Badger Meter Reports 6.6% Decline in Q2 2026 Net Sales, Highlights Acquisition of UDlive

Badger Meter, Inc. reported a decline in financial performance for the second quarter of 2026, with net sales of $222.3 million, a decrease of 6.6% from $238.1 million in the same period of 2025. The company's utility water product sales fell by 8.1% to $195.0 million, attributed to uneven project pacing in advanced metering infrastructure (AMI) initiatives. However, the company noted a positive contribution of $2.0 million from its recent acquisition of UDlive, a provider of sewer line monitoring solutions. In contrast, sales of flow instrumentation products increased by 5.6% to $27.3 million, reflecting growth in water-focused end markets.

For the first half of 2026, Badger Meter's net sales totaled $424.6 million, down from $460.3 million in the prior year. The decline in utility water sales was 8.8%, while flow instrumentation sales saw a marginal increase of 0.8%. Operating earnings for the second quarter were $39.4 million, or 17.7% of sales, compared to $44.9 million, or 18.8% of sales, in the previous year. The gross margin percentage also decreased slightly to 40.8% from 41.1%, primarily due to lower sales volumes and product mix.

The company’s total assets increased to $998.2 million as of June 30, 2026, up from $973.6 million at the end of 2025, driven by a rise in intangible assets and goodwill following the acquisition of UDlive. However, cash and cash equivalents decreased significantly to $95.7 million from $226.0 million, largely due to cash outflows for the acquisition and stock repurchases. The company’s primary working capital as a percentage of sales rose to 22.9%, reflecting increased receivables and inventories.

In terms of strategic developments, Badger Meter completed the acquisition of UDlive on May 1, 2026, for $94.4 million, with potential additional earn-out payments based on performance. This acquisition is expected to enhance the company's offerings in sewer line monitoring and contribute to its utility water product line. The company continues to focus on expanding its market presence, particularly in the U.S. and select international markets, while also investing in technology and product innovation to meet evolving customer demands.

Looking ahead, Badger Meter anticipates ongoing challenges related to uneven project pacing in the utility water sector and potential supply chain constraints. The company is committed to leveraging its strong relationships with suppliers and implementing pricing strategies to mitigate cost pressures. Management remains optimistic about the long-term growth prospects driven by increasing demand for smart water solutions and the continued transition to advanced metering technologies.