Heico Corp 10-Q for FY2026 Q3

Heico Corp (HEI)

10-Q 2026-08-27 For: 2026-07-31

Added on August 28, 2026

About this 10-Q

Heico Corp filed this 10-Q on August 27, 2026, covering the quarter ended July 31, 2026 (FY2026 Q3).

Headline figures

Quarter ended July 31, 2026, as reported in this filing, compared with the same period a year earlier where the filing states it.

Revenue: $1.41B; up 23.1% from $1.15B a year earlier
Net income: $235.44M; up 32.8% from net income of $177.34M a year earlier
Diluted EPS: $1.67; up 32.5% from $1.26 a year earlier

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☒						QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

						For the quarterly period ended July 31, 2026

						OR

☐						TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

						For the transition period from ______ to _______


Florida						65-0341002
(State or other jurisdiction of incorporation or organization)						(I.R.S. Employer Identification No.)

3000 Taft Street, Hollywood, Florida						33021
(Address of principal executive offices)						(Zip Code)


Common Stock, $.01 par value	55,241,647	shares
Class A Common Stock, $.01 par value	84,515,758	shares


			Page
Part I.	Financial Information

	Item 1.	Financial Statements:

		Condensed Consolidated Balance Sheets (unaudited) as of July 31 , 2026 and October 31, 2025	2

		Condensed Consolidated Statements of Operations (unaudited) for the nine and three months ended July 31 , 2026 and 2025	3

		Condensed Consolidated Statements of Comprehensive Income (unaudited) for the nine and three months ended July 31 , 2026 and 2025	4

		Condensed Consolidated Statements of Shareholders’ Equity (unaudited) for the nine and three months ended July 31 , 2026 and 2025	5

		Condensed Consolidated Statements of Cash Flows (unaudited) for the nine months ended July 31 , 2026 and 2025	7

		Notes to Condensed Consolidated Financial Statements (unaudited)	8

	Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	31

	Item 3.	Quantitative and Qualitative Disclosures About Market Risk	42

	Item 4.	Controls and Procedures	42

Part II.	Other Information



	Item 5.	Other Information	43

	Item 6.	Exhibits	44

Signatures			45


	July 31, 2026	October 31, 2025
ASSETS
Current assets:
Cash and cash equivalents	$240,959	$217,781
Accounts receivable, net	736,335	637,615
Contract assets	134,443	119,257
Inventories, net	1,447,885	1,295,336
Prepaid expenses and other current assets	165,869	86,377
Total current assets	2,725,491	2,356,366

Property, plant and equipment, net	478,326	431,710
Goodwill	4,356,143	3,661,624
Intangible assets, net	1,776,942	1,471,440
Other assets	599,709	579,294
Total assets	$9,936,611	$8,500,434

LIABILITIES AND EQUITY
Current liabilities:
Current maturities of long-term debt	$3,513	$3,358
Trade accounts payable	297,102	231,040
Accrued expenses and other current liabilities	676,264	577,624
Income taxes payable	26,200	19,982
Total current liabilities	1,003,079	832,004

Long-term debt, net of current maturities	2,537,660	2,164,587
Deferred income taxes	181,511	107,186
Other long-term liabilities	571,536	550,124
Total liabilities	4,293,786	3,653,901

Commitments and contingencies (Note 12)

Redeemable noncontrolling interests (Note 3)	617,893	467,358

Shareholders’ equity:
Preferred Stock, $.01 par value per share; 10,000 shares authorized; none issued	—	—
Common Stock, $.01 par value per share; 150,000 shares authorized; 55,242 and 55,143 shares issued and outstanding	552	551
Class A Common Stock, $.01 par value per share; 150,000 shares authorized; 84,511 and 84,198 shares issued and outstanding	845	842
Capital in excess of par value	728,827	650,667
Deferred compensation obligation	8,096	8,096
HEICO stock held by irrevocable trust	(8,096)	(8,096)
Accumulated other comprehensive (loss) income	(4,580)	5,581
Retained earnings	4,222,045	3,647,678
Total HEICO shareholders’ equity	4,947,689	4,305,319
Noncontrolling interests	77,243	73,856
Total shareholders’ equity	5,024,932	4,379,175
Total liabilities and equity	$9,936,611	$8,500,434


