Materion Corp.: Q3 FY2026 earnings call

What management said about Q3 FY2026, from the documents filed with the SEC on 4 November 2026: press release. Guidance figures: 1 raised. The quarter’s numbers.

Key takeaways

Net sales and operating profit rose: Net sales reached $567.3 million from $444.8 million. Operating profit was $50.4 million against $34.9 million a year earlier. Source
Adjusted EBITDA third-quarter record: Adjusted EBITDA was $70.7 million, or 22.5% of value-added sales, against $55.5 million, or 21.0%. The company described it as a third quarter record. Source
Electronic Materials sales and profit rose: Electronic Materials net sales were $336.6 million against $246.8 million, and operating profit was $28.4 million against $16.3 million. Adjusted EBITDA was $33.2 million, or 32.1% of value-added sales, against 27.1%. Source
Semiconductor sales reached a record: Value-added sales were $313.7 million, up 19% from $263.9 million, driven by record quarterly semiconductor sales. Management described these as the highest quarterly semiconductor sales in company history. Source
Price and mix lifted adjusted margin: Management attributed the adjusted EBITDA and margin increase to higher volume and price/mix. Source
Orders and backlog set all-time highs: Incoming orders were up about 25% year over year and backlog about 35%, with both reaching all-time highs. Source
Quarterly free cash flow turned positive: Free cash flow was $45.8 million against $(5.2) million, equal to 120% of net income versus (20)%. Operating cash flow was $72.2 million against $18.3 million. Source

“Our third quarter results demonstrate the power of our advanced materials portfolio and the strong momentum building across the company.”
Jugal Vijayvargiya, President & CEO of Materion

Guidance

Area	Period	Figure	Against last quarter
Adjusted earnings per share Source	full year 2026	$7.10 - $7.40	Raised from $6.80 - $7.20
Adjusted EBITDA margin Source	mid-term	23%

What changed from last quarter

Guidance raised: Full-year adjusted EPS guidance raised to $7.10 - $7.40 from $6.80 - $7.20 in the second-quarter release. Source

Results and growth drivers

Net sales and operating profit rose: Net sales reached $567.3 million from $444.8 million. Operating profit was $50.4 million against $34.9 million a year earlier. Source
Net income and adjusted EPS higher: Net income was $38.3 million, or $1.81 diluted per share, against $25.4 million, or $1.22. Adjusted EPS, excluding acquisition amortization, was $1.93 versus $1.41. Source
Adjusted EBITDA third-quarter record: Adjusted EBITDA was $70.7 million, or 22.5% of value-added sales, against $55.5 million, or 21.0%. The company described it as a third quarter record. Source

Segments and end markets

Each segment grew double digits: Management said each business segment delivered double-digit year-over-year sales and earnings growth in the quarter. Source
Electronic Materials sales and profit rose: Electronic Materials net sales were $336.6 million against $246.8 million, and operating profit was $28.4 million against $16.3 million. Adjusted EBITDA was $33.2 million, or 32.1% of value-added sales, against 27.1%. Source
Performance Materials sales rose, margin lower: Performance Materials net sales were $199.0 million against $170.8 million, with operating profit of $30.4 million against $26.8 million. Adjusted EBITDA was $42.6 million, or 23.8% of value-added sales, against 24.2%. Source
Precision Optics operating profit rose: Precision Optics net sales were $31.7 million against $27.2 million. Operating profit was $3.0 million against $0.7 million; adjusted EBITDA was $5.5 million, or 17.4% of value-added sales, against 11.8%. Source
Semiconductor sales reached a record: Value-added sales were $313.7 million, up 19% from $263.9 million, driven by record quarterly semiconductor sales. Management described these as the highest quarterly semiconductor sales in company history. Source
Aerospace and telecom sales grew: Management also cited significant growth across aerospace & defense and telecom & data center end markets in the quarter. Source

“Combined with continued strong execution across the business, we are well-positioned to deliver our strongest quarter yet, closing out an exciting record year for Materion.”
Jugal Vijayvargiya, President & CEO of Materion

Margins, costs and pricing

Gross margin and SG&A both rose: Gross margin was $103.7 million against $86.1 million. Selling, general and administrative expense was $42.5 million against $38.3 million. Source
Price and mix lifted adjusted margin: Management attributed the adjusted EBITDA and margin increase to higher volume and price/mix. Source
Pass-through metal cost rose: Pass-through metal cost, deducted to reach value-added sales, was $253.6 million against $180.9 million a year earlier. Source
Interest expense fell, tax expense rose: Net interest expense was $6.6 million against $7.5 million. Income tax expense was $5.8 million against $2.7 million. Source
Special items small this quarter: Special items totaled $0.2 million in the quarter against $2.3 million a year earlier. Nine-month special items were $6.9 million against $7.5 million. Source
Other category loss grew: EBITDA for the Other category was $(10.6) million against $(7.8) million. Adjusted EBITDA was $(10.6) million against $(7.3) million. Source

