Q1 Earnings Reveal Acquisition Impact: Higher Sales, Lower Net Income, Increased Debt
ALSN sits 62% above its 52-week low of $76.01.
Summary
Allison Transmission reported Q1 2026 results showing a significant increase in net sales due to the Dana acquisition, but a notable decrease in net income and EPS, alongside a substantial rise in debt.
Key Events · Earnings and Guidance · ALSN
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Q1 2026 Financial Performance
Net sales increased to $1,406 million for the three months ended March 31, 2026, up from $766 million in the prior year. However, net income decreased to $112 million from $192 million, and diluted EPS fell to $1.33 from $2.23.
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Impact of Dana Off-Highway Acquisition
The acquisition, completed on January 1, 2026, for $2,628 million, contributed $673 million in net sales but resulted in a $21 million operating loss for the new Allison Off-Highway segment. Acquisition-related expenses of $17 million and purchase price accounting adjustments (including $63 million for inventory step-up and $13 million for depreciation) also impacted profitability.
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Increased Debt and Reduced Cash
Long-term debt increased significantly to $4,247 million as of March 31, 2026, from $2,885 million at December 31, 2025, primarily to fund the acquisition. Cash and cash equivalents decreased to $311 million from $1,495 million over the same period.
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Share Repurchase Program Activity
The company repurchased $20 million of common stock during Q1 2026 under its existing $5,000 million program, with $1,171 million remaining authorized for repurchases.
Analysis · ALSN · Manufacturing
This quarterly report provides the first detailed financial results following the significant acquisition of Dana's off-highway business on January 1, 2026. While net sales saw a substantial increase driven by the new segment, net income and earnings per share declined year-over-year due to acquisition-related costs, higher interest expense, and purchase price accounting adjustments. The acquisition also led to a considerable increase in long-term debt and a reduction in cash reserves. Investors should monitor the integration of the new segment and its path to profitability, as well as the company's debt management, to assess the long-term benefits of this strategic expansion.
How filings like this one have moved
In the 30 days to Oct 5, 2026, 29.2% of the 1496 measured filings Wiseek scored 7 moved their stock by 5% or more by the next session's close. The median move was -0.63%. These are measured outcomes after filings of this importance, not a forecast for this one.
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At the time of this filing, ALSN was trading at $123.02 on NYSE in the Manufacturing sector, with a market capitalization of approximately $10.2B. The 52-week trading range was $76.01 to $137.62. This filing was assessed with neutral market sentiment and an importance score of 7 out of 10.