Terex Corporation

10/29/2026 | Press release | Distributed by Public on 10/29/2026 12:16

Quarterly Report for Quarter Ending September 30, 2026 (Form 10-Q)

MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
BUSINESS DESCRIPTION
Terex is a global industrial equipment manufacturer of materials processing machinery, waste and recycling solutions, customized vehicle solutions, mobile elevating work platforms (MEWPs), equipment for the electric utility industry, commercial and custom fire and ambulance vehicles, and recreational vehicles. We design, build, and support products used in maintenance, manufacturing, energy, waste and recycling, minerals and materials management, construction, the entertainment industry, emergency response, and the recreational vehicles market. We provide lifecycle support to our customers through our global parts and services organization, and offer complementary digital solutions, designed to help our customers maximize their return on their investment. Certain Terex products and solutions enable customers to reduce their impact on the environment including electric and hybrid offerings that deliver quiet and emission-free performance, products that support renewable energy, and products that aid in the recovery of useful materials from various types of waste. Our products are manufactured in North America, Europe, and Asia Pacific and sold worldwide. We engage with customers through all stages of the product life cycle, from initial specification to parts and service support. We report our business in the following segments: (i) Environmental Solutions ("ES"), (ii) Materials Processing ("MP"), (iii) Specialty Vehicles ("SV") and (iv) Aerials.
Overview
During the third quarter of 2026, the Company remained focused on executing its operating plan, integrating the legacy Terex and REV organizations, and deploying the Terex Operating System ("TOS") across the enterprise to improve operational execution, reduce fixed costs, and drive productivity. The REV Transaction, which closed in the first quarter of 2026, significantly expanded our portfolio of specialty equipment businesses and strengthened our position in resilient, high-demand markets with attractive long-term growth potential. The operating results of REV are included in the newly created SV segment. We remain focused on realizing synergies, improving operational consistency, and leveraging the combined scale of the Company. See Note D - "Acquisitions and Held for Sale" in our Notes to Condensed Consolidated Financial Statements for additional information regarding the REV Transaction.
Terex delivered solid results in the third quarter of 2026. Net sales for the three months ended September 30, 2026 were $2,197 million including $657 million generated by SV, compared to total Net sales of $1,387 million in the same period in the prior year. Adjusted operating profit for the three months ended September 30, 2026 was $260 million including $99 million generated by SV, compared to Adjusted operating profit of $168 million in the same period in 2025. Adjusted EBITDA for the three months ended September 30, 2026 was $286 million including adjusted EBITDA generated by SV of $105 million, compared to Adjusted EBITDA of $186 million in the same period in 2025. Additional information regarding segment specific results is provided in the "Results of Operations" section below. The Company's free cash flow for the three months ended September 30, 2026 was $209 million compared to $130 million in the same period in 2025, reflecting higher profitability excluding the impact of purchase accounting for the three months ended September 30, 2026. Backlog as of September 30, 2026 was $7.0 billion, providing solid forward visibility.
North America remained our largest market, representing approximately 81% of total sales during the third quarter of 2026 and reflecting our deliberate shift toward more U.S.-based, resilient and predictable sectors. We continue to execute our capital allocation strategy by generating additional operating cash through improved net working capital management and returning value to shareholders through dividends and opportunistic share repurchases. Net working capital as a percentage of trailing three month annualized net sales was 15.0% as of September 30, 2026 compared to 23.2% from the same period in the prior year. We maintained ample liquidity with approximately $1,207 million available as of September 30, 2026. See "Liquidity and Capital Resources" for a detailed description of liquidity and working capital levels, including the primary factors affecting such levels, as well as a reconciliation of net cash provided by operating activities to free cash flow.
Our key end markets remain resilient, supported by consistent replacement and aftermarket demand. In waste and recycling, long-term demand is supported by fleet replacement, innovation and demographic trends, although certain customers continue to manage capital spending and absorb recently delivered fleets. We expect utility market demand to remain supported by long-term investment in the U.S. electrical grid, including transmission expansion and future data-center-related growth. Demand for fire and emergency vehicles remains stable, supported by municipal budgets and replacement demand. In Aerials and MP, infrastructure activity remains robust, supported by government funding and a growing pipeline of mega projects that we expect to continue to provide a tailwind.
We continue to identify opportunities to improve operating performance across the portfolio by advancing the integration process, deploying TOS, investing in productivity-enhancing technology and leveraging our broader portfolio and scale to better serve customers.
