Executive Summary

Q3 delivered solid topline with revenues of $1.96B (+5% YoY) and adjusted EPS of $0.86, broadly in line with S&P consensus; adjusted EBITDA margin expanded sequentially to 27.9% on disciplined execution despite tariff headwinds . Relative to S&P Global consensus: revenue modest beat ($1.955B vs $1.949B*), EPS in line ($0.86 vs $0.86*) (see Estimates Context).
Guidance trimmed on tariffs and pricing timing: FY25 adjusted EBITDA cut to $2.06–$2.09B (from $2.10–$2.16B) and adjusted EPS to $3.25–$3.31 (from $3.34–$3.46); corporate cost outlook improved and M&A contribution raised .
Segment mix: ITS revenue +5% but organic –2% with margin at 29.0% (–170 bps YoY) on tariffs and mix; PST outperformed with revenue +5% (+2% organic) and margin 30.8% (+80 bps YoY; +130 bps QoQ) .
Capital deployment remained active: $249M to M&A, $193M buybacks (~2.5M shares), $8M dividend; liquidity $3.8B, leverage 1.8x net debt/Adj EBITDA . Potential stock catalysts: tariff relief not in guidance, sustained PST margin gains, and backlog conversion/pricing realization into 2026 .

What Went Well and What Went Wrong

What Went Well
- PST margin execution: PST adjusted EBITDA rose to $128M and margin to 30.8% (+80 bps YoY, +130 bps QoQ), driven by operational execution and balanced organic/FX/M&A growth .
- Sequential margin and cash: Company adjusted EBITDA margin improved to 27.9% (from 27.0% in Q2) and FCF was $326M; liquidity stayed robust at $3.8B .
- Management confidence and innovation: CEO reiterated resilience and long-term growth; highlighted launch of Meta compressor (up to +11% flow, –14% energy, 40% less space), reinforcing technology leadership and multi-brand strategy .
What Went Wrong
- ITS margin pressure: ITS adjusted EBITDA margin was 29.0% (–170 bps YoY), with drivers including organic volume decrementals, dilutive tariffs, and continued commercial investments .
- Tariff headwinds/lower FY guide: In-year tariff headwind now “slightly in excess of $100M,” prompting EBITDA/EPS guidance cuts; pricing offsets largely deferred into 2026 due to backlog timing .
- RNG/comps drag: Within clean energy, tougher comps in U.S. RNG reduced ITS revenue; though orders remained positive in the Americas, the dynamic weighed on the near-term mix .

Financial Results

Metric	Q3 2024	Q2 2025	Q3 2025	Q3 2025 Consensus
Revenue ($USD Millions)	$1,861.0	$1,887.9	$1,955.0	$1,948.1*
GAAP Diluted EPS ($)	$0.54	($0.29)	$0.61	—
Adjusted Diluted EPS ($)	$0.84	$0.80	$0.86	$0.86*
Adjusted EBITDA ($USD Millions)	$532.7	$509.4	$544.6	$541.2*
Adjusted EBITDA Margin (%)	28.6%	27.0%	27.9%	—
Operating Cash Flow ($USD Millions)	$404.0	$245.7	$354.6	—
Free Cash Flow ($USD Millions)	$374.3	$210.4	$325.5	—

Company highlights: Orders $1,942M (+8% YoY); revenue $1,955M (+5% YoY); adjusted EBITDA $545M (+2% YoY); adjusted EPS $0.86 (+2% YoY) .
Organic growth contribution: total organic orders +1.7%; revenue organic –1.3%; FX +1.6%; M&A +4.7% .

