Lincoln Electric Holdings Inc 10-Q for FY2026 Q2

Lincoln Electric Holdings Inc (LECO)

10-Q 2026-07-30 For: 2026-06-30

Added on July 30, 2026

About this 10-Q

Lincoln Electric Holdings Inc filed this 10-Q on July 30, 2026, covering the quarter ended June 30, 2026 (FY2026 Q2).

Headline figures

Quarter ended June 30, 2026, as reported in this filing, compared with the same period a year earlier where the filing states it.

Revenue: $1.22B; up 12.0% from $1.09B a year earlier
Net income: $158.52M; up 10.5% from net income of $143.4M a year earlier
Diluted EPS: $2.88; up 12.5% from $2.56 a year earlier

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Ohio		34-1860551
(State or other jurisdiction of incorporation or organization)		(I.R.S. Employer Identification No.)

22801 St. Clair Avenue, Cleveland, Ohio		44117
(Address of principal executive offices)		(Zip Code)


Title of each class	Trading Symbol	Name of exchange on which registered
Common Shares, without par value	LECO	The NASDAQ Stock Market LLC


Large accelerated filer	☒	Accelerated filer	☐
Non-accelerated filer	☐	Smaller reporting company	☐
		Emerging growth company	☐

PART I. FINANCIAL INFORMATION		3
Item 1. Financial Statements		3
CONSOLIDATED STATEMENTS OF INCOME (UNAUDITED)		3
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (UNAUDITED)		4
CONDENSED CONSOLIDATED BALANCE SHEETS (UNAUDITED)		5
CONSOLIDATED STATEMENTS OF EQUITY (UNAUDITED)		6
CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)		8
NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS		9
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations		24
Item 3. Quantitative and Qualitative Disclosures About Market Risk		35
Item 4. Controls and Procedures		35

PART II. OTHER INFORMATION		35
Item 1. Legal Proceedings		35
Item 1A. Risk Factors		35
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds		36
Item 4. Mine Safety Disclosures		36
Item 5. Other Information		36
Item 6. Exhibits		37
Signatures		38


	Three Months Ended				Six Months Ended
	June 30,				June 30,
	2026		2025		2026		2025
Net sales (Note 2)	$	1,219,663	$	1,088,673	$	2,341,097	$	2,093,061
Cost of goods sold		770,667		683,126		1,492,969		1,322,066
Gross profit		448,996		405,547		848,128		770,995
Selling, general & administrative expenses		224,871		210,861		435,682		407,526
Rationalization and asset impairment net charges (Note 6)		3,481		2,542		5,644		6,407
Operating income		220,644		192,144		406,802		357,062
Interest expense, net		12,521		12,619		25,895		24,746
Other (expense) income		(241)		4,034		329		4,478
Income before income taxes		207,882		183,559		381,236		336,794
Income taxes (Note 11)		49,363		40,163		86,335		74,911
Net income	$	158,519	$	143,396	$	294,901	$	261,883

Basic earnings per share (Note 3)	$	2.90	$	2.58	$	5.39	$	4.69
Diluted earnings per share (Note 3)	$	2.88	$	2.56	$	5.34	$	4.66
Cash dividends declared per share	$	0.79	$	0.75	$	1.58	$	1.50


	Three Months Ended June 30,				Six Months Ended June 30,
	2026		2025		2026		2025
Net income	$	158,519	$	143,396	$	294,901	$	261,883
Other comprehensive (loss) income, net of tax:
Unrealized (loss) gain on derivatives designated and qualifying as cash flow hedges		(176)		173		(1,499)		1,002
Defined benefit pension plan activity		13		(37)		(43)		(1,322)
Currency translation adjustment		436		60,119		(6,023)		89,798
Other comprehensive income (loss):		273		60,255		(7,565)		89,478
Comprehensive income	$	158,792	$	203,651	$	287,336	$	351,361


