Regal Rexnord Raises Adjusted Earnings Outlook After Impairment

The Tip Desk · November 3, 2026 · 3 min read

Third-quarter sales reached $1,588.0 million as Automation & Motion Control sales rose 24.5% and the company lifted 2026 adjusted diluted EPS guidance to a $10.60–$10.90 range.

Regal Rexnord Corporation (RRX) reported third-quarter sales of $1,588.0 million, up 6.1% from a year earlier, as Automation & Motion Control sales rose 24.5% and the industrial products company lowered GAAP earnings guidance while raising its adjusted diluted EPS outlook.

The Milwaukee-based maker of electric motors, air-moving subsystems and power-transmission components posted a GAAP net loss of $12.3 million, versus GAAP net income of $80.0 million in the year-ago quarter, after a $119.3 million goodwill impairment primarily related to the autonomous mobile solutions business in AMC. The charge reduced diluted earnings to a loss of $0.19 a share from $1.20 a share.

Adjusted EBITDA was $351.3 million, up 4% from a year earlier. Excluding IEEPA tariff refunds, adjusted EBITDA was $337 million, which the company said was ahead of expectations. Adjusted diluted EPS was $2.90 a share, versus $2.51 a year earlier. Company-wide adjusted EBITDA margin was 22.1%, versus 22.7% a year earlier.

Daily orders rose 6% versus the prior year. Chief Executive Officer Aamir Paul said orders growth excluding data centers was 13%, with commercial HVAC orders up 47% and discrete automation orders up 26%. He said data center order growth continued to scale, with some specific project timing effects in the quarter.

AMC net sales were $500.6 million, up 24.5%, or 25.2% on an organic basis. The company said growth was broad-based, with particular strength in data center, including $25 million of sales related to E-Pods, and in discrete automation. Data center sales were up 307%, or 169% excluding E-Pods. AMC adjusted EBITDA margin was 19.2% of net sales, or 18.7% excluding net IEEPA refund benefits.

Industrial Powertrain Solutions net sales were $649.5 million, down 1.9%, or 1.8% on an organic basis, which the company attributed to weakness in metals and mining partially offset by strength in discrete automation and energy markets. IPS adjusted EBITDA margin was 26.0% of net sales, or 25.2% excluding net IEEPA refund benefits.

Power Efficiency Solutions net sales were $437.9 million, up 1.2%, or 0.4% on an organic basis. The company said growth in commercial HVAC was partially offset by weakness in residential HVAC and pool. PES adjusted EBITDA margin was 19.7% of net sales, or 18.1% excluding net IEEPA refund benefits.

Paul said that four months into the role he sees opportunities to accelerate profitable growth, including improving operational performance and sharpening the growth agenda. The company said it has begun a comprehensive review of its portfolio with the board and outside advisors, with the goal of directing capital to the most attractive opportunities. It also announced it is exploring the sale of its autonomous mobile solutions business in AMC.

The company is lowering and narrowing 2026 GAAP EPS guidance to a range of $3.76 to $4.06, from a prior range of $5.42 to $5.92. The new GAAP range includes the $1.78 a share impact of the goodwill impairment. It is raising and narrowing 2026 adjusted diluted EPS guidance to $10.60 to $10.90, with the midpoint rising to $10.75 from $10.60.

Net debt to adjusted EBITDA, including synergies, ended the third quarter at 2.9 times. Cash and cash equivalents were $449.6 million at September 30, 2026.