Sensata (STN) Q3 2026 Earnings Report
MX:STN Q3 2026 EPS Results
- Actual EPS
- MXN 21.09
- Consensus EPS
- MXN 17.86
- Beat/Miss
- Beat by +MXN 3.23
- One Year Ago EPS
- MXN 16.61
MX:STN Q3 2026 Revenue Results
- Actual Revenue
- MXN 18.73B
- Expected Revenue
- MXN 18.16B
- Beat/Miss
- Beat by +MXN 567.90M
- YoY Revenue Growth
- +8.10%
Earnings Announcement Details
- Quarter
- Q3 2026
- Date
- 10/27/2026
- Time
- After Close
- Conference Call
- Tuesday, October 27, 2026
Sensata's next earnings date is estimated for February 2, 2027, based on past reporting schedules.
Q3 2026 Earnings Call Audio
Q3 2026 Earnings Slide Deck
Q3 2026 Earnings Call Summary
The call was strongly positive overall. Sensata reported broad-based organic growth, better-than-expected earnings, substantial free cash flow, continued deleveraging, expanding returns and significant data center and aerospace growth opportunities. The main challenges were weaker automotive production, pronounced China automotive pressure, Q4 and Q1 seasonality, a modest aerospace and defense growth shortfall versus market trends, and inflation in boards and electronics. Management stated that the underlying Q3 results met or exceeded guidance without the one-time termination payment and expects continued margin expansion despite the market challenges.
For the fourth quarter, Sensata expects revenue of $942 million to $972 million, adjusted operating income of $185 million to $192 million, adjusted operating margin of 19.6% to 19.8%, adjusted net income of $140 million to $145 million and adjusted earnings per share of $0.95 to $0.99; at the midpoint, this implies approximately 5% year-over-year revenue growth and 10% adjusted EPS growth. The company expects the automotive market down about 4%, revenue down 3-ish and net outgrowth of about 1%, with a 4% year-over-year contraction in fourth-quarter global light vehicle production and approximately 2% lower global production for the full year; full-year automotive outgrowth is expected to be approximately 2%, industrials is expected to grow 15% this year and aerospace, defense and commercial equipment is expected to grow 8%. Full-year 2026 free cash flow conversion is expected to exceed 100% of adjusted net income; Q1 revenue is not expected to increase sequentially from Q4, operating margins are expected to expand modestly year-over-year, and the full-year operating model will target 20 basis points of full-year margin expansion.
- Q3 Revenue and Earnings Exceeded GuidanceThird-quarter revenue was $1.004 billion, up $72 million or 8% year-over-year, with organic revenue growth of 7%. Adjusted operating income was $215 million versus $180 million a year ago, adjusted operating margin was 21.5% versus 19.3%, and adjusted EPS was $1.13, up $0.24 or 27% year-over-year. Revenue, adjusted operating income and adjusted EPS exceeded the high end of guidance, and adjusted EPS delivered a fourth consecutive quarter of double-digit growth.
- Underlying Q3 Performance Met or Exceeded GuidanceExcluding the $24 million customer termination payment related to an electric vehicle program cancellation, revenue would have been $980 million, representing 5% reported growth and 4% organic growth. Adjusted operating income would have been $191 million and adjusted operating margin 19.5%, up 20 basis points year-over-year. Management stated that underlying results met or exceeded the midpoint of guidance across key metrics without the payment.
- Exceptional Free Cash Flow GenerationThird-quarter free cash flow was $198 million, up $62 million or 46% year-over-year, with free cash flow conversion of 119% of adjusted net income, up 14 percentage points. Year-to-date free cash flow was $489 million, compared with $490 million for full-year 2025, and management expects full-year 2026 free cash flow conversion to exceed 100% of adjusted net income.
- Deleveraging and Balance Sheet ImprovementNet leverage declined to 2.1x trailing 12-month adjusted EBITDA. Net debt declined from $2.6 billion at year-end 2024 to $1.9 billion as of September 2026. Sensata completed $33 million of open-market debt repurchases during the quarter, had $553 million of cash on hand, and its $650 million revolving credit facility remained undrawn.
- Capital Allocation and Interest Savings BenefitsSensata returned approximately $17 million to shareholders through its quarterly dividend and announced a fourth-quarter dividend of $0.12 per share. Nearly 80% of the nearest-term debt maturity due in 2029 has been proactively retired. Management expects interest savings to contribute $0.10 of year-over-year adjusted EPS growth in 2026, following approximately $0.06 of adjusted EPS benefit in 2025.
- Improving Returns and Operating DisciplineAdjusted operating margin expanded year-over-year for the fifth consecutive quarter. Trailing twelve-month free cash flow conversion increased to 113%, and return on invested capital improved 80 basis points sequentially to 12.1%, representing 190 basis points of improvement since the transformation began seven quarters ago.
