ABM Industries Delivers Record Revenue and 27% Adjusted EPS Growth in Q3 2026, Raises Full-Year Free Cash Flow Outlook
ABM Industries (ABM) reported a strong third quarter 2026, with record quarterly revenue and 27% adjusted earnings per share (EPS) growth. The company delivered exceptional year-to-date cash flow despite project timing issues and client exits in its Building & Industrial Services segment.
The quarterly results demonstrate the resilience of ABM's portfolio and its ability to execute operationally even when individual parts of the business do not perform as expected. Aviation and Manufacturing & Distribution continued to deliver strong growth, while Education performed as expected. However, Building & Industrial Services reflected client exits discussed over several quarters, and Technical Solutions revenue came in below expectations due to project deferrals from an important client.
ABM's president and chief executive officer, Scott Salmirs, expressed satisfaction with the quarter, stating that it demonstrates both operational execution and portfolio resilience. He emphasized the company's ability to drive profitability and cash flow growth through cost actions and disciplined working capital management. This led to 27% adjusted EPS growth, 40 basis points of sequential segment margin improvement, and an increase of over $150 million in year-to-date free cash flow.
The company's focus on restoring cash generation performance following the disruption associated with its ERP implementation is increasingly visible in its results. ABM has raised its full-year free cash flow outlook based on its performance through the first nine months.
ABM's position in semiconductor, microgrids, and data centers is becoming increasingly important within the company. These businesses generated nearly $775 million of revenue through the first nine months, growing 26% organically and approximately 40% when including WGNSTAR. They now represent more than 11% of ABM's revenue and carry a double-digit blended operating margin.
The semiconductor business is notable for its strategic investment several years ago in industry expertise, relationships with leading manufacturers, and a strong position supporting semiconductor facilities. This investment has positioned the company to capitalize on the expansion of advanced manufacturing capacity.
ABM's third quarter 2026 results demonstrate its ability to navigate project timing issues and client exits while delivering record revenue and EPS growth. The company's focus on restoring cash generation performance and its growing position in strategic industries positions it for continued success.
