ITT Q1 Earnings Call Highlights

Key Points

• ITT reported a strong Q1 with orders up 26%, revenue up 33%, and adjusted EPS up 25% to $1.98, driven by broad-based growth across all segments and early contributions from the SPX FLOW acquisition.
• Margins and cash flow improved as operating margin expanded 130 basis points, while SPX FLOW began contributing net earnings and cash accretion. ITT also said it is on track for about one-third of its planned $80 million in cost synergies in year one.
• The company raised its full-year outlook, guiding for adjusted EPS of $7.70 to $8.00, organic revenue growth of 5% at the midpoint, and free cash flow of roughly $560 million. Executives also said demand remains solid in aerospace, defense, and flow projects despite tariff and macro uncertainty.

ITT NYSE: ITT reported a strong start to 2026, with executives highlighting broad-based order growth, double-digit organic revenue gains and early benefits from its acquisition of SPX FLOW during the company’s first-quarter earnings call Wednesday.

Chief Executive Officer and President Luca Savi said the company delivered “solid momentum across the portfolio” in the three-month period ended April 4, citing disciplined execution and contributions from mergers and acquisitions. ITT reported orders growth of 26%, including 8% organic growth, and revenue growth of 33%, including 11% organic growth. Adjusted earnings per share rose 25% to $1.98 on the company’s new reporting basis.

“This was an outstanding quarter,” Savi said, adding that all businesses contributed to growth and margin expansion.

Revenue and Orders Rise Across Segments

ITT’s first-quarter revenue reached $1.2 billion, Chief Financial Officer Emmanuel Caprais said. The company’s Connect & Control Technologies segment, or CCT, grew revenue 17% organically, supported by Aerospace & Defense and Industrial Connectors. Savi said Industrial Connector sales rose 27%, while Aerospace & Defense increased nearly 20%, with benefits beginning to show from a Boeing price negotiation completed last year.

Motion Technologies, or MT, grew revenue 15% overall and 5% organically despite a global automotive market that was down 3%. Savi said the friction business outperformed global vehicle production by more than 1,400 basis points in the quarter. Caprais said all regions outperformed global automotive production by more than 1,000 basis points.

The newly formed Flow Technologies segment, which combines Industrial Process and SPX FLOW, posted revenue growth of 61%, or 12% organically. Savi said project sales were higher, including a 44% increase from Svanehøj, while short-cycle sales grew 10% due to share gains across product categories.

Orders also advanced across the portfolio. CCT orders grew 10% organically, driven by aerospace demand and Industrial Connector share gains. Flow Technologies orders increased 44%, or 7% organically. Savi said short-cycle growth included baseline pumps, aftermarket and valves, while a GLP-1 project continued to expand in scope. ITT’s book-to-bill ratio was 1.09.

Margins Expand as SPX FLOW Begins Contributing

ITT expanded operating margin by 130 basis points in the quarter, with all businesses contributing. Flow Technologies delivered a 23.7% operating margin, up 100 basis points, driven by volume and, to a lesser extent, price. Motion Technologies posted a 21.1% operating margin, up 130 basis points, as productivity and volume growth more than offset price pressure. CCT expanded margin to 19.3%, with support from volume growth and price.

Caprais said operating income grew 42%, driven by “strong operational performance” in legacy businesses and the contribution from SPX FLOW. Free cash flow was $14 million, which he said was affected by $71 million of one-time acquisition-related expenses. Excluding those items, free cash flow increased 10% year over year.

ITT closed the SPX FLOW acquisition on March 2, one month ahead of schedule, with a leverage ratio of 2.7, Savi said. The new Flow Technologies segment has nearly $3 billion in revenue and includes brands in pumps, valves, mixers and other process solutions.

Savi said SPX FLOW produced net earnings and cash accretion in its first month under ITT ownership and showed promising growth. He said ITT has executed the first tranche of corporate general and administrative cost reductions and remains on track to deliver one-third of its planned $80 million in cost synergies in year one. Caprais said the company expects approximately $15 million of cost synergies in 2026.