	June 30, 2026		December 31, 2025
	(UNAUDITED)		(NOTE 1)
ASSETS
Current Assets
Cash and cash equivalents	$	242,443	$	308,789
Accounts receivable (less allowance for doubtful accounts of $10,510 in 2026; $11,326 in 2025)		586,348		538,791
Inventories (Note 8)		690,543		633,364
Other current assets		241,216		258,568
Total Current Assets		1,760,550		1,739,512
Property, plant and equipment (less accumulated depreciation of $965,937 in 2026; $942,806 in 2025)		731,762		702,762
Goodwill		885,232		886,686
Other assets		435,766		448,617
TOTAL ASSETS	$	3,813,310	$	3,777,577
LIABILITIES AND EQUITY
Current Liabilities
Short-term debt (Note 10)	$	—	$	143,780
Trade accounts payable		447,437		364,934
Accrued employee compensation and benefits		156,479		116,158
Other current liabilities		284,167		331,819
Total Current Liabilities		888,083		956,691
Long-term debt, less current portion (Note 10)		1,150,054		1,150,228
Other liabilities		220,993		200,864
Total Liabilities		2,259,130		2,307,783
Shareholders' Equity
Common shares, without par value - at stated capital amount; authorized 240,000,000 shares; issued 98,581,434 shares in 2026 and 2025; outstanding 54,505,757 shares in 2026 and 54,845,950 in 2025		9,858		9,858
Additional paid-in capital		617,879		601,566
Retained earnings		4,548,978		4,342,080
Accumulated other comprehensive loss		(213,496)		(205,931)
Treasury shares, at cost - 44,075,677 shares in 2026 and 43,735,484 shares in 2025		(3,409,039)		(3,277,779)
Total Equity		1,554,180		1,469,794
TOTAL LIABILITIES AND TOTAL EQUITY	$	3,813,310	$	3,777,577


													Accumulated
		Common					Additional						Other
		Shares		Common			Paid-In			Retained			Comprehensive			Treasury
		Outstanding		Shares			Capital			Earnings			Income (Loss)			Shares			Total
Balance at December 31, 2025		54,846		$	9,858		$	601,566		$	4,342,080		$	(205,931)		$	(3,277,779)		$	1,469,794
Net income											136,382									136,382
Defined benefit pension plan activity, net of tax														(56)						(56)
Unrealized loss on derivatives designated and qualifying as cash flow hedges, net of tax														(1,323)						(1,323)
Currency translation adjustment, net of tax														(6,459)						(6,459)
Cash dividends declared – $0.79 per share											(43,408)									(43,408)
Stock-based compensation activity		151						16,670									1,469			18,139
Purchase of shares for treasury		(210)															(56,670)			(56,670)
Other								(5,845)			706									(5,139)
Balance at March 31, 2026		54,787		$	9,858		$	612,391		$	4,435,760		$	(213,769)		$	(3,332,980)		$	1,511,260
Net income											158,519									158,519
Defined benefit pension plan activity, net of tax														13						13
Unrealized loss on derivatives designated and qualifying as cash flow hedges, net of tax														(176)						(176)
Currency translation adjustment, net of tax														436						436
Cash dividends declared – $0.79 per share											(43,591)									(43,591)
Stock-based compensation activity		6						4,812									62			4,874
Purchase of shares for treasury		(287)															(76,121)			(76,121)
Other								676			(1,710)									(1,034)
Balance at June 30, 2026		54,506		$	9,858		$	617,879		$	4,548,978		$	(213,496)		$	(3,409,039)		$	1,554,180

Standard	Description
ASU No. 2025-09, Derivatives and Hedging, issued November 2025	Updates hedge accounting guidance to better align financial reporting with risk management activities. The amendments are effective for annual periods beginning after December 15, 2026 and interim periods within those annual reporting periods. Early adoption is permitted.
ASU No. 2025-06, Goodwill and Other – Internal-Use Software, issued September 2025	Updates requirements for capitalization of internal-use software costs. The amendments are effective for annual periods beginning after December 15, 2027 and interim periods within those annual reporting periods. Early adoption is permitted.
ASU No. 2024-03, Income Statement-Reporting Comprehensive Income-Expense Disaggregation Disclosures, issued November 2024	Requires enhanced disclosures of specified information about certain costs and expenses. The amendments are effective for annual periods beginning January 1, 2027, and interim periods beginning January 1, 2028. Early adoption is prohibited.


