Q2 operating income fell 40% as tariffs doubled and gross margin compressed 730bp

Filed August 6, 2026 · Period ending June 30, 2026 · Compared to 10-Q Aug 7, 2025 · ~2 min read

Key Changes

• high

  Operating income fell 40% YoY to $36.5M in Q2 2026 from $61.2M in Q2 2025, driven by 730bp gross margin compression (37.3% vs. 44.7%) from higher aluminum costs, a one-time double-digit minimum wage increase in Colombia, and a stronger Colombian peso.

  MD&A: Operating Results verify on EDGAR →
• high

  Tariff expense more than doubled to $18.7M in Q2 2026 from $8.1M in Q2 2025 (up 129%), reflecting March/June 2025 steel/aluminum tariff escalations and April 2026 Section 232 modifications applying tariffs to full customs value with tiered rates by product composition.

  MD&A: Tariff Expense & Risk Factors verify on EDGAR →
• high

  Operating cash flow collapsed 83% to $11.1M in H1 2026 from $64.8M in H1 2025, driven by higher inventory purchases (U.S.-sourced aluminum for tariff mitigation), elevated tax payments ($39.2M vs. $18.5M), and longer cash cycles on large commercial installation jobs.

  MD&A: Cash Flow verify on EDGAR →