Demand and the order book

Orders and backlog set all-time highs: Incoming orders were up about 25% year over year and backlog about 35%, with both reaching all-time highs. Source
Robust demand supports Q4 sales step-up: Management expects a meaningful step up in fourth-quarter sales, supported by record backlog and robust demand across end markets. Source
Order momentum cited for 2026 confidence: Management cited year-to-date performance, record backlog and continued order rate momentum as reinforcing confidence in record 2026 results. Source

Cash, capital and returns

Quarterly free cash flow turned positive: Free cash flow was $45.8 million against $(5.2) million, equal to 120% of net income versus (20)%. Operating cash flow was $72.2 million against $18.3 million. Source
Nine-month operating cash flow higher: Nine-month operating cash flow was $142.7 million against $83.7 million. Property, plant and equipment payments were $44.3 million; mine development payments were $13.6 million against $20.0 million. Source
Long-term debt lower, equity higher: Long-term debt was $377.4 million at October 2, 2026, against $436.3 million at December 31, 2025. Shareholders’ equity rose to $1,029.3 million from $943.3 million. Source
No nine-month buybacks; dividends paid: Nine-month share repurchases were nil against $7.8 million a year earlier. Cash dividends paid were $9.0 million, and withholding taxes on stock awards were $11.5 million. Source

Strategy and investment

Fourth consecutive quarter of margin expansion: Management listed a fourth consecutive quarter of year-over-year adjusted EBITDA margin expansion among the quarter's delivered items. Source
Automation and transformation program costs: Business transformation costs cover project management and implementation expenses for the automation and transformation initiatives. None were recorded in the quarter. Source
Restructuring tied to idled facilities: Restructuring and cost reduction covers charges and idled-facility costs from decreased demand. Restructuring expense was $0.1 million in the quarter and $2.7 million for nine months. Source

Figures management reported

Figure	Reported
Incoming orders, year over year Source	up ~25%
Backlog, year over year Source	up ~35%

Risks management discussed

External: Precious and other pass-through metal prices move reported net sales, so net sales trends are affected by metal price movements. Source
Financial: Management said it cannot identify future adjustments for claims, legacy environmental costs and integration, so adjusted guidance cannot reconcile to GAAP. Source
Operational: A Q4 2025 quality issue led to idled production facilities within Performance Materials, and related costs were treated as special items. Source

Earlier plans management reported on

Not stated: Management said it is making significant progress toward the mid-term target. No status word was given. Source

Other quarters

Summarised with AI from the documents the company filed with the SEC. Every point is checked against the filing before it is shown: management’s own words word for word, figures against the line or table row they come from. A point that fails the check is left out. Source opens the filing at that line.

As filed with the SEC

Open the filing on EDGAR

MATERION CORPORATION REPORTS

RECORD THIRD-QUARTER 2026 FINANCIAL RESULTS AND RAISES

FULL-YEAR OUTLOOK

MAYFIELD HEIGHTS, Ohio - Materion Corporation (NYSE: MTRN) today reported record third-quarter 2026 financial results and raised its full-year outlook.

Financial Summary

Net sales were $567.3 million versus $444.8 million in the prior year period; value-added sales were $313.7 million versus $263.9 million in the prior year period
Net income of $38.3 million, or $1.81 per share, diluted, versus $25.4 million, or $1.22 per share, in the prior year period; adjusted earnings of $1.93 per share versus $1.41 in the prior year period
Operating profit of $50.4 million versus $34.9 million in the prior year period; adjusted EBITDA of $70.7 million, or 22.5% of value-added sales, versus $55.5 million, or 21.0%, in the prior year period
Strong free cash flow generation of ~$46 million, with 120% conversion
Raising full-year adjusted earnings per share outlook to $7.10 - $7.40, an increase of 33% year-over-year at the midpoint

Business Highlights

Delivered:
Record quarterly value-added sales and earnings
Highest quarterly semiconductor sales in company history
Double-digit year-over-year sales and earnings growth in each segment
Fourth consecutive quarter of year-over-year adjusted EBITDA margin expansion
Incoming orders and backlog reached all-time high, up ~25% and ~35% year-over-year respectively
Making significant progress towards mid-term adjusted EBITDA margin target of 23%

“Our third quarter results demonstrate the power of our advanced materials portfolio and the strong momentum building across the company. The team’s commitment to delivering for our customers across diverse end markets drove double-digit growth in each business segment and resulted in another quarter of record sales and earnings,” said Jugal Vijayvargiya, President & CEO of Materion.

