IDEX Q2 Earnings Call Highlights

IDEX NYSE: IEX reported second-quarter 2026 results that exceeded its expectations, supported by growth in its Health & Science Technologies segment, stronger orders and operational execution.

The company raised its full-year outlook for organic sales growth, adjusted EBITDA margin and adjusted earnings per share.

Organic sales increased 5% year over year in the second quarter, while adjusted EBITDA margin expanded 70 basis points to 28.1%.

Adjusted earnings per share rose 12% to $2.32.

President and Chief Executive Officer Eric Ashleman said the results were driven most significantly by higher volumes in the company’s growth platforms.

Orders grew 28% organically across IDEX, reaching a record level of more than $1 billion.

Each of the company’s three reporting segments posted double-digit order growth, led by Health & Science Technologies, or HST, where orders rose 47% organically.

Ashleman said HST demand was concentrated in data center, semiconductor, and space and defense applications.

Those application sets collectively represented more than one-third of HST revenue year to date, according to the company.

IDEX cited demand for Performance Pneumatics products supporting primary and standby power generation connected to data center construction, as well as liquid-cooling flow-control systems used in data center infrastructure.

In semiconductor markets, the company provides high-purity gas filtration, sealing, optical detection and thermal-management products for process tools, inspection systems and metrology equipment.

The company said its Mott filtration business has increased recurring revenue within HST’s semiconductor portfolio to approximately 50%.

Ashleman also pointed to engineered components for space and defense applications, where IDEX is seeking to establish specifications for emerging technologies that can create longer-term revenue streams.

HST organic revenue rose 12% in the quarter, while its adjusted EBITDA margin expanded 270 basis points year over year.

Sean Gillen, IDEX’s senior vice president and chief financial officer, said the margin performance reflected volume leverage and positive price-cost dynamics, including the effect of tariff refunds.

During the question-and-answer session, Ashleman said HST’s increasing order backlog includes some customer demand extending into 2027, particularly in data-center-related pneumatics.

He cautioned, however, that much of IDEX remains a rapid-replenishment business with short lead times.

IDEX received refunds during the quarter related to tariffs under the International Emergency Economic Powers Act, or IEEPA.

Gillen said the refunds lowered cost of sales, while interest paid by the U.S. government slightly reduced net interest expense.

In some cases, IDEX expects to provide custo...