								The Harris
		Americas			International			Products
		Welding			Welding			Group			Total
Three Months Ended June 30, 2026
Net sales		$	774,438		$	243,292		$	201,933		$	1,219,663
Inter-segment sales			28,904			7,564			4,972			41,440
			803,342			250,856			206,905			1,261,103
Reconciliation to Consolidated Net sales
Elimination of inter-segment sales												(41,440)
Net sales											$	1,219,663
Cost of goods sold			486,477			175,789			148,938
Other segment expenses^{(1) (3)}			159,782			50,754			15,901
Addback: Special items charge ⁽¹⁾			(1,012)			(2,282)			(187)
Segment Adjusted EBIT		$	158,095		$	26,595		$	42,253		$	226,943

Other Segment Information
Capital expenditures		$	(21,958)		$	(6,370)		$	(3,109)		$	(31,437)
Depreciation and amortization			17,868			6,671			2,590			27,129

Three Months Ended June 30, 2025
Net sales		$	696,730		$	232,824		$	159,119		$	1,088,673
Inter-segment sales			43,391			7,641			5,110			56,142
			740,121			240,465			164,229			1,144,815
Reconciliation to Consolidated Net sales
Elimination of inter-segment sales												(56,142)
Net sales											$	1,088,673
Cost of goods sold			449,197			170,287			117,975
Other segment expenses^{(2) (3)}			153,914			41,179			14,456
Addback: Special items charge ⁽²⁾			(905)			(1,551)			(86)
Segment Adjusted EBIT		$	137,915		$	30,550		$	31,884		$	200,349

Other Segment Information
Capital expenditures		$	(19,972)		$	(4,609)		$	(862)		$	(25,443)
Depreciation and amortization			17,139			5,485			2,598			25,222


	Three Months Ended June 30, 2026
	Unrealized gain
	(loss) on derivatives
	designated and		Defined benefit		Currency
	qualifying as cash		pension plan		translation
	flow hedges		activity		adjustment		Total
Balance at March 31, 2026	$	16,364	$	(1,118)	$	(229,015)	$	(213,769)
Other comprehensive income before reclassification		1,309		—		436		1,745
Amounts reclassified from AOCI		(1,485)		13		—		(1,472)
Net current-period other comprehensive (loss) income		(176)		13		436		273
Balance at June 30, 2026	$	16,188	$	(1,105)	$	(228,579)	$	(213,496)


	Three Months Ended June 30, 2025
	Unrealized gain
	(loss) on derivatives
	designated and		Defined benefit		Currency
	qualifying as cash		pension plan		translation
	flow hedges		activity		adjustment		Total
Balance at March 31, 2025	$	18,084	$	(2,333)	$	(286,663)	$	(270,912)
Other comprehensive income before reclassification		957		—		60,119		61,076
Amounts reclassified from AOCI		(784)		(37)		—		(821)
Net current-period other comprehensive income (loss)		173		(37)		60,119		60,255
Balance at June 30, 2025	$	18,257	$	(2,370)	$	(226,544)	$	(210,657)


	Six Months Ended June 30, 2026
	Unrealized gain
	(loss) on derivatives
	designated and		Defined benefit		Currency
	qualifying as cash		pension plan		translation
	flow hedges		activity		adjustment		Total
Balance at December 31, 2025	$	17,687	$	(1,062)	$	(222,556)	$	(205,931)
Other comprehensive income (loss) before reclassification		2,388		—		(6,023)		(3,635)
Amounts reclassified from AOCI		(3,887)		(43)		—		(3,930)
Net current-period other comprehensive loss		(1,499)		(43)		(6,023)		(7,565)
Balance at June 30, 2026	$	16,188	$	(1,105)	$	(228,579)	$	(213,496)