“As we enter the fourth quarter, the outlook is very strong. We expect a meaningful step up in sales supported by record backlog and robust demand across our end markets. Combined with continued strong execution across the business, we are well-positioned to deliver our strongest quarter yet, closing out an exciting record year for Materion."

THIRD QUARTER 2026 RESULTS

Net sales for the quarter were $567.3 million, compared to $444.8 million in the prior year period. Value-added sales were $313.7 million for the quarter, up 19% from the prior year period, driven by record quarterly semiconductor sales and significant growth across aerospace & defense and telecom & data center end markets.

Operating profit for the quarter was $50.4 million and net income was $38.3 million, or $1.81 per diluted share, compared to operating profit of $34.9 million and net income of $25.4 million, or $1.22 per share, in the prior year period.

Excluding special items, adjusted EBITDA was a third quarter record at $70.7 million, or 22.5% of value-added sales, compared to $55.5 million or 21.0% of value-added sales in the prior year period. The strong adjusted EBITDA and margin were driven by higher volume and strong price/mix.

Adjusted net income was $40.8 million excluding acquisition amortization, or $1.93 per diluted share, compared to $1.41 per share in the prior year period.

OUTLOOK

Our strong year-to-date performance, record backlog and continued order rate momentum have further reinforced our confidence in delivering record results for 2026. We are raising our full-year adjusted earnings per share guidance to $7.10 to $7.40, representing a 33% increase over the prior year at the midpoint.

ADJUSTED EARNINGS GUIDANCE

It is not possible for the Company to identify the amount or significance of future adjustments associated with potential insurance and litigation claims, legacy environmental costs, acquisition and integration costs, certain income tax items, or other non-routine costs that the Company adjusts in the presentation of adjusted earnings guidance. These items are dependent on future events that are not reasonably estimable at this time. Accordingly, the Company is unable to reconcile without unreasonable effort the forecasted range of adjusted earnings guidance for the full year to a comparable GAAP range. However, items excluded from the Company's adjusted earnings guidance include the historical adjustments noted in Attachments 4 through 9 to this press release.

CONFERENCE CALL

Materion Corporation will host an investor conference call with analysts at 9:00 a.m. Eastern Time, November 4, 2026. The conference call will be available via webcast through the Company’s website at www.materion.com. By phone, please dial (888) 506-0062. Calls outside the U.S. can dial (973) 528-0011; please reference participant access code of 777356. A replay of the call will be available until November 18, 2026 by dialing (877) 481-4010 or (919) 882-2331 if international; please reference replay ID number 53276. The call will also be archived on the Company’s website.

FOOTNOTES

Value-added sales deducts the impact of pass-through metals from net sales

EBITDA represents earnings before interest, taxes, depreciation, depletion and amortization

See reconciliation of operating cash flow to free cash flow in Attachment 9

Details of the special items can be found in Attachments 4 through 8

ABOUT MATERION

Materion Corporation is a global leader in advanced materials solutions for high-performance industries including semiconductor, industrial, aerospace & defense, energy and automotive. With nearly 100 years of expertise in specialty engineered alloy systems, inorganic chemicals and powders, precious and non-precious metals, beryllium and beryllium composites, and precision filters and optical coatings, Materion partners with customers to enable breakthrough solutions that move the world forward. Headquartered in Mayfield Heights, Ohio, the Company employs more than 3,000 talented people worldwide, serving customers in more than 60 countries.