Executives also pointed to early revenue synergy opportunities. Savi said SPX FLOW’s Waukesha Cherry-Burrell business won its first order for an ITT Bornemann twin screw pump. During the question-and-answer session, he said ITT plans to localize production of the Bornemann twin screw pump at the Delavan, Wisconsin, facility and sees additional opportunities in Latin America, the Middle East, Shanghai and Poland.

2026 Guidance Initiated

ITT initiated full-year adjusted EPS guidance of $7.70 to $8.00, representing 9% growth at the midpoint. The company expects total revenue growth of 37% and organic revenue growth of 5% at the midpoint, with a book-to-bill ratio above one.

Caprais said the outlook is supported by Aerospace & Defense demand, strength in flow projects and short-cycle markets, and continued friction original equipment outperformance. The company expects margin expansion of roughly 70 basis points to about 20% at the midpoint, driven by revenue growth, favorable price-cost dynamics and productivity gains.

SPX FLOW is expected to contribute high-single-digit revenue growth in 2026 and low-teens net adjusted EPS accretion, Caprais said. The company also expects free cash flow of roughly $560 million at the midpoint, equating to a free cash flow margin between 10% and 11%.

For the second quarter, Caprais said ITT expects EPS to rise in the high single digits from the prior year. Organic revenue growth is expected to be in the mid-single digits, with Flow Technologies up low double digits organically, CCT up mid-single digits and MT up low single digits. Operating margin is expected to expand about 50 basis points to approximately 20%.

Executives Address Auto, Defense, Tariffs and Middle East Exposure

During the Q&A session, analysts asked about sustainability of the friction business’s outperformance. Savi described the first-quarter result as exceptional but said ITT is maintaining its full-year assumption of 500 to 700 basis points of outperformance versus automotive production. He said the business won 39 electrified vehicle platforms during the quarter and is particularly strong in hybrid and electric vehicles.

On defense, Caprais said ITT does not see an air pocket if global hostilities begin to ease. He cited a broad defense portfolio and modernization trends in the U.S. and Europe that he characterized as long term.

Asked about pricing, tariffs and inflation, Savi said ITT expects the full-year price-cost equation to be positive, with stronger pricing power in Industrial Process and CCT than in Motion Technologies. He said the tariff situation remains fluid, but the company believes it can offset tariffs with commercial and productivity actions, as it did in 2025.

Executives said the Middle East represents approximately 4% of ITT’s total revenue, and Caprais said the conflict in the region had minimal impact on first-quarter results. Savi said the company expects investment discussions and service work to resume quickly if conditions normalize.

CFO to Depart

Savi also announced that Caprais, ITT’s CFO for the past six years and a company executive for nearly 14 years, will leave the company. Caprais will remain in an advisory role through the end of June to help ensure a transition. Michael Savinelli, ITT’s vice president, treasurer, chief tax officer and assistant secretary, has been appointed interim CFO.

Savi thanked Caprais for his partnership and said the two had worked together through ITT’s “perform and transform journey.”

“In these 14 years, you made us better,” Savi said.

About ITT NYSE: ITT

ITT Inc is a diversified industrial manufacturing company that designs, manufactures and services mission-critical components and systems for global markets. Its engineered solutions support applications in aerospace, defense, transportation, energy and industrial automation. The company focuses on delivering high-performance products that enable reliable fluid handling, precision motion control and robust connectivity in demanding environments.

The company's operations are organized into three segments: Motion Technologies, which provides precision components and aftermarket repair services for aircraft engines and industrial turbines; Connect & Control Technologies, which offers specialty valves, couplings, seals and proximity sensors for fuel, hydraulics and environmental control systems; and Fluid & Motion Control, which delivers pumps, heat exchangers and fluid management solutions for oil and gas, chemical processing and power generation.

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