Earnings Recap — Q2 FY2026
CY Q3 2026 · Reported August 3, 2026 · Beat 7 of last 7 quarters
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BWXT's strong quarter and raised guidance underscore accelerating demand across the nuclear value chain, from naval propulsion to commercial SMR and large reactor components. The company's expansion of U.S. commercial manufacturing capacity (PCG acquisition and potential greenfield site) and investments in advanced nuclear fuels (TRISO, HALEU) position it to capture a growing share of the AI-driven power demand that is driving nuclear new-build activity. The medical divestiture frees up capital to double down on these core growth areas.
BWXT delivered strong Q2 results with revenue up 18% (9% organic) and adjusted EPS of $1.07, beating consensus. Commercial Operations revenue grew 72% (33% organic) with adjusted EBITDA more than doubling, driven by commercial power, medical, and Kinectrics. Government Operations revenue grew 2% with strong margins (20.9% EBITDA) on operational execution. The company announced the sale of its medical business to Nordic Capital for up to $800 million, completed the acquisition of Precision Components Group, and signed an exclusive land-based licensing agreement for mPower with Applied Atomics. Backlog ended at $8.4 billion, up 40% YoY.
Management raised full-year 2026 revenue guidance to approximately $3.8 billion (high-teens growth) and adjusted EBITDA guidance to $662–672 million (up $10M at midpoint). Government Operations revenue growth was revised down to high single digits due to stronger cost performance (particularly on HPDU), but EBITDA margin guidance was raised to approximately 20.5% from >19%. Commercial Operations revenue growth guidance was raised to approximately 45% (from ~30%), with more than half from the PCG acquisition, while segment EBITDA margin guidance was lowered to ~13% due to investments in U.S. capacity expansion. Management expects ~55% of second-half earnings in Q4. They see a credible opportunity to secure at least one new-build nuclear equipment order before year-end and are evaluating a final investment decision on U.S. commercial manufacturing capacity in the coming months. The medical divestiture to Nordic Capital (up to $800M) will sharpen focus on core nuclear businesses and free up capital for growth investments.
“Demand for nuclear solutions continues to build across the national security and global commercial power markets. We are benefiting from that demand today and believe the industry is in the early stages of a multi-decade super cycle of growth.”
on Nuclear super cycle
“We are investing now to extend our market position and capitalize on this expanding opportunity set.”
on Growth investments
“These investments position the segment to capture a growing pipeline of long-term opportunities.”
on Commercial margin investments
Can you talk about the medical sale considerations and what drives the range up to $800 million?
The asset wasn't for sale, but Nordic Capital approached with a compelling offer. The deal includes $750M consideration with shared economics to reach $800M. It includes the legacy BWXT medical business and part of Kinectrics' stable isotope business. BWXT retains a 20% equity stake and will continue certain specialty manufacturing. The sale allows BWXT to focus on core nuclear national security and commercial power markets.
You mentioned expecting at least one new nuclear equipment order by year-end. Is that gigawatt-class or SMR?
It's among the opportunities—SMRs at Darlington, AP1000 opportunities, and X300 opportunities in the U.S. We're in constant contact with GE Vernova and Westinghouse. The deals are being structured as special purpose vehicles where the U.S. government would own reactors, and utilities are waiting to see how those unfold before stepping in.
Have you determined a use for the medical sale proceeds?
Not exactly. Capital allocation priorities focus on growth investments, including internal CapEx of 6-7% of sales. We have a robust M&A pipeline with a fine filter for strategic and financial fit. We also have bonds due over the next couple of years and may look at balance sheet strength. No planned share repurchases for 2026.