Qnity raises 2026 forecast as Q3 profit tops estimates
Qnity raised its 2026 forecast after third-quarter adjusted EPS of $1.46 topped the $1.23 consensus estimate. Net sales of $1.56 billion also beat the $1.52 billion estimate.
Key takeaways
- Qnity (Q) raised its 2026 forecast after reporting third-quarter net sales of $1.56 billion, up 22% from a year earlier, and adjusted earnings of $1.46 per share, up 55%. The results topped the $1.23 consensus estimate for adjusted EPS and the $1.52 billion estimate for revenue.
Qnity (Q) raised its 2026 forecast on Nov. 4 after reporting third-quarter adjusted earnings of $1.46 per share, which topped the $1.23 consensus estimate. Net sales were $1.56 billion, also above the $1.52 billion estimate.
Shares were little changed in regular-session trading as of 9:50 a.m. ET, from a regular-session close of $118.89.
The company's press release said net sales rose 22% from a year earlier. Adjusted operating EBITDA, a measure of operating profit before interest, taxes, depreciation and amortization and certain items, was $503 million, up from $370 million a year earlier on a pro forma basis.
Here's how the company did:
- Adjusted EPS: $1.46 vs. $0.94 a year earlier, against $1.23 expected
- Net sales: $1.56 billion vs. $1.28 billion a year earlier, against $1.52 billion expected
- GAAP diluted EPS: $0.87 vs. $1.01 a year earlier
- Net income: $196 million vs. $223 million a year earlier
Chief Executive Officer Jon Kemp said, "We delivered our tenth consecutive quarter of profitable growth with strong performance across both segments as Qnity continues to establish itself as the premier solutions provider across the semiconductor value chain."
Semiconductor Technologies sales were $797 million, up from $693 million a year earlier. Interconnect Solutions sales rose to $759 million from $583 million.
Gross margin was 47.8%, up from 45.1% a year earlier. Adjusted operating EBITDA in the Semiconductor Technologies segment was $285 million, against $240 million, while Interconnect Solutions reached $236 million, against $152 million.
2026 guidance
Qnity raised all four full-year measures. The company said the change reflected strong third-quarter performance and continued momentum in the business.
| Measure | Aug. 4 range | New range |
|---|---|---|
| Net sales | $5.55B - $5.65B | $5.77B - $5.83B |
| Adjusted operating EBITDA | $1.675B - $1.725B | $1.785B - $1.805B |
| Adjusted EPS | $4.40 - $4.60 | $4.95 - $5.05 |
| Adjusted free cash flow | $600M - $700M | $800M - $900M |
Costs and charges
Transformation, integration and other charges were $53 million in the quarter, against $1 million a year earlier. The company said about $35 million of that went to information technology independence initiatives. Interest expense rose to $64 million from $14 million.
Cash and capital returns
For the nine months, cash provided by operating activities was $647 million, down from $782 million a year earlier. The company repurchased $75 million of common stock and paid $50 million in dividends to stockholders in the period.