MATERION Corp 10-Q for FY2026 Q3

MATERION Corp (MTRN)

10-Q 2026-11-04 For: 2026-10-02

Added on November 04, 2026

About this 10-Q

MATERION Corp filed this 10-Q on November 4, 2026, covering the quarter ended October 2, 2026 (FY2026 Q3).

The Company reported third-quarter 2026 net sales of $567.3 million, up $122.5 million from $444.8 million in the third quarter of 2025, driven primarily by higher Electronic Materials sales. AI summary

Headline figures

Quarter ended October 2, 2026, as reported in this filing, compared with the same period a year earlier where the filing states it.

Revenue: $567.29M; up 27.5% from $444.81M a year earlier
Net income: $38.33M; up 50.8% from net income of $25.41M a year earlier
Diluted EPS: $1.81; up 48.4% from $1.22 a year earlier

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Ohio						34-1919973
(State or other jurisdiction of incorporation or organization)						(I.R.S. Employer Identification No.)


Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Common Stock, no par value	MTRN	New York Stock Exchange


	Third Quarter Ended				Nine Months Ended
(Thousands, except per share amounts)	October 2, 2026		September 26, 2025		October 2, 2026		September 26, 2025
Net sales	$	567,290	$	444,808	$	1,731,021	$	1,296,796
Cost of sales	463,589		358,685		1,441,142		1,051,836
Gross margin	103,701		86,123		289,879		244,960
Selling, general, and administrative expense	42,525		38,256		121,047		108,740
Research and development expense	6,505		6,548		19,224		19,466
Restructuring expense	92		212		2,711		2,729
Other—net	4,172		6,164		16,605		15,068
Operating profit	50,407		34,943		130,292		98,957
Other non-operating (income)—net	(370)		(711)		(997)		(1,944)
Interest expense—net	6,605		7,544		21,709		22,691
Income before income taxes	44,172		28,110		109,580		78,210
Income tax expense	5,840		2,698		13,116		9,960
Net income	$	38,332	$	25,412	$	96,464	$	68,250
Basic earnings per share:
Net income per share of common stock	$	1.84	$	1.23	$	4.64	$	3.29
Diluted earnings per share:
Net income per share of common stock	$	1.81	$	1.22	$	4.57	$	3.27
Weighted-average number of shares of common stock outstanding:
Basic	20,848		20,731		20,810		20,763
Diluted	21,163		20,883		21,116		20,893


	Third Quarter Ended				Nine Months Ended
	October 2,		September 26,		October 2,		September 26,
(Thousands)	2026		2025		2026		2025
Net income	$	38,332	$	25,412	$	96,464	$	68,250
Other comprehensive income (loss):
Foreign currency translation adjustment	(2,155)		(903)		(4,537)		9,308
Derivative and hedging activity, net of tax	399		(435)		287		(2,414)
Pension and post-employment benefit adjustment, net of tax	150		(161)		377		893
Other comprehensive income (loss)	(1,606)		(1,499)		(3,873)		7,787
Comprehensive income	$	36,726	$	23,913	$	92,591	$	76,037


	October 2,		December 31,
(Thousands)	2026		2025
Assets
Current assets
Cash and cash equivalents	$	15,404	$	13,681
Accounts receivable, net	268,815		222,916
Inventories, net	485,943		461,231
Prepaid and other current assets	88,911		91,692
Total current assets	859,073		789,520
Deferred income taxes	9,640		7,727
Property, plant, and equipment	1,411,039		1,376,703
Less allowances for depreciation, depletion, and amortization	(870,251)		(841,245)
Property, plant, and equipment, net	540,788		535,458
Operating lease, right-of-use assets	62,286		62,036
Intangible assets, net	96,887		105,874
Other assets	24,900		21,529
Goodwill	279,824		280,657
Total Assets	$	1,873,398	$	1,802,801
Liabilities and Shareholders’ Equity
Current liabilities
Short-term debt	$	19,609	$	22,445
Accounts payable	189,139		148,642
Salaries and wages	30,701		19,312
Other liabilities and accrued items	53,914		45,445
Income taxes	809		5,054
Unearned revenue	11,967		12,685
Total current liabilities	306,139		253,583
Other long-term liabilities	13,240		12,556
Operating lease liabilities	61,882		60,568
Finance lease liabilities	12,308		13,384
Retirement and post-employment benefits	22,609		23,931
Unearned income	47,766		55,862
Long-term income taxes	544		532
Deferred income taxes	2,150		2,760
Long-term debt	377,440		436,348
Shareholders’ equity
Serial preferred stock (no par value; 5,000 authorized shares, none issued)	—		—
Common stock (no par value; 60,000 authorized shares, issued shares of 27,148 at both October 2nd and December 31st)	393,918		351,901
Retained earnings	999,726		912,361
Common stock in treasury	(315,418)		(277,473)
Accumulated other comprehensive loss	(54,454)		(50,581)
Other equity	5,548		7,069
Total shareholders' equity	1,029,320		943,277
Total Liabilities and Shareholders’ Equity	$	1,873,398	$	1,802,801


