EnerSys Reports Second Quarter Fiscal Year 2027 Results

Delivers Gross Margin of 29.9% or 25.2% ex IRC 45X ⁽¹⁾ and Diluted EPS of $2.42, +34% ($1.22, +61% ex IRC 45X⁽¹⁾)

Second Quarter Fiscal 2027 Highlights

(All comparisons against the second quarter of fiscal 2026 unless otherwise noted)

• Delivered net sales of $950M, in line with prior year
• Achieved Gross Margin (GM) of 29.9%, +80 bps and GM ex IRC 45X⁽¹⁾ of 25.2%, +30 bps
• Realized diluted EPS of $2.42, +34%, adjusted diluted EPS⁽¹⁾ of $3.22, +22%, and adjusted diluted EPS ex IRC 45X⁽¹⁾ of $2.02, +25%
• Net leverage ratio^(a) 0.8 X EBITDA
• Returned $140M to shareholders, including repurchase of 679K shares for $130M
• Generated operating cash flow of $143M on improved earnings and primary operating capital efficiencies
• On October 27, 2026, announced proposed acquisition of Ultralife, to expand differentiated battery technologies and accelerate growth in defense market

READING, Pa.--(BUSINESS WIRE)--#EnerSys--EnerSys (NYSE: ENS), a global leader in stored energy solutions for industrial, infrastructure, and defense applications announced today results for its second quarter fiscal 2027, which ended on October 4, 2026.

“In the second quarter of fiscal year 2027, we delivered gross margin expansion, adjusted operating margin expansion and adjusted EPS growth while continuing to advance our strategic priorities,” said Shawn O’Connell, President and Chief Executive Officer of EnerSys. “Precision Power Solutions delivered more than 20% year-over-year sales growth, supported by strong demand for soldier power and munitions, while Network and Infrastructure Solutions delivered 3% growth against an unusually high second quarter prior year comparison, driven by double-digit growth in data centers. These strong results helped balance the continued pressure in material handling within our Industrial Mobility Solutions and demonstrate the resilience of our diversified portfolio and the operating discipline we are building through our EnerGize strategy.

“We are also seeing encouraging progress as our new products begin reaching customers. During the quarter, we secured our first order for our DataSafe Noir™ lithium solution, began generating sales from our second-generation lithium offering for material handling, and advanced our strategic acquisition plans. These are tangible steps toward expanding our higher-value solutions and converting our product development efforts into profitable growth.

“We recently announced that we entered into a definitive agreement to acquire Ultralife, which is a compelling strategic fit for EnerSys and directly advances our strategy to build a broader, more differentiated defense power platform. Building on the success of our recent acquisitions, Ultralife would expand our portfolio of advanced, reliable, high-performance power solutions. Together, we would be better positioned to support U.S. defense and allied forces with leading-edge, cost-effective technologies for the increasingly electrified battlefield of the future. We know the Ultralife business and its team well, and are confident that our shared commitment to engineering, problem solving, and customer focus would create a strong cultural fit. We look forward to combining our strengths to accelerate growth, enhance performance, and deliver greater value to our customers and shareholders,” O’Connell concluded.

The proposed acquisition of Ultralife remains subject to customary closing conditions, including the receipt of required regulatory approvals. Until the transaction closes, EnerSys and Ultralife will continue to operate as separate and independent companies.

(a) Net leverage ratio is a non-GAAP financial measure as defined pursuant to our credit agreement and discussed under Reconciliations of GAAP to Non-GAAP Financial Measures.

