Moog Inc. Achieves Record Third Quarter 2026 Results Through Operational Excellence and Raises Full-Year Guidance

EAST AURORA, N.Y., July 31, 2026--(BUSINESS WIRE)--Moog Inc. (NYSE: MOG.A and MOG.B), a worldwide designer, manufacturer and systems integrator of high-performance precision motion and fluid controls and control systems, today reported fiscal third quarter 2026 results, reflecting record sales and adjusted earnings per share, expanded operating margin and strong cash generation.

"These third quarter results demonstrate the strength of Moog's portfolio and operational excellence," said Pat Roche, CEO. "We are clear about where we win, disciplined on how we work, selective about where we invest, and able to turn attractive market demand into improved financial performance."

Quarter Highlights

• Record net sales, reflecting significant growth across all four segments.

• Operating margin benefitted from $30 million of claims related to previously incurred International Emergency Economic Powers Act ("IEEPA") tariffs and the absence of the prior year's program termination and asset impairment charges.

• Adjusted operating margin increased due to the claims of previously incurred IEEPA tariffs, which accounted for 270 basis points of incremental margin, and business performance, partially offset by last year's benefit from a non-core product line sale.

• Diluted net earnings per share was driven by income tax benefits attributable to current and prior fiscal years, the claims of previously incurred IEEPA tariffs and business performance.

• Adjusted diluted net earnings per share was driven by the claims of previously incurred IEEPA tariffs and business performance.

• Free cash flow improved significantly, driven by strong earnings.

• Twelve-month backlog increased 23% to $3.3 billion, reflecting continued demand across our markets.

Segment Results
Sales in the third quarter of 2026 were $1.1 billion, an increase of 15% compared to the third quarter of 2025. Space and Defense sales increased 17% to $336 million, reflecting broad-based defense demand including demand for missile controls and space vehicles. Military Aircraft sales increased 9% to $245 million, driven by strong aftermarket activity, as well as continued activity on the MV-75 program. Commercial Aircraft sales increased 17% to $254 million, driven by higher volume and pricing on various major production programs, as well as strong aftermarket sales. Industrial sales increased 18% to $282 million, driven by strong demand for data center cooling pumps, as well as for medical devices and energy products.

Operating margin in the third quarter of 2026 was 15.8%, an increase of 430 basis points compared to the third quarter of 2025. Industrial operating margin increased 770 basis points to 17.4%, primarily driven by tariff refund claims, as well as the absence of last year's impairment charges and the growing data center cooling pump business. Military Aircraft operating margin increased 650 basis points to 14.7%, driven by the absence of the prior year's 360 basis point charge associated with the termination of a product development effort and business performance. Space and Defense operating margin increased 240 basis points to 15.7%, driven by business performance and, to a lesser extent, the tariff refund. These benefits were partially offset by increased product development, business capture and operational readiness investments. Commercial Aircraft operating margin increased 50 basis points to 15.2%, driven by tariff refund claims and pricing benefits, mostly offset by the absence of the prior year's 300 basis points non-core product line sale and the current quarter's less favorable sales mix.

Adjusted operating margin excludes $7 million of charges for simplification initiatives in the third quarter of 2026, and excludes $20 million of charges for simplification initiatives, as well as a program termination, in the third quarter of 2025. Excluding these items, adjusted operating margin expanded 280 basis points to 16.4% compared to the third quarter of 2025. Industrial adjusted operating margin increased 630 basis points to 19.9% driven by tariff refund claims and the growing data center cooling pump business. Military Aircraft adjusted operating margin increased 290 basis points to 14.7%, driven by business performance and the tariff refund. Within Space and Defense and Commercial Aircraft, adjusted operating margin increased due to the same factors as described above.

Income Tax Expense
The effective tax rates for the third quarter and first three quarters of 2026 were (10.6)% and 10.0%, respectively, compared with 23.4% for both corresponding periods of 2025. During the third quarter of 2026, we recognized income tax benefits related to U.S. federal research credits of $35 million related to prior years. We also recognized a discrete income tax benefit of $8 million related to legal entity simplification initiatives. Adjusted 2026 net earnings and adjusted net earnings per share exclude both the $35 million and $8 million income tax benefits.

Free Cash Flow Results
Free cash flow for the quarter was $133 million. Strong earnings drove cash generation, and working capital remained relatively constant despite strong sales growth. Capital expenditures were $28 million, relatively light compared to recent periods due to timing of capital investments.

Fiscal 2026 Financial Guidance
"This quarter was another one marked with robust financial results," said Jennifer Walter, CFO. "We're increasing our 2026 guidance for all key financial metrics, reflecting our strong operational performance, as well as contributions from the tariff refund and a current year research and development tax credit. Fiscal 2026 is shaping up to be another record year."

