Entegris Q3 Sales Top $1 Billion as APS Drives Margin Growth

Entegris Corp. (NASDAQ: ENTG) reported third-quarter 2026 revenue above $1 billion as growth in its Advanced Purity Solutions business supported sharply higher earnings and wider margins. The semiconductor materials supplier also projected fourth-quarter sales of $1.025 billion to $1.055 billion, with profitability expected to remain above third-quarter levels.

Net sales reached $1.006 billion, rising 24.6% from $807.1 million a year earlier and 13.9% from the second quarter. GAAP operating income increased 88.1% year over year to $230.6 million, while the operating margin expanded to 22.9% from 15.2%.

GAAP net income more than doubled to $157.8 million, or $1.03 per diluted share, compared with $70.5 million, or $0.46 per share, in the prior-year period. On a non-GAAP basis, net income rose 72.6% to $189.7 million, and diluted earnings increased to $1.23 per share from $0.72.

Adjusted operating income climbed 58.2% to $269.4 million, producing a 26.8% adjusted operating margin versus 21.1% a year earlier. Adjusted EBITDA increased 37.4% to $303.3 million, while the adjusted EBITDA margin widened to 30.2% from 27.3%.

The GAAP gross margin was 49.7%, up from 43.5% in the third quarter of 2025. The adjusted gross margin, which excluded an $8.3 million refund of previously incurred tariffs, was 48.9%. Entegris characterized the refunds as a discrete, nonrecurring recovery arising from a legal and regulatory development rather than ongoing operating performance.

Advanced Purity Solutions leads growth

Advanced Purity Solutions generated third-quarter sales of $604.9 million, an increase of 31.3% year over year and 17.5% sequentially. The segment accounted for most of the company’s year-over-year revenue increase.

APS segment profit rose 79.9% to $212.7 million, with the segment profit margin expanding to 35.2% from 25.7%. Adjusted segment profit increased 74.7% to $208.2 million, and the adjusted margin reached 34.4%, compared with 25.9% a year earlier and 30.3% in the second quarter.

Materials Solutions reported sales of $404.1 million, up 15.9% from the prior year and 8.8% from the previous quarter. Segment profit increased 29.3% year over year to $84.3 million, while its margin rose to 20.9% from 18.7%. Adjusted segment profit was $82.3 million, with an adjusted margin of 20.4%, compared with 18.9% a year earlier.

Companywide operating expenses also increased alongside revenue. GAAP operating expenses rose 17.9% year over year to $269.6 million, while non-GAAP operating expenses increased 22.8% to $222.7 million.

Cash flow supports debt reduction

Entegris generated $266.8 million of cash from operating activities during the quarter and spent $43.2 million on capital expenditures. Free cash flow was $223.6 million, up from $191 million a year earlier and $120.3 million in the second quarter.

The company made $200 million of net debt payments during the period. Long-term debt declined to $3.261 billion from $3.843 billion a year earlier and $3.456 billion at the end of the second quarter. Cash and cash equivalents ended the quarter at $356.5 million.

Inventory increased to $769 million from $646.8 million a year earlier, while net accounts receivable rose to $625.2 million from $493.2 million.

Fourth-quarter outlook

For the fourth quarter of 2026, Entegris expects revenue between $1.025 billion and $1.055 billion. GAAP net income is projected at $168 million to $181 million, with diluted earnings of $1.09 to $1.17 per share and an operating margin of 23.0% to 23.7%.

On a non-GAAP basis, the company forecasts net income of $203 million to $215 million and diluted earnings of $1.32 to $1.40 per share. Adjusted EBITDA is expected to range from $315 million to $329 million, representing a margin of 30.7% to 31.2%. Non-GAAP operating expenses are projected at $224 million to $230 million.

The presentation also identified restructuring activity related to an internal reorganization, workforce reductions and the planned wind-down of the Life Sciences Fluid Management business. Entegris cautioned that its outlook remains exposed to changes in semiconductor demand and manufacturing volumes, export controls, tariffs, supply-chain constraints, customer concentration, global economic uncertainty and its ability to generate sufficient cash to service debt.