ITT Raises 2026 Outlook as Q3 Adjusted EPS Rises 20%

ITT Inc. (NYSE: ITT) raised its 2026 revenue, adjusted earnings and free cash flow guidance after third-quarter organic growth, margin expansion and SPX FLOW cost synergies lifted adjusted earnings per share by 20%.

Revenue for the quarter ended Oct. 3 increased 44% year over year to $1.44 billion, including an 8% organic gain, as all three operating segments contributed. Adjusted operating income rose 55% to $303.1 million, while adjusted operating margin expanded 140 basis points to 21.0%.

Adjusted EPS increased to $2.26 from $1.89. The company attributed the improvement mainly to higher volume, pricing, operating leverage and productivity savings, as well as a contribution from SPX FLOW that more than offset higher interest expense, share count and tax rate. Strategic growth investments in Flow Technologies and Connect & Control Technologies were a partial offset.

On a GAAP basis, income from continuing operations declined 2.7% to $123.6 million, and diluted EPS fell 14.8% to $1.38. The difference between reported and adjusted results included intangible amortization, restructuring and acquisition-related costs. ITT began excluding intangible amortization from its adjusted measures in the first quarter of 2026 and revised prior-year comparisons accordingly.

Orders and segment performance

Total orders climbed 58%, with organic orders up 20%, leaving ITT with continued order momentum and elevated backlog entering future periods.

Connect & Control Technologies posted the strongest underlying expansion. Revenue increased 21% on a reported basis and 19% organically, led by connectors and kSARIA. Organic orders surged 55%, supported by connectors and kSARIA, and book-to-bill reached 1.31 times. The segment generated $69.1 million of adjusted operating income and a 22.0% adjusted margin, up 100 basis points from a year earlier.

Flow Technologies revenue nearly doubled on a reported basis following the SPX FLOW acquisition and increased 6% organically, driven by pump projects and valves. Organic orders rose 11%, and book-to-bill was 1.02 times. Adjusted operating income reached $171.6 million, with a 22.4% adjusted margin. That margin was down 40 basis points year over year but improved 100 basis points sequentially, mainly because of accelerated synergies.

Motion Technologies recorded 2% organic revenue growth and 5% organic order growth, with book-to-bill of 1.03 times. Adjusted operating income was $76.4 million and adjusted margin increased 70 basis points to 21.0%, reflecting net productivity. ITT also reported 24% order growth at KONI, driven by rail and defense demand, with book-to-bill of 1.3 times. Global Friction outperformed its underlying market by 230 basis points in the quarter and 560 basis points year to date, according to the presentation.

SPX FLOW integration and cash generation

SPX FLOW revenue increased 8% year to date, including periods before and after the acquisition, compared with the corresponding pre-acquisition period in 2025. Strength in Nutrition & Health, Mixers and Waukesha Cherry-Burrell more than compensated for headwinds in Industrial Pumps. Backlog rose 7%, and book-to-bill was 1.04 times. ITT projects high-single-digit full-year growth for the acquired business.

The company said its synergy pipeline exceeds the original $80 million commitment. It now projects more than $20 million of 2026 profit-and-loss savings, above a $15 million budget, and more than $30 million of first-year run-rate savings, compared with a $27 million budget. Initial actions have focused mainly on corporate and business general and administrative costs, while supply-chain and procurement benefits are expected in the second year.

Year-to-date free cash flow rose to $464.3 million from $368.0 million. The total included $71 million of one-time acquisition-related expenses; excluding those costs, ITT said free cash flow increased 46%. The company ended the quarter with a leverage ratio of 2.3 times and had repurchased more than $150 million of shares year to date.

2026 outlook raised

ITT now expects 2026 reported revenue growth of 41% to 43%, compared with its previous range of 38% to 41%. Organic growth is projected at 7% to 9%, up from 5% to 8%.

Adjusted EPS is forecast at $8.54 to $8.62, representing growth of 19% to 20%. The prior range was $8.12 to $8.32. GAAP EPS from continuing operations is expected to be $4.65 to $4.73.

The adjusted operating margin outlook increased to 20.2% to 21.0%, implying expansion of 80 to 160 basis points. Free cash flow guidance rose to $600 million to $620 million from $550 million to $580 million, with an expected margin of about 11%.

Management expects order momentum, backlog, SPX FLOW synergies and productivity measures across the segments to support the outlook. However, the projections remain subject to acquisition integration, the timing and realization of expected synergies, and broader legal, regulatory and economic uncertainties. The presentation also identified ongoing Industrial Pumps headwinds within SPX FLOW and noted that forward-looking non-GAAP measures depend on items, including currency movements and special charges, that are inherently difficult to predict.