Oshkosh Corporation Reports 6.7% Sales Increase but Decline in Gross Income for Q2 2026

Oshkosh Corporation reported a consolidated net sales increase of 6.7% for the second quarter of 2026, reaching $2.92 billion compared to $2.73 billion in the same period last year. The growth was primarily driven by higher sales volume and improved pricing, with net sales for the first six months of 2026 totaling $5.23 billion, up from $5.04 billion in the prior year. However, the company experienced a decline in gross income, which fell to $480.3 million from $524.5 million year-over-year, reflecting a decrease in gross margin percentage from 19.2% to 16.5%. Operating income also decreased to $243.2 million, or 8.3% of sales, down from $291.7 million, or 10.7% of sales, in the previous year.

The financial performance for the first half of 2026 showed similar trends, with net income declining to $226.3 million from $317 million in the first half of 2025. The decrease in profitability was attributed to higher material costs, unfavorable sales mix, and increased manufacturing overhead, which outweighed the benefits of improved pricing. The effective tax rate for the second quarter was 16.9%, significantly lower than the 24.1% recorded in the same quarter last year, aided by net discrete tax benefits related to a foreign anti-hybrid tax matter.

Strategically, Oshkosh has been focusing on modernizing its municipal fire apparatus manufacturing processes and expanding production capabilities to meet customer demand. The Access segment, which includes aerial work platforms and telehandlers, reported strong orders of $1.5 billion, resulting in a book-to-bill ratio of 1.1 and a backlog of $2 billion as of June 30, 2026. The Vocational segment also saw a backlog increase, driven by demand for municipal fire apparatus and airport products, while the Transport segment's backlog decreased due to lower defense vehicle orders.

In terms of operational metrics, Oshkosh's cash and cash equivalents stood at $403.6 million as of June 30, 2026, down from $479.8 million at the end of 2025. The company reported a significant improvement in operating cash flows, generating $213.3 million in the first half of 2026 compared to a cash outflow of $305.7 million in the same period last year. Oshkosh continues to prioritize capital expenditures, expecting to invest approximately $200 million in 2026, while also repurchasing $139 million worth of its common stock in the first half of the year.

Looking ahead, Oshkosh has adjusted its earnings per share guidance for 2026 to a range of $10.50, down from previous estimates of $10.90, primarily due to a more gradual increase in municipal fire apparatus production. The company anticipates stronger fourth-quarter results as production capacity increases and expects to carry momentum into 2027. The overall outlook remains cautiously optimistic, with a focus on managing costs and enhancing operational efficiencies amid evolving market conditions.