	Nine months ended July 31,		Three months ended July 31,
	2026	2025	2026	2025

Net sales	$3,967,345	$3,275,633	$1,413,050	$1,147,591

Operating costs and expenses:
Cost of sales	2,361,869	1,975,010	832,063	690,434
Selling, general and administrative expenses	639,943	560,647	225,790	192,138

Total operating costs and expenses	3,001,812	2,535,657	1,057,853	882,572

Operating income	965,533	739,976	355,197	265,019

Interest expense	(99,551)	(97,024)	(35,904)	(31,701)
Other income	3,583	3,217	1,285	1,662

Income before income taxes and noncontrolling interests	869,565	646,169	320,578	234,980

Income tax expense	160,000	103,400	66,100	44,300

Net income from consolidated operations	709,565	542,769	254,478	190,680

Less: Net income attributable to noncontrolling interests	50,137	40,680	19,039	13,339

Net income attributable to HEICO	$659,428	$502,089	$235,439	$177,341

Net income per share attributable to HEICO shareholders:
Basic	$4.73	$3.61	$1.69	$1.27
Diluted	$4.67	$3.57	$1.67	$1.26

Weighted average number of common shares outstanding:
Basic	139,544	138,993	139,702	139,135
Diluted	141,122	140,678	141,269	140,950


		HEICO Shareholders' Equity
	Redeemable Noncontrolling Interests	Common Stock	Class A Common Stock	Capital in Excess of Par Value	Deferred Compensation Obligation	HEICO Stock Held by Irrevocable Trust	Accumulated Other Comprehensive (Loss) Income	Retained Earnings	Noncontrolling Interests	Total Shareholders' Equity
Balances as of October 31, 2025	$467,358	$551	$842	$650,667	$8,096	($8,096)	$5,581	$3,647,678	$73,856	$4,379,175
Comprehensive income (loss)	34,456	—	—	—	—	—	(10,161)	659,428	14,287	663,554
Cash dividends ($.25 per share)	—	—	—	—	—	—	—	(34,889)	—	(34,889)
Issuance of common stock for acquisitions	—	—	2	42,268	—	—	—	—	—	42,270
Share-based compensation expense	—	—	—	34,439	—	—	—	—	—	34,439
Issuance of common stock to HEICO Savings and Investment Plan	—	1	—	19,350	—	—	—	—	—	19,351
Proceeds from stock option exercises	—	—	1	5,293	—	—	—	—	—	5,294
Redemptions of common stock related to stock option exercises	—	—	—	(4,924)	—	—	—	—	—	(4,924)
Noncontrolling interests assumed related to acquisitions	103,410	—	—	—	—	—	—	—	—	—
Distributions to noncontrolling interests	(25,341)	—	—	—	—	—	—	—	(479)	(479)
Acquisitions of noncontrolling interests	(12,744)	—	—	(18,170)	—	—	—	—	(10,661)	(28,831)
Adjustments to redemption amount of redeemable noncontrolling interests	50,072	—	—	—	—	—	—	(50,072)	—	(50,072)
Other	682	—	—	(96)	—	—	—	(100)	240	44
Balances as of July 31, 2026	$617,893	$552	$845	$728,827	$8,096	($8,096)	($4,580)	$4,222,045	$77,243	$5,024,932



Cash paid			$1,031,258
Less: cash acquired			(10,322)
Cash paid, net			1,020,936
Issuance of common stock for acquisitions			42,270
Contingent consideration			2,695
Amounts due from sellers, net			(14,263)
Total consideration			$1,051,638



Assets acquired:
Goodwill			$705,253
Customer relationships			233,260
Intellectual property			155,832
Inventories			78,532
Accounts receivable			40,837
Trade names			38,728
Property, plant and equipment			33,653
Other assets			19,721
Total assets acquired, excluding cash			1,305,816

