What drove Teledyne's record third quarter results?

Net sales increased 9.4% to $1,684.9 million, led by the Digital Imaging segment, where net sales rose 15.0% on higher sales of infrared imaging detectors, components and subsystems for defense and commercial applications. Operating income rose 22.8% company-wide to $347.2 million, with the increase reflecting higher sales and favorable product mix in Digital Imaging and improved margins at recently acquired Aerospace and Defense Electronics businesses.

How did management change full-year 2026 guidance?

Full-year 2026 GAAP diluted EPS outlook was raised to $21.71 to $21.87 from $20.73 to $20.99, and non-GAAP diluted EPS outlook was raised to $25.40 to $25.50 from $24.45 to $24.65. For the fourth quarter of 2026, management expects GAAP diluted EPS of $5.68 to $5.83 and non-GAAP diluted EPS of $6.60 to $6.70. The non-GAAP outlook excludes certain transaction and integration costs and acquired intangible asset amortization.

What is the status of the Varex Imaging acquisition?

Teledyne entered into a definitive agreement on August 10, 2026 to acquire Varex Imaging Corporation in a cash transaction valued at approximately $1.1 billion, including Varex's outstanding equity awards and net debt. The company plans to fund it with cash on hand and borrowings under its credit facility. Closing is expected in early 2027, subject to customary conditions including regulatory approvals and Varex stockholder approval. Varex's special meeting is scheduled for October 28.

How strong is Teledyne's cash flow and balance sheet?

Third quarter cash provided by operating activities was $352.5 million and free cash flow was $319.5 million. Net debt was $1,465.4 million as of September 27, 2026, compared with $2,123.0 million at December 28, 2025, and cash and cash equivalents were $562.4 million. Of the $1.20 billion credit facility, $1,158.4 million was available after $41.6 million of letters of credit. The quarter-end consolidated leverage ratio was 0.9x.

How much stock has Teledyne repurchased recently?

The company repurchased stock for $224.6 million in September and through October 19, 2026, at a weighted average price of $607.03 per share. During the third quarter alone, Teledyne repurchased approximately 0.2 million shares for $94.8 million. Management described these as opportunistic repurchases made given continued strong cash flow.

TDY 8-K: Earnings & Results

01—Abstract

Summary

Summary of the 8-K filed October 21, 2026. Cited figures are marked; the original filing is the authoritative source.

Teledyne Technologies Incorporated (NYSE: TDY) furnished a press release with its third quarter 2026 financial results, dated October 21, 2026, as Exhibit 99.1 to this Item 2.02 Current Report.

The company reported all-time record quarterly sales, operating profit and non-GAAP diluted earnings per share. Third quarter net sales were $1,684.9 million^a, up 9.4% from $1,539.5 million, while GAAP diluted EPS was $5.82 (up 25.2% as stated in the release headline) and non-GAAP diluted EPS was $6.72 (up 20.6%). Digital Imaging drove the results, with segment net sales of $903.0 million (up 15.0%) and operating income of $182.7 million (up 48.1%).

Third quarter cash from operations was $352.5 million^b and free cash flow was $319.5 million. The company raised its full-year 2026 GAAP diluted EPS outlook to $21.71 to $21.87 (from $20.73 to $20.99) and its non-GAAP diluted EPS outlook to $25.40 to $25.50 (from $24.45 to $24.65). Fourth quarter 2026 outlook calls for GAAP diluted EPS of $5.68 to $5.83 and non-GAAP diluted EPS of $6.60 to $6.70.

Management also disclosed a pending cash acquisition of Varex Imaging Corporation for approximately $1.1 billion^c, expected to close in early 2027 subject to regulatory and Varex stockholder approvals, and $224.6 million of stock repurchases in September through October 19, 2026. Balance sheet metrics remained solid, with net debt of $1,465.4 million as of September 27, 2026, down from $2,123.0 million at December 28, 2025, and a quarter-end consolidated leverage ratio of 0.9x. Cash and cash equivalents were $562.4 million, and $1,158.4 million was available under the $1.20 billion credit facility.

02—Key points

Key Highlights

Record quarter: third quarter net sales of $1,684.9 million (up 9.4%), GAAP operating margin of 20.6% versus 18.4% a year earlier, and non-GAAP operating margin of 23.9% versus 22.1%.
EPS strength: GAAP diluted EPS of $5.82 versus $4.65, and non-GAAP diluted EPS of $6.72 versus $5.57 (up 20.6%).
Digital Imaging segment led growth: net sales of $903.0 million (up 15.0%) and operating income of $182.7 million (up 48.1%), driven by infrared detectors and subsystems for defense and commercial applications.
Raised 2026 outlook: full-year GAAP diluted EPS now $21.71 to $21.87 and non-GAAP diluted EPS now $25.40 to $25.50, both above the prior ranges.
Pending Varex Imaging acquisition: cash transaction valued at approximately $1.1 billion, expected to close in early 2027 and to be included in the Digital Imaging segment; Varex special meeting scheduled for October 28.
Cash generation and capital return: third quarter cash from operations of $352.5 million and free cash flow of $319.5 million; stock repurchases of $224.6 million in September through October 19, 2026 at a weighted average price of $607.03 per share.
Lower leverage: net debt fell to $1,465.4 million from $2,123.0 million at year-end 2025, and the quarter-end consolidated leverage ratio was 0.9x.

03—Questions

Frequently Asked Questions

What drove Teledyne's record third quarter results?
Net sales increased 9.4% to $1,684.9 million, led by the Digital Imaging segment, where net sales rose 15.0% on higher sales of infrared imaging detectors, components and subsystems for defense and commercial applications. Operating income rose 22.8% company-wide to $347.2 million, with the increase reflecting higher sales and favorable product mix in Digital Imaging and improved margins at recently acquired Aerospace and Defense Electronics businesses.
How did management change full-year 2026 guidance?
Full-year 2026 GAAP diluted EPS outlook was raised to $21.71 to $21.87 from $20.73 to $20.99, and non-GAAP diluted EPS outlook was raised to $25.40 to $25.50 from $24.45 to $24.65. For the fourth quarter of 2026, management expects GAAP diluted EPS of $5.68 to $5.83 and non-GAAP diluted EPS of $6.60 to $6.70. The non-GAAP outlook excludes certain transaction and integration costs and acquired intangible asset amortization.
What is the status of the Varex Imaging acquisition?
Teledyne entered into a definitive agreement on August 10, 2026 to acquire Varex Imaging Corporation in a cash transaction valued at approximately $1.1 billion, including Varex's outstanding equity awards and net debt. The company plans to fund it with cash on hand and borrowings under its credit facility. Closing is expected in early 2027, subject to customary conditions including regulatory approvals and Varex stockholder approval. Varex's special meeting is scheduled for October 28.
How strong is Teledyne's cash flow and balance sheet?
Third quarter cash provided by operating activities was $352.5 million and free cash flow was $319.5 million. Net debt was $1,465.4 million as of September 27, 2026, compared with $2,123.0 million at December 28, 2025, and cash and cash equivalents were $562.4 million. Of the $1.20 billion credit facility, $1,158.4 million was available after $41.6 million of letters of credit. The quarter-end consolidated leverage ratio was 0.9x.
How much stock has Teledyne repurchased recently?
The company repurchased stock for $224.6 million in September and through October 19, 2026, at a weighted average price of $607.03 per share. During the third quarter alone, Teledyne repurchased approximately 0.2 million shares for $94.8 million. Management described these as opportunistic repurchases made given continued strong cash flow.

04—Continue

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