Segment performance and mix

Segment Metric	Q3 2024	Q2 2025	Q3 2025
ITS Orders ($M)	$1,420.6	$1,560.9	$1,522.2
ITS Revenue ($M)	$1,467.2	$1,491.6	$1,540.5
ITS Adj EBITDA ($M)	$449.9	$427.2	$447.5
ITS Adj EBITDA Margin (%)	—	28.6%	29.0%
PST Orders ($M)	$378.1	$378.7	$420.1
PST Revenue ($M)	$393.8	$396.3	$414.5
PST Adj EBITDA ($M)	$118.1	$116.8	$127.6
PST Adj EBITDA Margin (%)	—	29.5%	30.8%

Key KPIs

KPI	Q3 2025
Total Book-to-Bill	~1.00x (ITS 0.99x; PST 1.01x; YTD ~1.04x)
Organic Pricing (Company)	~2.7% in Q3
Adj. Tax Rate (Q3)	23.9%
Net Debt / Adj. EBITDA	1.8x
Share Repurchases	$193M in Q3 (~2.5M shares)

Guidance Changes

Metric	Period	Previous Guidance (7/31/25)	Current Guidance (10/30/25)	Change
Revenue – Total IR (YoY)	FY 2025	4–6%	4–6%	Maintained
Organic Revenue (IR/ITS/PST)	FY 2025	(2%)–0%	(2%)–0%	Maintained
Adjusted EBITDA ($)	FY 2025	$2,100–$2,160M	$2,060–$2,090M	Lowered
Adjusted EPS ($)	FY 2025	$3.34–$3.46	$3.25–$3.31	Lowered
FX Impact	FY 2025	~1%	~1%	Maintained
M&A Contribution ($)	FY 2025	~$375M	~$415M	Raised
Corporate Costs ($)	FY 2025	(~$160M)	(~$140M)	Lower costs
Adjusted Tax Rate	FY 2025	~23%	~23.5%	Slightly higher
Net Interest Expense ($)	FY 2025	~220M	~220M	Maintained
CapEx (% of Revenue)	FY 2025	~2%	~2%	Maintained
Diluted Share Count (Adj)	FY 2025	~403M	~402M	Lower
Dividend per share	Q4 2025 payable 12/4	—	$0.02 declared 10/23	Declared

Management cited two main drivers for guidance cuts: incremental August Section 232 tariffs and delayed price realization due to growing backlog; potential tariff reductions announced the day before were not included in guidance .

Earnings Call Themes & Trends

Topic	Previous Mentions (Q1 & Q2 2025)	Current Period (Q3 2025)	Trend
Tariffs/Macro	Introduced tariff-pricing framework; raised FY guide in Q2 but flagged fluid tariff environment .	In-year tariff headwind now >$100M; pricing offsets pushed into 2026; guide cut; possible relief not included .	Worsened near term; potential 2026 tailwind
Pricing & Backlog	Q1 book-to-bill 1.10x; Q2 backlog up mid-teens since YE’24; base price ~2% .	Q3 book-to-bill ~1x; backlog up high teens since YE’24; Q3 price ~2.7% .	Backlog improving; price realization delayed
Segment Margins	Q1/Q2 ITS ~29%; PST ~29.5% in Q2 with sequential improvement .	PST up to 30.8% (+130 bps QoQ); ITS 29.0% with tariff dilution and mix .	PST improving; ITS pressured
Innovation/Tech	Q2 launched CompAir Ultima oil-free (+14% efficiency) .	Launched Meta compressor (+11% flow, –14% energy, 40% smaller) .	Continues
End Markets	Q2 strength in wastewater; managing hydrogen refueling exposure .	RNG U.S. still soft; positives in Brazil/Europe/India; Americas/EMEA orders solid .	Mixed; regional offsets
Cost Actions	Noted normal course productivity, integration benefits .	Proactive restructuring (largely headcount) to aid 2026 margins .	Incremental actions
M&A/Portfolio	Q2: 11 deals YTD; 9.5x pre-synergy multiple; raised FY guide .	$249M Q3; pace continues; life sciences bolt-ons; share repurchases ongoing .	Ongoing

Management Commentary

“We delivered positive organic orders growth in the third quarter across both segments…We remain well positioned for future growth with our proven agile business model, operational excellence, and ownership mindset.” — Vicente Reynal, CEO .
“Adjusted EBITDA of $545 million, with an adjusted EBITDA margin of 27.9%…We have recently implemented proactive measures to optimize our cost structure…position us well heading into 2026.” — Vikram Kini, CFO .
“The effect of incremental Section 232 tariffs…Pricing actions have been executed to offset these incremental tariffs. However…we expect this pricing to be realized in 2026…As a result, the midpoint of adjusted EPS guidance has been reduced to $3.28 from $3.40.” — CEO .
“Pricing will be sticky…we have never done price reductions based on [tariffs]…as tariffs will go away, there could be a benefit.” — CEO .