Liabilities assumed:
Deferred income taxes			77,732
Accrued expenses			26,918
Accounts payable			17,254
Other liabilities			28,864
Total liabilities assumed			150,768

Noncontrolling interests in consolidated subsidiaries			103,410

Net assets acquired, excluding cash			$1,051,638


	As of	As of
(in thousands)	July 31, 2026	October 31, 2025
Accounts receivable	$748,601	$647,864
Less: Allowance for doubtful accounts	(12,266)	(10,249)
Accounts receivable, net	$736,335	$637,615


	Foreign Currency Translation	Defined Benefit Pension Plan	Accumulated Other Comprehensive (Loss) Income
Balances as of October 31, 2025	$6,187	($606)	$5,581
Unrealized loss	(10,161)	(15)	(10,176)
Amortization of unrealized loss	—	15	15
Balances as of July 31, 2026	($3,974)	($606)	($4,580)


	Segment		Consolidated Totals
	FSG	ETG
Balances as of October 31, 2025	$1,997,178	$1,664,446	$3,661,624
Goodwill acquired	393,225	312,028	705,253
Adjustments to goodwill	200	(6,546)	(6,346)
Foreign currency translation adjustments	(315)	(4,073)	(4,388)
Balances as of July 31, 2026	$2,390,288	$1,965,855	$4,356,143


	As of July 31, 2026			As of October 31, 2025
	Gross Carrying Amount	Accumulated Amortization	Net Carrying Amount	Gross Carrying Amount	Accumulated Amortization	Net Carrying Amount
Amortizing Assets:
Customer relationships	$1,356,362	($450,710)	$905,652	$1,131,443	($373,100)	$758,343
Intellectual property	695,564	(188,422)	507,142	540,836	(153,783)	387,053
Other	5,265	(4,858)	407	8,651	(8,127)	524
	2,057,191	(643,990)	1,413,201	1,680,930	(535,010)	1,145,920
Non-Amortizing Assets:
Trade names	363,741	—	363,741	325,520	—	325,520
	$2,420,932	($643,990)	$1,776,942	$2,006,450	($535,010)	$1,471,440


	As of July 31, 2026		As of October 31, 2025
	Carrying Value	Fair Value	Carrying Value	Fair Value
2028 Notes	$597,355	$606,329	$596,437	$617,904
2031 Notes	545,143	548,303	—	—
2033 Notes	594,124	600,131	593,618	624,320
2036 Notes	643,713	643,230	—	—
Totals	$2,380,335	$2,397,993	$1,190,055	$1,242,224


	As of July 31, 2026
	Quoted Prices in Active Markets for Identical Assets (Level 1)	Significant Other Observable Inputs (Level 2)	Significant Unobservable Inputs (Level 3)	Total
Assets:
Deferred compensation plan:
Corporate-owned life insurance	$—	$406,887	$—	$406,887
Money market fund	2,278	—	—	2,278
Total assets	$2,278	$406,887	$—	$409,165

Liabilities:
Contingent consideration	$—	$—	$69,097	$69,097


	Nine months ended July 31,
	2026	2025
Operating Activities:
Net income from consolidated operations	$709,565	$542,769
Adjustments to reconcile net income from consolidated operations to net cash provided by operating activities:
Depreciation and amortization	166,385	144,869
Share-based compensation expense	34,439	18,346
Employer contributions to HEICO Savings and Investment Plan	17,892	14,186
Increase in accrued contingent consideration, net	7,973	8,974
Deferred income tax provision (benefit)	2,755	(28,789)
Payment of contingent consideration	—	(2,190)
Changes in operating assets and liabilities, net of acquisitions:
Increase in accounts receivable	(58,724)	(36,063)
Increase in contract assets	(8,337)	(20,305)
Increase in inventories	(78,368)	(60,157)
(Increase) decrease in prepaid expenses and other current assets	(33,505)	14,874
Increase in trade accounts payable	47,275	28,919
(Decrease) increase in accrued expenses and other current liabilities	(13,781)	11,903
Decrease in income taxes payable	(8,961)	(27,675)
Net changes in other long-term liabilities and assets related to HEICO Leadership Compensation Plan	16,244	23,042
Other	15,054	6,237
Net cash provided by operating activities	815,906	638,940