FORWARD-LOOKING STATEMENTS

Forward-looking statements notice

Portions of the narrative set forth in this document that are not statements of historical or current facts are forward-looking statements. Our actual future performance may materially differ from that contemplated by the forward-looking statements as a result of a variety of factors. These factors include, in addition to those mentioned elsewhere herein: the global economy, including inflationary pressures, potential future recessionary conditions and the impact of tariffs and trade agreements; the impact of any U.S. Federal Government shutdowns or sequestrations; the condition of the markets which we serve, whether defined geographically or by segment; changes in product mix and the financial condition of customers; our success in developing and introducing new products and new product ramp-up rates; our success in passing through the costs of raw materials to customers or otherwise mitigating fluctuating prices for those materials, including the impact of fluctuating prices on inventory values; our success in identifying acquisition candidates and in acquiring and integrating such businesses; the impact of the results of acquisitions on our ability to fully achieve the strategic and financial objectives related to these acquisitions; our success in implementing our strategic plans and the timely and successful start-up and completion of any capital projects; other financial and economic factors, including the cost and availability of raw materials (both base and precious metals), physical inventory valuations, metal consignment fees, tax rates, exchange rates, interest rates, pension costs and required cash contributions and other employee benefit costs, energy costs, regulatory compliance costs, the cost and availability of insurance, credit availability, and the impact of the Company’s stock price on the cost of incentive compensation plans; the uncertainties related to the impact of war, terrorist activities, and acts of God; changes in government regulatory requirements and the enactment of new legislation that impacts our obligations and operations; the conclusion of pending litigation matters in accordance with our expectation that there will be no material adverse effects; the disruptions in operations from, and other effects of, catastrophic and other extraordinary events including outbreaks from infectious diseases and other extraordinary events including geopolitical conflicts such as the conflict between Russia and Ukraine and the conflict between the United States and Iran; realization of expected financial benefits expected from the Inflation Reduction Act of 2022; and the risk factors set forth in Part 1, Item 1A of the Company's 2025 Annual Report on Form 10-K and in other reports that we file with the SEC.

Materion Corporation and Subsidiaries

Consolidated Statements of Income

(Unaudited)

	Third Quarter Ended		Nine Months Ended
(In thousands except per share amounts)	October 2, 2026	September 26, 2025	October 2, 2026	September 26, 2025
Net sales	$567,290	$444,808	$1,731,021	$1,296,796
Cost of sales	463,589	358,685	1,441,142	1,051,836
Gross margin	103,701	86,123	289,879	244,960
Selling, general, and administrative expense	42,525	38,256	121,047	108,740
Research and development expense	6,505	6,548	19,224	19,466
Restructuring expense	92	212	2,711	2,729
Other - net	4,172	6,164	16,605	15,068
Operating profit	50,407	34,943	130,292	98,957
Other non-operating (income) - net	(370)	(711)	(997)	(1,944)
Interest expense - net	6,605	7,544	21,709	22,691
Income before income taxes	44,172	28,110	109,580	78,210
Income tax expense	5,840	2,698	13,116	9,960
Net income	$38,332	$25,412	$96,464	$68,250
Basic earnings per share:
Net income per share of common stock	$1.84	$1.23	$4.64	$3.29
Diluted earnings per share:
Net income per share of common stock	$1.81	$1.22	$4.57	$3.27
Weighted-average number of shares of common stock outstanding:
Basic	20,848	20,731	20,810	20,763
Diluted	21,163	20,883	21,116	20,893

Attachment 2

Materion Corporation and Subsidiaries

Consolidated Balance Sheets

(Unaudited)

(Thousands)	October 2, 2026	December 31, 2025
Assets
Current assets
Cash and cash equivalents	$15,404	$13,681
Accounts receivable, net	268,815	222,916
Inventories, net	485,943	461,231
Prepaid and other current assets	88,911	91,692
Total current assets	859,073	789,520
Deferred income taxes	9,640	7,727
Property, plant, and equipment	1,411,039	1,376,703
Less allowances for depreciation, depletion, and amortization	(870,251)	(841,245)
Property, plant, and equipment, net	540,788	535,458
Operating lease, right-of-use assets	62,286	62,036
Intangible assets, net	96,887	105,874
Other assets	24,900	21,529
Goodwill	279,824	280,657
Total Assets	$1,873,398	$1,802,801
Liabilities and Shareholders’ Equity
Current liabilities
Short-term debt	$19,609	$22,445
Accounts payable	189,139	148,642
Salaries and wages	30,701	19,312
Other liabilities and accrued items	53,914	45,445
Income taxes	809	5,054
Unearned revenue	11,967	12,685
Total current liabilities	306,139	253,583
Other long-term liabilities	13,240	12,556
Operating lease liabilities	61,882	60,568
Finance lease liabilities	12,308	13,384
Retirement and post-employment benefits	22,609	23,931
Unearned income	47,766	55,862
Long-term income taxes	544	532
Deferred income taxes	2,150	2,760
Long-term debt	377,440	436,348
Shareholders’ equity	1,029,320	943,277
Total Liabilities and Shareholders’ Equity	$1,873,398	$1,802,801

Attachment 3

Materion Corporation and Subsidiaries

Consolidated Statements of Cash Flows

(Unaudited)

