ESAB Cuts Annual Forecast Despite 13.3% Rise in Third-Quarter Revenue to $824.5 Million
Key Facts
ESAB reported revenue of $824.5 million on November 4, 2026, up 13.3% from $727.8 million a year earlier and above the estimate of $788.84 million, but lowered its financial outlook for the year. The announcement came on the day of its earnings call, scheduled for 8:00 a.m. Eastern time. The figures reflect reported sales expanding much faster than growth in the existing business, with underlying organic sales growth at 2.3%. At the same time, the company narrowed its full-year guidance ranges for underlying adjusted earnings and underlying adjusted EBITDA. The results thus combined a revenue estimate beat with a lowered outlook, while showing that acquisitions and foreign exchange contributed to overall sales growth.
According to the sales data reported in the earnings release, underlying sales rose to $786.8 million from $687.4 million in the third quarter of 2025. The existing business contributed organic growth of 2.3%, while about 11.3% of underlying sales growth was attributed to acquisitions. This breakdown shows that the 13.3% increase in total revenue did not come entirely from organic business growth. ESAB estimated that mergers and acquisitions would contribute about 9.5% to full-year underlying sales growth, up from a previous estimate of 9.0%. It also raised its estimate for the foreign-exchange impact to about 2.0%, from a previous range of 0.0% to 1.0%.
On earnings, adjusted earnings per share were $1.32 for the quarter, $0.03 a share below the analyst consensus of $1.35, according to Investing.com. Net income from continuing operations attributable to ESAB was about $41 million, or $0.61 per diluted share. These figures relate to different measures: the first is adjusted earnings, while the second is net income from continuing operations and its per-share figure. Meanwhile, underlying adjusted EBITDA was $156 million, up 17.0% year over year. The underlying adjusted EBITDA margin expanded 40 basis points to 19.8%, putting improvement in the underlying operating margin alongside the lower full-year outlook.
Chief Executive Shyam P. Kambeyanda said the company posted record underlying sales and adjusted EBITDA for the quarter, with organic growth in both segments despite a dynamic global environment and inflationary pressures. He added: "We improved sales, margins and cash generation sequentially." The assessment points to sequential improvement in three metrics cited by the chief executive, while year-over-year organic growth remained at 2.3%. Management's comments put underlying business performance in the context of the pressures cited by the executive, as well as the effect of acquisitions on sales. The core divergence in the figures remained unchanged: strong growth in reported revenue and underlying EBITDA measures, alongside a reduction in full-year estimates.
ESAB lowered its forecast for underlying organic sales growth in 2026 to a range of 1.6%-2.0%, from its previous forecast of 2.0%-4.0%. At the same time, it kept its forecast for total underlying sales growth at 13.1%-13.3%, according to the updated outlook reported by Investing.com. The company cut its expected underlying adjusted EBITDA range to $603-$607 million from $615-$625 million. Its expected underlying adjusted earnings per share range is now $5.28-$5.33, compared with the previous range of $5.40-$5.50. The outlook keeps total sales growth well above the organic range, while the company lowers its full-year profitability estimates.