RESULTS OF OPERATIONS
Three Months Ended September 30, 2026 Compared with Three Months Ended September 30, 2025
Consolidated
Three Months Ended September 30,
2026 2025
% of
Sales 		% of
Sales 		% Change In
Reported Amounts
($ amounts in millions)
Net sales $ 2,197 - $ 1,387 - 58.4 %
Gross profit
435 19.8 % 299 21.6 % 45.5 %
Selling, general and administrative expenses
199 9.1 % 142 10.2 % 40.1 %
Amortization of purchased intangibles
53 2.4 % 17 1.2 % 211.8 %
Operating profit 183 8.3 % 140 10.1 % 30.7 %
Interest expense, net of interest income
44 2.0 % 42 3.0 % 4.8 %
Income taxes (21) (1.0) % (29) (2.1) % (27.6) %
Net income 114 5.2 % 65 4.7 % 75.4 %
Adjusted operating profit
260 11.9 % 168 12.1 % 54.8 %
Adjusted EBITDA
286 13.0 % 186 13.4 % 53.8 %
Net Sales
Net sales for the three months ended September 30, 2026 increased $810 million when compared to the same period in 2025, including sales generated from SV of $657 million. Excluding the impact of SV, and the impact of $27 million of sales in the prior year period from the Company's tower and rough terrain cranes businesses which were sold on October 31, 2025, the increase in Net sales of $180 million was primarily due to higher sales in Aerials, MP and utilities products in ES, partially offset by lower shipment of refuse collection vehicles in ES.
Gross Profit
Gross profit for the three months ended September 30, 2026 increased $136 million when compared to the same period in 2025, primarily driven by the gross profit contribution of $128 million from SV. Excluding the impact of SV, the increase in gross profit of $8 million was primarily due to higher shipment volumes, favorable mix, price cost discipline and higher production volumes in MP. These favorable impacts were partially offset by an unfavorable mix in Aerials, inefficiencies related to a production ramp up in Utilities, under-absorption associated with lower refuse collection vehicle production volume within ES, inflationary pressures in both ES and Aerials, and tariff pressures in Aerials.
Selling, general, and administrative expense
Selling, general and administrative expenses for the three months ended September 30, 2026 increased $57 million when compared to the same period in 2025, driven by the SG&A contribution of $50 million from SV. Excluding the impact of SV, the increase in selling, general, and administrative expense of $7 million was primarily due to loss on held-for-sale business, deal related costs and higher compensation costs primarily driven by the inclusion of REV corporate activities. These increases were partially offset by the one-time release of a contingent liability in ES, and lower costs within MP due to the absence of the Company's tower and rough terrain crane businesses, which were sold on October 31, 2025 and are included in the prior-year period results.
Amortization of purchased intangibles
Amortization of purchased intangibles for the three months ended September 30, 2026 increased $36 million when compared to the same period in 2025, which was directly related to the additional amortization expense from purchased intangibles resulting from the REV Transaction.
Operating profit
Operating profit for the three months ended September 30, 2026 increased $43 million when compared to the same period in 2025, primarily driven by the operating profit contribution of $43 million from SV. Excluding the impact of SV, operating profit was flat year over year, primarily due to the factors detailed above.
Interest expense, net of interest income
Interest expense, net of interest income, for the three months ended September 30, 2026 and 2025 was $44 million and $42 million, respectively. The increase in expense is primarily due to interest accrued on customer deposits which primarily relate to the SV segment.
Provision for income taxes
Income tax expense for the three months ended September 30, 2026 was $21 million on pretax income of $135 million, resulting in an effective tax rate of 15.6%, as compared to income tax expense of $29 million on pretax income of $94 million, resulting in an effective tax rate of 31.4%, for the three months ended September 30, 2025. The lower effective tax rate for the three months ended September 30, 2026 when compared with the three months ended September 30, 2025 is primarily due to an increase in favorable discrete items.
Net income
Net income for the three months ended September 30, 2026 was $114 million compared to Net income of $65 million in the same period in 2025. The increase in Net income of $49 million was primarily due to the factors detailed above.
Adjusted operating profit
Adjusted operating profit for the three months ended September 30, 2026 increased $92 million when compared to the same period in 2025, primarily due to the Adjusted operating profit generated by SV of $99 million. Excluding the impact of SV, Adjusted operating profit decreased by $7 million, primarily due to the factors detailed above, excluding a one-time release of a contingent liability in ES and deal related costs.
Adjusted EBITDA
Adjusted EBITDA for the three months ended September 30, 2026 increased $100 million when compared to the same period in 2025, primarily due to Adjusted EBITDA generated by SV of $105 million. Excluding the impact of SV, Adjusted EBITDA decreased by $5 million, driven by a decrease in ES and Corporate, partially offset by increases in MP and Aerials, the latter of which was primarily related to higher production volume and cost out actions.
Environmental Solutions
Three Months Ended September 30,
2026 2025
% of
Sales 		% of
Sales 		% Change In
Reported Amounts
($ amounts in millions)
Net sales $ 400 - $ 435 - (8.0) %
Adjusted EBITDA
$ 61 15.3 % $ 83 19.2 % (26.5) %
Net sales for the three months ended September 30, 2026 decreased $35 million when compared to the same period in 2025, primarily due to lower shipments of refuse collection vehicles, partially offset by higher utilities product sales.
Adjusted EBITDA for the three months ended September 30, 2026 decreased $22 million when compared to the same period in 2025, primarily due to unfavorable mix, inefficiencies related to a production ramp up in Utilities, under-absorption associated with lower refuse collection vehicle production volume and inflationary pressures.