	Six Months Ended June 30, 2025
	Unrealized gain
	(loss) on derivatives
	designated and		Defined benefit		Currency
	qualifying as cash		pension plan		translation
	flow hedges		activity		adjustment		Total
Balance at December 31, 2024	$	17,255	$	(1,048)	$	(316,342)	$	(300,135)
Other comprehensive income before reclassification		2,105		—		89,798		91,903
Amounts reclassified from AOCI		(1,103)		(1,322)		—		(2,425)
Net current-period other comprehensive income (loss)		1,002		(1,322)		89,798		89,478
Balance at June 30, 2025	$	18,257	$	(2,370)	$	(226,544)	$	(210,657)


Operating Leases		Balance Sheet Classification		June 30, 2026			December 31, 2025
Right-of-use assets		Other assets		$	51,719		$	52,989

Current liabilities		Other current liabilities		$	14,212		$	13,460
Noncurrent liabilities		Other liabilities			37,852			40,061
Total lease liabilities				$	52,064		$	53,521


	Six Months Ended June 30,
	2026		2025
CASH FLOWS FROM OPERATING ACTIVITIES
Net income	$	294,901	$	261,883
Adjustments to reconcile Net income to Net cash provided by operating activities:
Depreciation and amortization		51,978		48,246
Deferred income taxes		18,492		(26,342)
Stock-based compensation		14,455		12,277
Other, net		(1,736)		(179)
Changes in operating assets and liabilities, net of effects from acquisitions:
Increase in accounts receivable		(48,609)		(52,208)
Increase in inventories		(60,153)		(47,648)
Decrease (increase) in other current assets		18,149		(3,408)
Increase in trade accounts payable		83,216		68,092
(Decrease) increase in other current liabilities		(11,288)		68,579
Net change in other assets and liabilities		(3,471)		229
NET CASH PROVIDED BY OPERATING ACTIVITIES		355,934		329,521
CASH FLOWS FROM INVESTING ACTIVITIES
Capital expenditures		(70,600)		(52,392)
Acquisition of businesses, net of cash acquired		140		(32,309)
Proceeds from sale of property, plant and equipment		1,256		5,231
NET CASH USED BY INVESTING ACTIVITIES		(69,204)		(79,470)
CASH FLOWS FROM FINANCING ACTIVITIES
Payments on short-term borrowings, net		(143,889)		(5,206)
Payments on long-term borrowings		—		(169)
Proceeds from exercise of stock options		8,559		6,394
Purchase of shares for treasury		(132,792)		(233,824)
Cash dividends paid to shareholders		(87,466)		(84,904)
NET CASH USED BY FINANCING ACTIVITIES		(355,588)		(317,709)
Effect of exchange rate changes on Cash and cash equivalents		2,512		(10,123)
DECREASE IN CASH AND CASH EQUIVALENTS		(66,346)		(77,781)

Cash and cash equivalents at beginning of period		308,789		377,262
CASH AND CASH EQUIVALENTS AT END OF PERIOD	$	242,443	$	299,481


	Three Months Ended June 30,				Six Months Ended June 30,
		2026		2025		2026		2025
Reconciliation of Segment Adjusted EBIT to Consolidated Income before income taxes
Segment Adjusted EBIT	$	226,943	$	200,349	$	417,882	$	371,888
Addback: Segment special items charge		(3,481)		(2,542)		(5,644)		(6,267)
Corporate special items charge ⁽¹⁾		(15)		(429)		(668)		(1,231)
Elimination of inter-segment profit		(903)		(1,809)		(811)		(2,822)
Unallocated corporate expenses, net		(2,141)		609		(3,628)		(28)
Interest income		1,802		1,662		3,187		3,917
Interest expense		(14,323)		(14,281)		(29,082)		(28,663)
Consolidated Income before income taxes	$	207,882	$	183,559	$	381,236	$	336,794

Reconciliation of Other Segment Information to Consolidated Information
Capital expenditures
Segment totals	$	(31,437)	$	(25,443)	$	(70,600)	$	(52,392)
Adjustments		—		—		—		—
Consolidated totals	$	(31,437)	$	(25,443)	$	(70,600)	$	(52,392)

Depreciation and amortization
Segment totals	$	27,129	$	25,222	$	54,234	$	49,377
Adjustments		(1,160)		(760)		(2,256)		(1,131)
Consolidated totals	$	25,969	$	24,462	$	51,978	$	48,246

