Nordson (NASDAQ:NDSN) reported fiscal 2026 first-quarter results that management said reflected broad-based demand trends, including particular strength tied to semiconductor-related products in its Advanced Technology Solutions segment. The company posted record first-quarter sales of $669 million, up 9% from $615 million a year earlier, with 7% overall organic growth.
Quarterly performance and profitability
President and CEO Sundaram Nagarajan said the company entered fiscal 2026 “optimistic about end market demand trends” and highlighted record first-quarter sales, record adjusted earnings per share, and free cash flow of $123 million. Management also pointed to cash flow conversion “over 100% of net income” and said cash was used to repurchase shares, pay dividends, maintain leverage, and continue investing in the business.
Adjusted operating profit increased 10% year-over-year to $166 million. EBITDA rose 8% to a first-quarter record $203 million, and EBITDA margin was 30%, in line with the prior year. Hopgood said margins were influenced by the geographic and product mix of sales growth, noting that growth was concentrated in Asia where gross margins are generally lower, particularly on system sales, resulting in lower incremental margins that management expects to normalize over time.
Net interest expense was $23 million, down $3 million from the prior year, which Hopgood attributed to lower debt levels and a stable-to-declining rate environment. Other income increased $19 million, driven principally by a non-cash gain related to marking a minority investment to market following the investee company’s initial public offering in December 2025 on the Korean Stock Exchange. Hopgood said the company recorded a $22 million pre-tax gain in the quarter, excluded it from adjusted earnings, and intends to treat future mark-to-market adjustments similarly.
GAAP net income was $133 million, or $2.38 per share. Adjusted earnings per share were $2.37, a 15% increase from $2.06 in the prior-year quarter and $0.02 above the midpoint of quarterly guidance, according to Hopgood.
Segment results: growth led by Advanced Technology Solutions
Nordson reported results across three segments, with the fastest growth in Advanced Technology Solutions.
- Industrial Precision Solutions (IPS): Sales were $327 million, up 9% year-over-year. Organic sales increased 3%, and currency added 6%. Hopgood said growth was broad-based with “particular strength in Asia-Pacific markets,” and noted that demand for polymer processing and automotive product lines had stabilized. EBITDA was $110 million, or 34% of sales, down 2% year-over-year due largely to the geographic and product mix of growth and lower incremental leverage on foreign currency changes.
- Medical and Fluid Solutions (MFS): Sales were $193 million, relatively flat year-over-year. Organic sales rose 3%, led by engineered fluid solutions product lines, while divested sales from the medical contract manufacturing business reduced reported growth by about 4%. Management said winter storms at the end of January temporarily impacted production and certain medical supply chain activity, estimating about a 1% sales impact in the quarter. EBITDA increased to $70 million, or 36% of sales, up 9% from $64 million, driven by the divestiture, organic volume, and strong incremental performance.
- Advanced Technology Solutions (ATS): Sales were $149 million, up 23% year-over-year, with 21% organic growth. Hopgood attributed the increase to double-digit growth in electronics dispense product lines tied to semiconductor applications and recovering demand for X-ray systems. EBITDA rose to $33 million, or 22% of sales, from $23 million, or 19% of sales, on stronger volume leverage and maintained SG&A discipline.
Management commentary on end markets and mix
In the question-and-answer session, management addressed margin dynamics and noted that mix pressures were concentrated in IPS. Hopgood said there was “no fundamental change” in the margin outlook and reiterated the company’s view that approximately 40% incremental margins are a “normal ongoing” expectation, describing the quarter’s impact as primarily mix-related.
On Medical and Fluid Solutions, management said the 3% organic growth was slower than expected but maintained confidence in a mid-single-digit outlook for the year. Nagarajan and Hopgood said order entry, backlog, and customer project activity supported that view, and management estimated that without the late-quarter storm-related disruption, medical organic performance would have been about 4%.
On Advanced Technology Solutions, Nagarajan said semiconductor applications represent approximately 50% of ATS revenue and drove the segment’s double-digit organic growth. He described Nordson’s position in advanced packaging, citing precision dispense systems used in underfill and encapsulation, and said quality control needs were expanding opportunities for test and inspection. He also said investments were primarily in Asia Pacific and that Nordson is positioned across the semiconductor supply chain “both technologically and geographically.”
Management also discussed ATS test and inspection in more detail, separating the portfolio into X-ray and acoustic/optical inspection (referred to as AMI). Nagarajan said X-ray was beginning to inflect after being down last year, while AMI followed “two really strong years of growth” and was expected to grow again this year, though comparisons would be more challenging in the second half as the segment began to inflect in the second half of the prior year.
Cash flow, capital deployment, and updated guidance
Nordson ended the quarter with $120 million in cash, net debt of approximately $1.9 billion, and a leverage ratio of 2.1 times, consistent with year-end results. Hopgood said free cash flow was $123 million, representing a 105% conversion rate on net income excluding the non-cash gain, marking the third consecutive quarter above 100% conversion.
During the quarter, the company invested $18 million in capital projects, paid $46 million in dividends, and repurchased $82 million of shares. Hopgood also said Nordson modified and extended its $1.2 billion credit facility, consolidating a term loan due in fiscal 2026 into the new facility with no change in total outstanding debt, leaving about $800 million available at quarter end.
Looking ahead, Nordson said second-quarter fiscal 2026 sales are expected in the range of $710 million to $740 million, with adjusted earnings per diluted share of $2.70 to $2.90. Management said backlog entering the quarter was up approximately 4% year-over-year, with broad-based order momentum and strength in ATS.
Based on the first-quarter performance, second-quarter outlook, and foreign exchange rate environment, management raised full-year guidance. Nordson now expects fiscal 2026 sales of $2.86 billion to $2.98 billion and adjusted earnings per share of $11.00 to $11.60. Management said the high end of the sales range assumes continued momentum from electronics end markets and modest improvement in industrial and automotive product lines, while the low end assumes a broader pullback in demand in the second half, which the company said it does not currently see but views as prudent to plan for.
About Nordson (NASDAQ:NDSN)
Nordson Corporation designs, manufactures and markets precision dispensing equipment and systems that apply adhesives, coatings, sealants and polymers in a broad range of industrial and medical applications. The company’s portfolio spans fluid systems, curing and surface preparation technologies, vacuum and thermal management products, and advanced test and inspection solutions. Nordson’s offerings serve critical manufacturing processes by delivering exacting dispensing accuracy and process control to ensure consistent product performance and high production throughput.
Nordson operates through multiple segments that cater to diverse markets including electronics, packaging, medical, energy, automotive and general industrial sectors.
