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Quanta Services, Inc. (PWR) Q3 2026 Earnings Call October 29, 2026 9:00 AM EDT

Company Participants

Kip Rupp - Vice President of Investor Relations
Earl Austin - President, CEO & Director
Jayshree Desai - Chief Financial Officer

Conference Call Participants

Ameet Thakkar - BMO Capital Markets Equity Research
Justin Hauke - Robert W. Baird & Co. Incorporated, Research Division
Julien Dumoulin-Smith - Jefferies LLC, Research Division
Nicholas Amicucci - Evercore ISI Institutional Equities, Research Division
Steven Fisher - UBS Investment Bank, Research Division
Michael Dudas - Vertical Research Partners, LLC
Jamie Cook - Truist Securities, Inc., Research Division
Sherif El-Sabbahy - BofA Securities, Research Division
Andrew Kaplowitz - Citigroup Inc., Research Division
Liam Burke - B. Riley Securities, Inc., Research Division
Philip Shen - ROTH Capital Partners, LLC, Research Division
Alexa Petrick - Goldman Sachs Group, Inc., Research Division
Alexander Rygiel - Texas Capital Securities, Research Division
Dimple Gosai - Piper Sandler & Co., Research Division
Brian Brophy - Stifel, Nicolaus & Company, Incorporated, Research Division

Presentation

Operator

Good morning, and welcome to the Quanta Services Third Quarter 2026 Earnings Call. [Operator Instructions] As a reminder, this conference is being recorded. If you have any objections, please disconnect at this time.

I will now turn the call over to Kip Rupp, Vice President, Investor Relations, for introductory remarks.

Kip Rupp
Vice President of Investor Relations

Thank you, and welcome, everyone, to the Quanta Services Third Quarter 2026 Earnings Conference Call. This morning, we issued a press release announcing our third quarter 2026 results, which can be found on the Investor Relations section of our website at quantaservices.com. This morning, we also posted our third quarter 2026 operational and financial commentary and our 2026 outlook expectation summary on Quanta's Investor Relations website. While management will make brief introductory remarks during this morning's call, the operational and financial commentary is intended to largely replace management's prepared remarks, allowing additional time for questions from the institutional investment community.

Northern Oil and Gas (NOG) doesn't possess the right combination of the two key ingredients for a likely earnings beat in its upcoming report. Get prepared with the key expectations.

Enterprise Products Partners (EPD) is looking like an interesting pick from a technical perspective, as the company reached a key level of support. Recently, EPD crossed above the 200-day moving average, suggesting a long-term bullish trend.

The market expects Natera (NTRA - Free Report) to deliver a year-over-year increase in earnings on higher revenues when it reports results for the quarter ended September 2026. This widely-known consensus outlook is important in assessing the company's earnings picture, but a powerful factor that might influence its near-term stock price is how the actual results compare to these estimates.

The earnings report might help the stock move higher if these key numbers are better than expectations. On the other hand, if they miss, the stock may move lower.

While the sustainability of the immediate price change and future earnings expectations will mostly depend on management's discussion of business conditions on the earnings call, it's worth handicapping the probability of a positive EPS surprise.

Zacks Consensus EstimateThis genetic testing company is expected to post quarterly loss of $0.17 per share in its upcoming report, which represents a year-over-year change of +73.4%.

Revenues are expected to be $702.41 million, up 18.6% from the year-ago quarter.

Estimate Revisions TrendThe consensus EPS estimate for the quarter has been revised 87.5% lower over the last 30 days to the current level. This is essentially a reflection of how the covering analysts have collectively reassessed their initial estimates over this period.

Investors should keep in mind that an aggregate change may not always reflect the direction of estimate revisions by each of the covering analysts.

Price, Consensus and EPS Surprise

Earnings WhisperEstimate revisions ahead of a company's earnings release offer clues to the business conditions for the period whose results are coming out. This insight is at the core of our proprietary surprise prediction model -- the Zacks Earnings ESP (Expected Surprise Prediction).

The Zacks Earnings ESP compares the Most Accurate Estimate to the Zacks Consensus Estimate for the quarter; the Most Accurate Estimate is a more recent version of the Zacks Consensus EPS estimate. The idea here is that analysts revising their estimates right before an earnings release have the latest information, which could potentially be more accurate than what they and others contributing to the consensus had predicted earlier.