Materials Processing
Three Months Ended September 30,
2026 2025
% of
Sales 		% of
Sales 		% Change In
Reported Amounts
($ amounts in millions)
Net sales $ 434 - $ 417 - 4.1 %
Adjusted EBITDA
$ 84 19.3 % $ 56 13.5 % 50.0 %
Net sales for the three months ended September 30, 2026 increased $17 million when compared to the same period in 2025. Excluding the sales impact from the Company's tower and rough terrain crane businesses, which were sold on October 31, 2025 and are included in the prior-year period results, net sales increased $44 million. The improvement was primarily driven by increased shipments across most product categories, with the largest increase coming from Aggregates in North America.
Adjusted EBITDA for the three months ended September 30, 2026 increased $28 million when compared to the same period in 2025, primarily due to higher shipment volume, favorable mix, price cost discipline, and improved absorption driven by higher production volumes. The adjusted EBITDA impact from the Company's tower and rough terrain crane businesses, which were sold on October 31, 2025 and are included in the prior period results, was $2 million.
Specialty Vehicles
Three Months Ended September 30,
2026 2025
% of
Sales 		% of
Sales 		% Change In
Reported Amounts
($ amounts in millions)
Net sales $ 657 - $ - - *
Adjusted EBITDA
$ 105 16.0 % $ - * *
* Not a meaningful percentage
Net sales and Adjusted EBITDA represent the results of operations of REV from the REV Transaction for the three months ended September 30, 2026. See Note D - "Acquisitions and Held for Sale" in our Condensed Consolidated Financial Statements for additional information regarding the REV Transaction.
Aerials
Three Months Ended September 30,
2026 2025
% of
Sales 		% of
Sales 		% Change In
Reported Amounts
($ amounts in millions)
Net sales $ 709 - $ 537 - 32.0 %
Adjusted EBITDA
$ 62 8.7 % $ 56 10.5 % 10.7 %
Net sales for the three months ended September 30, 2026 increased $172 million when compared to the same period in 2025, primarily due to higher shipment volume resulting from strong demand from national customers and increased customer capital spending on large projects.
Adjusted EBITDA for the three months ended September 30, 2026 increased $6 million when compared to the same period in 2025, primarily due to higher sales and cost out actions, partially offset by unfavorable customer mix, inflationary and tariff pressures.
Corporate and Other / Eliminations
Three Months Ended September 30,
2026 2025
% of
Sales 		% of
Sales 		% Change In
Reported Amounts
($ amounts in millions)
Net sales $ (3) - $ (2) - (50.0) %
Adjusted EBITDA
$ (26) * $ (9) * (188.9) %
* Not a meaningful percentage
Adjusted EBITDA for the three months ended September 30, 2026 decreased $17 million when compared to the same period in 2025. The decrease is primarily due to higher compensation costs primarily driven by the inclusion of REV corporate activities and professional fees.
RESULTS OF OPERATIONS
Nine Months Ended September 30, 2026 Compared with Nine Months Ended September 30, 2025
Consolidated
Nine Months Ended September 30,
2026 2025
% of
Sales 		% of
Sales 		% Change In
Reported Amounts
($ amounts in millions)
Net sales $ 6,169 - $ 4,103 - 50.4 %
Gross profit 1,086 17.6 % 855 20.8 % 27.0 %
Selling, general and administrative expenses
650 10.5 % 465 11.3 % 39.8 %
Amortization of purchased intangibles 148 2.4 % 52 1.3 % 184.6 %
Operating profit 288 4.7 % 338 8.2 % (14.8) %
Interest expense, net of interest income 133 2.2 % 125 3.0 % 6.4 %
Income taxes (16) (0.3) % (51) (1.2) % (68.6) %
Net income 135 2.2 % 158 3.9 % (14.6) %
Adjusted operating profit 655 10.6 % 443 10.8 % 47.9 %
Adjusted EBITDA 727 11.8 % 495 12.1 % 46.9 %
* Not a meaningful percentage
Net Sales
Net sales for the nine months ended September 30, 2026 increased $2,066 million when compared to the same period in 2025, including sales generated from SV of $1,744 million. Excluding the impact of SV, and the impact of $91 million of sales in the prior year period from the Company's tower and rough terrain cranes businesses which were sold on October 31, 2025, the increase in Net sales was primarily due to higher sales in Aerials, utilities products in ES and MP, as well as favorable foreign exchange rate movements, partially offset by lower sales of refuse collection vehicles in ES.
Gross Profit
Gross profit for the nine months ended September 30, 2026 increased $231 million when compared to the same period in 2025, primarily driven by the gross profit contribution of $233 million from SV. Excluding the impact of SV, the decrease in gross profit of $2 million was primarily due to unfavorable mix in ES and Aerials, inefficiencies related to a production ramp up in Utilities, under-absorption associated with lower refuse collection vehicle volume within ES, and higher tariff costs and inflationary pressures in Aerials. These unfavorable impacts were partially offset by higher sales volume, favorable mix, and lower SG&A costs in MP.
Selling, general, and administrative expense
Selling, general and administrative expenses for the nine months ended September 30, 2026 increased $185 million when compared to the same period in 2025, driven by the SG&A contribution of $112 million from SV. Excluding the impact of SV, the increase in selling, general, and administrative expense of $73 million was primarily due to deal related costs, loss on held-for-sale business and higher compensation costs primarily driven by the inclusion of REV corporate activities. These increases were partially offset by the one-time release of a contingent liability in ES, and lower costs within MP due to the absence of the Company's tower and rough terrain crane businesses, which were sold on October 31, 2025 and are included in the prior-year period results.
