Key Highlights

• Revenue reached a record $164.4 million in Q3 2026, an 18% increase year-over-year, with 19% organic growth on a constant currency basis

• Operating Income surged 83% to $22.3 million, with Operating Margin expanding 480 basis points to a record 13.6%

• Adjusted EBITDA climbed 46% to $29.7 million, representing an 18.0% margin

• Orders hit a record $218.1 million, up 64% year-over-year, generating a book-to-bill ratio of 1.33x and pushing Backlog to $351.5 million

Allient Inc(NASDAQ:ALNT), a global designer and manufacturer of precision motion, controls, and power products, posted record-setting financial results for the third quarter ended September 30, 2026. The company reported revenue of $164.4 million, an 18% increase from $138.7 million in the prior-year quarter, while Net Income more than doubled to $15.3 million, or $0.91 per diluted share, compared to $6.5 million, or $0.39 per diluted share, a year earlier.

Revenue Growth Across Key Markets

The company's revenue gains were broad-based across its end markets. Industrial revenue rose 15% to $81.7 million, driven by continued Demand for industrial automation and solutions supporting Data Center and infrastructure applications. Vehicle revenue increased 27% to $27.3 million, reflecting improved commercial automotive demand, including shipments accelerated ahead of a customer's model changeover. Aerospace and Defense revenue climbed 36% to $25.5 million on elevated defense-related demand for mission-critical platforms and favorable program timing. Medical revenue dipped 2% to $21.3 million, as growth in surgical precision motion applications was more than offset by lower demand for medical mobility applications. Distribution channel sales increased 39%, reflecting broad-based growth.

Sales to U.S. customers accounted for 57% of total revenue, consistent with the prior-year period, with the remainder going to customers primarily in Europe, Canada, and Asia-Pacific. Foreign currency translation provided an unfavorable impact of $0.9 million during the quarter.

Margin Expansion and Profitability Improvement

Gross profit increased 30% to $60.2 million, with gross margin expanding 330 basis points to 36.6%. The improvement reflected higher sales volume, a favorable product mix, and operational improvements under the company's Simplify to Accelerate NOW (STAN) initiative. Operating costs and expenses totaled $37.9 million, up from $34.0 million, driven by higher sales commissions, personnel-related expenses, and software licensing costs. However, as a percentage of revenue, operating costs declined 150 basis points to 23.0%, indicating Operating Leverage on the higher revenue base.

Restructuring and Business realignment costs declined to $15,000 from $0.8 million in the prior-year quarter. The company expects approximately $2 million of restructuring costs for the full year 2026. Interest expense decreased 27% to $2.5 million from $3.4 million, reflecting lower average Debt balances. The effective income tax rate was 22.2% for the quarter.

Adjusted net income, excluding acquisition-related amortization, restructuring costs, and other non-recurring items, was $18.0 million, or $1.07 per diluted share, up 82% from $9.9 million, or $0.59 per diluted share. Adjusted EBITDA reached $29.7 million, representing an 18.0% margin, compared with $20.3 million and a 14.6% margin a year earlier.

Balance Sheet and Capital Allocation

Cash and cash equivalents stood at $39.6 million at September 30, 2026, compared with $40.7 million at year-end 2025. Net cash provided by Operating Activities was $22.1 million for the first nine months of 2026, compared with $43.1 million in the prior-year period. The change was primarily attributed to Accounts Receivable timing and investments in inventory to support growth and mitigate Supply constraints. Total debt stood at $173.4 million, down $7.0 million from year-end 2025, with the Leverage Ratio improving to 1.49x.

Capital expenditures were $10.6 million for the first nine months of 2026. The company noted that Working Capital Management and cash conversion remain priorities as it supports higher business activity.

Looking Ahead

Record orders of $218.1 million grew 64% year-over-year and 8% sequentially during Q3, generating a book-to-bill ratio of 1.33x. Backlog reached a record $351.5 million at quarter-end, providing visibility into demand for the fourth quarter and into early 2027. Management noted that customer schedules, product mix, and the trade environment could affect quarterly performance but expressed confidence in the company's operating model and financial flexibility to build on its progress.