Badger Meter Reports Q3 2026 Financial Results with Slight Revenue Increase

Badger Meter, Inc. reported its financial results for the third quarter of 2026, revealing net sales of $235.9 million, a slight increase of 0.1% from $235.7 million in the same period last year. The utility water market contributed $208.9 million to sales, reflecting a marginal decline of 0.1% compared to $209.2 million in the prior year, primarily due to uneven advanced metering infrastructure (AMI) project pacing. However, this was partially offset by a $5.6 million revenue contribution from the recently acquired UDlive Limited, which specializes in sewer line monitoring solutions. Sales from the flow instrumentation segment rose by 2.1% to $27.0 million, driven by strong demand in water-focused markets.

In terms of profitability, Badger Meter reported operating earnings of $47.7 million for the quarter, representing 20.2% of sales, compared to $46.1 million or 19.6% of sales in the same quarter of 2025. The gross margin improved to 41.9%, up from 40.7% in the prior year, attributed to a favorable product mix that included increased revenue from software-as-a-service (SaaS) offerings and ultrasonic meters. Selling, engineering, and administration expenses rose to $51.1 million, or 21.7% of sales, largely due to the inclusion of UDlive's operational costs and amortization of acquired intangible assets.

For the nine months ending September 30, 2026, Badger Meter's net sales totaled $660.5 million, a decrease of 5.1% from $696.0 million in the same period of 2025. The utility water segment saw a 5.9% decline in sales to $582.3 million, while flow instrumentation sales increased by 1.3% to $78.2 million. Operating earnings for the nine-month period were $122.3 million, or 18.5% of sales, down from $140.4 million, or 20.2% of sales, in the previous year. The decrease in earnings was attributed to lower sales and increased personnel costs, despite a consistent gross margin percentage.

Badger Meter's acquisition of UDlive for $94.4 million, completed on May 1, 2026, is a significant strategic development, enhancing its capabilities in sewer line monitoring. The acquisition was funded through cash on hand and is expected to contribute to future revenue growth. The company also reported a decrease in cash and cash equivalents to $67.9 million from $226.0 million at the end of 2025, primarily due to cash used for the acquisition, stock repurchases, and dividend payments.

Looking ahead, Badger Meter remains focused on leveraging its innovative water management solutions to capture market opportunities, particularly in the growing demand for smart water technologies. The company anticipates continued revenue growth from its SaaS offerings and aims to mitigate supply chain challenges through strategic vendor relationships and inventory management. Despite the current economic uncertainties, Badger Meter is positioned to navigate these challenges while pursuing its long-term growth objectives.