	Nine Months Ended
(Thousands)	October 2, 2026	September 26, 2025
Cash flows from operating activities:
Net income	$96,464	$68,250
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation, depletion, and amortization	57,333	51,551
Amortization of deferred financing costs in interest expense	717	1,647
Stock-based compensation expense (non-cash)	12,506	8,520
Deferred income tax expense (benefit)	(2,180)	(43)
Changes in assets and liabilities:
Accounts receivable	(46,747)	1,701
Inventory	(24,202)	(21,980)
Prepaid and other current assets	410	(21,089)
Accounts payable and accrued expenses	56,469	21,532
Unearned revenue	(5,788)	(13,142)
Interest and taxes payable	(2,387)	(1,550)
Other-net	98	(11,673)
Net cash provided by operating activities	142,693	83,724
Cash flows from investing activities:
Payments for purchase of property, plant, and equipment	(44,291)	(38,741)
Payments for mine development	(13,591)	(19,952)
Proceeds from sale of property, plant, and equipment	-	932
Payments for acquisition, net of cash acquired	-	(19,500)
Net cash used in investing activities	(57,882)	(77,261)
Cash flows from financing activities:
Proceeds from (repayments of) borrowings under credit facilities, net	(57,429)	30,574
Repayment of debt	(4,495)	(16,609)
Principal payments under finance lease obligations	(456)	(456)
Cash dividends paid	(8,950)	(8,608)
Deferred financing costs	-	(2,935)
Repurchase of common stock	-	(7,843)
Payments of withholding taxes for stock-based compensation awards	(11,540)	(2,540)
Net cash used in financing activities	(82,870)	(8,417)
Effects of exchange rate changes	(218)	1,652
Net change in cash and cash equivalents	1,723	(302)
Cash and cash equivalents at beginning of period	13,681	16,713
Cash and cash equivalents at end of period	$15,404	$16,411

Attachment 4

Materion Corporation and Subsidiaries

Reconciliation of Non-GAAP Measure - Value-added Sales, Operating Profit, and EBITDA

(Unaudited)

	Third Quarter Ended		Nine Months Ended
(Millions)	October 2, 2026	September 26, 2025	October 2, 2026	September 26, 2025
Net Sales
Performance Materials	$199.0	$170.8	$562.6	$527.6
Electronic Materials	336.6	246.8	1,075.1	696.0
Precision Optics	31.7	27.2	93.3	73.2
Other	-	-	-	-
Total	$567.3	$444.8	$1,731.0	$1,296.8
Less: Pass-through Metal Cost
Performance Materials	$20.3	$13.7	$54.5	$41.9
Electronic Materials	233.2	167.1	792.6	462.4
Precision Optics	0.1	0.1	0.3	0.2
Other	-	-	-	-
Total	$253.6	$180.9	$847.4	$504.5
Value-added Sales (non-GAAP)
Performance Materials	$178.7	$157.1	$508.1	$485.7
Electronic Materials	103.4	79.7	282.5	233.6
Precision Optics	31.6	27.1	93.0	73.0
Other	-	-	-	-
Total	$313.7	$263.9	$883.6	$792.3
Gross Margin
Performance Materials	$47.5	$44.7	$130.1	$141.9
Electronic Materials	45.6	33.1	126.1	84.1
Precision Optics	10.6	8.3	33.7	19.0
Other	-	-	-	-
Total	$103.7	$86.1	$289.9	$245.0
See reconciliation of gross margin to adjusted gross margin in Attachment 8
Note: Quarterly information presented within this document and previously disclosed quarterly information may not equal the total computed for the year due to rounding

	Third Quarter Ended		Nine Months Ended
(Millions)	October 2, 2026	September 26, 2025	October 2, 2026	September 26, 2025
Operating Profit/(Loss)
Performance Materials	$30.4	$26.8	$79.9	$89.1
Electronic Materials	28.4	16.3	72.4	36.4
Precision Optics	3.0	0.7	9.4	(4.0)
Other	(11.4)	(8.9)	(31.4)	(22.5)
Total	$50.4	$34.9	$130.3	$99.0
Non-Operating (Income)/Expense
Performance Materials	$0.2	$0.2	$0.4	$0.3
Electronic Materials	-	(0.2)	(0.1)	(0.2)
Precision Optics	(0.3)	(0.2)	(0.6)	(0.6)
Other	(0.3)	(0.6)	(0.7)	(1.4)
Total	$(0.4)	$(0.8)	$(1.0)	$(1.9)
Depreciation, Depletion, and Amortization
Performance Materials	$12.3	$10.3	$35.1	$29.9
Electronic Materials	4.7	4.4	14.0	13.0
Precision Optics	2.2	2.3	6.7	7.2
Other	0.5	0.5	1.5	1.5
Total	$19.7	$17.5	$57.3	$51.6
Segment EBITDA
Performance Materials	$42.5	$36.9	$114.6	$118.7
Electronic Materials	33.1	20.9	86.5	49.6
Precision Optics	5.5	3.2	16.7	3.8
Other	(10.6)	(7.8)	(29.2)	(19.6)
Total	$70.5	$53.2	$188.6	$152.5
Special Items
Performance Materials	$0.1	$1.1	$4.3	1.7
Electronic Materials	0.1	0.7	0.6	3.1
Precision Optics	-	-	0.9	1.5
Other	-	0.5	1.1	1.2
Total	$0.2	$2.3	$6.9	$7.5
Adjusted EBITDA Excluding Special Items
Performance Materials	$42.6	$38.0	$118.9	$120.4
Electronic Materials	33.2	21.6	87.1	52.7
Precision Optics	5.5	3.2	17.6	5.3
Other	(10.6)	(7.3)	(28.1)	(18.4)
Total	$70.7	$55.5	$195.5	$160.0

