Highlights

  • Third quarter 2026 net sales were $235.9 million, and net earnings were $35.9 million, or $1.24 per diluted share.
  • Utility water sales were $208.9 million, and sales of flow instrumentation products were $27.0 million in the third quarter.
  • Gross margin was 41.9% of sales, compared with 40.7%, and operating earnings were $47.7 million, or 20.2% of sales.
  • Nine-month net sales were $660.5 million, down 5.1%, and net earnings were $93.0 million, or $3.19 per diluted share.

Badger Meter, Inc. (NYSE: BMI) shares were trading at USD 148.13 on October 27, 2026, down 5.02%, with a relative volume at time of 2.13. The water technology company acquired UDlive Limited effective May 1, 2026, amended and extended its credit facility on June 5, 2026, and filed its Form 10-Q for the quarter ended September 30, 2026 on October 23, 2026, with management discussing its outlook on an October 22 call.

Badger Meter is incorporated in Wisconsin and lists its principal executive offices in Milwaukee, Wisconsin. It is a global provider of water management solutions, with approximately 95% of net sales derived from water-related applications. Its offerings are marketed as BlueEdge. It reports a Utility Water product line, approximately 89% of net sales in 2025, and a Flow Instrumentation product line, approximately 11%. Its fiscal year ends December 31.

Third Quarter 2026 Results

Net sales for the three months ended September 30, 2026 were $235.9 million, an increase of 0.1% compared with $235.7 million a year earlier. Sales into the utility water market were $208.9 million, a decrease of 0.1% from $209.2 million. The company said utility water sales reflected uneven AMI project pacing, partially offset by increased BEACON SaaS revenue and $5.6 million of revenue from the UDlive acquisition. Flow instrumentation sales were $27.0 million, compared with $26.5 million, an increase of 2.1%.

Total operating earnings were $47.7 million, or 20.2% of sales, compared with $46.1 million, or 19.6%. Gross margin was 41.9% of sales, compared with 40.7%. Selling, engineering and administration expenses were $51.1 million, or 21.7% of sales, compared with $49.8 million, or 21.1%.

The provision for income taxes was 25.1% of earnings before income taxes, compared with 26.1%. Net earnings were $35.9 million, or $1.24 per diluted share, compared with $35.1 million, or $1.19 per diluted share.

Nine-Month Results, Cash and Capital

For the nine months ended September 30, 2026, net sales were $660.5 million, a decrease of 5.1% from $696.0 million. Sales into the utility water market were $582.3 million, a decrease of 5.9%, which the company attributed to uneven AMI project pacing. Operating earnings were $122.3 million, or 18.5% of sales, compared with $140.4 million, or 20.2%. Net earnings were $93.0 million, or $3.19 per diluted share, compared with $108.1 million, or $3.65 per diluted share.

Cash provided by operations was $103.9 million for the nine months, compared with $128.9 million. Cash and cash equivalents decreased to $67.9 million from $226.0 million at December 31, 2025, reflecting $94.4 million deployed for UDlive, $119.0 million for share repurchases and $35.9 million for quarterly dividends.

The company had $154.5 million of unused credit lines at September 30, 2026 and was in compliance with all covenants.

UDlive Acquisition

Effective May 1, 2026, the company acquired 100% of the stock of UDlive, a provider of hardware-enabled software solutions for sewer line monitoring. The purchase consideration was $94.4 million, net of cash acquired, with a potential earn-out of up to an additional $50.0 million based on EBITDA targets in the 24 months after the acquisition date. The acquisition was funded by cash on hand.

Outlook

On the October 22 call, management said it expects both sequential and year-over-year base sales growth in the fourth quarter of 2026, with approximately 5% fewer workdays than in typical quarters due to holiday timing. Management said it expects full-year organic sales to decline low single digits compared with the prior year, and that it anticipates further ramping of awarded utility projects, subject to the unevenness typical of the business.

Management said it expects UDlive intangible asset amortization of approximately $5 million annually and that it expects to sustain growth into 2027. It said a Puerto Rico Aqueduct and Sewer Authority project has begun shipping product, with installations expected to start in the fourth quarter.