cancellation of the M10 Booker program.
- Medical: Up 9%, driven by surgical and robotics applications.
- Data Center Infrastructure: Revenue up 60% year over year, contributing 10.6% to total sales.
What the Numbers Show
A divergence between revenue growth and earnings expansion highlights the company’s improving margin profile. While revenue grew 10%, net income rose 85%, indicating that gross margin expansion and reduced interest expense are disproportionately boosting bottom-line profitability. Additionally, the data center segment’s 60% growth rate significantly outpaces the company’s overall 10% revenue growth, suggesting this niche is becoming a critical driver of future top-line acceleration.
Balance Sheet and Outlook
Allient continues to deleverage, with total debt decreasing to $173.3 million from year-end 2025 levels. Net debt stood at $131.2 million, and leverage improved to 1.63 times. The company holds approximately $42 million in cash and $162 million in unused revolver capacity, enhancing financial flexibility.
Management expects full-year capital expenditures of $12 to $15 million, focusing on capacity expansions for data center power quality and automation products. The effective tax rate for the quarter was 20.2%, with a full-year expectation of 21% to 23%.
How will the 60% growth in data center infrastructure revenue impact Allient's long-term margin structure as this segment becomes a larger portion of total sales?
Can the company sustain its record 34.9% gross margin through the second half of fiscal 2026, or are these levels dependent on temporary favorable product mix shifts?
What specific capacity expansion timelines are required to support the $201.3 million backlog, and how might supply chain constraints affect revenue conversion rates?
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