(1) GM (Gross Margin) excluding IRC 45X , Adjusted Diluted EPS and Adjusted Diluted EPS excluding IRC 45X benefit are non-GAAP financial measures and discussed under Reconciliations of GAAP to Non-GAAP Financial Measures.
(2) Operating Earnings are adjusted for charges that the Company incurs as a result of restructuring and exit activities, stock based compensation, impairment of goodwill and indefinite-lived intangibles and other assets, acquisition activities and those charges and credits that are not directly related to operating unit performance. A reconciliation of operating earnings to Non-GAAP Adjusted Earnings are provided in tables under the section titled Business Segment Operating Results.
(3) Non-GAAP EBITDA is calculated as net earnings adjusted for depreciation, amortization, interest and income taxes. Non-GAAP Adjusted EBITDA is further adjusted for certain charges such as restructuring and exit activities, stock based compensation, impairment of goodwill and indefinite-lived intangibles and other assets, acquisition activities and other charges and credits as discussed under Reconciliations of GAAP to Non-GAAP Financial Measures.

Summary of Results

Second Quarter Fiscal 2027

Net sales for the second quarter of fiscal 2027 were $949.9 million, a decrease of 0.1% from the prior year second quarter net sales of $951.3 million and below the range of the second quarter of fiscal 2027 guidance of $955 million to $995 million. The decrease compared to prior year quarter and net sales below the guidance range were the result of foreign currency translation.

Net earnings attributable to EnerSys stockholders (“Net earnings”) for the second quarter of fiscal 2027 were $89.6 million, or $2.42 per diluted share, which included an unfavorable highlighted net of tax impact of $29.3 million, or $0.80 per diluted share, from highlighted items described in further detail in the tables shown below, reconciling non-GAAP adjusted financial measures to reported amounts.

Net earnings for the second quarter of fiscal 2026 were $68.4 million, or $1.80 per diluted share, which included an unfavorable highlighted net of tax impact of $32.4 million, or $0.85 per diluted share, from highlighted items described in further detail in the tables shown below, reconciling non-GAAP adjusted financial measures to reported amounts.

Excluding these highlighted items, adjusted Net earnings per diluted share for the second quarter of fiscal 2027, on a non-GAAP basis, were $3.22, compared to the guidance of $3.15 to $3.25 per diluted share for the second quarter given by the Company on August 12, 2026. These earnings compare to the prior year second quarter adjusted Net earnings of $2.65 per diluted share. Please refer to the section included herein under the heading “Reconciliations of GAAP to Non-GAAP Financial Measures” for a discussion of the Company’s use of non-GAAP adjusted financial information, which includes tables reconciling GAAP and non-GAAP adjusted financial measures for the quarters ended October 4, 2026 and September 28, 2025.

Fiscal Year to Date 2027

Net sales for the six months of fiscal 2027 were $1,885.5 million, an increase of 2.2% from the prior year six months net sales of $1,844.3 million. This increase was due to a 1% increase in pricing, and a 1% increase in organic volume.

Net earnings for the six months of fiscal 2027 were $206.1 million, or $5.52 per diluted share, which included an unfavorable highlighted net of tax impact of $50.5 million, or $1.36 per diluted share, from highlighted items described in further detail in the tables shown below, reconciling non-GAAP adjusted financial measures to reported amounts.

Net earnings for the six months of fiscal 2026 were $125.9 million, or $3.26 per diluted share, which included an unfavorable highlighted net of tax impact of $62.4 million, or $1.62 per diluted share, from highlighted items described in further detail in the tables shown below, reconciling non-GAAP adjusted financial measures to reported amounts.

Adjusted Net earnings per diluted share for the six months of fiscal 2027, on a non-GAAP basis, were $6.88. This compares to the prior year six months adjusted Net earnings of $4.88 per diluted share. Please refer to the section included herein under the heading “Reconciliations of GAAP to Non-GAAP Financial Measures” for a discussion of the Company’s use of non-GAAP adjusted financial information.

Quarterly Dividend

The Company announced today that its Board of Directors has approved a quarterly cash dividend of $0.2875 per share of common stock. The dividend is payable on December 31, 2026, to holders of record as of December 18, 2026.

