Atlas Copco: 2Q26 Results. A reassuring broad-based 13% order beat. Adj. EBIT margins expanding again YOY after two years of declines

Research evidence excerpt

Atlas Copco: 2Q26 Results. A reassuring broad-based 13% order beat. Adj. EBIT margins expanding again YOY after two years of declines

UpdateMfor 2027. 2) We view the Vacuum order strength as encouraging with a SEK 14.4bn

order result in 2Q26, +24% versus consensus. This should dispel any debate around

Atlas losing market share, or not participating in this semi-cap up-cycle. 3) On EBITA

margins, Atlas Adjusted EBIT margins of 21% (+40bps YOY) are now increasing YOY,

which has not happened since 1Q24. FX headwinds are now abating, and

incremental margins are positively contributing. That said, we do see room for

improvement in incremental margins at Atlas in the coming quarters as Vacuum

revenues in particular really start to accelerate.

Variance: 1) Strong order intake (+26% YoY) driven by strong demand from semis

customers, with VT and CT growing +59% and +19% YoY, respectively. Within CT

(+9.6% vs cons), order intake for gas and process compressors increased sharply,

both YoY and sequentially. Particular strength was noted in marine LNG and air

separation applications. Similarly, within VT (+23.4% vs cons), orders reached a

record high, supported by strong demand from both semis and general industrial

customers. Group order strength was broad based with both IT and Power coming in

+9.8% and +10.5% vs cons. In IT, management noted strong demand within

automotive and general industry, whilst Power was supported by strong Equipment

orders and solid contribution from acquisitions in Specialty Rental. 2) Revenue

came in +2.7% vs cons (+8% YoY), supported largely by Power (+7.5% vs cons), IT

(+7.1% vs cons), and VT to a lesser extent (+2.3% vs cons). CT came in marginally

below cons. 3) Adjusted EBITA margins expanded 60bps YoY, largely in-line with

consensus.