Thus, a positive or negative Earnings ESP reading theoretically indicates the likely deviation of the actual earnings from the consensus estimate. However, the model's predictive power is significant for positive ESP readings only.

A positive Earnings ESP is a strong predictor of an earnings beat, particularly when combined with a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold). Our research shows that stocks with this combination produce a positive surprise nearly 70% of the time, and a solid Zacks Rank actually increases the predictive power of Earnings ESP.

Please note that a negative Earnings ESP reading is not indicative of an earnings miss. Our research shows that it is difficult to predict an earnings beat with any degree of confidence for stocks with negative Earnings ESP readings and/or Zacks Rank of 4 (Sell) or 5 (Strong Sell).

How Have the Numbers Shaped Up for Natera?For Natera, the Most Accurate Estimate is lower than the Zacks Consensus Estimate, suggesting that analysts have recently become bearish on the company's earnings prospects. This has resulted in an Earnings ESP of -84.85%.

On the other hand, the stock currently carries a Zacks Rank of #4.

So, this combination makes it difficult to conclusively predict that Natera will beat the consensus EPS estimate.

Does Earnings Surprise History Hold Any Clue?While calculating estimates for a company's future earnings, analysts often consider to what extent it has been able to match past consensus estimates. So, it's worth taking a look at the surprise history for gauging its influence on the upcoming number.

For the last reported quarter, it was expected that Natera would post a loss of$0.47 per share when it actually produced a loss of -$0.47, delivering no surprise.

Over the last four quarters, the company has beaten consensus EPS estimates just once.

Bottom LineAn earnings beat or miss may not be the sole basis for a stock moving higher or lower. Many stocks end up losing ground despite an earnings beat due to other factors that disappoint investors. Similarly, unforeseen catalysts help a number of stocks gain despite an earnings miss.

That said, betting on stocks that are expected to beat earnings expectations does increase the odds of success. This is why it's worth checking a company's Earnings ESP and Zacks Rank ahead of its quarterly release. Make sure to utilize our Earnings ESP Filter to uncover the best stocks to buy or sell before they've reported.

Natera doesn't appear a compelling earnings-beat candidate. However, investors should pay attention to other factors too for betting on this stock or staying away from it ahead of its earnings release.

Stay on top of upcoming earnings announcements with the Zacks Earnings Calendar.

MDU Resources (MDU) doesn't possess the right combination of the two key ingredients for a likely earnings beat in its upcoming report. Get prepared with the key expectations.

Bala Cynwyd, Pennsylvania--(Newsfile Corp. - October 29, 2026) - Law office of Brodsky & Smith announces that it is investigating potential claims against the Board of Directors of Maplebear Inc. ("Instacart" or the "Company") (NASDAQ: CART) for possible breaches of fiduciary duty and other violations of federal and state law in connection with the sale of the Company to DoorDash, Inc. (NASDAQ: DASH). Under the terms of the agreement, Instacart shareholders will receive consideration valued at $65.00 per share, payable in cash, DoorDash common stock, or a combination of both, subject to proration, in a transaction with an equity value of approximately $17 billion.

The investigation concerns whether the Instacart Board breached its fiduciary duties to shareholders by failing to conduct a fair process, including whether the proposed transaction is paying fair value to shareholders of the Company.

If you own shares of Instacart stock and wish to discuss the legal ramifications of the investigation, or have any questions, you may e-mail or call the law office of Brodsky & Smith who will, without obligation or cost to you, attempt to answer your questions. You may contact Jason L. Brodsky, Esquire, or Marc L. Ackerman by email at [email protected], visit https://www.brodskysmith.com/cases/maplebear-inc-nasdaq-cart/, or call toll free 855-576-4847.

Brodsky & Smith is a litigation law firm with extensive expertise representing shareholders throughout the nation in securities and class action lawsuits. The attorneys at Brodsky & Smith have been appointed by numerous courts throughout the country to serve as lead counsel in class actions and have successfully recovered millions of dollars for our clients and shareholders.

Attorney advertising. Prior results do not guarantee a similar outcome.