Q&A Highlights

Tariffs magnitude and timing: In-year headwind now slightly above $100M; multiple price actions taken, but backlog growth defers realization into 2026 .
Margin path: Expect muted expansion in 1H26 with improvement later as pricing catches up and tariff mitigation takes effect; still committed to 30% ITS margin by 2027 .
End-market color: Clean energy/RNG remains soft in North America, better in Europe/LatAm/India; wastewater and certain China applications supportive .
Cost actions: Restructuring largely headcount-related, with ~one-year payback; more benefit in 2026 .
Capital deployment: Q3 buybacks $193M; balance sheet supports incremental repurchases alongside bolt-on M&A .

Estimates Context

How Q3 results compared to S&P Global consensus:

Revenue: $1.955B vs $1.949B consensus* — modest beat .
Adjusted/Primary EPS: $0.86 vs $0.86 consensus* — in line .
EBITDA: Adjusted EBITDA $545M vs EBITDA consensus $541M*; note definitional differences (company reports Adjusted EBITDA) .

Forward consensus (S&P Global) and company color:

Metric	Q3 2025	Q4 2025	Q1 2026
Revenue Consensus Mean ($B)	1.949*	2.036*	1.858*
Primary EPS Consensus Mean ($)	0.863*	0.904*	0.777*
EBITDA Consensus Mean ($M)	541.2*	560.4*	500.0*
# EPS Est. / # Rev. Est.	15 / 12*	15 / 12*	9 / 5*

Management expects Q4 margins roughly flat vs Q3 and maintained FY assumptions for tax (~~23.5%), net interest (~~$220M), and CapEx (~2% of revenue) .
2026 set-up: backlog up high teens since YE’24; pricing actions in backlog to convert in 2026; potential tariff relief not in current FY25 guide .

Values retrieved from S&P Global.*

Key Takeaways for Investors

PST is the earnings engine near term: sustained sequential and YoY margin gains to 30.8% provide mix support while ITS absorbs tariff/mix pressure .
Guidance reset reduces bar: EBITDA/EPS trimmed primarily on tariff timing; corporate costs improved, M&A contribution up—creating potential for upside if tariff relief materializes or price realization accelerates .
Backlog and pricing underpin 2026: backlog up high teens since YE’24 with multiple price actions embedded; management expects muted 1H26 and better 2H26 as price catches up .
Capital deployment remains active and balanced: bolt-on M&A at ~9.5x pre-synergy and ongoing buybacks supported by $3.8B liquidity and 1.8x leverage .
Watch tariff trajectory and RNG normalization: any confirmed tariff reductions and signs of U.S. RNG stabilization could lift margins and sentiment; neither is in FY25 guidance .
Innovation cadence intact: Meta compressor efficiency gains and multi-brand rollouts support share capture and aftermarket pull-through .
Trading setup: With earnings largely in line and guide rebased, near-term stock reaction hinges on tariff headlines, PST durability, and Q4 execution on flat margins vs Q3 .

Appendices: Additional Relevant Press Releases (Q3-related)

Dividend declaration: $0.02 per share payable Dec 4, 2025 (record Nov 13) .
Post-quarter: Transvac acquisition (ejector tech; wastewater/desalination/energy recovery) to augment IT&S engineered solutions and sustainability exposure .

Citations:
Press release (Q3 results):
8-K / Item 2.02:
Earnings call (Q3):
Prior quarters (trend): Q2 release & call ; Q1 release
Dividend PR:
Transvac PR:

Ingersoll Rand Inc. (IR)·Q3 2025 Earnings Summary