- Broad-Based Segment GrowthAll three segments delivered year-over-year organic revenue growth, market outgrowth and operating income growth. Automotive revenue increased 4% reported and 3% organically while production declined 2%. Industrials revenue increased 13% reported and 12% organically, while Aerospace, Defense and Commercial Equipment revenue increased approximately 13% on both a reported and organic basis.
- Automotive Margin Expansion and OutgrowthAutomotive segment operating margin was 28.4% versus 23.7% in the prior-year quarter. Excluding the termination payment, automotive operating margin increased 150 basis points year-over-year to 25.2%, reflecting productivity and disciplined cost management. Management expects full-year automotive outgrowth of approximately 2%.
- Industrials Growth and Operating LeverageIndustrials operating income was $61 million and segment operating margin was 28.8%, up 160 basis points year-over-year. Management attributed the improvement to strong volume growth and operating leverage, which enabled disciplined investment in attractive growth opportunities.
- Motors and Actuators Wins in Aerospace and UAVsNew motor business wins reached a record in 2026, doubling the pace of wins from last year and reaching approximately triple the typical annual win rate from two years prior. The wins support participation in a global drone and UAV market expected to grow at a double-digit CAGR over the balance of the decade.
- Data Center Revenue Growth and Hyperscaler WinsData center sensing and electrical protection revenue is expected to increase from $27 million in 2025 to $48 million in 2026, representing annual growth of 76%. Sensata has seven design wins spanning six hyperscalers, including a win in China, up from five wins last quarter and one win at the start of the year. Management expects these wins to begin ramping in mid-2027.
- Data Center Market Tailwinds and Expanding Addressable MarketManagement cited underlying data center market growth rates in the mid-teens, a 1.5x to 2.5x expansion in Sensata's serviceable addressable market, a stronger competitive position as sourcing becomes more specification-driven, and increasing demand for power and peak-management solutions. Sensata expects to benefit from growth in thermal management, electrical protection and energy management.
- New Liquid-Cooling Flow Sensor LaunchedSensata launched its FL series ultrasonic flow-sensing solution for liquid-cooling applications. The product is designed to provide continuous, highly accurate coolant-flow measurement for increasingly dense computing environments, with initial shipments expected by mid-2027, subject to final customer timing.
- Dynapower Refocused Toward Data Center PowerSensata has reset Dynapower's focus toward data center power needs while continuing to pursue active clean-energy projects. Management identified opportunities for Dynapower inverters, converters and rectifiers used for power and peak management, with the opportunity expected to develop from mid-2027 onward. Dynapower revenue is not included in the $48 million of data center component revenue cited for 2026.
- Regional Automotive Outgrowth and China DiversificationAutomotive growth in India exceeds 30% against 10% market growth, North America is delivering double-digit organic growth against an expected 2% market contraction, Japan is accelerating to high-single-digit outgrowth, and low-single-digit outgrowth is expected in Europe and Korea. Sensata also cited battery-supplier wins and content gains with local Chinese OEMs as future growth opportunities.
- Recovery Signals in Selected End MarketsNorth American Class 8 truck production increased approximately 50% year-over-year in the third quarter, with management expecting recovery through year-end and into 2027. U.S. residential HVAC shipments returned to growth after first-half weakness, manufacturing indicators showed signs of stabilization, and aircraft backlogs and defense spending supported a positive outlook.
MX:STN Earnings History
| Report Date | Fiscal Quarter | Forecast / EPS | Last Year's EPS | EPS YoY Change | Press Release |
|---|---|---|---|---|---|
| Feb 02, 2027 | 2026 (Q4) | 18.14- | 16.42 | ― | ― |
| Oct 27, 2026 | 2026 (Q3) | 17.8621.09 | 16.61 | 26.97% (+4.48) | |
| Jul 29, 2026 | 2026 (Q2) | 17.4118.29 | 16.24 | 12.64% (+2.05) | |
| Apr 28, 2026 | 2026 (Q1) | 15.5816.05 | 14.56 | 10.26% (+1.49) | |
| Feb 19, 2026 | 2025 (Q4) | 16.1116.42 | 14.18 | 15.79% (+2.24) | |
| Oct 28, 2025 | 2025 (Q3) | 15.9416.61 | 16.05 | 3.49% (+0.56) | |
| Jul 29, 2025 | 2025 (Q2) | 15.6816.24 | 17.36 | -6.45% (-1.12) | |
| May 08, 2025 | 2025 (Q1) | 13.4714.56 | 16.61 | -12.36% (-2.05) | |
| Feb 11, 2025 | 2024 (Q4) | 13.9614.18 | 15.12 | -6.17% (-0.93) | |
| Nov 04, 2024 | 2024 (Q3) | 15.9616.05 | 16.98 | -5.49% (-0.93) |
The table shows recent earnings report dates and whether the forecast was beat or missed. See the change in forecast and EPS from the previous year.