Gates Industrial Q3 2026: Margin Expansion Powers an EPS Beat
As seen on the 24/7 Wall St. homepage on October 30, 2026.
Gross margin widened to 42.4% from 39.9% a year ago, enough to beat EPS expectations even with sales missing expectations. Management raised full-year adjusted EPS guidance to $1.66 to $1.72.
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Gates Industrial delivered adjusted earnings per share of $0.47 in the third quarter of 2026, beating expectations even as net sales came in just under estimates.
Gross profit margin expanded to 42.4% from 39.9% a year earlier, giving the company enough profit per dollar of sales to clear the earnings bar.
Demand skewed toward Industrial OEM, which posted high-teens sales growth that CEO Ivo Jurek called a key driver, while Industrial Aftermarket growth accelerated from the prior quarter.
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Management lifted full-year adjusted EPS guidance to $1.66 to $1.72 from the prior range of $1.62 to $1.70, and tightened core sales growth guidance without moving the midpoint.
Gates has beaten the EPS consensus in each of the past eight quarters, aided by buybacks that cut the diluted share count. Management flagged tariff policy, Middle East supply-chain pressure, and a working-capital build that reduced nine-month operating cash flow.
Sources
Mentioned: GTES