TransDigm Tops Estimates as Fourth-Quarter Sales Hit $2.99 Billion

TransDigm Group (NYSE: TDG) reported fourth-quarter fiscal 2026 net sales of $2.99 billion, above the $2.95 billion analysts expected, and adjusted earnings per share of $12.44 against the $12.21 average analyst estimate, according to an 8-K filed Tuesday, Nov. 10. The quarter ended Sept. 30.

Net sales rose 23% from $2.44 billion a year earlier. Organic sales growth was 14% of net sales. Earnings per share were $10.33 on a GAAP basis, up 33% from $7.75. Net income fell 4% to $586 million, which the company attributed mainly to higher interest expense from a larger year-over-year gross debt balance and higher tax expense.

Profit measures

EBITDA As Defined rose 20% to $1.58 billion, and its margin was 53.0%, compared with 54.2% a year earlier. The company said the margin included about two percentage points of dilution from recent acquisitions. Adjusted net income rose 12% to $706 million.

For the full fiscal year, net sales increased 20% to $10.56 billion, and adjusted earnings per share rose to $41.35 from $37.33. Chief Executive Mike Lisman said the fourth-quarter results "exceeded the high end of our most recent guidance for both revenue and EBITDA As Defined."

Capital deployment

TransDigm completed the Prince & Izant acquisition for about $1.07 billion in cash, including certain tax benefits. The company also sold $3.0 billion of 6.75% senior secured notes due January 2035 in a private offering and used about $1.8 billion of the proceeds to repurchase part of its $2.1 billion of 6.75% notes due 2028.

TransDigm returned $943 million to shareholders in the quarter through repurchases of 820,000 shares at an average price of $1,150. For fiscal 2026 it repurchased shares totaling $2.8 billion. The company invested about $4.4 billion in acquisitions during the year.

Fiscal 2027 outlook

TransDigm guided fiscal 2027 net sales to $11.95 billion to $12.15 billion, which the company said is a 14% increase at the midpoint. It expects adjusted earnings per share of $47.09 to $47.94, a range that sits below the $48.66 average analyst estimate for the year. Guidance assumes high single-digit to low double-digit growth in commercial OEM revenue, high single-digit growth in commercial aftermarket revenue and high single-digit growth in defense revenue.

The company's conference call was scheduled for Nov. 10 at 10:00 a.m. Eastern Time.