⁽¹⁾Corporate special items primarily include transaction costs.
					June 30, 2026		December 31, 2025
Reconciliation of Segment Assets to Consolidated Assets
Americas Welding					$	2,536,957	$	2,464,376
International Welding						1,165,674		1,244,117
The Harris Products Group						475,648		431,259
Total Segment Assets						4,178,279		4,139,752
Corporate Assets						41,871		41,033
LIFO reserve not allocated to segments						(143,613)		(138,589)
Eliminations						(263,227)		(264,619)
Total Consolidated Assets					$	3,813,310	$	3,777,577


		Six Months Ended June 30,
		2026		2025
Americas Welding		$	1,585	$	3,040
International Welding			4,054		3,103
The Harris Products Group			5		264
Total		$	5,644	$	6,407


		Americas		International			The Harris Products
		Welding		Welding			Group			Consolidated
Balance at December 31, 2025		$	944	$	5,713		$	428		$	7,085
Payments and other adjustments			(1,842)		(6,932)			(422)			(9,196)
Charged to expense			1,585		4,054			5			5,644
Balance at June 30, 2026		$	687	$	2,835		$	11		$	3,533


		June 30, 2026
2026		$	9,544
2027			14,273
2028			12,229
2029			8,134
2030			4,063
After 2030			10,697
Total lease payments		$	58,940
Less: Imputed interest			6,876
Operating lease liabilities		$	52,064



Total gain (loss) recognized in AOCI, net of tax		June 30, 2026			December 31, 2025
Foreign exchange contracts		$	993		$	1,396
Forward starting swap agreements			15,195			16,291
Net investment contracts			(1,079)			(5,721)


		Gain (loss) recognized in the		Three Months Ended June 30,						Six Months Ended June 30,
Derivative type		Consolidated Statements of Income:		2026			2025			2026			2025
Foreign exchange contracts		Sales		$	1,041		$	378		$	2,513		$	(335)
		Cost of goods sold			132			182			1,691			543
Forward starting swap agreements		Interest expense, net			689			689			1,378			1,378


					Quoted Prices in
					Active Markets for
					Identical Assets or			Significant Other			Significant
		Balance as of			Liabilities			Observable Inputs			Unobservable
Description		June 30, 2026			(Level 1)			(Level 2)			Inputs (Level 3)
Assets:
Foreign exchange contracts		$	2,820		$	—		$	2,820		$	—
Net investment contracts			7,254			—			7,254			—
Pension surplus			5,966			5,966			—			—
Total assets		$	16,040		$	5,966		$	10,074		$	—
Liabilities:
Foreign exchange contracts		$	1,510		$	—		$	1,510		$	—
Net investment contracts			528			—			528			—
Deferred compensation			28,052			—			28,052			—
Total liabilities		$	30,090		$	—		$	30,090		$	—


	Three Months Ended June 30,
											Favorable (Unfavorable)
	2026					2025					2026 vs. 2025
	Amount			% of Sales		Amount			% of Sales		$			%
Net sales	$	1,219,663				$	1,088,673				$	130,990		12.0	%
Cost of goods sold		770,667					683,126					(87,541)		(12.8)	%
Gross profit		448,996		36.8	%		405,547		37.3	%		43,449		10.7	%
Selling, general & administrative expenses		224,871		18.4	%		210,861		19.4	%		(14,010)		(6.6)	%
Rationalization and asset impairment net charges		3,481		0.3	%		2,542		0.2	%		(939)		(36.9)	%
Operating income		220,644		18.1	%		192,144		17.6	%		28,500		14.8	%
Interest expense, net		12,521					12,619					98		0.8	%
Other (expense) income		(241)					4,034					(4,275)		(106.0)	%
Income before income taxes		207,882		17.0	%		183,559		16.9	%		24,323		13.3	%
Income taxes		49,363					40,163					(9,200)		(22.9)	%
Effective tax rate		23.7	%				21.9	%				(1.8)	%
Net income	$	158,519		13.0	%	$	143,396		13.2	%	$	15,123		10.5	%
Diluted earnings per share	$	2.88				$	2.56				$	0.32		12.5	%


