What is the initial customer feedback on ALTAIR io, and do you expect the MSA+ adoption trend to continue?

The MSA+ platform, including ALTAIR io 4 and io 6, is very well received. Io 6 early performance is good, and order pace has been better than expected. MSA+ now accounts for 14% of total portable sales, up from 10% last year, and this trend is expected to accelerate. “Io 6 early indicator performance is really good, and I expect you're going to see that continue to accelerate. Again, this is the first year, as we noted, I think I mentioned this in the call earlier this year, that's a longer cycle product. So it takes a little bit of time for it to build into orders, but we've seen the order pace has been better than we expected so far, frankly.”

Can you elaborate on the drivers of strength in industrial PPE, specifically distinguishing between short-cycle and ballistic helmet orders, and end markets in the Americas?

International strength is driven by protective ballistic helmets due to increased European defense spending, and also by fall protection. In the Americas, strength comes from underlying industrial activity, infrastructure investments, data centers, and the adoption of the H2 safety helmet. This strength is expected to continue into the second half. “Certainly, the protective ballistics will be part of that story, but we expect the others to do well as well. And then in the Americas, the underlying theme really is strong. It's nice to see the industrial strength.”

Are electronic supply and cost becoming an issue, and is this contributing to the H2 gross margin moderation?

The company is managing electronic supply and cost inputs, which are part of the H2 gross margin story. They are taking additional inventory to ensure continuity of supply. The costs have been accounted for in the forecast. “It is. We are managing through that. We've certainly seen and are managing some of those cost inputs on the electronics side. I'd say the cost is part of the story, which we have certainly accounted for.”

MSA

MSA Safety (MSA) Q2 FY26 earnings call: guidance and Q&A

Earnings call· Jun 2026 (Q2 FY26)· Industrials· Jul 31, 2026

Source: earnings call transcript

Executive summary

MSA Safety Q2 FY26 — Strong Sales Growth and Margin Expansion

MSA Safety delivered robust Q2 FY26 results, showcasing strong sales growth and significant margin expansion driven by strategic pricing and productivity. Despite geopolitical headwinds impacting fixed monitoring and international detection, the company remains confident in its full-year organic growth outlook and continues to execute its Accelerate strategy, including disciplined capital allocation for M&A and shareholder returns. Product innovation and operational efficiencies are key drivers of performance.

Highlights

Achieved 6% reported sales growth in Q2 FY26.
Delivered adjusted earnings per share of $2.40, up 24% from last year.
GAAP gross margin increased 290 basis points year-over-year to 49.5%.
Generated strong free cash flow of $83 million, marking a 118% increase year-over-year.
Returned $47 million to shareholders via buybacks and dividends in the quarter.

Concerns

Fixed monitoring sales saw a low single-digit decline, impacted by the ongoing Middle East conflict.
Fire service organic sales decreased 2% year-over-year due to slower-than-expected AFG grant-related orders.
International segment experienced a double-digit decline in detection sales, primarily due to the Middle East conflict.
Anticipates a moderate tempering in gross margin in the second half, reflecting delayed impact of inflation caused by the Middle East conflict.

Guidance & targets

Category	Target	Timeline	Confidence
Full-year 2026 Total Revenue Growth	low double-digit high materiality	FY26	High
Full-year 2026 Organic Growth	mid-single-digit high materiality	FY26	High
Full-year 2026 Acquisitions Contribution to Growth	mid-single-digit medium materiality	FY26	High
Full-year 2026 Favorable Translational Foreign Exchange	1 to 2 points medium materiality	FY26	High
Full-year Adjusted Gross Margin	47.5% to 48.5% high materiality	FY26	High
Full-year Interest Expense	$40 million to $43 million medium materiality	FY26	High
Share Repurchases Pace	lower rate medium materiality	H2 FY26	High

Segment performance

Segment	Revenue	YoY	QoQ	Margin
Americas Strong execution, strategic pricing, productivity, favorable transactional foreign exchange, and lower tariffs drove margin improvement, partially offset by inflation. Organic growth: 5%Currency translation tailwind: 2%Industrial PPE organic growth: double-digitDetection organic growth: high single-digitAdjusted incremental operating margin (excluding tariff refund): 53%	—	7% reported	—	32% adjusted operating margin
International Margin expansion driven by M&C inclusion, productivity, and favorable transactional foreign exchange, partially offset by inflation. Organic sales were consistent as strong industrial PPE growth offset the detection decline. Organic sales: consistent with prior yearM&C contribution: 3%Foreign exchange tailwind: 2%Industrial PPE growth: strongDetection decline: double-digit (due to Middle East conflict)Fire service sales: consistent with prior yearAdjusted incremental operating margin: 62%	—	5% reported	17% sequentially	15.5% adjusted operating margin

Orderbook & backlog

Book-to-bill ratio approximately one time Q2 FY26

above seasonal patterns

Organic orders strong Q2 FY26

broad-based across segments and product categories

Product announcements

Product	Type	Timeline	Details
ALTAIR io 6 solution	launch	—

Deals & partnerships

Autronica Fire and Security Acquisition of a fire and security company.

