Kadant Posts Record Revenue of $313.2 Million, Raises 2026 Earnings Outlook
Key Facts
Kadant, listed on the New York Stock Exchange under the ticker KAI, reported on November 3 results for its third quarter ended October 3, 2026, posting record revenue of $313.2 million. The company said revenue rose 15% from $271.6 million in the same period of 2025. Organic growth was 4%, while acquisitions contributed 11% of the increase. Net income attributable to the company was $35.1 million, up 27% from $27.7 million a year earlier. GAAP diluted earnings per share rose to $2.96 from $2.35, while adjusted earnings per share increased 21% to a record $3.64.
Bookings reflected strong demand during the quarter, rising 22% to $291.1 million from $238.4 million in the same period last year. Organic bookings growth was 10%, while acquisitions added 12% to the increase. Adjusted EBITDA reached a record $71.7 million, up 24% from $58.0 million. The measure's margin rose to 22.9% of revenue, compared with 21.4% in the third quarter of 2025. But gross margin fell 50 basis points to 44.7% from 45.2%, putting the margin decline alongside growth in revenue, earnings and bookings.
Liquidity indicators improved alongside higher earnings, with cash flow from operations rising 33% to a record $62.9 million. Operating cash flow was $47.3 million in the year-earlier quarter. Free cash flow also rose 32% to a record $58.1 million, compared with $44.1 million a year earlier. Year over year, third-quarter revenue included $31.0 million from acquisitions, as well as a positive foreign currency translation impact of $0.6 million compared with the same period. The figures show acquisitions were a key driver of revenue and bookings growth, while organic revenue growth remained below the overall increase.
Kadant raised its fiscal 2026 revenue outlook to $1.195–$1.210 billion, from a previous range of $1.190–$1.210 billion. It also adjusted its GAAP earnings-per-share outlook to $9.88–$10.03, compared with the previous range of $9.78–$10.03. The company raised its adjusted earnings-per-share range to $12.58–$12.73 from $12.43–$12.68. Management said it expects aftermarket demand to remain stable and project activity to improve. It added that strength in aftermarket business, together with execution discipline and operational excellence, supports its expectation of finishing the year strongly. At the same time, the timing of large capital orders remains affected by economic and geopolitical uncertainty.
The company expects fourth-quarter 2026 revenue of $287 million to $302 million, GAAP earnings per share of $2.01 to $2.16, and adjusted earnings per share of $2.67 to $2.82. The forecast follows annual revenue growth of 23% to a record $312.9 million in the second quarter of 2026, when bookings reached $312 million. In its results for that quarter, the company had noted that customer caution and lengthy approval cycles were weighing on the timing of capital spending projects, despite continued interest in its products and technologies. After the results were announced on November 3, Kadant shares rose 3.6% in trading after the close on Tuesday. The company is scheduled to hold an online investor conference to discuss results and the outlook on November 4, 2026, at 11 a.m. Eastern time.