Graco Inc. Q1 2026 Earnings Recap

Graco's Q1 sales grew modestly by 2%, driven primarily by acquisitions and currency benefits, despite a 6% decline in organic revenue; net earnings declined 5% as margins and volume pressures persisted.

Key Takeaways

• Total revenues reached $540 million, with acquisitions contributing 5% and foreign exchange 3%, offsetting organic decline.
• Organic sales decreased 6%, with softer demand in construction and semiconductor markets; backlog increased by $26 million.
• Gross margin contracted 60 basis points amid higher product costs from tariffs ($7 million) and volume declines.
• Operating margins held steady at 24% in Contractor and Expansion segments but declined to 32% in Industrial due to volume and tariff impacts.
• Adjusted EPS declined 6% to $0.66; cash flow remained strong at $120 million, with strategic investments, share repurchases, and dividends underway.