Helios Technologies, Inc.

What they do

Helios designs and manufactures hydraulic motion control and fluid conveyance products, including cartridge valves, manifolds, and quick release couplings, as well as complete hydraulic system solutions. The Electronics segment produces customized electronic controls systems, displays, wire harnesses, and software solutions. The company serves diverse end markets such as construction, material handling, agriculture, industrial, energy, recreational vehicles, marine, aerospace, and health and wellness.

Revenue drivers

• Hydraulics segment — Largest segment, generated $146.4 million in Q2 2026 (63% of total sales), with Americas and EMEA growing 6% and 12%, respectively, while APAC declined 8%.
• Electronics segment — Faster-growing segment, with Q2 2026 sales up 19% pro forma for divestiture and FX; contributes the remaining ~37% of total company sales.
• Geographic mix — Sales are well-diversified across Americas, EMEA, and APAC, with the company exporting from U.S. locations to more than 40 countries.

Recent performance

In Q2 2026 (ended July 4, 2026), Helios reported sales of $232 million, up 9% year-over-year (16% pro forma for divestiture and FX). Gross margin expanded 280 bps to 34.6%, and diluted EPS rose 94% to $0.66; adjusted diluted EPS was $0.88, up 49%. The company generated $42 million in operating cash flow and reduced net-debt-to-adjusted EBITDA to 1.4x from 2.6x a year earlier. For the first half of 2026, revenue reached $460.3 million, and the company paid its 118th consecutive dividend and repurchased $6.0 million of stock in Q2.

Strategy

Helios is executing 'The CORE Strategy' and targeting 2030 financial goals, focusing on customer-centric go-to-market, innovation, and operational excellence. The company is restructuring to improve efficiency, including consolidating North American operations of Hydraulics Faster in Toledo, Ohio, closing a Quebec facility, and moving more Electronics production to a low-cost Center of Excellence in Tijuana, Mexico. Management emphasizes debt reduction, organic growth investments, and disciplined acquisitions to supplement growth, while returning capital to shareholders through dividends and share repurchases. They are also leveraging the Helios Business System to drive accountability and translate long-term vision into measurable results.

Risks

• Tariff exposure — Ongoing U.S. tariff policy changes and legal challenges create uncertainty in cost structure and supply chain; the company received $5.5 million in refunds in Q2 2026 related to IEEPA tariffs, but future impacts are unpredictable.
• Macroeconomic cyclicality — Demand for capital goods in construction, agriculture, and industrial markets is cyclical and sensitive to global economic conditions, which could reduce orders.
• Supply chain disruption — Potential supply chain disruptions could affect production and delivery of components, impacting sales and margins.
• Restructuring execution — The company is consolidating facilities and moving production, which could cause operational disruptions or fail to achieve expected cost savings.

Outlook

Management raised full-year 2026 guidance, with midpoint implying the highest annual sales in company history. They expect challenging macroeconomic conditions to continue, but cite strong cash generation, lower leverage, and an ROIC-focused capital allocation approach as positioning the company to navigate a range of environments. The restructuring activities are expected to be substantially completed in 2026, with Tijuana moves continuing throughout the year.