	Common Shares		Shareholders' Equity
(Thousands, except per share amounts)	Common Shares	Common Shares Held in Treasury	Common Stock		Retained Earnings		Common Stock in Treasury		Accumulated Other Comprehensive Loss		Other Equity		Total
Balance at July 3, 2026	20,834	6,314	$	380,134	$	964,469	$	(302,376)	$	(52,848)	$	5,488	$	994,867
Net income	—	—	—		38,332		—		—		—		38,332
Other comprehensive income	—	—	—		—		—		(1,606)		—		(1,606)
Cash dividends declared ($0.145 per share)	—	—	—		(3,024)		—		—		—		(3,024)
Stock-based compensation activity	39	(39)	13,748		(51)		(9,339)		—		—		4,358
Payments of withholding taxes for stock-based compensation awards	(12)	12	—		—		(3,652)		—		—		(3,652)
Directors’ deferred compensation	—	—	36		—		(51)		—		60		45
Balance at October 2, 2026	20,861	6,287	$	393,918	$	999,726	$	(315,418)	$	(54,454)	$	5,548	$	1,029,320

Balance at June 27, 2025	20,727	6,421	$	345,666	$	886,247	$	(276,447)	$	(51,760)	$	6,939	$	910,645
Net income	—	—	—		25,412		—		—		—		25,412
Other comprehensive income	—	—	—		—		—		(1,499)		—		(1,499)
Cash dividends declared ($0.140 per share)	—	—	—		(2,903)		—		—		—		(2,903)
Stock-based compensation activity	8	(8)	3,557		(65)		(409)		—		—		3,083
Payments of withholding taxes for stock-based compensation awards	(2)	2	—		—		(203)		—		—		(203)
Directors’ deferred compensation	—	—	24		—		(44)		—		64		44
Balance at September 26, 2025	20,733	6,415	$	349,247	$	908,691	$	(277,103)	$	(53,259)	$	7,003	$	934,579


		Third quarter ended October 2, 2026
		Performance Materials		Electronic Materials		Precision Optics		Other		Consolidated
Net sales (1)		$	198,978	$	336,608	$	31,704	$	—	$	567,290

Less:
	Cost of sales	151,522		291,033		21,030		4		463,589
	Selling, general and administrative expense	15,484		11,075		4,906		11,060		42,525
	Other segment items (2)	1,738		6,077		2,533		51		10,399
Segment EBIT		$	30,234	$	28,423	$	3,235	$	(11,115)	$	50,777
Plus:
	Segment depreciation, depletion and amortization	12,274		4,713		2,238		494		19,719
Segment EBITDA		$	42,508	$	33,136	$	5,473	$	(10,621)	$	70,496
	Income tax expense									5,840
	Interest expense - net									6,605
	Depreciation, depletion and amortization									19,719
Net Income										$	38,332


		Third quarter ended September 26, 2025
		Performance Materials		Electronic Materials		Precision Optics		Other		Consolidated
Net sales (1)		$	170,787	$	246,837	$	27,184	$	—	$	444,808

Less:
	Cost of sales	125,909		213,746		18,892		138		358,685
	Selling, general and administrative expense	14,228		10,731		4,896		8,401		38,256
	Other segment items (2)	4,018		5,878		2,442		(125)		12,213
Segment EBIT		$	26,632	$	16,482	$	954	$	(8,414)	$	35,654
Plus:
	Segment depreciation, depletion and amortization	10,279		4,443		2,277		505		17,504
Segment EBITDA		$	36,911	$	20,925	$	3,231	$	(7,909)	$	53,158
	Income tax expense									2,698
	Interest expense - net									7,544
	Depreciation, depletion and amortization									17,504
Net Income										$	25,412