Amortization of purchased intangibles
Amortization of purchased intangibles for the nine months ended September 30, 2026 increased $96 million when compared to the same period in 2025, which was directly attributable to the additional amortization expense from purchased intangibles resulting from the REV Transaction.
Operating profit
Operating profit for the nine months ended September 30, 2026 was $288 million compared to Operating profit of $338 million in the same period in 2025. Excluding the operating profit generated by SV of $28 million, operating profit decreased $78 million, primarily due to the factors detailed above.
Interest expense, net of interest income
Interest expense, net of interest income, for the nine months ended September 30, 2026 and 2025 was $133 million and $125 million, respectively. The increase in expense is primarily due to interest accrued on customer deposits which primarily relate to the SV segment.
Provision for income taxes
Income tax expense for the nine months ended September 30, 2026 was $16 million on pretax income of $147 million, resulting in an effective tax rate of 11.0%, as compared to income tax expense of $51 million on pretax income of $209 million, resulting in an effective tax rate of 24.5%, for the nine months ended September 30, 2025. The lower effective tax rate for the nine months ended September 30, 2026 when compared with the nine months ended September 30, 2025 is primarily due to an increase in favorable discrete items.
Net income
Net income for the nine months ended September 30, 2026 was $135 million compared to Net income of $158 million in the same period in 2025. The decrease in Net income of $23 million was primarily due to the factors detailed above.
Adjusted operating profit
Adjusted operating profit for the nine months ended September 30, 2026 increased $212 million when compared to the same period in 2025, primarily due to the Adjusted operating profit generated by SV of $246 million. Excluding the impact of SV, Adjusted operating profit decreased by $34 million, primarily due to the factors detailed above, excluding deal related costs, restructuring costs, and a one-time release of a contingent liability in ES.
Adjusted EBITDA
Adjusted EBITDA for the nine months ended September 30, 2026 increased $232 million when compared to the same period in 2025, primarily due to Adjusted EBITDA generated by SV of $262 million. Excluding the impact of SV, Adjusted EBITDA decreased by $30 million, driven by a decrease in ES, Aerials and Corporate, partially offset by an increase in MP as detailed below.
Environmental Solutions
Nine Months Ended September 30,
2026 2025
% of
Sales 		% of
Sales 		% Change In
Reported Amounts
($ amounts in millions)
Net sales $ 1,267 - $ 1,264 - 0.2 %
Adjusted EBITDA $ 215 17.0 % $ 251 19.8 % (14.3) %
Net sales for the nine months ended September 30, 2026 increased $3 million when compared to the same period in 2025, primarily due to increased throughput and shipments of utilities products, partially offset by lower shipments of refuse collection vehicles.
Adjusted EBITDA for the nine months ended September 30, 2026 decreased $36 million when compared to the same period in 2025, primarily due to unfavorable mix, inefficiencies related to a production ramp up in Utilities, under-absorption associated with lower refuse collection vehicle volume and inflationary pressures.
Materials Processing
Nine Months Ended September 30,
2026 2025
% of
Sales 		% of
Sales 		% Change In
Reported Amounts
($ amounts in millions)
Net sales $ 1,317 - $ 1,253 - 5.1 %
Adjusted EBITDA $ 234 17.8 % $ 162 12.9 % 44.4 %
Net sales for the nine months ended September 30, 2026 increased $64 million when compared to the same period in 2025. Excluding the sales impact from the Company's tower and rough terrain crane businesses, which were sold on October 31, 2025 and are included in the prior-year period results, net sales increased $155 million. The increase was primarily driven by higher shipment volume across all product categories, with the largest increase coming from Aggregates in North America, and favorable foreign exchange rate movements.
Adjusted EBITDA for the nine months ended September 30, 2026 increased $72 million when compared to the same period in 2025, primarily due to higher sales volume, favorable mix, improved absorption driven by higher production volumes, and lower SG&A costs driven by the sale of the Company's tower and rough terrain cranes businesses, partially offset by inflationary pressures. The adjusted EBITDA impact from the Company's tower and rough terrain crane businesses, which were sold on October 31, 2025 and are included in the prior period results, was $5 million.
Specialty Vehicles
Nine Months Ended September 30,
2026 2025
% of
Sales 		% of
Sales 		% Change In
Reported Amounts
($ amounts in millions)
Net sales $ 1,744 - $ - - *
Adjusted EBITDA $ 262 15.0 % $ - * *
* Not a meaningful percentage
Net sales and Adjusted EBITDA represent the results of operations of REV from the REV Transaction since February 2, 2026. See Note D - "Acquisitions and Held for Sale" in our Condensed Consolidated Financial Statements for additional information regarding the REV Transaction.
Aerials
Nine Months Ended September 30,
2026 2025
% of
Sales 		% of
Sales 		% Change In
Reported Amounts
($ amounts in millions)
Net sales $ 1,851 - $ 1,594 - 16.1 %
Adjusted EBITDA $ 100 5.4 % $ 131 8.2 % (23.7) %
Net sales for the nine months ended September 30, 2026 increased $257 million when compared to the same period in 2025, primarily due to higher shipments across most product lines, with the largest increase coming from booms in North America and Western Europe as well as favorable foreign exchange rate movements.