Conference call information
In conjunction with today's release, Pat Roche, CEO, and Jennifer Walter, CFO, will host a conference call today beginning at 10:00 a.m. ET, which will be simultaneously broadcast live online. Listeners can access the call and supplemental financial materials at www.moog.com/investors/communications.

Cautionary Statement
This press release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, which can be identified by words such as: "may," "will," "should," "believes," "expects," "expected," "intends," "plans," "projects," "approximate," "estimates," "predicts," "potential," "outlook," "forecast," "anticipates," "presume," "assume" and other words and terms of similar meaning (including their negative counterparts or other various or comparable terminology). These forward-looking statements are made pursuant to the Private Securities Litigation Reform Act of 1995, are neither historical facts nor guarantees of future performance and are subject to several factors, risks and uncertainties, the impact or occurrence of which could cause actual results to differ materially from the expected results described in the forward-looking statements.

Although it is not possible to create a comprehensive list of all factors that may cause our actual results to differ from the results expressed or implied by our forward-looking statements or that may affect our future results, some of these factors and other risks and uncertainties are described in Item 1A "Risk Factors" of our Annual Report on Form 10-K and in our other periodic filings with the Securities and Exchange Commission ("SEC") and include, but are not limited to, risks relating to: (i) our operation in highly competitive markets with competitors who may have greater resources than we possess; (ii) our operation in cyclical markets that are sensitive to domestic and foreign economic conditions and events; (iii) current and future geopolitical conditions and events, including wars, armed conflicts, sanctions, trade restrictions and related disruptions to global markets and supply chains; (iv) our heavy dependence on government contracts that may not be fully funded, delayed or terminated; (v) our ability to remediate the material weakness in internal control over financial reporting and maintain effective disclosure controls and procedures; (vi) supply chain constraints and inflationary impacts on prices for raw materials and components used in our products; (vii) failure of our subcontractors or suppliers to perform their contractual obligations; (viii) risks related to information systems interruptions, intrusions, cybersecurity threats or new software implementations; and (ix) our accounting estimates for over-time contracts and any changes we may need to make thereto. You should evaluate all forward-looking statements made in this press release in the context of these risks and uncertainties.

While we believe we have identified and discussed in our SEC filings the material risks affecting our business, there may be additional factors, risks and uncertainties not currently known to us or that we currently consider immaterial that may affect the forward-looking statements we make herein. Given these factors, risks and uncertainties, investors should not place undue reliance on forward-looking statements as predictive of future results. Any forward-looking statement speaks only as of the date on which it is made, and we disclaim any obligation to update any forward-looking statement made in this press release, except as required by applicable law.

Non-GAAP Financial Measures
The press release also includes certain financial information that is not presented in accordance with Generally Accepted Accounting Principles ("GAAP"), including, but not limited to, "Adjusted Operating Margin," "Adjusted Diluted Net Earnings Per Share," "Adjusted Net Earnings," "Adjusted Effective Tax Rate," "Free Cash Flow" and "Free Cash Flow Conversion." While we believe that these non-GAAP financial measures may be useful in evaluating our financial condition and results of operations, this information should be considered supplemental and is not a substitute for financial information prepared in accordance with GAAP. Adjustments to operating profit and margin and net earnings per share have included restructuring charges; acquisition- and integration-related costs; gains or losses on investments; asset impairments; litigation and regulatory matters; discrete tax items; changes in the fair value of contingent consideration; foreign exchange gains or losses; and other non-recurring or non-cash items. Reconciliations of the non-GAAP measures to the most directly comparable GAAP measures can be found in the accompanying materials.

The press release also includes certain forward-looking non-GAAP financial guidance, including, but not limited to, "Adjusted Diluted Net Earnings per Share," "Adjusted Operating Margin" and "Free Cash Flow Conversion". The Company is unable to provide a reconciliation of such forward-looking non-GAAP guidance to the most directly comparable GAAP measures without unreasonable effort because certain items that are material to the comparable GAAP measures are not available and cannot be estimated with reasonable certainty. These items are dependent on future events that are difficult to predict and outside the Company's control. These items may include, but are not limited to, restructuring charges; acquisition- and integration-related costs; gains or losses on investments; asset impairments; litigation and regulatory matters; discrete tax items; changes in the fair value of contingent consideration; foreign exchange gains or losses; and other non-recurring or non-cash items. The timing and amount of these items may vary significantly from period to period and could have a material impact on the Company's GAAP results, including, but not limited to, "Diluted Net Earnings per Share" and "Operating Margin".