Regal Rexnord Organic Sales Growth Accelerates

The Tip Desk · August 5, 2026 · 3 min read

Organic sales growth reached 3.3% in the second quarter, and the company narrowed 2026 adjusted EPS guidance to $10.35 to $10.85.

Regal Rexnord Corporation (RRX), the Milwaukee-based motion-control and powertrain supplier, reported that organic sales growth accelerated to 3.3% in the second quarter, after 1.6% in the first quarter.

Daily orders rose 8.8% versus the year-ago quarter, up from 8.5% in the first quarter. Chief Financial Officer Rob Rehard said the mid-term sales growth outlook strengthened further, with Automation & Motion Control daily orders up 17.1%.

Sales were $1,558.4 million, up 4.2% from a year earlier. GAAP net income was $116.8 million, up 46.7% versus the year-ago quarter, after an 11.8% year-over-year increase in the first quarter. Diluted earnings were $1.74 a share. Adjusted diluted EPS was $2.99, up 20.6% versus the year-ago quarter, after a 0.9% year-over-year increase in the first quarter. The second-quarter adjusted figure includes $0.39 of IEEPA tariff refund benefit.

Adjusted EBITDA was $366.6 million, up 11.2% versus the year-ago quarter, after a 1.6% year-over-year decline in the first quarter. The second-quarter figure includes a $32.0 million IEEPA tariff refund benefit. Rehard said that excluding IEEPA refunds, enterprise adjusted EBITDA margins were in line with expectations despite incremental inflationary pressures, aided in part by incremental synergies.

Automation & Motion Control net sales were $477.7 million, up 16.2%, or 15.6% on an organic basis, after 15.3% (12.1% organic) growth in the first quarter. Growth was broad-based, with particular strength in data center, discrete automation, and aerospace & defense. AMC adjusted EBITDA margin was 21.1% of net sales, or 19.9% excluding refunds, up from 18.2% in the first quarter. Rehard said AMC margins improved sequentially and year over year.

Industrial Powertrain Solutions net sales were $669.4 million, up 3.0%, or 2.0% on an organic basis, after 5.8% (2.8% organic) growth in the first quarter. Growth was strongest in the energy market. IPS adjusted EBITDA margin was 27.1% of net sales, or 25.9% excluding refunds.

Power Efficiency Solutions net sales were $411.3 million, down 5.5%, or 6.6% on an organic basis, due to weakness in residential HVAC and pool markets, which was partially offset by strength in commercial HVAC. PES adjusted EBITDA margin was 20.5% of net sales, or 16.2% excluding refunds. Rehard said organic sales growth also accelerated despite greater-than-expected headwinds in Resi-HVAC, pool, mining and agriculture markets.

Cash from operating activities was $176.6 million and free cash flow was $154.1 million. Net debt to adjusted EBITDA including synergies ended the second quarter at 3.06x. The company expects to be below 3.0x in the second half of 2026.

The company narrowed 2026 GAAP EPS guidance to $5.42 to $5.92 from the $5.29 to $6.09 range introduced in February. It also narrowed 2026 adjusted diluted EPS guidance to $10.35 to $10.85, inclusive of $0.57 per share of IEEPA tariff refund benefits, with the midpoint remaining $10.60 versus the $10.20 to $11.00 range introduced in February.

Rehard said the top-line outlook remains unchanged and that the company is holding the adjusted EPS outlook range midpoint, including refunds. The outlook now reflects a longer timeline to realize planned productivity gains, in some cases to prioritize service levels, a lag in price realization relative to a faster pace of inflation, and modestly unfavorable segment mix. He said those factors do not change the company’s view of a strong and broad-based underlying demand environment and that it continues to see positive order momentum across the business.

Aamir Paul, who joined as the company’s sixth chief executive, said he is spending time learning the business and that the goal is to create a sustainable platform for growth while delivering predictable results.