SKF Q2 2026: Continued margin improvement

GOTHENBURG, Sweden , 17 July 2026 /PRNewswire/ -- Q2 2026 Net sales: MSEK 23,195 (23,166) Organic growth: 1.4% (−0.2%). Driven by organic sales growth within the industrial segments, offset by negative market demand for the Automotive business. Adjusted operating profit: MSEK 3,223 (3,090). Driven by solid commercial execution, especially within Specialized Industrial Solutions. Adjusted operating margin: 13.9% (13.3%). Net cash flow from operating activities: MSEK 2,055 (2,817). Mainly driven by working capital build-up related to the ongoing Automotive separation. Financial overview, MSEK unless otherwise stated Q2 2026 Q2 2025 Half year 2026 Half year 2025 Net sales 23,195 23,166 45,068 47,132 Organic growth, % 1.4 −0.2 1.9 −1.8 Adjusted operating profit 3,223 3,090 6,174 6,323 Adjusted operating margin, % 13.9 13.3 13.7 13.4 Operating profit 2,219 1,300 4,862 4,185 Operating margin, % 9.6 5.6 10.8 8.9 Adjusted net profit 2,333 2,373 4,380 4,669 Net profit 1,329 583 3,068 2,531 Net cash flow from operating activities 2,055 2,817 1,609 3,794 Basic earnings per share 2.77 1.13 6.34 5.08 Adjusted earnings per share 4.98 5.06 9.23 9.77 Rickard Gustafson, President and CEO: "In Q2, our adjusted operating margin improved year-over-year, mainly driven by further strengthened profitability in Specialized Industrial Solutions (SIS). We continued to execute on our commercial agenda and strategic initiatives, including investments in attractive growth areas such as humanoids, as well as progressing the Automotive separation. Solid commercial execution drives margin improvement Organic sales increased by 1.4% year-over-year, mainly driven by solid price/mix. The SIS segment continued its strong growth, primarily driven by Aerospace and Magnetic Solutions. This more than compensated for continued weakness in the Automotive segment, although growth in China, especially in light and commercial vehicles, was strong. In Bearing Solutions, organic sales were flat compared to the same quarter last year. Our regions in Asia continued to grow, Europe remained soft, while the OEM market in the Americas showed early signs of improvement. The adjusted operating margin at 13.9% improved year-over-year and sequentially. I'm pleased to see the strong margin development in SIS with growth in targeted areas including aftermarket. As previously communicated, an improved margin development for SIS is one key lever to deliver on our mid- and long-term targets for our Industrial business. The margin in the Automotive business also improved by further efficiencies in production and sourcing. As part of the separation, production lines are being transferred into Automotive plants which means that production support was provided to Automotive also in this quarter. This led to a somewhat less efficient production performance, resulting in a limited positive earnings impact on the Group. For the full year, we expect some support production also in the second half. Savings from rightsizing activities of approximately MSEK 350 more than offset separation-related negative synergies with a stronger net contribution than in Q1. For the full year 2026, we expect that rightsizing savings will be higher than the negative synergies. We were again able to largely compensate for tariff-related costs, and, at current levels, we aim to continue to do so also in Q3. In Q2, we received the majority of the IEEPA tariff reclaims, which impacted sales negatively due to customer refunds and had a somewhat positive impact on earnings. As expected, the negative impact from currency movements was significantly lower than in the first quarter. Items affecting comparability in Q2 was BSEK –1.0 whereof approximately half related to the consolidation of our footprint in the Americas as previously communicated. The other half is related to the ongoing Automotive separation. Cash flow from operating activities was BSEK 2.1. This was lower than in the same period last year, reflecting higher working capital development mainly related to the ongoing Automotive separation. Creating two even sharper businesses We continue to develop our portfolio and strengthen SKF's long-term profitable growth potential. The Automotive business is now separated and operates as a standalone business within the SKF Group, and we remain on track for the planned listing in Q4 2026, subject to SKF's Board of Directors proposing a listing and shareholders' approval. Kerstin Enochsson has been elected Board member of SKF Vertevo, confirming her role as CEO with a clear task to build an even stronger standalone Automotive business. In parallel, we are strengthening our industrial business. The announced humanoids partnership with Leaderdrive marks an important step into an attractive growth area, expanding capabilities in critical bearing applications and access to robotics expertise, technology and customers. Additionally, we initiated a modernization of our IT landscape to create an AI foundati