To view the source version of this press release, please visit https://www.newsfilecorp.com/release/321575

Source: Brodsky & Smith

DoorDash is buying Instacart for $17 billion, adding more grocery delivery to its growing arsenal of services.

Textron (TXT - Free Report) reported $3.75 billion in revenue for the quarter ended September 2026, representing a year-over-year increase of 4.1%. EPS of $1.76 for the same period compares to $1.55 a year ago.

The reported revenue compares to the Zacks Consensus Estimate of $3.76 billion, representing a surprise of -0.16%. The company delivered an EPS surprise of +23.08%, with the consensus EPS estimate being $1.43.

While investors closely watch year-over-year changes in headline numbers -- revenue and earnings -- and how they compare to Wall Street expectations to determine their next course of action, some key metrics always provide a better insight into a company's underlying performance.

As these metrics influence top- and bottom-line performance, comparing them to the year-ago numbers and what analysts estimated helps investors project a stock's price performance more accurately.

Here is how Textron performed in the just reported quarter in terms of the metrics most widely monitored and projected by Wall Street analysts:

Revenues- Manufacturing- Bell: $933 million versus $1.11 billion estimated by two analysts on average. Compared to the year-ago quarter, this number represents a -9.1% change.Revenues- Manufacturing- Textron systems: $360 million compared to the $332.82 million average estimate based on two analysts. The reported number represents a change of +17.3% year over year.Revenues- Manufacturing- Textron Aviation: $1.68 billion versus the two-analyst average estimate of $1.55 billion. The reported number represents a year-over-year change of +13.7%.Revenues- Finance: $13 million versus the two-analyst average estimate of $11.45 million. The reported number represents a year-over-year change of -50%.Revenues- Manufacturing: $3.74 billion compared to the $3.75 billion average estimate based on two analysts. The reported number represents a change of +4.5% year over year.Revenues- Manufacturing- Industrial: $765 million versus the two-analyst average estimate of $755.87 million. The reported number represents a year-over-year change of +0.5%.Segment Profit- Textron Aviation: $179 million versus the two-analyst average estimate of $162.53 million.Segment Profit- Bell: $76 million compared to the $91.23 million average estimate based on two analysts.Segment Profit- Industrial: $38 million versus the two-analyst average estimate of $40.07 million.Segment Profit- Finance: $5 million compared to the $4.58 million average estimate based on two analysts.Segment Profit- Manufacturing: $350 million compared to the $337.19 million average estimate based on two analysts.Segment Profit- Textron Systems: $57 million versus $43.37 million estimated by two analysts on average.View all Key Company Metrics for Textron here>>>

Shares of Textron have returned +2.8% over the past month versus the Zacks S&P 500 composite's +0.9% change. The stock currently has a Zacks Rank #3 (Hold), indicating that it could perform in line with the broader market in the near term.

Textron (TXT +14.19%) shares soared 13% through 10:50 a.m. ET Thursday after crushing earnings this morning.

Heading into Textron's Q3 report, analysts expected the aerospace and defense company to earn only $1.43 per share on a bit less than $3.8 billion in sales. In fact, Textron earned $1.76 per share -- and hit $3.8 billion in sales on the nose.

Image source: U.S. Navy.

Textron Q3 earningsThat news wasn't quite as good as it sounds. Turns out, Textron's "$1.76" per share was only a non-GAAP number; actual earnings calculated under generally accepted accounting principles (GAAP) were only $1.56 per share. Still, this was up 19% from one year ago, with only 4% revenue growth.

Sales in the Textron Systems armored vehicle division drove revenue performance in the quarter, rising 16%, and commercial aviation sales were also strong, rising 14%. Only sales in the Bell helicopter division lagged, declining by 9%. (Industrial sales were roughly flat year over year, up just 1%.)

Textron's cash performance was even more impressive. Relative to the company's $266 million in reported net profit, Textron generated 54% more free cash flow -- $410 million -- and grew that number 51% year over year.