Adjusted EBITDA for the nine months ended September 30, 2026 decreased $31 million when compared to the same period in 2025, primarily due to higher tariff costs, unfavorable mix, and inflationary pressures, partially offset by higher sales volume and cost out actions.
Corporate and Other / Eliminations
Nine Months Ended September 30,
2026 2025
% of
Sales 		% of
Sales 		% Change In
Reported Amounts
($ amounts in millions)
Net sales $ (10) - $ (8) - (25.0) %
Adjusted EBITDA $ (84) * $ (49) * (71.4) %
* Not a meaningful percentage
Adjusted EBITDA for the nine months ended September 30, 2026 decreased $35 million when compared to the same period in 2025. The decrease is primarily due to higher compensation primarily driven by the inclusion of REV Corporate activities, legal and other professional fees.
Non-GAAP Measures
In this document, we refer to various GAAP (U.S. generally accepted accounting principles) and non-GAAP financial measures. These non-GAAP measures may not be comparable to similarly titled measures being disclosed by other companies. Management believes that presenting these non-GAAP financial measures provides investors with additional analytical tools which are useful in evaluating our operating results and the ongoing performance of our underlying businesses because they (i) provide meaningful supplemental information regarding financial performance by excluding the impact of one-time items and other items affecting comparability between periods, and non-cash items such as depreciation and amortization, (ii) permit investors to view performance using the same tools that management uses to budget, make operating and strategic decisions, and evaluate our core operating performance across periods, and (iii) otherwise provide supplemental information that may be useful to investors in evaluating our financial results. We do not, nor do we suggest that investors consider such non-GAAP financial measures in isolation from, or as a substitute for, financial information prepared in accordance with GAAP.
We discuss Adjusted operating profit, which is defined as Operating profit or loss as adjusted for acquisition or divestiture related items, restructuring, purchase price accounting, and other items that we believe are not indicative of our ongoing operating performance.
We also discuss Adjusted EBITDA. To determine Adjusted EBITDA, we adjust net income or net loss for the following items: non-cash depreciation and amortization, interest expense, income taxes, acquisition or divestiture related items, restructuring, purchase price accounting, and other items that we believe are not indicative of our ongoing operating performance.
We calculate a non-GAAP measure of free cash flow. We define free cash flow as Net cash provided by operating activities less Capital expenditures, net of proceeds from sale of capital assets. We believe this measure of free cash flow provides management and investors further useful information on cash generation in our primary operations.
Working capital is calculated using the Condensed Consolidated Balance Sheet amounts for Receivables (net of allowance) plus Inventories, less Trade accounts payable, and short and long-term Customer advances. We view excessive working capital as an inefficient use of resources, and seek to minimize the level of investment without adversely impacting ongoing operations of the business. Trailing three months annualized net sales is calculated using net sales for the most recent quarter end multiplied by four. The ratio calculated by dividing working capital by trailing three months annualized net sales is a non-GAAP measure we believe measures our resource use efficiency.
Non-GAAP measures also include the translation effect of foreign currency exchange rate changes on net sales, gross profit, selling, general & administrative expenses and operating profit, as well as net sales, gross profit, and SG&A costs and operating profit excluding the impact of acquisitions and divestitures.
The following table reconciles Net income to Adjusted operating profit for the periods presented:
Three Months Ended September 30,
2026 2025
Net income $ 114 $ 65
Provision for income taxes (21) (29)
Interest income 5 3
Interest expense (49) (45)
Other expense - net (4) (4)
Operating profit 183 140
Restructuring and other (a)
(15) 5
Deal related (b)
9 3
Purchase price accounting (c)
60 20
Divestitures (d)
23 -
Adjusted operating profit
$ 260 $ 168
Nine Months Ended September 30,
2026 2025
Net income $ 135 $ 158
Income from discontinued operations - net of tax 4 -
Provision for income taxes (16) (51)
Interest income 14 7
Interest expense (147) (132)
Other expense - net (8) (4)
Operating profit 288 338
Restructuring and other (a)
(8) 22
Deal related (b)
90 11
Purchase price accounting (c)
265 62
Divestitures (d)
20 -
Litigation related (e)
- 10
Adjusted operating profit
$ 655 $ 443
The following table reconciles Net income (loss) to Adjusted EBITDA for the periods presented:
Three Months Ended September 30, 2026
ES
MP(3)
SV(3)
Aerials
Corporate and Other / Elims
Total
Net income (loss)(1)
$ 52 $ 71 $ 39 $ 53 $ (101) $ 114
Provision for income taxes - - - - 21 21
Interest income - - - - (5) (5)
Interest expense - 4 4 - 41 49
Other expense
- - - 1 3 4
Operating profit (loss)
52 75 43 54 (41) 183
Depreciation(2)
5 4 7 7 3 26
Amortization(2)
20 1 40 - 3 64
Non-cash interest costs
- - - - (2) (2)
EBITDA
77 80 90 61 (37) 271
Restructuring and other (a)
(16) - - 1 - (15)
Deal related (b)
- - - - 9 9
Purchase price accounting (c) - - (4) - 2 (2)
Divestitures (d)
- 3 20 - - 23
Adjusted EBITDA
$ 61 $ 84 $ 105 $ 62 $ (26) $ 286
(1) Management does not allocate income taxes, interest costs incurred at the Corporate level, and certain other Corporate items to the segments.