The cost of gold, silver, platinum, palladium, copper, ruthenium, iridium, rhodium, rhenium, and osmium is passed through to customers and, therefore, the trends and comparisons of net sales are affected by movements in the market price of these metals. Internally, management also reviews net sales on a value-added basis. Value-added sales is a non-GAAP financial measure that deducts the value of the pass-through metals sold from net sales. Value-added sales allows management to assess the impact of differences in net sales between periods or segments and analyze the resulting margins and profitability without the distortion of the movements in pass-through market metal prices. The dollar amount of gross margin and operating profit is not affected by the value-added sales calculation. The Company sells other metals and materials that are not considered direct pass throughs, and these costs are not deducted from net sales to calculate value-added sales.

The Company’s pricing policy is to pass the cost of these metals on to customers in order to mitigate the impact of price volatility on the Company’s results from operations. Value-added information is being presented since changes in metal prices may not directly impact profitability. It is the Company’s intent to allow users of the financial statements to review sales with and without the impact of the pass-through metals.

See additional details of special items in Attachment 5.

Attachment 5

Materion Corporation and Subsidiaries

Reconciliation of Net Sales to Value-added Sales, Net Income to EBITDA and Adjusted EBITDA

(Unaudited)

	Third Quarter Ended		Nine Months Ended
(Millions)	October 2, 2026	September 26, 2025	October 2, 2026	September 26, 2025
Net sales	$567.3	$444.8	$1,731.0	$1,296.8
Pass-through metal cost	253.6	180.9	847.4	504.5
Value-added sales	$313.7	$263.9	$883.6	$792.3
Net income	$38.3	$25.4	$96.5	$68.3
Income tax expense	5.9	2.7	13.1	9.9
Interest expense - net	6.6	7.6	21.7	22.7
Depreciation, depletion and amortization	19.7	17.5	57.3	51.6
Consolidated EBITDA	$70.5	$53.2	$188.6	$152.5
Net Income as a % of Net sales	6.8%	5.7%	5.6%	5.3%
Net Income as a % of Value-added sales	12.2%	9.6%	10.9%	8.6%
EBITDA as a % of Net sales	12.4%	12.0%	10.9%	11.8%
EBITDA as a % of Value-added sales	22.5%	20.2%	21.3%	19.2%
Special items
Restructuring and cost reduction	$0.2	$0.2	$2.8	$2.8
Product quality issue	-	-	3.5	-
Business transformation costs	-	0.5	0.4	0.8
Merger, acquisition and divestiture related costs	-	1.0	-	3.3
Environmental Remediation	-	0.6	-	0.6
Other	-	-	0.2	-
Total special items	0.2	2.3	6.9	7.5
Adjusted EBITDA	$70.7	$55.5	$195.5	$160.0
Adjusted EBITDA as a % of Net sales	12.5%	12.5%	11.3%	12.3%
Adjusted EBITDA as a % of Value-added sales	22.5%	21.0%	22.1%	20.2%

In addition to presenting financial statements prepared in accordance with U.S. generally accepted accounting principles (GAAP), this earnings release contains financial measures, including gross margin, segment gross margin, operating profit, segment operating profit, earnings before interest, taxes, depreciation, depletion and amortization (EBITDA), segment EBITDA, net income, and earnings per share, on a non-GAAP basis. As detailed in the above reconciliation and Attachments 6-8, we have adjusted the results for certain special items, including the following:

1.Restructuring and cost reduction - Costs include restructuring charges, costs associated with temporarily idled facilities as a result of decreased demand and costs associated with disposal of assets associated with obsolete products.

