Aerospace and defense company Woodward (NASDAQ: WWD) met Wall Street’s revenue expectations in Q2 CY2026, with sales up 21.2% year on year to $1.11 billion. Its non-GAAP profit of $2.52 per share was 2.9% above analysts’ consensus estimates.
Is now the time to buy Woodward? Find out by accessing our full research report, it’s free.
Woodward (WWD) Q2 CY2026 Highlights:
- Revenue: $1.11 billion vs analyst estimates of $1.11 billion (21.2% year-on-year growth, in line)
- Adjusted EPS: $2.52 vs analyst estimates of $2.45 (2.9% beat)
- Adjusted EBITDA: $249.1 million vs analyst estimates of $235.4 million (22.4% margin, 5.8% beat)
- Management raised its full-year Adjusted EPS guidance to $9.40 at the midpoint, a 1.1% increase
- Operating Margin: 18.7%, up from 13% in the same quarter last year
- Free Cash Flow Margin: 7.8%, down from 10.8% in the same quarter last year
- Market Capitalization: $24.46 billion
“We delivered outstanding third quarter results, including significant sales growth and margin expansion in both segments,” said Chip Blankenship, Chairman and Chief Executive Officer.
Company Overview
Initially designing controls for water wheels in the early 1900s, Woodward (NASDAQ: WWD) designs, services, and manufactures energy control products and optimization solutions.
Revenue Growth
A company’s long-term sales performance is one signal of its overall quality. Any business can have short-term success, but a top-tier one grows for years. Over the last five years, Woodward grew its sales at an exceptional 13.7% compounded annual growth rate. Its growth surpassed the average industrials company and shows its offerings resonate with customers, a great starting point for our analysis.
Long-term growth is the most important, but within industrials, a half-decade historical view may miss new industry trends or demand cycles. Woodward’s annualized revenue growth of 13.6% over the last two years aligns with its five-year trend, suggesting its demand was predictably strong. 
This quarter, Woodward’s year-on-year revenue growth of 21.2% was excellent, and its $1.11 billion of revenue was in line with Wall Street’s estimates.
Looking ahead, sell-side analysts expect revenue to grow 9.8% over the next 12 months, a deceleration versus the last two years. Still, this projection is commendable and implies the market is forecasting success for its products and services.
ALSO WORTH WATCHING: Nvidia’s Quiet Partner. Nvidia’s chips cost a hundred grand. The connectors that make them work cost even more. One company makes them all.
Every AI server needs specialized infrastructure the chip companies don’t make. High-speed cables. Power connectors. Thermal sensors. This 90-year-old company built a monopoly on it. The AI boom just started. This stock is still flying under the radar. Claim The Stock Ticker Here for FREE.
Operating Margin
Operating margin is one of the best measures of profitability because it tells us how much money a company takes home after procuring and manufacturing its products, marketing and selling those products, and most importantly, keeping them relevant through research and development.
Woodward has been an efficient company over the last five years. It was one of the more profitable businesses in the industrials sector, boasting an average operating margin of 12.4%.
Looking at the trend in its profitability, Woodward’s operating margin rose by 7.1 percentage points over the last five years, as its sales growth gave it immense operating leverage.
This quarter, Woodward generated an operating margin profit margin of 18.7%, up 5.7 percentage points year on year. This increase was a welcome development and shows it was more efficient.
Earnings Per Share
Revenue trends explain a company’s historical growth, but the long-term change in earnings per share (EPS) points to the profitability of that growth — for example, a company could inflate its sales through excessive spending on advertising and promotions.
Woodward’s EPS grew at 23.3% compounded annual growth rate over the last five years, higher than its 13.7% annualized revenue growth. This tells us the company became more profitable on a per-share basis as it expanded.
We can take a deeper look into Woodward’s earnings to better understand the drivers of its performance. As we mentioned earlier, Woodward’s operating margin expanded by 7.1 percentage points over the last five years. On top of that, its share count shrank by 7.4%. These are positive signs for shareholders because improving profitability and share buybacks turbocharge 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 Woodward, its two-year annual EPS growth of 22.5% is similar to its five-year trend, implying strong and stable earnings power.
In Q2, Woodward reported adjusted EPS of $2.52, up from $1.76 in the same quarter last year. This print beat analysts’ estimates by 2.9%. Over the next 12 months, Wall Street expects Woodward’s full-year EPS to grow 14.6% from $9.05 to $10.37.
Key Takeaways from Woodward’s Q2 Results
We enjoyed seeing Woodward beat analysts’ EBITDA expectations this quarter. We were also glad its EPS outperformed Wall Street’s estimates. Overall, this print had some key positives. Investors were likely hoping for more, and shares traded down 8.8% to $353.03 immediately after reporting.
Big picture, is Woodward a buy here and now? When making that decision, it’s important to consider its valuation, business qualities, as well as what has happened in the latest quarter. We cover that in our actionable full research report which you can read here (it’s free).
