Lindsay (NYSE:LNN) executives said demand for irrigation equipment remained soft in North America during the company’s fiscal second quarter of 2026, while international results were tempered by project timing in the Middle East and North Africa (MENA) and continued financing constraints in Brazil. The company also reported a sharp year-over-year decline in Infrastructure segment revenue due to the absence of a large Road Zipper project that benefited the prior-year period.
Management addresses Middle East conflict and MENA project timing
President and CEO Randy Wood opened the call by addressing “recent developments related to the conflict in the Middle East,” noting the company is “closely monitoring the situation” with employee and partner safety as its top priority.
In response to analyst questions, Wood said the current MENA project is being manufactured in Turkey and that the company has confirmed with logistics providers and suppliers that the project remains on track “provided this is not a prolonged… conflict.” He added that if the conflict lasts “months or several quarters,” the company’s outlook could change. Wood also said there “could be short-term delays” in other regional business as customers take a “wait and see” stance.
Second-quarter results: revenue down 16% and margins pressured
Chief Financial Officer Sam Henrichson reported total fiscal second-quarter revenue of $157.7 million, down 16% from $187.1 million a year earlier, driven by lower revenue in both operating segments.
Operating income was $13.0 million versus $32.1 million in the prior-year quarter, with operating margin declining to 8.3% from 17.2%. Net earnings were $12.0 million, or $1.16 per diluted share, compared with $26.6 million, or $2.44 per diluted share, a year earlier. Henrichson attributed the year-over-year decline in net earnings to lower operating income and a higher effective tax rate.
Irrigation: North America volume declines offset partly by pricing
Irrigation segment revenue totaled $141.2 million, down 5% from $148.1 million in the prior-year quarter. Henrichson said results were “largely in line with our expectations” amid a “continued challenging agricultural environment.”
North America irrigation revenue was $71.0 million, down 8% year over year. Henrichson said lower unit sales volume was “partially offset by higher average selling prices,” and demand remained pressured by “low commodity prices and overall tempered farmer sentiment.” Wood said customers continued to delay large capital purchases given current farm economics and that the company was not seeing a typical spring pickup in order volume.
International irrigation revenue was $70.2 million, compared with $71.0 million a year earlier. Henrichson said the marginal decline reflected lower volume in Brazil and “MENA project timing,” partly offset by growth in other international markets. Wood said Brazil continues to face high interest rates and limited credit availability, constraining growers’ ability to finance capital equipment purchases. He added that market feedback suggests Brazil’s 2026 crop plan, expected to be released in July, could include lower financing rates than the prior year, prompting many customers to wait.
Irrigation segment operating income was $19.5 million, down from $27.4 million, with operating margin falling to 13.8% from 18.5%. Henrichson said the margin compression was mainly due to lower North America volume, unfavorable regional mix, and “fixed cost deleverage.”
On pricing, management characterized the market as more competitive during the downturn, particularly among smaller private competitors, but still “rational.” Wood said Lindsay’s approach is strategic and that the company is not using pricing to drive market-share gains, adding, “We certainly want to preserve the quality of the business.” Henrichson also noted that while year-over-year pricing was favorable, cost increases “exceeded the pricing opportunities we’re able to get in the market,” contributing to margin pressure.
Infrastructure: prior-year Road Zipper project drives the comparison
Infrastructure segment revenue declined to $16.5 million from $38.9 million in the prior-year quarter. Management reiterated that the year-earlier period included delivery of a $20 million Road Zipper project that did not repeat this quarter.
Excluding the prior-year Road Zipper project, Wood said Infrastructure revenue grew 6% in the quarter, led by higher sales in road safety products. Henrichson said the same, attributing the underlying growth to “continued growth in road safety products.”
Infrastructure operating income was $1.2 million, down from $13.3 million, and operating margin was 7.1% versus 34.1% a year earlier. Henrichson said the decline was primarily due to the absence of the higher-margin Road Zipper project revenue and the resulting unfavorable mix. In the Q&A, management said that without a large project, segment margins are expected to be “closer to what we’ve seen right now,” citing cost absorption deleverage.
Wood also highlighted new product introductions in the road safety portfolio, unveiled at the American Traffic Safety Services Association trade show. He described the AlphaGuard channeling device as offering “speed, strength, and flexibility” for both emergency and everyday applications, and the Road Runner as a truck-mounted attenuator designed for faster deployment and durability.
Balance sheet, capital allocation, and Nebraska investments
Henrichson said total available liquidity at quarter end was $236.1 million, consisting of $186.1 million in cash and cash equivalents and $50 million available under the company’s revolving credit facility. He added that Lindsay completed $25 million of share repurchases during the quarter while continuing “progress on key strategic investments.”
Management also provided updates on capital investments in Lindsay, Nebraska. Wood said the tube mill is “up and running and turned over to full production,” aided by favorable winter weather conditions. He said construction of the new galvanizing facility is “on track” and expected to come online near the end of the calendar year, “sometime in the first portion of our fiscal 2027 year,” later indicating it is expected in early 2027.
Wood and Henrichson both cautioned that near-term financial benefits from the investments are likely to be muted due to incremental depreciation and current volume levels. Wood said the company will need market recovery to achieve “volume leverage” on the investment and realize improved profitability in an upcycle.
Looking ahead, Wood said near-term conditions remain challenging in North America, with current indicators suggesting the “trough environment” will persist until there is more clarity around trade impacts, profitability, and the Middle East situation. In Brazil, he said recovery will depend on grower response to the July crop plan and financing availability, and management does not expect “any meaningful market recovery” before then. He also said Lindsay plans to continue delivering the large MENA project through the third and fourth fiscal quarters and remains focused on managing spending while investing for long-term growth.
About Lindsay (NYSE:LNN)
Lindsay Corporation (NYSE: LNN) is a U.S.-based manufacturer of agricultural irrigation and infrastructure products. Headquartered in Omaha, Nebraska, the company has built a reputation for designing and producing center pivot and lateral‐move irrigation systems under the Zimmatic brand. These systems feature advanced controls, precision sprinklers and automated monitoring technology that help growers optimize water use, improve crop yields and enhance sustainability in a variety of row-crop, specialty crop and forage operations.
Beyond its core irrigation business, Lindsay operates an infrastructure segment that delivers engineered products and services for water and roadway management.