2.Product quality issue - Represents costs incurred related to a previously identified quality issue in the fourth quarter of 2025 identified by a large precision clad strip customer which led to temporarily idling production facilities within the Performance Materials segment.

3.Business transformation costs - Represents project management and implementation expenses related to the Company's automation and transformation initiatives.

4.Merger, acquisition and divestiture related costs - Includes due diligence costs associated with potential merger, acquisition and divestitures as well as loss on asset disposals.

5.Environmental remediation - Cost associated with non-recurring environmental remediation

6.Other - Costs primarily consist of miscellaneous expenses that are not indicative of current performance and are therefore included within our EBITDA adjustments, but are not significant enough to warrant separate presentation.

Internally, management reviews the results of operations without the impact of these costs in order to assess the profitability from ongoing activities. We are providing this information because we believe it will assist investors in analyzing our financial results and, when viewed in conjunction with the GAAP results, provide a more comprehensive understanding of the factors and trends affecting our operations.

Attachment 6

Materion Corporation and Subsidiaries

Reconciliation of Net Income to Adjusted Net Income

and Diluted Earnings per Share to Adjusted Diluted Earnings per Share (Unaudited)

	Third Quarter Ended					Nine Months Ended
(Millions)	October 2, 2026	Diluted EPS	September 26, 2025	Diluted EPS		October 2, 2026	Diluted EPS		September 26, 2025	Diluted EPS
Net income and EPS	$38.3	$1.81	$25.4	$1.22		$96.5	$4.57		$68.3	$3.27
Special items
Restructuring and cost reduction	0.2		0.2			2.8			2.8
Product quality issue	-		-			3.5			-
Business transformation costs	-		0.5			0.4			0.8
Merger, acquisition and divestiture related costs	-		1.0			-			3.3
Environmental Remediation	-		0.6		-	-		-	0.6
Other	-		-			0.2			-
Debt extinguishment costs	-		-			-			0.5
Provision for income taxes	0.3		(0.4)			(1.8)			(1.2)
Total special items	0.5	0.02	1.9	0.09		5.1	0.24		6.8	0.33
Adjusted net income and adjusted EPS	$38.8	$1.83	$27.3	$1.31		$101.6	$4.81		$75.1	$3.60
Acquisition amortization (net of tax)	2.0	0.10	2.1	0.10		6.0	0.29		6.5	0.31
Adjusted net income and adjusted EPS excl. amortization	$40.8	$1.93	$29.4	$1.41		$107.6	$5.10		$81.6	$3.91

Debt extinguishment costs - Represents debt extinguishment costs incurred in connection with the amendment of the Company's Credit Agreement in June 2025.

Provision for income taxes includes the net tax impact on pre-tax adjustments (listed above), the impact of certain discrete tax items recorded during the respective periods as well as other adjustments to reflect the use of one overall effective tax rate on adjusted pre-tax income in interim periods.

Attachment 7

Reconciliation of Segment Net sales to Segment Value-added sales and Segment EBITDA to Adjusted Segment EBITDA (Unaudited)
Performance Materials	Third Quarter Ended		Nine Months Ended
(Millions)	October 2, 2026	September 26, 2025	October 2, 2026	September 26, 2025
Net sales	$199.0	$170.8	$562.6	$527.6
Pass-through metal cost	20.3	13.7	54.5	41.9
Value-added sales	$178.7	$157.1	$508.1	$485.7
EBITDA	$42.5	$36.9	$114.6	$118.7
Restructuring and cost reduction	0.1	-	0.6	0.5
Product quality issue	-	-	3.5	-
Environmental remediation	-	0.6	-	0.6
Business transformation costs	-	0.5	0.2	0.6
Adjusted EBITDA	$42.6	$38.0	$118.9	$120.4
EBITDA as a % of Net sales	21.4%	21.6%	20.4%	22.5%
EBITDA as a % of Value-added sales	23.8%	23.5%	22.6%	24.4%
Adjusted EBITDA as a % of Net sales	21.4%	22.2%	21.1%	22.8%
Adjusted EBITDA as a % of Value-added sales	23.8%	24.2%	23.4%	24.8%
Electronic Materials
	Third Quarter Ended		Nine Months Ended
(Millions)	October 2, 2026	September 26, 2025	October 2, 2026	September 26, 2025
Net sales	$336.6	$246.8	$1,075.1	$696.0
Pass-through metal cost	233.2	167.1	792.6	462.4
Value-added sales	$103.4	$79.7	$282.5	$233.6
EBITDA	$33.1	$20.9	$86.5	$49.6
Restructuring and cost reduction	0.1	0.2	0.5	0.8
Merger, acquisition and divestiture related costs	-	0.5	-	2.3
Other	-	-	0.1	-
Adjusted EBITDA	$33.2	$21.6	$87.1	$52.7
EBITDA as a % of Net sales	9.8%	8.5%	8.0%	7.1%
EBITDA as a % of Value-added sales	32.0%	26.2%	30.6%	21.2%
Adjusted EBITDA as a % of Net sales	9.9%	8.8%	8.1%	7.6%
Adjusted EBITDA as a % of Value-added sales	32.1%	27.1%	30.8%	22.6%
Precision Optics
	Third Quarter Ended		Nine Months Ended
(Millions)	October 2, 2026	September 26, 2025	October 2, 2026	September 26, 2025
Net sales	$31.7	$27.2	$93.3	$73.2
Pass-through metal cost	0.1	0.1	0.3	0.2
Value-added sales	$31.6	$27.1	$93.0	$73.0
EBITDA	$5.5	$3.2	$16.7	$3.8
Restructuring and cost reduction	-	-	0.9	1.5
Adjusted EBITDA	$5.5	$3.2	$17.6	$5.3
EBITDA as a % of Net sales	17.4%	11.8%	17.9%	5.2%
EBITDA as a % of Value-added sales	17.4%	11.8%	18.0%	5.2%
Adjusted EBITDA as a % of Net sales	17.4%	11.8%	18.9%	7.2%
Adjusted EBITDA as a % of Value-added sales	17.4%	11.8%	18.9%	7.3%

