Atmus Filtration Technologies (NYSE:ATMU) reported first-quarter 2026 results that reflected a full quarter contribution from the newly acquired Koch Filter business and modest growth in its legacy operations, while management highlighted continued uncertainty tied to global market conditions and the ongoing conflict in the Middle East.
Chief Executive Officer Steph Disher said the company delivered “strong financial results to start the year” despite “continued challenging market conditions,” and emphasized progress against Atmus’ four-pillar growth strategy. Chief Financial Officer Jack Kienzler said the team delivered “strong financial performance” even as global conditions remained uncertain.
Acquisition of Koch Filter adds Industrial Solutions segment
Atmus said it has made “significant progress” integrating Koch Filter, exiting more than 50% of transition services agreements (TSAs). Disher said remaining integration activities are expected to be completed “early in the third quarter.”
With the acquisition, Atmus will report two segments in 2026:
- Power Solutions, serving global on-highway and off-highway equipment markets
- Industrial Solutions, reflecting the Koch Filter acquisition
On performance, Disher said Koch Filter posted “6% revenue growth in the quarter,” and described the early integration period as a “very good start.” When asked about the drivers of that growth relative to market expectations, Disher said first-quarter performance was “right where I would expect it to be at about 1% price, 2% share, and about 3% market growth.”
Kienzler said the acquisition is showing “margin accretion” potential for the overall portfolio, and reiterated synergy opportunities previously outlined, including “supply chain and procurement savings.” He also pointed to possible commercial opportunities where Atmus can apply “media expertise” alongside Koch Filter’s product offerings to expand into additional end markets, while noting it is still “early days.”
First-quarter results: sales up 14.6% on acquisition, EBITDA margin steady
Atmus reported first-quarter sales of $478 million, up from $417 million in the prior-year period, an increase of 14.6% that management said was “largely driven by the acquisition of Koch Filter.”
By segment, Kienzler said:
- Power Solutions sales were $439 million, up 5.4% year over year, driven primarily by 4% favorable foreign exchange and 2% higher pricing, with volume “down slightly.”
- Industrial Solutions sales were $38 million, reflecting Koch Filter.
Gross margin was $137 million, compared with $111 million a year ago. Kienzler attributed the increase primarily to incremental margin from Koch Filter, higher pricing, the cessation of one-time separation costs, and favorable currency, partially offset by “higher logistics and duties costs, higher manufacturing costs, along with lower volumes.”
Selling, administrative, and research expenses rose to $59 million from $55 million, driven by “people-related expenses and information technology consulting,” Kienzler said.
Joint venture income was $8 million versus $9 million a year ago. Kienzler said the decline was primarily due to a $3 million expense at the company’s India joint venture tied to benefit obligation remeasurement “driven by recent labor law changes.”
Other income was an expense of $7 million, compared with income of $1 million in the prior year. Kienzler said the increase in expense was primarily related to Koch Filter, including $6 million in transaction costs.
Adjusted EBITDA was $95 million, or 19.8% of sales, up from $82 million, or 19.6%, in the year-ago quarter. Adjusted EBITDA for Power Solutions was $86 million (19.6%), while Industrial Solutions adjusted EBITDA was $8 million (21.9%).
Adjusted earnings per share were $0.69 compared with $0.63 in the prior-year quarter. Adjusted free cash flow was $33 million, up from $20 million.
Capital allocation and balance sheet
Disher said Atmus returned $12 million of cash to shareholders in the quarter, including $7 million of share repurchases and $5 million of dividends. The company has $62 million remaining on its repurchase authorization and expects total share repurchases of $20 million to $40 million in 2026, she said.
On liquidity, Kienzler said Atmus ended the quarter with $210 million of cash and full availability under its $500 million revolving credit facility, totaling $710 million in available liquidity. He said net debt to adjusted EBITDA for the last 12 months ended March 31 was estimated at “2x,” reflecting the acquisition and the company’s cash position.
Pricing, tariffs, and market conditions
In response to questions about pricing, Kienzler said Atmus maintained its expectation of approximately 1% pricing for the full year. He said first-quarter pricing comparisons were expected to be the strongest of the year as “tariff dynamics” evolve, with tariff-related pricing expected to be “essentially flat year-over-year” for the full year based on tariffs in effect as of April 30.
Kienzler said the company’s approach to tariffs remains to mitigate exposure and remain “price cost neutral.” He noted the Section 232 steel and aluminum tariffs that took effect in early April were not expected to be a significant incremental change because an “immaterial” number of Atmus products qualify under that category and many already fall under Section 232 for heavy-duty and medium-duty products. He also discussed a newly established refund mechanism using the “CAPE system,” but said the timing and market treatment of refunds remain “highly uncertain.”
Disher also addressed volume and end-market trends. She said Power Solutions volume was slightly down in the first quarter and the company expects volume to “continue to grow quarter-over-quarter” through the year, with heavy-duty and medium-duty market improvement “all second half loaded.” Disher said Atmus is seeing “positive inflection in the first-fit market” in build rates and orders and expressed confidence in the second-half outlook, while the company’s aftermarket assumptions underpin a view of flat year-over-year conditions.
Guidance and Middle East risk factors
Management said the Middle East conflict adds uncertainty to the 2026 outlook, including potential impacts on input costs, the ability to sell products in the region, and broader macroeconomic effects. Disher said Atmus has not incorporated adverse impacts from the conflict into guidance, but is monitoring the situation.
Disher said the conflict could affect the company in three areas: input cost pressures (especially “plastics or petroleum-based products”), sales in the Middle East, and broader business confidence and demand. For context, she said Atmus’ sales in the Middle East were $38 million in 2025, about 2% of total revenue, and that the company saw a $4 million impact in the first quarter related to delivery restrictions in March. She said Atmus has mitigated those disruptions and is “not expecting that to continue” through the remainder of the year, while continuing to monitor the ongoing conflict.
For 2026, Atmus guided:
- Power Solutions revenue of $1.79 billion to $1.85 billion
- Industrial Solutions revenue of $155 million to $165 million, including Koch Filter from its Jan. 7 closing date
- Total company revenue of $1.945 billion to $2.015 billion
- Adjusted EBITDA margin of 19.5% to 20.5% (maintained)
- Adjusted EPS of $2.75 to $3.00
Disher added that if commodity prices rise due to the conflict, Atmus would expect to recover inflationary costs, though “there may be a timing lag for recovery.”
About Atmus Filtration Technologies (NYSE:ATMU)
Atmus Filtration Technologies is a global developer and manufacturer of high-performance filter media and filtration solutions. The company designs and produces advanced materials that capture airborne particles across a range of applications, from heating, ventilation and air-conditioning (HVAC) systems to industrial and cleanroom environments. By focusing on proprietary meltblown and nanofiber technologies, Atmus delivers media that balances efficiency, airflow and durability for both original equipment manufacturers (OEMs) and aftermarket customers.
The company’s product portfolio encompasses pleated and panel filter media, depth filtration products and specialty laminates used in industries such as commercial buildings, healthcare, transportation and power generation.
