AZZ Inc. ( AZZ ) shares are sinking premarket on Thursday after the company reported weaker-than-expected second-quarter FY26 results on Wednesday.

Revenue rose 2.0% year over year to $417.3 million, missing the consensus of $426.2 million.

By segment, Metal Coatings sales increased 10.8% year-over-year to $190.0 million, driven by higher volumes.

Meanwhile, Precoat Metals’ sales declined 4.3% year-over-year to $227.3 million, owing to weak end markets, primarily in building construction, HVAC, and appliances.

Adjusted diluted EPS increased 13.1% Y/Y to $1.55, missing the consensus of $1.57.

Adjusted EBITDA declined to $88.7 million (margin: 21.3%) from $91.9 million (margin: 22.5%) in the prior year quarter. This was due to the performance of Welding Service’s business and the seasonally slow summer.

Operating cash flow stood at $58.4 million in the quarter. AZZ ended the quarter with cash equivalents of $0.90 million.

Outlook

AZZ reiterated FY26 adjusted EPS outlook of $5.75-$6.25 vs street view of $6.03 and sales outlook of $1.625 billion-$1.725 billion vs consensus of $1.667 billion.

The company projects adjusted EBITDA of $360 million to $400 million and capital expenditures of $60 million to $80 million in FY26. 

Investors can gain exposure to the stock through the Gabelli Automation ETF ( GAST ) and the Gabelli Love Our Planet & People ETF ( LOPP ) .

AZZ Price Action: AZZ shares were down 12.03% at $93.20 at the time of publication on Thursday, according to Benzinga Pro data.

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