Three Months Ended June 30,			Change in Net Sales due to:
	Net Sales											Foreign			Net Sales
	2025		Volume			Price			Acquisitions			Exchange			2026
Lincoln Electric Holdings, Inc.	$	1,088,673	$	25,790		$	83,911		$	16,193		$	5,096		$	1,219,663
% Change
Lincoln Electric Holdings, Inc.				2.4	%		7.7	%		1.5	%		0.4	%		12.0	%


		Twelve Months Ended June 30,
		2026			2025
Net income as reported		$	553,551		$	502,868
Plus: Interest expense (after-tax)			44,075			42,688
Less: Interest income (after-tax)			4,564			6,636
Net operating profit after taxes		$	593,062		$	538,920
Special items:
Rationalization and asset impairment net charges			17,436			31,172
Transaction costs			2,176			4,332
Pension settlement net charges			719			3,792
Amortization of step up in value of acquired inventories			4,104			4,771
Tax effect of Special items ⁽¹⁾			5,555			(11,118)
Adjusted net operating profit after taxes		$	623,052		$	571,869

Invested Capital		June 30, 2026			June 30, 2025
Short-term debt		$	—		$	105,323
Long-term debt, less current portion			1,150,054			1,150,395
Total debt			1,150,054			1,255,718
Total equity			1,554,180			1,379,613
Invested capital		$	2,704,234		$	2,635,331

Return on invested capital as reported			21.9	%		20.4	%
Adjusted return on invested capital			23.0	%		21.7	%


							Total Number of
							Shares		Maximum Number
							Repurchased		of Shares that May
		Total Number of					as Part of Publicly		Yet be Purchased
		Shares		Average Price			Announced Plans or		Under the Plans or
Period		Repurchased		Paid Per Share			Programs		Programs ⁽²⁾
April 1 - 30, 2026		68,319	⁽¹⁾	$	254.41		67,462		4,841,522
May 1 - 31, 2026		102,396	⁽¹⁾		264.77		102,352		4,739,170
June 1 - 30, 2026		116,417	⁽¹⁾		271.69		115,556		4,623,614
Total		287,132	111	$	265.11		285,370



10.1*	Form of Restricted Stock Unit Agreement for Non-Employee Directors under 2023 Stock Plan for Non-Employee Directors (filed herewith).
31.1	Certification of the Chairman and Chief Executive Officer (Principal Executive Officer) pursuant to Rule 13a-14(a) of the Securities Exchange Act of 1934 (filed herewith).
31.2	Certification of the Executive Vice President, Chief Financial Officer and Treasurer (Principal Financial and Accounting Officer) pursuant to Rule 13a-14(a) of the Securities Exchange Act of 1934 (filed herewith).
32.1	Certification of the Chairman and Chief Executive Officer (Principal Executive Officer) and Executive Vice President, Chief Financial Officer and Treasurer (Principal Financial and Accounting Officer) pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 (filed herewith).

101.INS	Inline XBRL Instance Document
101.SCH	Inline XBRL Taxonomy Extension Schema Document
101.CAL	Inline XBRL Taxonomy Extension Calculation Linkbase Document
101.LAB	Inline XBRL Taxonomy Extension Label Linkbase Document
101.PRE	Inline XBRL Taxonomy Extension Presentation Linkbase Document
101.DEF	Inline XBRL Taxonomy Extension Definition Linkbase Document
104	Cover page Interactive Data File (formatted as Inline XBRL and contained in the Exhibit 101 attachments)
	Inline XBRL Taxonomy Extension Label Linkbase Document

* Reflects management contract or other compensatory arrangement required to be filed as an exhibit pursuant to Item 15(b) of this report


		LINCOLN ELECTRIC HOLDINGS, INC.

		/s/ Gabriel Bruno
		Gabriel Bruno
		Executive Vice President, Chief Financial Officer and Treasurer
		(Principal Financial and Accounting Officer)
		July 30, 2026

Pril 2
Date: July 30, 2026
	/s/ Steven B. Hedlund
	Steven B. Hedlund
	Chairman and Chief Executive Officer