		First nine months ended October 2, 2026
		Performance Materials		Electronic Materials		Precision Optics		Other		Consolidated
Net sales (1)		$	562,592	$	1,075,154	$	93,275	$	—	$	1,731,021

Less:
	Cost of sales	432,511		949,003		59,618		10		1,441,142
	Selling, general and administrative expense	44,426		31,969		15,103		29,549		121,047
	Other segment items (2)	6,206		21,675		8,526		1,136		37,543
Segment EBIT		$	79,449	$	72,507	$	10,028	$	(30,695)	$	131,289
Plus:
	Segment depreciation, depletion and amortization	35,162		13,990		6,722		1,459		57,333
Segment EBITDA		$	114,611	$	86,497	$	16,750	$	(29,236)	$	188,622
	Income tax expense									13,116
	Interest expense - net									21,709
	Depreciation, depletion and amortization									57,333
Net Income										$	96,464


		First nine months ended September 26, 2025
		Performance Materials		Electronic Materials		Precision Optics		Other		Consolidated
Net sales (1)		$	527,552	$	696,059	$	73,185	$	—	$	1,296,796

Less:
	Cost of sales	385,435		611,969		54,211		221		1,051,836
	Selling, general and administrative expense	42,451		30,475		13,598		22,216		108,740
	Other segment items (2)	10,889		16,982		8,720		(1,272)		35,319
Segment EBIT		$	88,777	$	36,633	$	(3,344)	$	(21,165)	$	100,901
Plus:
	Segment depreciation, depletion and amortization	29,901		12,971		7,192		1,487		51,551
Segment EBITDA		$	118,678	$	49,604	$	3,848	$	(19,678)	$	152,452
	Income tax expense									9,960
	Interest expense - net									22,691
	Depreciation, depletion and amortization									51,551
Net Income										$	68,250


(Thousands)	October 2, 2026		December 31, 2025		$ change		% change
Accounts receivable, trade	$	271,558	$	223,763	$	47,795	21	%
Unbilled receivables	52,626		46,548		6,078		13	%
Unearned revenue	11,967		12,685		(718)		(6)	%


	Reduction in Force
(Thousands)	Performance Materials		Electronic Materials		Precision Optics		Other		Consolidated
Balance at December 31, 2025	$	—	$	83	$	59	$	9	$	151
Additional Charges	694		449		878		690		2,711
Cash Payments	(694)		(521)		(937)		(667)		(2,819)
Balance at October 2, 2026	$	—	$	11	$	—	$	32	$	43


	Pension Benefits				Other Benefits
	Third Quarter Ended				Third Quarter Ended
	October 2,		September 26,		October 2,		September 26,
(Thousands)	2026		2025		2026		2025
Components of net periodic benefit (credit) cost
Service cost	$	283	$	315	$	—	$	11
Interest cost	1,837		1,932		31		58
Expected return on plan assets	(2,363)		(2,539)		—		—
Amortization of prior service (benefit) cost	(21)		(23)		—		—
Amortization of net loss (gain)	259		90		(104)		(87)
Net periodic benefit (credit) cost	$	(5)	$	(225)	$	(73)	$	(18)


	Gains and Losses on Cash Flow Hedges
(Thousands)	Foreign Currency		Interest Rate		Precious Metals		Total		Pension and Post-Employment Benefits		Foreign Currency Translation		Total
Balance at July 3, 2026	$	1,411	$	782	$	2	$	2,195	$	(52,214)	$	(2,829)	$	(52,848)
Other comprehensive income (loss) before reclassifications	(38)		999		—		961		—		(2,155)		(1,194)
Amounts reclassified from accumulated other comprehensive income (loss)	29		(471)		—		(442)		191		—		(251)
Net current period other comprehensive (loss) income before tax	(9)		528		—		519		191		(2,155)		(1,445)
Deferred taxes	(2)		122		—		120		41		—		161
Net current period other comprehensive (loss) income after tax	(7)		406		—		399		150		(2,155)		(1,606)
Balance at October 2, 2026	$	1,404	$	1,188	$	2	$	2,594	$	(52,064)	$	(4,984)	$	(54,454)