	Third Quarter Ended		Nine Months Ended
Other
(Millions)	October 2, 2026	September 26, 2025	October 2, 2026	September 26, 2025
EBITDA	$(10.6)	$(7.8)	$(29.2)	$(19.6)
Restructuring and cost reduction	-	-	0.8	-
Business transformation costs	-	-	0.2	0.2
Merger, acquisition and divestiture related costs	-	0.5	-	1.0
Other	-	-	0.1	-
Adjusted EBITDA	$(10.6)	$(7.3)	$(28.1)	$(18.4)

Attachment 8

Materion Corporation and Subsidiaries

Reconciliation of Non-GAAP Measure - Gross Margin to Adjusted Gross Margin

(Unaudited)

	Third Quarter Ended		Nine Months Ended
(Millions)	October 2, 2026	September 26, 2025	October 2, 2026	September 26, 2025
Gross Margin
Performance Materials	$47.5	$44.7	$130.1	$141.9
Electronic Materials	45.6	33.1	126.1	84.1
Precision Optics	10.6	8.3	33.7	19.0
Other	-	-	-	-
Total	$103.7	$86.1	$289.9	$245.0
Special Items
Performance Materials	$ -	$0.6	$3.5	$0.6
Electronic Materials	-	-	-	-
Precision Optics	-	-	-	-
Other	-	-	-	-
Total	$ -	$0.6	$3.5	$0.6
Adjusted Gross Margin
Performance Materials	$47.5	$45.3	$133.6	$142.5
Electronic Materials	45.6	33.1	126.1	84.1
Precision Optics	10.6	8.3	33.7	19.0
Other	-	-	-	-
Total	$103.7	$86.7	$293.4	$245.6

Special items impacting gross margin represent the product quality issue identified in the fourth quarter of 2025.

Attachment 9

Materion Corporation and Subsidiaries

Reconciliation of Non-GAAP Measure - Operating Cash Flow to Free Cash Flow

(Unaudited)

	Third Quarter Ended		Nine Months Ended
(Millions)	October 2, 2026	September 26, 2025	October 2, 2026	September 26, 2025
Net Income	$38.3	$25.4	$96.5	$68.3
Net cash provided by operating activities	$72.2	$18.3	$142.7	$83.7
Payments for purchase of property, plant and equipment	(14.5)	(13.7)	(44.3)	(38.7)
Payments for mine development	(11.9)	(9.8)	(13.6)	(20.0)
Free cash flow (FCF)	$45.8	$(5.2)	$84.8	$25.0
Free cash flow conversion as a % of Net Income	120%	(20)%	88%	37%

Free cash flow (FCF) represents operating cash flow adjusted for capital expenditures and mine development costs. Management believes FCF is an important performance measure of the business. FCF is not a measure calculated in accordance with GAAP, and it should not be considered a substitute for operating cash flow or any other measure of financial performance presented in accordance with GAAP.

Contacts
Kyle Kelleher
(216) 383-4931 kyle.kelleher@materion.com
Jason Saragian
(216) 383-6893 jason.saragian@materion.com https://materion.com
Attachment 1