Investing Activities:
Acquisitions, net of cash acquired	(1,018,164)	(629,928)
Capital expenditures	(54,104)	(46,038)
Investments related to HEICO Leadership Compensation Plan	(19,397)	(21,689)
Proceeds from corporate-owned life insurance policy withdrawals	22,654	—
Other	(3,858)	(39)
Net cash used in investing activities	(1,072,869)	(697,694)

Financing Activities:
Proceeds from issuance of senior unsecured notes	1,191,506	—
Payments on revolving credit facility	(1,845,700)	(275,000)
Borrowings on revolving credit facility	1,030,700	495,000
Cash dividends paid	(34,889)	(31,968)
Acquisitions of noncontrolling interests	(29,345)	(5,773)
Distributions to noncontrolling interests	(25,820)	(27,248)
Redemptions of common stock related to stock option exercises	(4,924)	(1,979)


	As of	As of
(in thousands)	July 31, 2026	October 31, 2025
Finished products	$778,706	$715,286
Work in process	142,801	119,611
Materials, parts, assemblies and supplies	526,378	460,439
Inventories, net of valuation reserves	$1,447,885	$1,295,336


	As of	As of
(in thousands)	July 31, 2026	October 31, 2025
Land	$97,294	$85,134
Buildings and improvements	269,408	255,776
Machinery, equipment and tooling	529,486	476,735
Construction in progress	31,454	21,812
	927,642	839,457
Less: Accumulated depreciation and amortization	(449,316)	(407,747)
Property, plant and equipment, net	$478,326	$431,710


	As of	As of
	July 31, 2026	October 31, 2025
Borrowings under revolving credit facility	$145,000	$960,000
2028 senior unsecured notes	600,000	600,000
2031 senior unsecured notes	550,000	—
2033 senior unsecured notes	600,000	600,000
2036 senior unsecured notes	650,000	—
Finance leases and notes payable	15,838	17,890
Less: Debt discount and debt issuance costs	(19,665)	(9,945)
Total debt	2,541,173	2,167,945
Less: Current maturities of long-term debt	(3,513)	(3,358)
Long-term debt, net of current maturities	$2,537,660	$2,164,587


Acquisition	Fair Value	Unobservable		Weighted
Date	(in thousands)	Input	Range	Average (1)
6-30-2026	$12,231	Compound annual revenue growth rate	12% - 43%	35%
		Discount rate	9.1% - 9.2%	9.1%

4-8-2026	2,736	Compound annual revenue growth rate	0% - 10%	7%
		Discount rate	8.2% - 8.2%	8.2%

1-31-2025	15,856	Compound annual revenue growth rate	(1%) - 19%	11%
		Discount rate	6.7% - 6.7%	6.7%

7-18-2022	24,683	Compound annual revenue growth rate	6% - 9%	7%
		Discount rate	6.8% - 6.8%	6.8%

3-17-2022	13,591	Compound annual revenue growth rate	10% - 11%	11%
		Discount rate	5.1% - 5.1%	5.1%


						Liabilities
Balance as of October 31, 2025						$46,198
Contingent consideration related to the acquisition of noncontrolling interests						12,183
Increase in accrued contingent consideration						8,021
Contingent consideration related to an acquisition						2,695
Balance as of July 31, 2026						$69,097

Included in the accompanying Condensed Consolidated Balance Sheet under the following captions:
Accrued expenses and other current liabilities						$40,102
Other long-term liabilities						28,995
						$69,097


