Key Highlights

  • Sales of USD 1.42 billion rose 26% year over year, above the consensus estimate of USD 1.32 billion.
  • Adjusted EPS of USD 1.46 topped the consensus estimate of USD 1.37, while GAAP diluted EPS was USD 1.37.
  • Adjusted EBITDA climbed 46% to USD 328 million, the highest quarterly result since 2007, at a 23% margin.
  • Full year adjusted EBITDA guidance rose USD 35 million to a range of USD 1.19 billion to USD 1.20 billion.

ATI Inc. (NYSE:ATI) reported third quarter 2026 sales of USD 1,423.7 million, up 26% from USD 1,125.5 million a year earlier and above the consensus estimate of USD 1.32 billion. Adjusted earnings per share were USD 1.46 against a consensus estimate of USD 1.37, while GAAP diluted earnings per share were USD 1.37 compared with USD 0.78 a year ago.

Chief Executive Officer Kimberly Fields said adjusted EBITDA exceeded the high end of the company guidance range by USD 13 million and described the third increase to the full year outlook this year. Jet engine revenue grew 39% year over year, and backlog stood at USD 4.3 billion, up 20%, near an all time record.

Aerospace Contracts Reshape Segment Margins

The High Performance Materials and Components segment posted sales of USD 721 million, up 20%, at a segment margin of 23.2%. The ramp of a sixth nickel based superalloy for the hot section of jet engines trimmed that margin by about 200 basis points against plan, and the Chief Financial Officer said only a modest residual effect remains in the fourth quarter. The Advanced Alloys and Solutions segment recorded sales of USD 702 million, up 34%, with a record margin of 25.8%, up 850 basis points, helped by long term contracts, improved pricing for hafnium and zirconium, and a richer aerospace and defense mix.

By end market, jet engine sales rose 39%, airframe 11%, defense 6% and specialty energy 49%. Consolidated adjusted EBITDA margin expanded 300 basis points to 23%.

Guidance Raised on Jet Engine Demand

The company guided fourth quarter adjusted EBITDA to USD 345 million to USD 355 million and adjusted EPS to USD 1.51 to USD 1.57, and called the fourth quarter its strongest of 2026 for sales and profit. Full year adjusted EPS guidance stands at USD 5.17 to USD 5.23, and adjusted free cash flow is guided to a midpoint of USD 575 million within a range of USD 550 million to USD 600 million. Management lifted its full year jet engine revenue growth projection to the low to mid 20% range, from high teens previously, and maintains mid to high single digit airframe growth, high teens defense growth and mid teen specialty energy growth.

Adjusted free cash flow was USD 80 million in the quarter and USD 223 million year to date, up USD 73 million. Capital spending was USD 93 million in the quarter and USD 217 million year to date, with customer funded capital of USD 48 million. Managed working capital stood at 32.9% of sales, and cash and equivalents were USD 442.3 million at quarter end.

Signposts for the Fourth Quarter Report

The fourth quarter guidance sets concrete markers: adjusted EBITDA of USD 345 million to USD 355 million and adjusted EPS of USD 1.51 to USD 1.57, which at the midpoint would be 7% above the third quarter result of USD 328 million. The company anticipates Advanced Alloys and Solutions margins to hold in the mid 20% range, while High Performance Materials and Components margin is projected to improve from 23.2% as ramp costs fade.

Other data points include backlog of USD 4.3 billion, full year adjusted free cash flow against the USD 575 million midpoint, and managed working capital at 32.9% of sales, since management noted inventories are temporarily elevated while new assets come online.