TXT Textron$89.43+$11.11 (+14.19%)

NYSE · As of 12:20 PM ET 10/29/26

What's next for Textron stockWith cash profits surging, Textron raised its guidance through the end of this year. GAAP profits are now expected to range from $5.64 to $5.74 (so $5.69 at the midpoint, giving Textron stock a 15.7x price-to-earnings ratio.) The free cash flow forecast is similarly strong, with Textron raising its best guess to $800 million to $900 million. On a $13.5 billion market capitalization, that works out to about a 15.9x price-to-free cash flow ratio.

With analysts forecasting Textron's earnings to grow by less than 11% over the next five years, that looks a little expensive to me.

Rich Smith has no position in any of the stocks mentioned. The Motley Fool recommends Textron. The Motley Fool has a disclosure policy.

Analysts on Wall Street project that Fox (FOXA - Free Report) will announce quarterly earnings of $1.99 per share in its forthcoming report, representing an increase of 31.8% year over year. Revenues are projected to reach $4.23 billion, increasing 13.2% from the same quarter last year.

Over the past 30 days, the consensus EPS estimate for the quarter has been adjusted upward by 4.1% to its current level. This demonstrates the covering analysts' collective reassessment of their initial projections during this period.

Before a company reveals its earnings, it is vital to take into account any changes in earnings projections. These revisions play a pivotal role in predicting the possible reactions of investors toward the stock. Multiple empirical studies have consistently shown a strong association between trends in earnings estimates and the short-term price movements of a stock.

While it's common for investors to rely on consensus earnings and revenue estimates for assessing how the business may have performed during the quarter, exploring analysts' forecasts for key metrics can yield valuable insights.

With that in mind, let's delve into the average projections of some Fox metrics that are commonly tracked and projected by analysts on Wall Street.

The combined assessment of analysts suggests that 'Revenues by Component- Advertising' will likely reach $1.76 billion. The estimate suggests a change of +24.8% year over year.

The consensus among analysts is that 'Segment Revenues- Television' will reach $2.40 billion. The estimate points to a change of +16.9% from the year-ago quarter.

It is projected by analysts that the 'Segment Revenues- Cable Network Programming' will reach $1.72 billion. The estimate suggests a change of +3.7% year over year.

Analysts' assessment points toward 'Segment Revenues- Corporate and Other' reaching $54.83 million. The estimate suggests a change of +110.9% year over year.

Analysts predict that the 'Revenues- Television- Advertising' will reach $1.39 billion. The estimate suggests a change of +30.3% year over year.

Based on the collective assessment of analysts, 'Revenues- Cable Network Programming- Advertising' should arrive at $357.10 million. The estimate points to a change of +3.5% from the year-ago quarter.

The collective assessment of analysts points to an estimated 'Segment EBITDA- Cable Network Programming' of $819.46 million. Compared to the current estimate, the company reported $800.00 million in the same quarter of the previous year.

According to the collective judgment of analysts, 'Segment EBITDA- Television' should come in at $611.08 million. The estimate compares to the year-ago value of $399.00 million.

View all Key Company Metrics for Fox here>>>

Shares of Fox have demonstrated returns of +1.2% over the past month compared to the Zacks S&P 500 composite's +0.9% change. With a Zacks Rank #1 (Strong Buy), FOXA is expected to beat the overall market performance in the near future. You can see the complete list of today's Zacks Rank #1 (Strong Buy) stocks here >>>> .

Wall Street expects a year-over-year increase in earnings on higher revenues when Paylocity (PCTY - Free Report) reports results for the quarter ended September 2026. While this widely-known consensus outlook is important in gauging the company's earnings picture, a powerful factor that could impact its near-term stock price is how the actual results compare to these estimates.

The earnings report, which is expected to be released on November 5, might help the stock move higher if these key numbers are better than expectations. On the other hand, if they miss, the stock may move lower.

While management's discussion of business conditions on the earnings call will mostly determine the sustainability of the immediate price change and future earnings expectations, it's worth having a handicapping insight into the odds of a positive EPS surprise.

Zacks Consensus EstimateThis provider of cloud-based payroll and human-resources software services is expected to post quarterly earnings of $1.93 per share in its upcoming report, which represents a year-over-year change of +10.3%.

Revenues are expected to be $442.37 million, up 8.4% from the year-ago quarter.

Estimate Revisions TrendThe consensus EPS estimate for the quarter has remained unchanged over the last 30 days. This is essentially a reflection of how the covering analysts have collectively reassessed their initial estimates over this period.

