Lift truck and material handling solutions manufacturer Hyster-Yale Materials Handling (NYSE: HY) announced better-than-expected revenue in Q2 CY2026, but sales fell by 15% year on year to $812.9 million. Its non-GAAP loss of $1.64 per share was 19.8% above analysts’ consensus estimates.

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Company Overview

Playing a significant role in the development of the hydraulic lift truck, Hyster-Yale (NYSE: HY) designs, manufactures, and sells materials handling equipment to various sectors.

Revenue Growth

Reviewing a company’s long-term sales performance reveals insights into its quality. Even a bad business can shine for one or two quarters, but a top-tier one grows for years. Unfortunately, Hyster-Yale Materials Handling’s 4.1% annualized revenue growth over the last five years was sluggish. This fell short of our benchmark for the industrials sector and is a poor baseline for our analysis.

We at StockStory place the most emphasis on long-term growth, but within industrials, a half-decade historical view may miss cycles, industry trends, or a company capitalizing on catalysts such as a new contract win or a successful product line. Hyster-Yale Materials Handling’s performance shows it grew in the past but relinquished its gains over the last two years, as its revenue fell by 9.1% annually.

This quarter, Hyster-Yale Materials Handling’s revenue fell by 15% year on year to $812.9 million but beat Wall Street’s estimates by 1%.

Looking ahead, sell-side analysts expect revenue to grow 7.9% over the next 12 months, an improvement versus the last two years. This projection is above average for the sector and suggests its newer products and services will spur better top-line performance.

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Operating Margin

Hyster-Yale Materials Handling was profitable over the last five years but held back by its large cost base. Its average operating margin of 1.5% was weak for an industrials business. This result isn’t too surprising given its low gross margin as a starting point.

On the plus side, Hyster-Yale Materials Handling’s operating margin rose by 2.8 percentage points over the last five years, as its sales growth gave it operating leverage.

In Q2, Hyster-Yale Materials Handling generated an operating margin profit margin of negative 2.3%, down 2.9 percentage points year on year. Since Hyster-Yale Materials Handling’s operating margin decreased more than its gross margin, we can assume it was less efficient because expenses such as marketing, R&D, and administrative overhead increased.

Earnings Per Share

Revenue trends explain a company’s historical growth, but the long-term change in earnings per share (EPS) points to the profitability of that growth — for example, a company could inflate its sales through excessive spending on advertising and promotions.

Sadly for Hyster-Yale Materials Handling, its EPS declined by 41.4% annually over the last five years while its revenue grew by 4.1%. However, its operating margin actually improved during this time, telling us that non-fundamental factors such as interest expenses and taxes affected its ultimate earnings.

Diving into the nuances of Hyster-Yale Materials Handling’s earnings can give us a better understanding of its performance. A five-year view shows Hyster-Yale Materials Handling has diluted its shareholders, growing its share count by 6.2%. This dilution overshadowed its increased operational efficiency and has led to lower per share earnings. Taxes and interest expenses can also affect EPS but don’t tell us as much about a company’s fundamentals.

Like with revenue, we analyze EPS over a shorter period to see if we are missing a change in the business.

For Hyster-Yale Materials Handling, its two-year annual EPS declines of 59.5% show it’s continued to underperform. These results were bad no matter how you slice the data.

In Q2, Hyster-Yale Materials Handling reported adjusted EPS of negative $1.64, down from negative $0.79 in the same quarter last year. Despite falling year on year, this print easily cleared analysts’ estimates. Over the next 12 months, Wall Street is optimistic. Analysts forecast Hyster-Yale Materials Handling’s full-year EPS will flip from negative $5.43 to positive $0.95.

Key Takeaways from Hyster-Yale Materials Handling’s Q2 Results

It was good to see Hyster-Yale Materials Handling beat analysts’ EPS expectations this quarter. We were also happy its revenue narrowly outperformed Wall Street’s estimates. Zooming out, we think this was a solid print. Investors were likely hoping for more, and shares traded down 4.4% to $33.60 immediately after reporting.

Is Hyster-Yale Materials Handling an attractive investment opportunity right now? The latest quarter does matter, but not nearly as much as longer-term fundamentals and valuation, when deciding if the stock is a buy. We cover that in our actionable full research report which you can read here (it’s free).