We delivered another strong quarter with results that reflect the breadth of demand across the portfolio. All-in revenue grew 7% or 5% organically, with all five segments posting positive organic growth. Adjusted EBITDA margin expanded 80 basis points to 25.9% as operational execution on incremental volume more than offset input cost inflation and facility consolidation costs during the quarter. Incremental margins were 38%, from 25% in Q1, the healthy product mix driven by our growth platforms.
Adjusted EPS was $2.74 per share, up 12% year-over-year, marking another quarter of double-digit earnings growth. Orders increased 16% year-over-year and outpaced shipments with book-to-bill at 1.06, extending strong order momentum of recent quarters and improving our visibility into the second half of the year. Our balance sheet remains a competitive advantage, and we continue to invest capital behind our businesses. During the quarter, we advanced capacity expansion projects to support growth as well as productivity investments to drive margin improvement across the portfolio.
Industrial M&A markets have improved this year, and our acquisition pipeline has a number of interesting opportunities in attractive end markets. Given our first half performance, the momentum in our end markets, and the visibility we have in the second half, we are raising our full year adjusted EPS guidance. We are committed to delivering double-digit adjusted EPS growth consistent with Dover's long-term performance trajectory. Growth was driven by strong demand in aerospace and defense components, fluid dispensing, and industrial winches, along with continued stabilization in the North American vehicle aftermarket.
| Metric | Period | Current guidance |
|---|---|---|
| Adjusted EPS | FY2026 | Raised; committed to double-digit adjusted EPS growth consistent with Dover's long-term trajectory |
| Organic revenue growth | FY2026 | Raised; positive organic growth expected across all five segments, led by secular-growth markets |
| Free cash flow | FY2026 | Unchanged at 14%-16% of revenue (H2 seasonally stronger on working-capital liquidation) |
| Capital expenditures | FY2026 | Unchanged at $190M-$210M |
| Space-related revenue | FY2026 | ~$50 million, with order rates signaling significant momentum |
| Metric | YoY | Note |
|---|---|---|
| Total revenue | +7% (+5% organic) to $2.19B | All five segments grew organically, led by secular-growth markets and broad-based constructive trading conditions. |
| Adjusted EPS | +12% to $2.74 | Volume leverage, favorable mix and cost discipline; GAAP diluted EPS from continuing operations up 14% to $2.31. |
| Clean Energy & Fueling organic | +9% | LNG/space cryogenic components and healthy retail fueling (dispensers, software, below-ground); margin +170 bps on volume leverage and acquisition integration. |
| Climate & Sustainability organic | +8% | Best-ever heat-exchanger quarter on data center liquid cooling and European heat-pump recovery, partly offset by a refrigeration throughput shortfall. |
| Engineered Products organic | +2% | Aerospace/defense, fluid dispensing and industrial winches plus vehicle-aftermarket stabilization; margin +100 bps, with muted top line partly self-inflicted by avoiding dilutive Vehicle Service Group sales. |
| Pumps & Process Solutions organic | Slightly positive | Strength in AI/energy infrastructure, single-use biopharma and industrial pumps offset by a tough Polymer Processing comp; segment margin +170 bps to a record ~35%. |
| Adjusted EBITDA margin | +80 bps to 25.9% | Incremental margins of 38% from healthy growth-platform mix more than offset inflation and facility-consolidation costs. |
| Topic | Previous mention | Current period | Trend |
|---|---|---|---|
| Data center liquid cooling | Emerging opportunity | Heat exchangers (SWEP brazed plate) had their best quarter ever with demand outstripping supply; capacity being doubled over 12 months (coming on sequentially into 2027), plus new cryogenic cooling and OPW connector/trench exposure to hyperscalers. | — |
| Secular growth portfolio shift | ~20% of revenue (end of Q1) | ~25% of 2026 revenue across aerospace/defense, power-gen (steam/gas turbines), single-use biopharma, CO2 refrigeration, liquid cooling and space (~$50M), where most acquisition capital has been deployed. | — |
| Refrigeration facility consolidation | Planned plant consolidation | Throughput fell short during the labor ramp, costing ~1-1.5 pts of organic growth; the old plant is ~three-quarters closed, and management expects materially better H2 profitability as throughput and fixed-cost absorption improve. | — |
| CO2 refrigeration adoption | Regulation-driven | Adoption now driven by total-cost-of-ownership economics rather than regulation; the removal of a time-based EPA mandate is viewed as favorable, extending demand over a multi-year period with an accelerating backlog. | — |
| Capital allocation and M&A | Leaning toward capital return amid scarce, expensive assets | More assets are coming to market at potentially reasonable valuations; Dover is keeping powder dry for M&A but would pivot to capital return (stock viewed as cheap) if deals do not materialize. | — |
| Order-to-revenue conversion and cycle durability | Strong multi-quarter order momentum | Management resisted talking up revenue beyond guidance given short-cycle volatility, but sees visibility into 2027 across its cycles and no end markets expected to turn negative next year. | — |