(2) These line items include $1 million of depreciation and $60 million of amortization within the ES and SV segments related to purchase price accounting.
(3) Column does not foot due to rounding.
Three Months Ended September 30, 2025
ES MP Aerials Corporate and Other / Elims Total
Net income (loss)(1)
$ 58 $ 48 $ 44 $ (85) $ 65
Provision for income taxes - - - 29 29
Interest income - - - (3) (3)
Interest expense - 4 - 41 45
Other expense - - 1 3 4
Operating profit (loss) 58 52 45 (15) 140
Depreciation 4 5 6 3 18
Amortization(2)
20 - - 2 22
Non-cash interest costs - - - (2) (2)
EBITDA 82 57 51 (12) 178
Restructuring and other (a) 1 (1) 5 - 5
Deal related (b) - - - 3 3
Adjusted EBITDA $ 83 $ 56 $ 56 $ (9) $ 186
(1) Management does not allocate income taxes, interest costs incurred at the Corporate level, and certain other Corporate items to the segments.
(2) This line item includes $20 million of amortization within the ES segment related to purchase price accounting.
The following notes apply to both the Adjusted operating profit and Adjusted EBITDA reconciliations above, as applicable:
a.Costs for the three months ended September 30, 2026 are primarily associated with the release of a contingent liability in ES and a reduction in force and a plant closure in the Aerials segment. Costs for the three months ended September 30, 2025 are associated with restructuring programs across the ES, MP and Aerials segments.
b.Costs for the three months ended September 30, 2026 relate to the REV Transaction and other strategic initiatives, including integration costs and other professional fees. Costs for the three months ended September 30, 2025 relate to costs incurred as part of the ESG integration.
c.Costs for the three months ended September 30, 2026 primarily relate to the REV Transaction, driven by the impact of adjusting inventory fair value step-ups in connection with purchase accounting related measurement period adjustments. Amortization of purchased intangibles is not included within Purchase price accounting in the reconciliation of Net income (loss) to Adjusted EBITDA, as amortization is a separate line item within the reconciliation.
d.Primarily relates to losses on held for sale businesses in the MP and SV segments.
Nine Months Ended September 30, 2026
ES
MP
SV
Aerials
Corporate and Other / Elims
Total
Net income (loss)(1)
$ 156 $ 210 $ 17 $ 69 $ (317) $ 135
Gain on disposition of discontinued operations - net of tax - - - - (4) (4)
Provision for income taxes - - - - 16 16
Interest income - - - - (14) (14)
Interest expense - 11 11 1 124 147
Other expense - - - 3 5 8
Operating profit (loss) 156 221 28 73 (190) 288
Depreciation(2)
14 13 18 20 8 73
Amortization(2)
60 2 107 - 9 178
Non-cash interest costs - - - - (5) (5)
EBITDA 230 236 153 93 (178) 534
Restructuring and other (a) (15) - - 7 - (8)
Deal related (b) - - - - 90 90
Purchase price accounting (c) - - 87 - 4 91
Divestitures (d) - (2) 22 - - 20
Adjusted EBITDA $ 215 $ 234 $ 262 $ 100 $ (84) $ 727
(1) Management does not allocate income taxes, interest costs incurred at the Corporate level, and certain other Corporate items to the segments.
(2) These line items include $2 million of depreciation and $166 million of amortization within the ES and SV segments related to purchase price accounting.
Nine Months Ended September 30, 2025
ES MP Aerials
Corporate and Other / Elims
Total
Net income (loss)(1)
$ 175 $ 126 $ 92 $ (235) $ 158
Provision for income taxes - - - 51 51
Interest income - - - (7) (7)
Interest expense - 11 - 121 132
Other expense
- - 1 3 4
Operating profit (loss)
175 137 93 (67) 338
Depreciation(2)
13 13 19 5 50
Amortization(2)
60 2 - 6 68
Non-cash interest costs
- - - (6) (6)
EBITDA
248 152 112 (62) 450
Restructuring and other (a)
1 10 9 2 22
Deal related (b)
- - - 11 11
Purchase price accounting (c)
2 - - - 2
Litigation related (e)
- - 10 - 10
Adjusted EBITDA
$ 251 $ 162 $ 131 $ (49) $ 495
(1) Management does not allocate income taxes, interest costs incurred at the Corporate level, and certain other Corporate items to the segments.
(2) This line item includes $1 million of depreciation and $60 million of amortization within the ES segment related to purchase price accounting.