The acquisition was completed in early July, financed using a combination of cash on hand and the revolver.

Risks & headwinds

Ongoing conflict in the Middle East Ongoing, H1 FY26 impact

Low single-digit decline in fixed monitoring sales; double-digit decline in International detection sales; cost north of 1.5% of revenue in H1 FY26.

Mitigation:Monitoring and strategically managing challenges; starting to see activity for rebuild and restoration work.

Slower-than-expected AFG grant-related orders H1 FY26

Fire service organic sales decreased 2% YoY.

Mitigation:Order momentum accelerated through June and July; 2026 AFG signals are very positive for a better pace.

Delayed impact of inflation (transportation, resins, metallics) H2 FY26

Expected moderate tempering in gross margin in H2 FY26; H1 gross margin 49%, full year guide 47.5%-48.5%.

Mitigation:Costs accounted for in gross margin guidance; agreements with suppliers and index pricing in place.

Electronic supply and cost issues Ongoing

Not explicitly quantified, but mentioned as a cost input.

Mitigation:Managing cost inputs and taking additional inventory to ensure continuity of supply.

What to watch in Q3 FY26

Fire service AFG order conversion

H2 FY26

Current Slower than anticipated in H1 FY26, but uptick in June/July.

Target Continued acceleration of order pace, better pace for 2026 grants.

Why it matters

Indicates recovery and future growth in the lumpy fire service business, which has been impacted by grant delays.

I would say if you look at June and July, and I talked about this in the prepared remarks, we did see really nice uptick in Acceleration of the order pace, as I said, in June, but also we've seen the same thing in July. So that's a good indicator for us that, that should continue.

Find out whether MSA delivers this. Inve re-checks your case every morning.

Q&A highlights

What is the status of AFG grant-related orders, and when do you expect the fire service market to return to normalcy?

AFG orders from 2025 grants have been slower than anticipated, but order pace accelerated in June and July. The outlook for 2026 grants is positive, with expectations for a better pace. The business is lumpy, but the company is optimistic for the second half, with an inflection point expected in 2027.

“I would say if you look at June and July, and I talked about this in the prepared remarks, we did see really nice uptick in Acceleration of the order pace, as I said, in June, but also we've seen the same thing in July. So that's a good indicator for us that, that should continue.”

asked by Ethan Coyle · answered by Steven Blanco

2 min read 6 chapters

Detailed narrative

Strategic Execution & Portfolio Strength

MSA Safety's Accelerate strategy is driving strong Q2 FY26 performance, reflecting strategic actions to strengthen its portfolio and expand technology capabilities. The recent acquisition of Autronica Fire and Security in early July further positions the company for long-term growth. This execution is evident in the company's ability to differentiate itself in the market and enhance competitive positioning with customers.

Product Innovation & Adoption

The company continues to demonstrate leadership in premium safety markets through product innovation, such as the H2 safety helmet, which protects against vertical and lateral impacts. The MSA+ Connected Solutions platform, including the newly launched ALTAIR io 6, is gaining significant traction, now accounting for 14% of total portable gas detection sales, up from 10% last year, indicating strong customer adoption and future growth potential.

Operational Efficiency & Productivity

The advancement of the MSA business system is improving execution across the enterprise, fostering greater discipline and consistency. This has enabled positive price/cost contributions in the first half, driven by strategic pricing actions and enhanced productivity. The benefits of these continuous improvement efforts are increasingly evident in the strength of operating performance and financial results.

Capital Allocation & Financial Flexibility

MSA Safety maintains a strong balance sheet and a disciplined approach to capital allocation, providing meaningful strategic flexibility. In the first half, the company returned $118 million to shareholders, a 45% increase year-over-year, and increased its dividend for the 56th consecutive year. Post-Autronica acquisition, the pro forma net leverage stands at 1.8x, well within the company's target range.

Geopolitical Headwinds & Mitigation

The ongoing conflict in the Middle East has presented challenges, impacting fixed monitoring sales and leading to a double-digit decline in international detection. This geopolitical environment has also contributed to delayed inflation impacts on costs, which are expected to temper gross margins in the second half. Management is actively monitoring and strategically managing these challenges, with some rebuild and restoration activity beginning.

Fire Service Market Dynamics

AFG grant-related orders for SCBA sales in the fire service segment materialized slower than initially expected in the first half, partly due to the U.S. Department of Homeland Security closure. However, order momentum accelerated significantly through June and July, and the outlook for 2026 grants is positive, suggesting a potential inflection point in the fire service replacement cycle in late 2026 and into 2027.

Summary of the company's earnings call; see how call summaries are prepared. Not investment advice.