Investors should keep in mind that an aggregate change may not always reflect the direction of estimate revisions by each of the covering analysts.

Price, Consensus and EPS Surprise

Earnings WhisperEstimate revisions ahead of a company's earnings release offer clues to the business conditions for the period whose results are coming out. This insight is at the core of our proprietary surprise prediction model -- the Zacks Earnings ESP (Expected Surprise Prediction).

The Zacks Earnings ESP compares the Most Accurate Estimate to the Zacks Consensus Estimate for the quarter; the Most Accurate Estimate is a more recent version of the Zacks Consensus EPS estimate. The idea here is that analysts revising their estimates right before an earnings release have the latest information, which could potentially be more accurate than what they and others contributing to the consensus had predicted earlier.

Thus, a positive or negative Earnings ESP reading theoretically indicates the likely deviation of the actual earnings from the consensus estimate. However, the model's predictive power is significant for positive ESP readings only.

A positive Earnings ESP is a strong predictor of an earnings beat, particularly when combined with a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold). Our research shows that stocks with this combination produce a positive surprise nearly 70% of the time, and a solid Zacks Rank actually increases the predictive power of Earnings ESP.

Please note that a negative Earnings ESP reading is not indicative of an earnings miss. Our research shows that it is difficult to predict an earnings beat with any degree of confidence for stocks with negative Earnings ESP readings and/or Zacks Rank of 4 (Sell) or 5 (Strong Sell).

How Have the Numbers Shaped Up for Paylocity?For Paylocity, the Most Accurate Estimate is higher than the Zacks Consensus Estimate, suggesting that analysts have recently become bullish on the company's earnings prospects. This has resulted in an Earnings ESP of +2.07%.

On the other hand, the stock currently carries a Zacks Rank of #3.

So, this combination indicates that Paylocity will most likely beat the consensus EPS estimate.

Does Earnings Surprise History Hold Any Clue?Analysts often consider to what extent a company has been able to match consensus estimates in the past while calculating their estimates for its future earnings. So, it's worth taking a look at the surprise history for gauging its influence on the upcoming number.

For the last reported quarter, it was expected that Paylocity would post earnings of $1.54 per share when it actually produced earnings of $1.84, delivering a surprise of +19.48%.

Over the last four quarters, the company has beaten consensus EPS estimates four times.

Bottom LineAn earnings beat or miss may not be the sole basis for a stock moving higher or lower. Many stocks end up losing ground despite an earnings beat due to other factors that disappoint investors. Similarly, unforeseen catalysts help a number of stocks gain despite an earnings miss.

That said, betting on stocks that are expected to beat earnings expectations does increase the odds of success. This is why it's worth checking a company's Earnings ESP and Zacks Rank ahead of its quarterly release. Make sure to utilize our Earnings ESP Filter to uncover the best stocks to buy or sell before they've reported.

Paylocity appears a compelling earnings-beat candidate. However, investors should pay attention to other factors too for betting on this stock or staying away from it ahead of its earnings release.

An Industry Player's Expected ResultsDigitalOcean Holdings, Inc. (DOCN - Free Report) , another stock in the Zacks Internet - Software industry, is expected to report earnings per share of $0.32 for the quarter ended September 2026. This estimate points to a year-over-year change of -40.7%. Revenues for the quarter are expected to be $307.24 million, up 33.8% from the year-ago quarter.

The consensus EPS estimate for DigitalOcean has been revised 20% lower over the last 30 days to the current level. However, a higher Most Accurate Estimate has resulted in an Earnings ESP of +26.81%.

This Earnings ESP, combined with its Zacks Rank #3 (Hold), suggests that DigitalOcean will most likely beat the consensus EPS estimate. The company beat consensus EPS estimates in each of the trailing four quarters.

Stay on top of upcoming earnings announcements with the Zacks Earnings Calendar.

Newmark Group (NMRK - Free Report) came out with quarterly earnings of $0.48 per share, missing the Zacks Consensus Estimate of $0.49 per share. This compares to earnings of $0.42 per share a year ago. These figures are adjusted for non-recurring items.

