UFP Technologies Gross Margin Extends 2026 Climb

The Tip Desk · November 10, 2026 · 3 min read

Net income reached $20.6 million, or $2.64 a share, as sales rose 11.6% to $172.4 million.

UFP Technologies (UFPT), a contract development and manufacturing organization for medical devices and sterile packaging, reported net income of $20.6 million for the third quarter ended September 30, 2026, 25.8% higher than $16.4 million a year earlier. GAAP diluted earnings were $2.64 a share; adjusted diluted earnings were $2.88.

Net sales were $172.4 million, 11.6% above $154.6 million in the third quarter of 2025. Organic sales growth was 11.1% for the three months ended September 30, 2026.

Gross margin increased to 29.4% in the third quarter of 2026, from 27.7% in the same quarter of 2025. President and Chief Executive Officer Mitch Rock said sales grew 11.6%, including 11.1% organic growth, and that MedTech sales grew 12.5%, reflecting broad-based demand across the portfolio.

Operating income increased 18.1% to $27.6 million from $23.4 million a year earlier. Adjusted operating income rose 14.5% to $30.1 million from $26.3 million. Adjusted EBITDA increased 15.3% to $35.4 million from $30.7 million.

Selling, general and administrative expenses increased 21.4% to $23.2 million from $19.1 million a year earlier. As a percentage of sales, SG&A was 13.4%, up from 12.3%. Adjusted SG&A was 12.0% of sales.

Rock said year-to-date sales increased 10.3% to $500.6 million through September, compared with $453.9 million in the same period of 2025. Organic sales growth for the nine months ended September 30, 2026, was 7.9%. Net income for the nine-month period was $59.0 million, 16.2% higher than $50.7 million a year earlier. GAAP and adjusted EPS for the nine months were $7.56 and $8.28.

The company said MedTech sales grew 11.7% year-to-date and that its top five MedTech customers collectively grew 11.7%. Rock said the company is seeing scaling of new programs in the Dominican Republic and margin improvements in legacy UFP operations. He said the 2025 investment in TPI has exceeded expectations and provides an initial position in injection molding. He also said the company has made year-over-year progress at AJR in the United States and the Dominican Republic, but that scheduled program transfers to the Dominican Republic and margin improvement remain behind plan.

Looking ahead to 2027, Rock said the company is optimistic about UFP’s strength and positioning. He said UFP has invested in additional capacity at DAS Medical to support double-digit growth and continues to build the team. He said the company continues to see attractive acquisition opportunities and is making progress on several of them, and that it is working to expand its credit facility to increase capacity to invest in high-quality businesses.

Cash and cash equivalents were $20.6 million at September 30, 2026. Long-term debt, excluding current installments, was $83.5 million. Total equity was $485.7 million.