Balance Sheet and Cash Flow

As of October 4, 2026, cash and cash equivalents were $275.5 million and net debt as defined by our credit facility was $554.9 million. The net leverage ratio at the end of the second quarter was 0.8 X, down from 1.3 X in the prior year period due to the impact of lower debt and increased earnings. Capital expenditures during the second quarter were $12.4 million, down from $20.9 million in the prior year period. During the second quarter, cash from operating activities was $142.8 million, down from $218.0 million in the prior year period. Free cash flow, a non-GAAP financial measure, was an inflow of $130.4 million, as compared to an inflow of $197.1 million in the prior year period. The decrease in cash from operating activities and free cash flow were both driven by the receipt of our U.S. federal tax refund in the prior year quarter. Fiscal year to date, cash from operating activities was $372.8 million, up from $219.0 million in the prior year period. Free cash flow, a non-GAAP financial measure, was an inflow of $348.0 million, as compared to an inflow of $165.1 million in the prior year period. The increase in cash from operating activities and free cash flow were both driven by improved earnings, disciplined capital allocation decisions, and targeted emphasis to optimize primary operating capital, or POC. Please refer to the section included herein under the heading “Reconciliations of GAAP to Non-GAAP Financial Measures” for a discussion of the Company’s use of non-GAAP adjusted financial information, which includes tables reconciling GAAP and non-GAAP adjusted financial measures for the quarters ended October 4, 2026 and September 28, 2025.

The Company also returned approximately $140.3 million to shareholders through $130.0 million in share repurchases and $10.3 million through its quarterly dividend payment in the second quarter.

Third Quarter and Fiscal Year 2027 Outlook

In the third quarter of fiscal 2027, EnerSys expects:

• Net sales: $935M to $975M
• Adjusted diluted EPS: $3.05 to $3.15*

For the full year fiscal 2027, EnerSys expects:

• Capital expenditures ~$70M

Outlook does not reflect any impact from the proposed acquisition of Ultralife, which is expected to close in the fourth fiscal quarter of 2027, or the impact of any IEEPA tariff refunds or customer reimbursements in our income statement. In the quarter, results included a one-time impact of ($2M) or ($0.04) per share from tariff refund adjustments recorded in corporate unallocated and other. Fiscal year to date, results include an impact of $29M or $0.59 per share.

“Our second quarter results demonstrate continued progress in strengthening the earnings power of EnerSys,” said Andrea Funk, EnerSys Chief Financial Officer. “Improved volumes and favorable price/mix in our PPS and NIS segments, balanced the impact of material handling softness within our IMS segment. We again delivered strong free cash flow, with FCF conversion of 146%. Our focus on operating discipline, cost management and higher-value solutions supports our ability to expand margins while investing in the opportunities ahead.

“Our third quarter outlook reflects continued strength across Aerospace and Defense, Data Centers, and Transportation, with Communications picking up and Material Handling demonstrating early recovery that should transform IMS segment revenue to year-on-year growth. From a margin perspective, we expect IMS to see pressure as Transportation outpaces higher margin Material Handling growth, largely offsetting the margin lift from incremental volume. In PPS and NIS, the project nature of these businesses and related quarter-to-quarter fluctuations create tough comps as both segments delivered exceptionally strong margins in the prior year and prior quarter. For the third quarter, we expect net sales of $935 million to $975 million and adjusted diluted EPS of $3.05 to $3.15. We remain focused on translating demand opportunities across all of our end markets into profitable growth. Disciplined capital allocation remains central to our approach as we invest in growth, pursue strategic acquisitions and return capital to shareholders,” concluded Funk.

*Inclusive of IRC 45X Advanced Manufacturing Production Credits.

Please refer to the section included herein under the heading “Reconciliations of GAAP to Non-GAAP Financial Measures” for a discussion of the Company’s use of non-GAAP adjusted financial information.

