Rogers (NYSE:ROG) reported second-quarter 2026 sales growth and substantially higher profitability, while outlining a third-quarter outlook that calls for revenue growth across each of its major end markets.
Second-quarter sales totaled $216.8 million, up 6.9% from a year earlier and above the midpoint of the company’s guidance range. President and CEO Ali El-Haj said the top-line performance reflected improving demand and market-share gains.
“We delivered another quarter of solid progress as our commercial and profitability initiatives continue to gain traction across all business units,” El-Haj said.
Supply Chain and Facility Issues Affected Earnings
Although the company’s adjusted EPS was within its guidance range, it fell below the midpoint due to supply-chain pressures, a one-time facility event and higher operating expenses. Chief Financial Officer Laura Russell said the combined impact of those factors exceeded $0.10 per share.
El-Haj said Rogers continues to encounter shortages of certain raw materials, including silver and copper, as well as extended freight lead times related to conditions in the Middle East. Transit times that had historically ranged from four to six weeks have extended to more than 12 weeks in some cases, he said.
Rogers also experienced a small fire at one facility that suspended manufacturing for several days and required cleanup work. El-Haj said the issue has been resolved and no employees were injured.
Russell later said raw-material and freight headwinds, together with operating-expense timing and investments, represented roughly 70% to 80% of the second-quarter earnings impact. The balance was associated with the facility event.
Industrial, Electronics and Automotive Growth
Industrial remained Rogers’ largest end market, accounting for about 37% of year-to-date sales. Revenue in the segment grew at a high single-digit rate from the prior-year quarter, supported by improving general industrial demand in the U.S. and Europe, particularly in the company’s silicone solutions business. Mass-transit demand was also strong, led by U.S. rail applications.
Automotive represented about 25% of quarterly sales and grew at a low single-digit rate year over year. Sales of advanced driver-assistance systems and internal-combustion-engine vehicle applications increased. Electric-vehicle revenue was flat from a year earlier, as better power-substrate sales offset lower orders for EV battery materials.
El-Haj said EV and hybrid-electric battery sales improved sequentially, and recent design wins are expected to support stronger EV sales in the second half as new programs ramp.
Electronics and communications, which accounted for about 18% of sales, posted double-digit revenue growth. The performance was driven by wireless-infrastructure and smartphone demand, with smartphone sales benefiting from higher-end device mix and customer share gains.
Aerospace and defense represented 15% of revenue and declined slightly year over year. Defense sales were lower because of customer ordering variability, though commercial aerospace demand improved. El-Haj said defense revenue is expected to improve significantly in the second half, while commercial aerospace demand remains strong.
Third-Quarter Outlook Calls for Broad Growth
For the third quarter, Rogers forecast revenue of $233 million to $243 million. At the midpoint, the outlook represents 10% year-over-year growth. The company expects all four major end markets to grow, with particular strength anticipated in aerospace and defense and general industrial.
- Gross margin is expected to range from 33.2% to 34.2%.
- Adjusted EPS is forecast at $1.10 to $1.30.
- Adjusted EBITDA is projected at $44 million to $50 million.
- The midpoint of EBITDA guidance implies a 19.7% margin, up 250 basis points from the third quarter of 2025.
Russell said third-quarter gross margin will be affected by underutilization at the company’s newer ceramic factory in China, which is expected to create an approximately 85-basis-point headwind. Commodity costs are also expected to remain a pressure.
However, Rogers expects higher volume and cost-structure improvement actions to support margins. The company is working on supply contracts, copper sourcing and engineering initiatives intended to reduce material consumption. Russell said the company may pass through certain incremental commodity costs to customers in some situations, though such pricing changes can lag cost increases.
The company also said its $13 million restructuring program involving the ceramic facility remains on track, with some savings already appearing in results.
Cash Flow, Innovation Programs and Investor Day
Rogers ended the second quarter with more than $211 million in cash and short-term investments, up $15.6 million from the end of the first quarter. Operating cash flow was $24.4 million, while free cash flow was $18.3 million. Capital expenditures were $6.1 million during the quarter, and the company expects full-year capital spending of $30 million to $35 million.
The company repurchased $3 million of shares during the quarter, partially offsetting dilution from annual share issuances. Russell said Rogers intends to balance shareholder returns with other capital-allocation priorities and cited the company’s balance sheet as a source of strategic flexibility.
El-Haj said testing and validation of Rogers’ microchannel cooler technology for high-power artificial intelligence and data-center applications continued with multiple customers. The company is also sampling high-frequency circuit materials for data-center uses with prospective customers, with initial feedback described as positive.
Rogers plans to provide more details on its strategy, growth opportunities, innovation programs, capital-allocation priorities and long-term financial planning at an analyst and investor day in New York City on Sept. 30, 2026.
About Rogers (NYSE:ROG)
Rogers Corporation (NYSE: ROG) is a global technology and materials company specializing in the development and manufacture of engineered materials and components. The company designs and produces a broad portfolio of high-performance elastomeric, foam, silicone, adhesive and thermal management solutions, as well as advanced circuit board laminates. Its products are engineered to meet stringent requirements in areas such as electrical insulation, thermal performance and electromagnetic shielding.
Rogers serves a diverse range of end markets, including automotive, aerospace and defense, telecommunications, consumer electronics and industrial applications.
