Rogers NYSE: ROG reported first-quarter 2026 results that management said met or exceeded the midpoint of guidance for a third consecutive quarter, supported by improved profitability and growth in several end markets. The company also issued second-quarter guidance calling for year-over-year gains in sales and margins, while noting that certain operational disruptions weighed on first-quarter revenue.
First-quarter results: sales up 5%, profitability improved
Interim President and CEO Ali El-Haj said Rogers delivered “solid results” in the quarter, with all key financial metrics meeting or exceeding the midpoint of guidance. First-quarter sales were $201 million, up 5% year-over-year, which the company attributed to foreign currency benefits and stronger industrial demand in the U.S.
El-Haj said adverse weather and multiple supplier disruptions affected operations at some U.S. plants and limited the sales upside. CFO Laura Russell added that without those disruptions, results would have trended closer to the high end of the guidance range, though she did not quantify the exact revenue impact.
Profitability improved sharply. El-Haj said adjusted EPS more than doubled to $0.75 per share and adjusted EBITDA margin expanded 580 basis points to 16%. Russell said adjusted EPS rose 178% versus the prior-year period, driven by higher gross margin and improvements in operating expenses, while foreign currency had only a small effect on adjusted EPS because the company’s global footprint acts as a “natural hedge.”
Russell reported first-quarter adjusted EBITDA of $32 million, also at 16% of sales. She attributed the year-over-year improvement to higher sales and product mix, along with reduced manufacturing costs, start-up costs, and general and administrative expenses. She noted the company is continuing to ramp new factory capacity, which created a $1.4 million headwind to EBITDA versus the prior year, though new factory performance costs declined compared with the fourth quarter of 2025.
End-market performance and new reporting structure
Rogers said it streamlined reporting into four primary end markets beginning in the quarter. El-Haj detailed the segments and first-quarter performance:
- Industrial (37% of sales): Now includes renewable energy and mass transit. El-Haj said industrial sales increased at a double-digit rate year-over-year, driven by demand aligned with improved manufacturing PMI activity in the U.S. and Europe and additional market share gains with traditional customers.
- Automotive (24% of sales): Includes EV, HEV, ADAS, and internal combustion applications. Sales declined at a high single-digit rate year-over-year due to lower global light vehicle production and weakness in the U.S. EV market. El-Haj said the company is seeing “positive design win momentum” that it expects to translate into stronger sales in coming quarters.
- Electronics and communications (18% of sales): Includes consumer electronics, semiconductors, and wired/wireless infrastructure. El-Haj said the segment rose at a double-digit rate, driven by higher smartphone and wireless infrastructure sales. He cited higher volume, a favorable mix toward higher-end devices, and increased share with existing customers.
- Aerospace and defense (15% of sales): Improved slightly year-over-year, led by commercial aerospace sales in the EMS business. El-Haj said Rogers expects aerospace and defense to remain a growth area.
In response to an analyst question on industrial trends, El-Haj said industrial growth reflected three factors: improvement in the broader economy (as indicated by PMI), growth in semiconductors, and “recapturing some market share” with existing customers.
Design wins, R&D pipeline, and the data center opportunity
Management emphasized design wins and new product development as part of its multi-year growth focus. El-Haj said in the AES business, Rogers’ high-frequency circuit materials were designed into a new automotive radar application with a “leading Asian OEM,” with sales planned to begin in the second quarter. In the AMS business, he said the company won several EV battery-related design wins with OEMs in the U.S. and Asia spanning multiple platforms.
On timing, El-Haj said “the majority of these wins will be in production between Q2 and Q4 of this year,” with revenue expected to begin in Q2 and continue through Q3 and Q4.
Rogers also discussed ongoing data center initiatives. El-Haj said the company is testing and validating microchannel cooler technology with multiple customers and described customer feedback as “encouraging,” adding that the technology could address cooling needs for high-power chips in data centers and AI applications. He said development of high-frequency circuit material for data centers is ongoing and that internal testing has been promising, with customer sampling and testing expected to begin within the next two quarters.
However, El-Haj cautioned that data center revenue in 2026 is not expected to be significant, characterizing it as mostly sampling or prototype revenue. He said meaningful revenue is more likely in “Q3, Q4 of 2027,” depending on customer qualification timelines. He also said the biggest potential volume or dollar impact would come from microchannels “with the ceramic activities” and high-speed digital product lines.
Cost initiatives, restructuring, and capital allocation
On profitability initiatives, El-Haj said Rogers has seen measurable improvements in manufacturing cost structure and operating performance. He said restructuring at the company’s German facility remains underway, with $13 million of annualized savings still expected by the fourth quarter of the year.
Russell said restructuring costs related to the company’s “ceramic actions in Germany” are excluded from adjusted EPS. She reported $4.4 million of restructuring charges in Q1, bringing program-to-date charges to $9.8 million versus an estimated total range of $12 million to $15 million. Remaining restructuring costs are expected to be incurred largely in Q2 and Q3 of 2026, and the program remains expected to deliver a $13 million annual run-rate savings.
Addressing a question about broader cost savings, Russell said the company realized $25 million of savings in calendar 2025, with an additional $7 million still to flow through the P&L when annualized. Adding the incremental $13 million expected from the Germany restructuring would bring cumulative savings to $45 million, she said.
Rogers ended Q1 with $196 million in cash, Russell said. Operating cash flow was $5.8 million, down from $46.9 million in Q4 2025, which she attributed primarily to inventory reductions in the prior quarter that were not expected to repeat. Q1 capital expenditures were $4.7 million, and the company maintained its full-year 2026 CapEx outlook of $30 million to $40 million. Russell said the company did not repurchase shares in the quarter and would continue balancing capital returns with other needs.
El-Haj also said the company increased its focus on evaluating potential M&A opportunities aligned with its strategic and financial objectives, while organic growth is expected to be supported largely by existing capacity.
Second-quarter guidance calls for higher sales and margin
For the second quarter, Rogers guided revenue to $210 million to $220 million, implying 6% year-over-year growth at the midpoint. Russell said the outlook assumes higher automotive sales from new program wins and continued existing programs, a seasonal increase in smartphone sales, and ongoing growth in some industrial end markets.
The company guided gross margin to 32.5% to 33.5%, with the midpoint 140 basis points above the prior year due to higher volumes and cost structure improvements. Adjusted operating expenses are expected to be approximately flat versus Q1. Adjusted EPS is forecast at $0.90 to $1.10, with a midpoint of $1.00 compared with $0.34 in Q2 2025. Adjusted EBITDA is expected at $35 million to $41 million, which would represent a 17.7% margin at the midpoint and a 590 basis point improvement versus Q2 2025.
Russell also said Rogers projects its non-GAAP full-year tax rate to be approximately 30%.
In Q&A, El-Haj said the company does not currently face capacity constraints, projecting existing capacity is sufficient for the next “six to eight quarters,” aside from additional new R&D-related opportunities. He said the company may need to rebalance capacity by region to support “local for local” needs. On pricing, he said Rogers evaluates market conditions and typically seeks to mitigate cost increases internally before pursuing customer price increases.
About Rogers NYSE: ROG
Rogers Corporation NYSE: ROG is a global technology and materials company specializing in the development and manufacture of engineered materials and components. The company designs and produces a broad portfolio of high-performance elastomeric, foam, silicone, adhesive and thermal management solutions, as well as advanced circuit board laminates. Its products are engineered to meet stringent requirements in areas such as electrical insulation, thermal performance and electromagnetic shielding.
Rogers serves a diverse range of end markets, including automotive, aerospace and defense, telecommunications, consumer electronics and industrial applications.
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