Conference Call and Webcast Details

The Company will host a conference call to discuss its second quarter results at 9:00 AM (ET) Thursday, November 12, 2026. A live broadcast as well as a replay of the call can be accessed via this webcast registration link or the Investor Relations section of the company’s website at https://investor.enersys.com.

If you cannot join via webcast, please reach out to investorrelations@enersys.com for dial-in details.

About EnerSys

EnerSys is a global leader in stored energy solutions helping industrial, infrastructure and defense customers address critical power and operational needs with batteries, chargers and other power equipment. The company delivers integrated solutions that combine energy storage technologies, power electronics, software-enabled intelligence, technical expertise and comprehensive global customer support. EnerSys supports customers across communications networks, data centers, energy infrastructure, material handling, transportation, aerospace and defense — including applications where power continuity is essential. Serving customers in more than 100 countries, EnerSys helps organizations manage energy more reliably, efficiently and intelligently in complex operating environments where uptime, safety and resilience matter. For more information, visit www.enersys.com.

Caution Concerning Forward-Looking Statements

This press release, and oral statements made regarding the subjects of this release, contains forward-looking statements, within the meaning of the Private Securities Litigation Reform Act of 1995, or the Reform Act, which may include, but are not limited to, statements regarding EnerSys’ earnings estimates, intention to pay quarterly cash dividends, return capital to stockholders, plans, objectives, expectations and intentions and other statements contained in this press release that are not historical facts, including statements identified by words such as “believe,” “plan,” “seek,” “expect,” “intend,” “estimate,” “anticipate,” “will,” and similar expressions. All statements addressing operating performance, events, or developments that EnerSys expects or anticipates will occur in the future, including statements relating to sales growth, earnings or earnings per share growth, order intake, backlog, payment of future cash dividends, commodity prices, execution of its stock buyback program, judicial or regulatory proceedings, ability to identify and realize benefits in connection with acquisition and disposition opportunities, EnerSys’ pending acquisition of Ultralife, including the anticipated timing of completion and the anticipated benefits of the pending acquisition, and EnerSys’ strategy, plans, objectives, expectations (financial or otherwise) and intentions with respect to its future financial results, growth potential and anticipated product portfolio in connection with the pending acquisition, and market share, as well as statements expressing optimism or pessimism about future operating results or benefits from its cash dividend, its stock buyback programs, application of Section 45X of the Internal Revenue Code, funding, development and construction of the Company's gigafactory in Greenville, South Carolina, adverse developments with respect to the economic conditions in the U.S. in the markets in which we operate and other uncertainties, including the impact of supply chain disruptions, interest rate changes, inflationary pressures, geopolitical and other developments and labor shortages on the economic recovery and our business and changes in law, regulation or policy that may affect our business, including trade policy and tariffs, and other government priorities or budgets are forward-looking statements within the meaning of the Reform Act. The forward-looking statements are based on management's current views and assumptions regarding future events and operating performance, and are inherently subject to significant business, economic, and competitive uncertainties and contingencies and changes in circumstances, many of which are beyond the Company’s control. The statements in this press release are made as of the date of this press release, even if subsequently made available by EnerSys on its website or otherwise. EnerSys does not undertake any obligation to update or revise these statements to reflect events or circumstances occurring after the date of this press release.

Although EnerSys does not make forward-looking statements unless it believes it has a reasonable basis for doing so, EnerSys cannot guarantee their accuracy. The foregoing factors, among others, could cause actual results to differ materially from those described in these forward-looking statements. For a list of other factors which could affect EnerSys’ results, including earnings estimates, see EnerSys’ filings with the Securities and Exchange Commission, including “Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations,” and “Forward-Looking Statements,” set forth in EnerSys’ Annual Report on Form 10-K for the fiscal year ended March 31, 2026. No undue reliance should be placed on any forward-looking statements.

Lisa Hartman Langell
Vice President, Investor Relations and Corporate Communications
EnerSys
E-mail: investorrelations@enersys.com