This quarterly report represents an earnings surprise of -2.04%. A quarter ago, it was expected that this provider of commercial real estate services would post earnings of $0.4 per share when it actually produced earnings of $0.39, delivering a surprise of -2.5%.

Over the last four quarters, the company has surpassed consensus EPS estimates two times.

Newmark Group, which belongs to the Zacks Real Estate - Operations industry, posted revenues of $973.2 million for the quarter ended September 2026, surpassing the Zacks Consensus Estimate by 1.86%. This compares to year-ago revenues of $863.46 million. The company has topped consensus revenue estimates three times over the last four quarters.

The sustainability of the stock's immediate price movement based on the recently-released numbers and future earnings expectations will mostly depend on management's commentary on the earnings call.

Newmark Group shares have lost about 30.5% since the beginning of the year versus the S&P 500's gain of 13.1%.

What's Next for Newmark Group?While Newmark Group has underperformed the market so far this year, the question that comes to investors' minds is: what's next for the stock?

There are no easy answers to this key question, but one reliable measure that can help investors address this is the company's earnings outlook. Not only does this include current consensus earnings expectations for the coming quarter(s), but also how these expectations have changed lately.

Empirical research shows a strong correlation between near-term stock movements and trends in earnings estimate revisions. Investors can track such revisions by themselves or rely on a tried-and-tested rating tool like the Zacks Rank, which has an impressive track record of harnessing the power of earnings estimate revisions.

Ahead of this earnings release, the estimate revisions trend for Newmark Group was unfavorable. While the magnitude and direction of estimate revisions could change following the company's just-released earnings report, the current status translates into a Zacks Rank #4 (Sell) for the stock. So, the shares are expected to underperform the market in the near future. You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here.

It will be interesting to see how estimates for the coming quarters and the current fiscal year change in the days ahead. The current consensus EPS estimate is $0.74 on $1.11 billion in revenues for the coming quarter and $1.94 on $3.8 billion in revenues for the current fiscal year.

Investors should be mindful of the fact that the outlook for the industry can have a material impact on the performance of the stock as well. In terms of the Zacks Industry Rank, Real Estate - Operations is currently in the bottom 16% of the 250 plus Zacks industries. Our research shows that the top 50% of the Zacks-ranked industries outperform the bottom 50% by a factor of more than 2 to 1.

WaterBridge (WBI - Free Report) , another stock in the same industry, has yet to report results for the quarter ended September 2026. The results are expected to be released on November 4.

This water infrastructure and pipeline company is expected to post quarterly earnings of $0.09 per share in its upcoming report, which represents a year-over-year change of +550%. The consensus EPS estimate for the quarter has been revised 8.3% higher over the last 30 days to the current level.

WaterBridge's revenues are expected to be $235.17 million, up 90.8% from the year-ago quarter.

Axon Enterprise (AXON - Free Report) is expected to deliver a year-over-year increase in earnings on higher revenues when it reports results for the quarter ended September 2026. This widely-known consensus outlook gives a good sense of the company's earnings picture, but how the actual results compare to these estimates is a powerful factor that could impact its near-term stock price.

The stock might move higher if these key numbers top expectations in the upcoming earnings report, which is expected to be released on November 5. On the other hand, if they miss, the stock may move lower.

While management's discussion of business conditions on the earnings call will mostly determine the sustainability of the immediate price change and future earnings expectations, it's worth having a handicapping insight into the odds of a positive EPS surprise.

Zacks Consensus EstimateThis maker of stun guns and body cameras is expected to post quarterly earnings of $1.90 per share in its upcoming report, which represents a year-over-year change of +62.4%.

Revenues are expected to be $931.13 million, up 31% from the year-ago quarter.

Estimate Revisions TrendThe consensus EPS estimate for the quarter has been revised 3.13% higher over the last 30 days to the current level. This is essentially a reflection of how the covering analysts have collectively reassessed their initial estimates over this period.

Investors should keep in mind that the direction of estimate revisions by each of the covering analysts may not always get reflected in the aggregate change.

Price, Consensus and EPS Surprise

Earnings WhisperEstimate revisions ahead of a company's earnings release offer clues to the business conditions for the period whose results are coming out. This insight is at the core of our proprietary surprise prediction model -- the Zacks Earnings ESP (Expected Surprise Prediction).

