Lincoln Electric (NASDAQ:LECO) beats Q3 2026 sales expectations

Welding equipment manufacturer Lincoln Electric (NASDAQ:LECO) beat Wall Street’s revenue expectations in Q3 2026, with revenue up 15.1% year on year to $1.22 billion. Its non-GAAP profit of $2.98 per share was 6.2% above analysts’ consensus estimates.

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“We achieved strong third quarter results led by higher volumes, an increase in our adjusted operating income margin, and record adjusted earnings per share,” said Steven B. Hedlund, Chairman and Chief Executive Officer. “Our performance underscores the agility of our global team who are focused on supporting customers, diligently managing inflationary headwinds, and accelerating RISE strategy initiatives and investments to optimize long-term value for all our stakeholders.”

Revenue growth

Examining a company’s long-term performance can provide clues about its quality. Even a poor business can perform well for one or two quarters, but a high-quality one grows for years. Lincoln Electric’s revenue grew at a decent 8.5% compounded annual growth rate over the last five years. Its growth was slightly above the average industrials company and shows its offerings resonate with customers.

Long-term growth matters most, but within industrials, a half-decade historical view may miss cycles, industry trends or a company capitalizing on catalysts such as a new contract win or a successful product line. Lincoln Electric’s recent performance shows its demand has slowed as its annualized revenue growth of 7.1% over the last two years was below its five-year trend. Decelerating revenue growth in the sector warrants caution, as it could signal changing consumer tastes aided by low switching costs.

Lincoln Electric also reports organic revenue, which strips out one-time events like acquisitions and currency fluctuations that don’t accurately reflect its fundamentals. Over the last two years, Lincoln Electric’s organic revenue averaged 4.1% year-on-year growth. Total revenue growth outpaced organic growth over that period, indicating that some combination of acquisitions and foreign exchange rates boosted its headline results.

This quarter, Lincoln Electric reported year-on-year revenue growth of 15.1%, and its $1.22 billion of revenue exceeded Wall Street’s consensus estimates by 3.9%.

Looking ahead, sell-side analysts expect revenue to grow 6.6% over the next 12 months, according to S&P, similar to its two-year rate. This underwhelming projection suggests its newer products and services will not lead to better top-line performance yet. On the positive side, the company is tracking well in other measures of financial health.

Operating margin

Lincoln Electric has performed well over the last five years. It demonstrated strong profitability for an industrials business, with an average operating margin of 16.6%. That outcome is unsurprising given its favorable gross margin baseline.

Lincoln Electric’s operating margin rose by 1.2 percentage points over the last five years, as its revenue growth provided operating leverage.

This quarter, Lincoln Electric generated an operating margin of 17.3%, in line with the same quarter last year. This indicates the company’s cost structure has recently been stable.

Earnings per share

We track the long-term change in earnings per share (EPS) for the same reason as long-term revenue growth. Compared to revenue, however, EPS highlights whether a company’s growth is profitable.

Lincoln Electric’s EPS grew at a 13.6% compounded annual growth rate over the last five years, higher than its 8.5% annualized revenue growth. This tells us the company became more profitable on a per-share basis as it expanded.

A closer look at Lincoln Electric’s earnings helps explain its performance. As we mentioned earlier, Lincoln Electric’s operating margin was flat this quarter but expanded by 1.2 percentage points over the last five years. On top of that, its share count shrank by 8.6%. These are positive signs for shareholders because improving profitability and share buybacks boost EPS growth relative to revenue growth.

Like with revenue, we analyze EPS over a shorter period to see if we are missing a change in the business.

For Lincoln Electric, its two-year annual EPS growth of 9.9% was lower than its five-year trend. This was underwhelming, but the company performed well on other measures of financial health.

In Q3, Lincoln Electric reported adjusted EPS of $2.98, up from $2.47 in the same quarter last year. This result beat analysts’ consensus estimates by 6.2%. Over the next 12 months, Wall Street expects Lincoln Electric’s full-year EPS to grow 10.4% from $11.06 to $12.21, according to S&P.

Key takeaways from Lincoln Electric’s Q3 results

Lincoln Electric’s quarter was mixed: Revenue came in well ahead of analysts’ consensus estimates and adjusted operating income also topped Wall Street’s estimates, but organic revenue missed expectations. Shares remained flat at $258.49 immediately after the release.

Evaluating Lincoln Electric at its current price requires looking beyond the latest quarter. Those results matter, but longer-term fundamentals and valuation matter more when deciding whether the stock is a buy. For more, read our full research report here (it’s free).