Mayville Engineering Company — Third Quarter 2026 Earnings Summary

Financial Performance:

• Net sales reached $170.4 million for the quarter ended September 30, 2026, representing an 18.1% year-over-year increase.
• Net income was $0.4 million ($0.02 per diluted share), compared to a net loss of $2.7 million ($0.13 per diluted share) in the prior year period.
• Adjusted EBITDA was $17.0 million (10.0% margin), up from $14.1 million (9.8% margin) in the prior year.
• Adjusted Net Income was $4.0 million ($0.15 per diluted share), compared to $2.0 million ($0.10 per diluted share) in the prior year.
• Manufacturing margin was $18.8 million (11.0% of sales), unchanged margin percentage but higher dollars compared to $15.9 million in the prior year.
• Free cash flow was negative $3.3 million for the quarter, compared to negative $1.1 million in the prior year, driven by higher capital expenditures.
• Net debt stood at $146.6 million as of September 30, 2026, with a net debt to trailing twelve-month Adjusted EBITDA ratio of 2.9x.
• Interest expense was $3.0 million, down from $3.4 million in the prior year, due to decreased average borrowings partially offset by higher interest rates.
• Accounts receivable increased to $86.2 million from $57.6 million at December 31, 2025.
• Inventories increased to $78.2 million from $59.4 million at December 31, 2025.

Guidance and Future Outlook:

• Full-year 2026 Net Sales guidance updated to a range of $630 million to $640 million (midpoint $635 million), up from $546.5 million actual in 2025.
• Full-year 2026 Adjusted EBITDA guidance updated to a range of $48 million to $52 million (midpoint $50 million), up from $47.1 million actual in 2025.
• Full-year 2026 Free Cash Flow guidance updated to a range of negative $16 million to negative $6 million (midpoint negative $11 million), compared to positive $26.9 million in 2025.
• The company anticipates reaching full capacity within the next 18 months.
• The acquisition of the Thomson, Georgia facility is expected to add approximately $50 million of annual revenue capacity by 2028, increasing total revenue capacity beyond the previously disclosed $850 million.
• Management expects to realize improved operating leverage as volumes ramp, despite ongoing launch costs and capital deployment.
• Guidance assumes a full year of Accu-Fab ownership, incremental Datacenter & Critical Power cross-selling revenue, and continued improvement in Commercial Vehicle and Construction & Access, partially offset by softness in Agriculture and Powersports.

Business Segments and Product Lines:

• Datacenter & Critical Power: Net sales of $37.2 million, a 64.9% year-over-year increase, driven by accelerating demand from legacy customers and new project launches.
• Commercial Vehicle: Net sales of $52.8 million, a 34.7% year-over-year increase, supported by increased North American Class 8 production.
• Construction & Access: Net sales of $24.2 million, a 9.3% year-over-year increase, due to continued improvement in non-residential construction demand.
• Other: Net sales of $24.8 million, a 13.5% year-over-year increase, associated with strong aluminum extrusion demand.
• Powersports: Net sales of $16.8 million, a 26.9% year-over-year decrease, driven by soft customer demand due to global supply chain realignment.
• Agriculture: Net sales of $7.3 million, a 9.9% year-over-year decrease, reflecting continued demand softness for large agricultural equipment.
• Military: Net sales of $7.2 million, a 2.8% year-over-year decrease, due to continued program transition delays.
• The company secured approximately $45 million in new Datacenter & Critical Power project awards during the quarter.
• The qualified opportunity pipeline for Datacenter & Critical Power now exceeds $200 million.

Market and Competitive Landscape:

• The company views the current demand in the Datacenter & Critical Power space as a historic, multi-year growth opportunity reflecting infrastructure investments initiated approximately three years ago.
• MEC is a Tier 1 supplier to top commercial vehicle OEMs and holds ITAR certification for military components.
• Operational efficiency remained uneven during the quarter as teams responded to rapidly evolving customer requirements and the pace of incoming demand.

Risks and Challenges:

• Operational efficiency challenges persist due to the need to align operations with rapidly evolving customer timelines and accelerating demand volumes.
• The company continues to absorb project launch costs and outsourcing costs associated with new Datacenter & Critical Power programs.
• Free cash flow remains negative due to working capital investments and planned capital expenditures required to support accelerating demand.
• Forward-looking statements note risks including macroeconomic conditions, labor availability, material cost pressures, trade policy uncertainty, and the ability to realize net sales from awarded business.

Management Commentary and Tone:

• CEO Jag Reddy stated results were in line with expectations, reflecting strong demand and accelerating project volumes in the Datacenter & Critical Power end market.
• Management views operational dynamics as a natural part of scaling the business through accelerated growth and prioritizes investing in people, equipment, and capacity.
• The tone is confident regarding the ability to deliver profitable growth in 2027 and beyond, anticipating improved operating leverage as volumes continue to ramp.
• Management emphasized a disciplined approach to incurring launch costs and deploying capital to serve the growing customer base.

Other Key Points:

• On October 1, 2026, the company closed on the acquisition of its Thomson, Georgia facility.
• The company completed a stock offering generating $93.9 million in proceeds during the nine months ended September 30, 2026.
• The company maintains 28 facilities across ten states, with 25 currently in use.
• Conference call for third-quarter results was scheduled for November 4, 2026, at 10:00 a.m. Eastern Time.