Loar Holdings Inc.

Q2 2026 sales were $172 million, up 17% year over year. Commercial aftermarket sales increased 12%, commercial OEM sales increased 28%, and defense sales increased 8%; net organic sales increased 12%. Gross profit margin declined 60 basis points year over year, mainly due to higher noncash amortization from acquired intangible assets, and would have been 100 basis points higher excluding that effect. Net income was flat year over year, adjusted net income rose $9 million or 35%, adjusted EBITDA rose $20 million, and adjusted EBITDA margin was 40.5% versus 38.3% a year ago. For 2026, management raised guidance to net sales of $665 million-$675 million, adjusted EBITDA of $265 million-$270 million, adjusted EBITDA margin of approximately 40%, GAAP net income of $56 million-$60 million, adjusted EPS of $1.32-$1.36, and capex of about $20 million.

Dirkson Charles framed the quarter as evidence that Loar’s operating model is working, emphasizing collaboration, disciplined capital allocation, and strong execution on certification and new product wins. He said the company is at an “inflection point” in new business conversion, with engineering resources being concentrated on higher-probability projects rather than “blue sky” work. His tone was highly confident and upbeat, repeatedly saying Loar expects to meet or beat guidance and that the company is building a long-term aerospace and defense cash compounder.

Glenn D'Alessandro highlighted the quarter’s hard numbers: sales of $172 million, 12% organic growth, gross margin down 60 basis points year over year due to noncash amortization from LMB and Harper, flat net income, $9 million or 35% growth in adjusted net income, and adjusted EBITDA margin of 40.5%. He noted that excluding the amortization effect, gross margin would have been 100 basis points higher than last year. On capital allocation and outlook, management reiterated capex at about $20 million, or roughly 3% of sales, and said the 2026 guide assumes no additional acquisitions.

Analysts focused on whether new product conversion is inflecting, how much upside remains in guidance, aftermarket trends into 2027, and whether defense remains purely lumpy. Management said the new business engine is indeed at an inflection point, that the company is seeing certification wins and expects more over the next 6 to 9 months, and that it does not think in terms of win rate but of converting pipeline into base business. On aftermarket, management said destocking risk appears largely behind them, described inventories as lower than earlier in the year, and said 2027 should show stronger aftermarket growth. On guidance and operations, management said risks were effectively removed from the forecast and called out the need to invest more in Fans & Motors, restraints, and brakes to keep up with demand.