	Segment		Corporate (1)	Intersegment (2)	Consolidated Totals
	FSG	ETG
Nine months ended July 31, 2026:
Net sales to external customers	$2,694,619	$1,272,726	$—	$—
Intersegment net sales	2,611	40,968	—	(43,579)
Net sales	2,697,230	1,313,694	—	(43,579)	$3,967,345
Cost of sales	1,649,643	754,713	—	(42,487)
Other segment items (3)	358,491	238,361	—	—
Operating income	689,096	320,620	(43,091)	(1,092)	965,533
Capital expenditures	20,395	32,952	757	—	54,104
Depreciation (4)	21,770	21,599	1,328	—	44,697
Amortization (4)	68,453	53,235	—	—	121,688

Nine months ended July 31, 2025:
Net sales to external customers	$2,281,624	$994,009	$—	$—
Intersegment net sales	1,281	34,336	—	(35,617)
Net sales	2,282,905	1,028,345	—	(35,617)	$3,275,633
Cost of sales	1,413,297	594,675	—	(32,962)
Other segment items (3)	320,186	198,336	—	—
Operating income	549,422	235,334	(42,125)	(2,655)	739,976
Capital expenditures	26,238	19,731	69	—	46,038
Depreciation (4)	20,283	18,586	1,496	—	40,365
Amortization (4)	62,579	40,748	1,177	—	104,504


			Other, Primarily Corporate	Consolidated Totals
	Segment
	FSG	ETG
Total assets as of July 31, 2026	$5,452,443	$3,987,629	$496,539	$9,936,611
Total assets as of October 31, 2025	4,571,887	3,437,221	491,326	8,500,434


Exhibit						Description

4.1						Indenture, dated July 16, 2026, between HEICO Corporation and Truist Bank, as trustee, is incorporated by reference to Exhibit 4.1 to the Form 8-K filed on July 16, 2026. ***

4.2						First Supplemental Indenture, dated July 16, 2026, between HEICO Corporation and Truist Bank, as trustee, is incorporated by reference to Exhibit 4.2 to the Form 8-K filed on July 16, 2026. ***

4.3						Form of 4.950% Notes due 2031 (form included as Exhibit A to the First Supplemental Indenture is incorporated by reference as Exhibit 4.2 to the Form 8-K filed on July 16, 2026 ). ***

4.4						Form of 5.400% Notes due 2036 (form included as Exhibit B to the First Supplemental Indenture is incorporated by reference as Exhibit 4.2 to the Form 8-K filed on July 16, 2026 ). ***

10.1						Fourth Amendment to Revolving Credit Agreement, effective as of June 11, 2026, among HEICO Corporation, as Borrower, the Lenders from time to time party thereto and Truist Bank (as successor by merger to SunTrust Bank), as Administrative Agent, is incorporated by reference to Exhibit 10.1 to the Form 8-K filed on June 17, 2026. ***

31.1						Rule 13a-14(a)/15d-14(a) Certification of Co-Chief Executive Officer. *

31.2						Rule 13a-14(a)/15d-14(a) Certification of Co-Chief Executive Officer. *

31.3						Rule 13a-14(a)/15d-14(a) Certification of Chief Financial Officer. *

32.1						Section 1350 Certification of Co-Chief Executive Officer. **

32.2						Section 1350 Certification of Co-Chief Executive Officer. **

32.3						Section 1350 Certification of Chief Financial Officer. **

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101.SCH						Inline XBRL Taxonomy Extension Schema Document. *

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104						Cover Page Interactive Data File (formatted as inline XBRL and contained in Exhibit 101). *


		HEICO CORPORATION

Date:	August 27, 2026	By:	/s/ CARLOS L. MACAU, JR.
			Carlos L. Macau, Jr. Executive Vice President - Chief Financial Officer and Treasurer (Principal Financial Officer)

		By:	/s/ BRADLEY K. ROWEN
			Bradley K. Rowen Chief Accounting Officer and Assistant Treasurer (Principal Accounting Officer)


Date:	August 27, 2026	/s/ ERIC A. MENDELSON
		Eric A. Mendelson
		Co-Chief Executive Officer
		(Co-Principal Executive Officer)


Date:	August 27, 2026	/s/ VICTOR H. MENDELSON
		Victor H. Mendelson
		Co-Chief Executive Officer
		(Co-Principal Executive Officer)