Wacker Neuson SE (WBO:WAC) (H1 2026) Earnings Call Highlights: Revenue Surges 17% and EBIT ...

• Order momentum weakened noticeably during Q2 2026, particularly in Europe, leading to a cautiously optimistic outlook for H2.

• Revenue in the Asia-Pacific region declined slightly due to weak demand, partly due to a dealer insolvency in Australia that resulted in a receivable write-off.

• The company expects higher capital investment in H2 2026, which could impact cash flow.

• Geopolitical and macroeconomic risks, including the Middle East war and U.S. tariff policies, create uncertainty for the second half.

• Rising input costs, including transportation, energy, and supply chain pressures, may increase material costs in H2, potentially impacting margins.

• Demand for skid steers in North America remained below previous year levels, indicating weakness in that product segment.

Q & A Highlights

Q: How is the John Deere cooperation ramp-up progressing in the U.S., and what volume contribution is expected in the second half versus the first half? A: Karl Tragl (CEO) stated that the first two John Deere models are already in production in Linz, Austria, and are generating revenue this year. However, there is no major revenue impact in the U.S. from the cooperation in 2026. The largest machine is currently being introduced, and production for the second machine will start at the beginning of next quarter. These two machines are the volume drivers for the cooperation and will begin contributing significant revenue next year. Current U.S. growth is being driven by the data center trend, with strong demand for light towers, generators, and other worksite technology.

Q: Can you explain the factors behind the expected EBIT margin development in the second half of 2026, including the impact of rising input costs and price pressure? A: Karl Tragl (CEO) explained that the second half typically has lower profitability due to plant closures in August and mid-December. Additionally, the company anticipates increased transportation costs, slightly higher energy costs, and pressure on the supply chain, which could increase material input costs. To mitigate these effects, the company has already implemented price increases in mid-2026, particularly in Europe and for spare parts, to compensate for potential negative effects on the material side.

Q: What was the reason for the small allowance taken in the Asia Pacific region? A: Christoph Burkhard (CFO) clarified that the allowance was related to a dealer in Australia that went into insolvency. The dealer had taken on too much inventory during 2024 and 2025, and the correction was necessary. He also noted that the Australian market is currently very depressed.

Q: How confident are you in your ability to pass on higher logistics costs to customers through pricing? A: Karl Tragl (CEO) rephrased the question to address the company's pricing behavior. He stated that Wacker Neuson has made progress on pricing in 2026, having reacted to tariffs in North America. The company has increased pricing in mid-2026, especially in Europe and for spare parts, to compensate for potential future negative effects on the material side. The final balancing will depend on many factors.

Q: What were the key drivers behind the strong financial performance in the first half of 2026? A: Karl Tragl (CEO) highlighted that group revenue reached EUR1.26 billion, up 17% year-over-year, driven by strong growth in both Europe and the Americas. EBIT nearly doubled to approximately EUR105 million, with an EBIT margin of 8.3%. Key drivers were profitable revenue growth, improved coverage, and disciplined cost management, as operating costs remained essentially flat year-over-year, allowing for significant scale effects.

Q: Can you provide more detail on the revenue development across the different business segments? A: Karl Tragl (CEO) reported that the Compact Equipment segment, accounting for 59% of group revenue, grew by 26% to EUR743 million, driven by strong demand for excavators and dumpers in Europe. The Light Equipment segment, 20% of revenue, grew by 9% to EUR260 million, mainly driven by North America and strong demand for light towers and generators for AI data center construction. The Services segment, 21% of revenue, grew by 3% to EUR263 million, supported by stronger demand for spare parts and rental machines.

Q: How did the net working capital and free cash flow develop in the first half of 2026? A: Christoph Burkhard (CFO) stated that the net working capital ratio stood at 28.7% at the end of June, 4.1 percentage points below the previous year's level, despite revenue growth. This was achieved through improvements in the end-to-end S&OP process. Free cash flow for the first half increased to EUR76 million, up from EUR68 million in H1 2025, with Q2 alone generating EUR78 million. He expects a triple-digit free cash flow number for the full year.

Q: What is the company's updated guidance for the full year 2026? A: Karl Tragl (CEO) announced that the company raised its guidance on July 17. Group revenue is now expected to be in the range of EUR2.3 billion to EUR2.4 billion, up from the previous range of EUR2.2 billion to EUR2.4 billion. The EBIT margin guidance was raised by 50 basis points to a range of 7.0% to 8.0%, up from 6.5% to 7.5%. The company remains cautiously optimistic for the second half due to weaker order momentum and geopolitical risks.

Q: How did the order intake develop during the first half of 2026? A: Karl Tragl (CEO) noted that order intake in the first half of 2026 was above revenue, resulting in a book-to-bill ratio of 1.1 as of June year-to-date. However, order momentum weakened noticeably during the second quarter, particularly in Europe, which is why the company remains cautious about the second half of the year.

Q: What is the expected capital investment volume for the full year 2026? A: Karl Tragl (CEO) stated that the company expects a higher capital investment volume in the second half of the year and continues to expect a range of EUR70 million to EUR90 million for the full year. Additionally, the net working capital ratio is expected to stay below the strategic target of 30%.

For the complete transcript of the earnings call, please refer to the full earnings call transcript .