Teledyne (NYSE: TDY) lifts sales 9.4% and raises full-year EPS outlook

What happened

Teledyne Technologies Incorporated (NYSE: TDY) reported third-quarter 2026 net sales of $1.68 billion and raised full-year EPS guidance on October 21, 2026. The company said the quarter set records for sales, operating profit and non-GAAP diluted EPS.

Cash from operations was $352.5 million and free cash flow was $319.5 million. Digital Imaging net sales rose 15.0% to $903.0 million. Teledyne also announced a pending acquisition of Varex Imaging Corporation for about $1.1 billion.

Quarter-end consolidated leverage was 0.9x. Teledyne repurchased $224.6 million of stock in September and through October 19 at a weighted average price of $607.03 per share. Net debt fell to $1.47 billion from $2.12 billion as of December 28, 2025.

Key numbers

Metric	Latest	Change	Source
Net sales	$1.68 billion	from $1.54 billion, +$145.4 million	SEC 8-K earnings release
GAAP diluted EPS	$5.82	from $4.65, +$1.17	SEC 8-K earnings release
Non-GAAP diluted EPS	$6.72	from $5.57, +$1.15	SEC 8-K earnings release
Cash from operations	$352.5 million	from $343.1 million, +$9.4 million	SEC 8-K earnings release
Free cash flow	$319.5 million	from $313.9 million, +$5.6 million	SEC 8-K earnings release
Digital Imaging sales	$903.0 million	from $785.4 million, +$117.6 million	SEC 8-K earnings release

Read more: Teledyne Technologies (TDY) stock analysis and investment case

Why it matters

The filing supports the view that Teledyne's high-reliability sensing and information businesses can still support pricing, cash conversion and capital allocation. Net sales rose by $145.4 million from the third quarter of 2025, and operating margin improved to 20.6% from 18.4%.

The margin gain matters because it shows more profit for each dollar of sales. Net income attributable to Teledyne rose to $272.8 million from $220.7 million, and non-GAAP diluted EPS rose to $6.72 from $5.57.

Teledyne also lifted full-year 2026 GAAP diluted EPS outlook to $21.71 to $21.87 from $20.73 to $20.99. It raised non-GAAP EPS outlook to $25.40 to $25.50 from $24.45 to $24.65. That suggests management sees enough strength to improve its full-year view.

Not all of the quarter came from core operations. It included $11.7 million of incremental sales from recent acquisitions, $55.2 million of pretax acquired intangible asset amortization and $0.2 million of pretax transaction and integration costs. Teledyne also recorded a $10.6 million gain from marking Varex shares to market at quarter end.

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What's next

Varex's special meeting is set for October 28, and Teledyne expects the deal to close in early 2027. Teledyne said it plans to fund the acquisition with cash on hand and available borrowings under its credit facility. It said Varex will join the Digital Imaging segment after close. Approval by Varex stockholders and regulatory clearances would keep the deal on track. A failed vote or missing approvals would leave the transaction unresolved.

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