The following notes apply to both the Adjusted operating profit and Adjusted EBITDA reconciliations above, as applicable:
a.Costs for the nine months ended September 30, 2026 are primarily associated with the release of a contingent liability in ES and a reduction in force and a plant closure in the Aerials segment. Costs for the nine months ended September 30, 2025 are associated with restructuring programs across the ES, MP, Aerials, and Corporate segments.
b.Costs for the nine months ended September 30, 2026 are primarily related to the REV Transaction, including acceleration of stock-based compensation awards, severance and retention costs, transaction and integration costs, and professional fees related to other strategic initiatives. Costs for the nine months ended September 30, 2025 relate to costs incurred as part of the ESG integration.
c.Costs for the nine months ended September 30, 2026 relate to the REV Transaction, and include amortization of the inventory step-up and incremental stock based compensation cost for replacement stock awards, both of which were recognized in connection with purchase accounting. Costs for the nine months ended September 30, 2025 primarily relate to purchase accounting related measurement period adjustments for ESG. Amortization of purchased intangibles is not included within Purchase price accounting in the reconciliation of Net income (loss) to Adjusted EBITDA, as amortization is a separate line item within the reconciliation.
d.Reflects a net gain realized on the previously disposed of Cranes business, partially offset by a loss on a held for sale business in the MP segment and losses on the sale of a business and a held for sale business in the SV segment.
e.Costs for the nine months ended September 30, 2025 reflect costs incurred to settle a claim which was outside the normal course of business.
LIQUIDITY AND CAPITAL RESOURCES
We are focused on generating cash and maintaining liquidity (cash and availability under our revolving line of credit) for the efficient operation of our business. At September 30, 2026, we had cash and cash equivalents of $407 million and undrawn availability under our revolving line of credit of $800 million, giving us total liquidity of approximately $1,207 million. During the nine months ended September 30, 2026, our liquidity decreased by approximately $365 million from December 31, 2025 primarily due to cash used for the REV Transaction, capital expenditures, share repurchases, dividend payments, and taxes paid on shares withheld in connection with stock vestings, partially offset by cash provided by operating activities.
Our main sources of funding are cash generated from operations, including cash generated from the sale of receivables, loans from our bank credit facilities and funds raised in capital markets. We have no significant debt maturities until 2029. Our actions to maintain liquidity include disciplined management of costs and working capital. We believe these measures will provide us with adequate liquidity to comply with our financial covenants under our bank credit facility, continue to support internal operating initiatives and meet our operating and debt service requirements for at least the next 12 months from the date of issuance of this quarterly report. See Part I, Item 1A. - "Risk Factors" of our Annual Report on Form 10-K for the year ended December 31, 2025 and Part II Item 1A - "Risk Factors" of this Quarterly Report for a detailed description of the risks resulting from our debt and our ability to generate sufficient cash flow to operate our business.
Our ability to generate cash from operations is subject to numerous factors, including the following:
•The duration and depth of the global economic volatility resulting from tariffs, trade war, geopolitical uncertainty, inflationary pressures, foreign exchange rate volatility and high interest rates.
•As our sales change, the amount of working capital needed to support our business may change.
•Many of our customers fund their purchases through third-party finance companies that extend credit based on the creditworthiness of customers and expected residual value of our equipment. Changes either in customers' credit profile or used equipment values may affect the ability of customers to purchase equipment. There can be no assurance that third-party finance companies will continue to extend credit to our customers as they have in the past.
•Our suppliers extend payment terms to us primarily based on our overall credit rating. Deterioration in our credit rating may influence suppliers' willingness to extend terms and in turn accelerate cash requirements of our business.
•Sales of our products are subject to general economic conditions, tariffs, weather, competition, translation effect of foreign currency exchange rate changes, and other factors that in many cases are outside our direct control. For example, during periods of economic uncertainty, our customers have delayed purchasing decisions, which in turn reduces cash generated from operations.
•Availability and utilization of other sources of liquidity such as trade account receivables sales programs.
Typically, we have invested our cash in a combination of highly rated, liquid money market funds and in short-term bank deposits with large, highly rated banks. Our investment objective is to preserve capital and liquidity while earning a market rate of interest.
We seek to use cash held by our foreign subsidiaries to support our operations and continued growth plans through the funding of capital expenditures, operating expenses or other similar cash needs of worldwide operations. Most of this cash could be used in the U.S., if necessary, without additional tax expense. Incremental cash repatriated to the U.S. would not be expected to result in material foreign income and withholding, U.S. federal or state income tax cost. We will continue to seek opportunities to tax-efficiently mobilize and redeploy funds.
We had free cash flow of $209 million and $253 million for the three and nine months ended September 30, 2026, respectively. The following table reconciles net cash provided by operating activities to free cash flow (in millions):
Three Months Ended
9/30/2026 		Nine Months Ended
9/30/2026
Net cash provided by operating activities $ 241 $ 338
Capital expenditures, net of proceeds from sale of capital assets (32) (85)
Free cash flow $ 209 $ 253
Pursuant to the terms of our trade accounts receivable factoring arrangements, during the nine months ended September 30, 2026, we sold, without material recourse, approximately $562 million of trade accounts receivable to enhance liquidity.
