Rogers (ROG) Q3 2026 Earnings Call Transcript

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DATE

Tuesday, Oct. 27, 2026

CALL PARTICIPANTS

• Senior Director of Investor Relations – Stephen Haymore
• President and Chief Executive Officer – Ali El-Haj
• Senior Vice President and Chief Financial Officer – Laura Russell

TAKEAWAYS

• Net Sales — $236.1 million, growing 9.3% year over year driven by demand in the electronics, communications, and automotive end markets.
• Adjusted EPS — $1.39, increasing 54% year over year due to higher sales volume and improved margins.
• Adjusted EBITDA — $47.7 million, representing a 28% increase versus the prior year.
• Adjusted EBITDA Margin — 20.2%, expanding 300 basis points to its highest level since 2020.
• Gross Margin — 34.2%, up 70 basis points year over year reflecting higher volume and favorable product mix.
• Industrial Market Revenue — 34% of third-quarter sales, with growth supported by renewable energy and industrial applications across all regions.
• Automotive Market Revenue — 24% of third-quarter sales, increasing at a high single digit rate year over year due to demand for ADAS and electric vehicle platforms.
• Electronics and Communications Revenue — 20% of third-quarter sales, driven by strong sales of wireless infrastructure materials despite lower smartphone demand.
• Aerospace and Defense Revenue — 15% of third-quarter sales, growing at a mid single digit rate behind higher defense and commercial aerospace sales.
• AES Revenue Growth — 13.5% year over year, with performance improvements across all end markets within the segment.
• EMS Revenue Growth — 4.3% year over year, led by automotive and aerospace applications.
• Cash and Short-term Investments — $236.4 million as of Sept. 30, 2026, increasing $25 million from the prior quarter.
• Operating Cash Flow — $41.4 million, up from $24.4 million in the second quarter.
• Free Cash Flow — $35.4 million, increasing from $18.3 million in the prior quarter.
• Share Repurchases — $9.3 million, representing a portion of the company’s capital allocation strategy during the quarter.
• Q4 Net Sales Guidance — $215 million to $225 million, reflecting expected year-over-year growth of approximately 9%.
• Q4 Gross Margin Guidance — 32.5% to 33.5%, incorporating the impact of higher volumes and cost structure improvements.
• Q4 Adjusted EPS Guidance — $0.90 to $1.10, compared to $0.89 in the fourth quarter of 2025.
• Q4 Adjusted EBITDA Guidance — $37 million to $43 million, an anticipated 16% increase year over year at the midpoint.
• Full-year Capital Expenditures Guidance — $30 million to $35 million, focused on supporting organic growth.
• Full-year Tax Rate Guidance — 31% on a non-GAAP basis.
• High Growth Opportunity Targets — $100 million in revenue by 2028 and $450 million by 2030, led by data center and battery technology applications.
• Suzhou Facility Costs — Management noted that higher year-over-year costs from the new Suzhou, China facility partially offset EBITDA improvements.
• Design Win Timing — Management expects full volumes from a major new design win for high-growth applications to be achieved by the second quarter of 2027.

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RISKS

• Russell stated, “higher commodity costs will continue to be a headwind versus Q4 of 2025,” which may limit further gross margin expansion in the near term.
• Russell noted that while they achieved operational savings, “these were offset by higher commodity costs” during the third quarter.

SUMMARY

Rogers Corporation (ROG +5.01%) reported third-quarter results characterized by revenue growth across all primary end markets and the achievement of multiyear peaks in profitability and earnings per share. Management attributed the performance to disciplined cost execution, improved product mix, and higher factory utilization. The company is currently seeing high demand for advanced materials in the electric vehicle and data center sectors, which is driving a pipeline of new design wins expected to materialize into significant revenue in 2027. Management indicated that its growth strategy is ahead of its previously stated organic growth targets, supported by a healthy balance sheet and intensifying engagement with global original equipment manufacturers.

• El-Haj noted that customer momentum is accelerating in high-growth adjacencies, stating, “We see more intensity in those activities” as customers move toward product testing and evaluation.
• Management is evaluating strategic M&A opportunities, with El-Haj indicating that the company anticipates “some actionable announcement probably within the next couple of quarters or so.”
• Data center solutions represent the largest high-growth opportunity for the company, specifically focused on high-speed digital applications and micro-channel cooling for AI chips.
• The company has completed its restructuring activities and expects to fully realize the remaining $13 million of a total $45 million in targeted cost savings as it exits the 2026 fiscal year.
• Management is advancing its EMI shielding technology with initial customer sampling targeted for early 2027.

INDUSTRY GLOSSARY

• ADAS: Advanced Driver Assistance Systems, which are electronic systems in vehicles that use sensors to help drivers with safety and convenience features.
• AES: Advanced Electronics Solutions, a Rogers business segment focused on materials for high-power electronics and wireless infrastructure.
• EMS: Elastomeric Material Solutions, a Rogers business segment providing polyurethane and silicone materials for cushioning and sealing.
• EMI Shielding: Electromagnetic Interference shielding, a technology that prevents electrical signals from interfering with one another in electronic devices.
• Thermal Runaway: A dangerous condition in lithium-ion batteries where a cell enters an uncontrollable self-heating state.
• Micro Channel Cooler: A cooling technology used to manage high power density in semiconductors, such as those used in AI data centers.

Full Conference Call Transcript

Operator: Good afternoon. My name is Diego, and I will be your conference operator today. At this time, I would like to welcome everyone to the Rogers Corporation Third Quarter 2026 Earnings Conference Call. I will now turn the call over to your host, Mr. Steve Haymore, Senior Director of Investor Relations. Mr. Haymore, you may begin.

Stephen Haymore: Good afternoon, and welcome to the Rogers Corporation Third Quarter 2026 Earnings Conference Call. Slides for today’s call can be found in the Investors section of our website along with the news release that was issued earlier today. Please turn to slide 2. Before we begin, I would like to note that statements in this conference call that are not strictly historical are forward looking statements within the meaning

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