Balance at June 27, 2025	$	1,316	$	1,888	$	2	$	3,206	$	(53,648)	$	(1,318)	$	(51,760)
Other comprehensive (loss) income before reclassifications	118		122		—		240		—		(903)		(663)
Amounts reclassified from accumulated other comprehensive income (loss)	(9)		(797)		—		(806)		(164)		—		(970)
Net current period other comprehensive (loss) income before tax	109		(675)		—		(566)		(164)		(903)		(1,633)
Deferred taxes	24		(155)		—		(131)		(3)		—		(134)
Net current period other comprehensive (loss) income after tax	85		(520)		—		(435)		(161)		(903)		(1,499)
Balance at September 26, 2025	$	1,401	$	1,368	$	2	$	2,771	$	(53,809)	$	(2,221)	$	(53,259)


Risk-free interest rate	3.62	%
Dividend yield	0.34	%
Volatility	34.0	%
Expected term (in years)	4.8


(Thousands)	Performance Materials		Electronic Materials		Precision Optics		Other		Total
Third Quarter 2026
End Market
Semiconductor	$	3,905	$	275,621	$	2,851	$	—	$	282,377
Industrial	32,362		15,045		7,493		—		54,900
Aerospace and defense	59,992		4,311		9,791		—		74,094
Consumer electronics	47,648		135		3,394		—		51,177
Automotive	17,857		737		2,216		—		20,810
Energy	9,500		22,857		—		—		32,357
Life sciences	2,373		9,269		5,567		—		17,209
Other	25,341		8,633		392		—		34,366
Total	$	198,978	$	336,608	$	31,704	$	—	$	567,290

Third Quarter 2025
End Market
Semiconductor	$	2,005	$	205,821	$	1,120	$	—	$	208,946
Industrial	31,141		9,020		6,656		—		46,817
Aerospace and defense	40,326		2,357		8,298		—		50,981
Consumer electronics	48,206		416		4,027		—		52,649
Automotive	15,206		669		1,628		—		17,503
Energy	8,448		19,619		—		—		28,067
Life sciences	2,465		6,497		5,097		—		14,059
Other	22,990		2,438		358		—		25,786
Total	$	170,787	$	246,837	$	27,184	$	—	$	444,808


(Thousands)	Performance Materials		Electronic Materials		Precision Optics		Other		Total
First Nine Months 2026
End Market
Semiconductor	$	10,102	$	888,685	$	7,079	$	—	$	905,866
Industrial	99,526		40,473		23,037		—		163,036
Aerospace and defense	165,063		13,167		29,546		—		207,776
Consumer electronics	117,355		14,237		10,717		—		142,309
Automotive	53,184		1,231		6,138		—		60,553
Energy	38,399		93,407		—		—		131,806
Life sciences	6,089		6,508		16,306		—		28,903
Other	72,874		17,446		452		—		90,772
Total	$	562,592	$	1,075,154	$	93,275	$	—	$	1,731,021

First Nine Months 2025
End Market
Semiconductor	$	7,390	$	579,064	$	2,690	$	—	$	589,144
Industrial	93,424		27,779		18,678		—		139,881
Aerospace and defense	126,382		6,137		21,812		—		154,331
Consumer electronics	149,913		1,682		10,343		—		161,938
Automotive	48,243		3,211		4,774		—		56,228
Energy	37,388		53,002		—		—		90,390
Life sciences	7,323		18,886		14,042		—		40,251
Other	57,489		6,298		846		—		64,633
Total	$	527,552	$	696,059	$	73,185	$	—	$	1,296,796


	October 2,		December 31,
(Thousands)	2026		2025
Raw materials and supplies	$	114,609	$	108,040
Work in process	301,168		298,695
Finished goods	70,166		54,496
Inventories, net	$	485,943	$	461,231


(Thousands)	October 2, 2026		December 31, 2025
Borrowings under Credit Agreement	$	169,125	$	221,125
Borrowings under the Term Loan Facility	217,969		222,188
Overdraft Sweep Facility	10,593		15,659
Foreign debt	902		1,670
Total debt outstanding	398,589		460,642
Current portion of long-term debt	(19,609)		(22,445)
Gross long-term debt	378,980		438,197
Unamortized deferred financing fees	(1,540)		(1,849)
Long-term debt	$	377,440	$	436,348