Working capital as a percentage of trailing three month annualized net sales was 15.0% at September 30, 2026. The following tables show the calculation of our working capital and trailing three months annualized sales as of September 30, 2026 (in millions):
Three Months Ended
September 30, 2026
Net sales, as reported
$ 2,197
x 4
Trailing three month annualized net sales $ 8,788
As of
September 30, 2026
Inventories $ 1,631
Receivables 1,124
Trade accounts payable
(986)
Short and long-term customer advances (447)
Working capital
$ 1,322
During the nine months ended September 30, 2026, there were 1,164,795 shares of common stock repurchased under our Board authorized share repurchase programs, leaving approximately $111 million available for repurchase under such programs. Our Board declared a dividend of $0.17 per share in each of the first three quarters of 2026, which were paid to our stockholders during those periods. In October 2026, our Board declared a dividend of $0.17 per share, which will be paid on December 18, 2026 to our stockholders of record as of November 9, 2026.
Our ability to access capital markets to raise funds, through the sale of equity or debt securities, is subject to various factors, some specific to us and others related to general economic and/or financial market conditions. These include results of operations, projected operating results for future periods and debt to equity leverage. Our ability to access capital markets is also subject to our timely filing of periodic reports with the Securities and Exchange Commission. In addition, terms of our bank credit facilities and senior notes contain restrictions on our ability to make further borrowings and to sell substantial portions of our assets.
Cash Flows
Cash provided by operations was $338 million and $235 million for the nine months ended September 30, 2026 and 2025, respectively. The increase in cash provided by operations was primarily driven by higher profitability excluding the impact of purchase accounting, partially offset by changes in working capital and payments of transaction costs and severance in connection with the REV Transaction.
Cash used in investing activities was $519 million and $44 million for the nine months ended September 30, 2026 and 2025, respectively. The increase in cash used in investing activities relates primarily to cash consideration paid in connection with the REV Transaction.
Cash used in financing activities was $177 million and $98 million for the nine months ended September 30, 2026 and 2025, respectively. The increase in cash used in financing activities was primarily driven by higher dividend payments, increased share repurchases and higher cash payments related to shares withheld for tax payment on Restricted Stock awards.
OFF-BALANCE SHEET ARRANGEMENTS
Guarantees
See Note J - "Litigation and Contingencies" in the Notes to Condensed Consolidated Financial Statements for information regarding our guarantees.
CONTINGENCIES AND UNCERTAINTIES
Foreign Exchange and Interest Rate Risk
Our products are sold in over 100 countries around the world and, accordingly, our revenues are generated in foreign currencies, while costs associated with those revenues are only partly incurred in the same currencies. Primary currencies to which we are exposed are the Euro, British Pound, Chinese Yuan, Australian Dollar, Indian Rupee and Mexican Peso. We purchase hedging instruments to manage the variability of future cash flows associated with recognized assets or liabilities due to changing currency exchange rates.
We manage our exposure to interest rate risk by establishing a mix of indebtedness bearing interest at both floating and fixed rates at inception and maintain a ratio of floating and fixed rates on this mix of indebtedness using interest rate derivatives when necessary.
See Item 3 "Quantitative and Qualitative Disclosures About Market Risk" for a discussion of the impact of changes in foreign currency exchange rates and interest rates may have on our financial performance.
Other
We are subject to a number of contingencies and uncertainties including, without limitation, product liability claims, workers' compensation liability, intellectual property litigation, self-insurance obligations, tax examinations, guarantees, class action lawsuits and other matters. See Note J - "Litigation and Contingencies" in the Notes to Condensed Consolidated Financial Statements for more information regarding contingencies and uncertainties. We are insured for product liability, general liability, workers' compensation, employer's liability, property damage, intellectual property and other insurable risks required by law or contract with retained liability to us or deductibles. Many of the exposures are unasserted or proceedings are at a preliminary stage, and it is not presently possible to estimate the amount or timing of any liability. However, we do not believe these contingencies and uncertainties will, individually or in aggregate, have a material adverse effect on our operations. For contingencies and uncertainties other than income taxes, when it is probable a loss will be incurred and possible to make reasonable estimates of our liability with respect to such matters, a provision is recorded for the amount of such estimate or for the minimum amount of a range of estimates when it is not possible to estimate the amount within the range that is most likely to occur.
We generate hazardous and non-hazardous wastes in the normal course of our manufacturing operations. As a result, we are subject to a wide range of environmental laws and regulations. All of our employees are required to obey all applicable health, safety and environmental laws and regulations and must observe the proper safety rules and environmental practices in work situations. These laws and regulations govern actions that may have adverse environmental effects, such as discharges to air and water, and require compliance with certain practices when handling and disposing of hazardous and non-hazardous wastes. These laws and regulations would also impose liability for the costs of, and damages resulting from, cleaning up sites, past spills, disposals and other releases of hazardous substances, should any such events occur. We are committed to complying with these standards and monitoring our workplaces to determine if equipment, machinery and facilities meet specified safety standards. Each of our manufacturing facilities is subject to an environmental audit at least once every five years to monitor compliance. Also, no incidents have occurred which required us to pay material amounts to comply with such laws and regulations. We are dedicated to ensuring that safety and health hazards are adequately addressed through appropriate work practices, training and procedures. We are committed to reducing injuries and working towards a world-class level of safety practices in our industry.
RECENT ACCOUNTING STANDARDS
Please refer to Note A - "Basis of Presentation" in the accompanying Condensed Consolidated Financial Statements for a summary of recently issued accounting standards.
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