Ingersoll Rand Inc. (IR) Income Statement

The 8.5% YoY growth in 2026Q2 is a slight acceleration from the prior quarter's 7.6%, but remains below the 10.1% peak seen in 2025Q4. This suggests a stable but not accelerating top-line trajectory, likely driven by a mix of organic demand and contributions from recent acquisitions. The modest growth rate may indicate that the company is not gaining significant market share, and investors should monitor whether the maintained guidance implies a slowdown in the second half of the year.

Excluding the 2025Q4 outlier, gross margins have been remarkably stable in the 42-45% range, reflecting the company's pricing power and aftermarket mix. The 2025Q4 anomaly appears to be driven by a one-time charge or revenue recognition issue, as operating margin in that quarter was unusually high at 31.7%, suggesting a non-recurring gain. This volatility underscores the importance of normalizing for one-offs when assessing underlying margin trends.

The operating margin in 2025Q2 was a mere 4.0%, while 2025Q4 showed 31.7%, both extremes likely due to one-time items. Excluding these, operating margins have been relatively stable in the 15-20% range, suggesting that the company is not achieving significant operating leverage from its revenue growth. SG&A expenses have grown roughly in line with revenue, indicating that overhead costs are not being scaled efficiently, which may limit margin expansion potential.

The stability in gross margin suggests that the company has been able to pass on raw material cost increases to customers, or that its aftermarket mix is providing a buffer. SG&A expenses have grown modestly, from $331.7M in 2024Q4 to $400.8M in 2026Q2, which is roughly in line with revenue growth. This indicates disciplined overhead control, but the lack of operating leverage suggests that cost savings from the IRX program may be plateauing.