(Thousands)	Total Carrying Value in the Consolidated Balance Sheets				Quoted Prices in Active Markets for Identical Assets (Level 1)				Significant Other Observable Inputs (Level 2)				Significant Unobservable Inputs (Level 3)
	2026		2025		2026		2025		2026		2025		2026		2025
Financial Assets
Deferred compensation investments	$	7,849	$	7,175	$	7,849	$	7,175	$	—	$	—	$	—	$	—
Foreign currency forward contracts	614		80		—		—		614		80		—		—
Interest rate swap	1,550		1,491		—		—		1,550		1,491		—		—
Precious metal swaps	—		—		—		—		—		—		—		—
Total	$	10,013	$	8,746	$	7,849	$	7,175	$	2,164	$	1,571	$	—	$	—
Financial Liabilities
Deferred compensation liability	$	7,849	$	7,175	$	7,849	$	7,175	$	—	$	—	$	—	$	—
Foreign currency forward contracts	1,564		490		—		—		1,564		490		—		—
Interest Rate Swap	8		325		—		—		8		325		—		—
Precious metal swaps	—		—		—		—		—		—		—		—
Total	$	9,421	$	7,990	$	7,849	$	7,175	$	1,572	$	815	$	—	$	—


	October 2, 2026
			Fair Value
(Thousands)	Notional Amount		Prepaid and other current assets		Other assets		Other liabilities and accrued items		Other long-term liabilities
Foreign currency forward contracts - yen	$	570	$	3	$	—	$	2	$	—
Foreign currency forward contracts - euro	—		—		—		—		—
Precious metal swaps	—		—		—		—		—
Interest rate swap	320,000		199		1,351		8		—
Total	$	320,570	$	202	$	1,351	$	10	$	—

	December 31, 2025
			Fair Value
	Notional Amount		Prepaid and other current assets		Other assets		Other liabilities and accrued items		Other long-term liabilities


Foreign currency forward contracts - yen	$	579	$	3	$	—	$	—	$	—
Foreign currency forward contracts - euro	—		—		—		—		—
Precious metal swaps	—		—		—		—		—
Interest rate swaps	200,000		1,491		—		325		—
Total	$	200,579	$	1,494	$	—	$	325	$	—


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


Item 3.			Quantitative and Qualitative Disclosures about Market Risk


Item 2.			Unregistered Sales of Equity Securities, Use of Proceeds and Issuer Purchases of Equity Securities


Period	Total Number of Shares Purchased	Average Price Paid per Share		Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs (1)	Approximate Dollar Value of Shares that May Yet Be Purchased Under the Plans or Programs (1)
July 4 through August 7, 2026	—	$	—	—	$	50,000,000
August 8 through September 4, 2026	—	—		—	50,000,000
September 5 through October 2, 2026	—	—		—	50,000,000
Total	—	$	—	—	$	50,000,000



(1)			On October 29, 2025, the Company announced its Board of Directors had authorized the repurchase of up to $50.0 million of its common stock. During the three months ended October 2, 2026, the Company did not repurchase any shares under this authorization.


31.1						Certification of Chief Executive Officer required by Rule 13a-14(a) or 15d-14(a)*
31.2						Certification of Chief Financial Officer required by Rule 13a-14(a) or 15d-14(a)*
32						Certifications of Chief Executive Officer and Chief Financial Officer required by 18 U.S.C. Section 1350*
95						Mine Safety Disclosure Pursuant to Section 1503(a) of the Dodd-Frank Wall Street Reform and Consumer Protection Act for the period ended October 2, 2026*
101.INS						XBRL Instance Document - the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document*
101.SCH						Inline XBRL Taxonomy Extension Schema Document*
101.DEF						Inline XBRL Taxonomy Extension Definition Linkbase 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*
104						Cover Page Interactive Data File (formatted as Inline XBRL and contained in the Exhibit 101 attachments)


1)			I have reviewed this quarterly report on Form 10-Q of Materion Corporation (the “registrant”);


2)			Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;


3)			Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;


4)			The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:


			a)			designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;


			b)			designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;


			c)			evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and


			d)			disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and


			a)			all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and


			b)			any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.


1.			The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934 (15 U.S.C. 78m or 78o(d)), and


2.			The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company as of the dates and for the periods expressed in the Report.