The Zacks Earnings ESP compares the Most Accurate Estimate to the Zacks Consensus Estimate for the quarter; the Most Accurate Estimate is a more recent version of the Zacks Consensus EPS estimate. The idea here is that analysts revising their estimates right before an earnings release have the latest information, which could potentially be more accurate than what they and others contributing to the consensus had predicted earlier.

Thus, a positive or negative Earnings ESP reading theoretically indicates the likely deviation of the actual earnings from the consensus estimate. However, the model's predictive power is significant for positive ESP readings only.

A positive Earnings ESP is a strong predictor of an earnings beat, particularly when combined with a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold). Our research shows that stocks with this combination produce a positive surprise nearly 70% of the time, and a solid Zacks Rank actually increases the predictive power of Earnings ESP.

Please note that a negative Earnings ESP reading is not indicative of an earnings miss. Our research shows that it is difficult to predict an earnings beat with any degree of confidence for stocks with negative Earnings ESP readings and/or Zacks Rank of 4 (Sell) or 5 (Strong Sell).

How Have the Numbers Shaped Up for Axon?For Axon, the Most Accurate Estimate is lower than the Zacks Consensus Estimate, suggesting that analysts have recently become bearish on the company's earnings prospects. This has resulted in an Earnings ESP of -18.55%.

On the other hand, the stock currently carries a Zacks Rank of #3.

So, this combination makes it difficult to conclusively predict that Axon will beat the consensus EPS estimate.

Does Earnings Surprise History Hold Any Clue?While calculating estimates for a company's future earnings, analysts often consider to what extent it has been able to match past consensus estimates. So, it's worth taking a look at the surprise history for gauging its influence on the upcoming number.

For the last reported quarter, it was expected that Axon would post earnings of $1.89 per share when it actually produced earnings of $1.88, delivering a surprise of -0.53%.

Over the last four quarters, the company has beaten consensus EPS estimates just once.

Bottom LineAn earnings beat or miss may not be the sole basis for a stock moving higher or lower. Many stocks end up losing ground despite an earnings beat due to other factors that disappoint investors. Similarly, unforeseen catalysts help a number of stocks gain despite an earnings miss.

That said, betting on stocks that are expected to beat earnings expectations does increase the odds of success. This is why it's worth checking a company's Earnings ESP and Zacks Rank ahead of its quarterly release. Make sure to utilize our Earnings ESP Filter to uncover the best stocks to buy or sell before they've reported.

Axon doesn't appear a compelling earnings-beat candidate. However, investors should pay attention to other factors too for betting on this stock or staying away from it ahead of its earnings release.

An Industry Player's Expected ResultsAmong the stocks in the Zacks Aerospace - Defense Equipment industry, BWX Technologies (BWXT - Free Report) , is soon expected to post earnings of $1.19 per share for the quarter ended September 2026. This estimate indicates a year-over-year change of +19%. This quarter's revenue is expected to be $992.35 million, up 14.6% from the year-ago quarter.

Over the last 30 days, the consensus EPS estimate for BWX has been revised 0.1% down to the current level. Nevertheless, the company now has an Earnings ESP of +0.22%, reflecting a higher Most Accurate Estimate.

When combined with a Zacks Rank of #3 (Hold), this Earnings ESP indicates that BWX will most likely beat the consensus EPS estimate. The company beat consensus EPS estimates in each of the trailing four quarters.

Stay on top of upcoming earnings announcements with the Zacks Earnings Calendar.

Axalta Coating Systems Ltd. (AXTA) Q3 2026 Earnings Call October 29, 2026 8:00 AM EDT

Company Participants

Colleen Lubic - Vice President of Investor Relations
Chrishan Anthon Villavarayan - CEO, President & Director
Carl Anderson - Senior VP & CFO

Conference Call Participants

Caleb Boehnlein - BMO Capital Markets Equity Research
Kevin McCarthy - Vertical Research Partners, LLC
David Begleiter - Deutsche Bank AG, Research Division
Joshua S. Vesely - Robert W. Baird & Co. Incorporated, Research Division
Harris Fein - Wolfe Research, LLC
Matthew DeYoe - BofA Securities, Research Division
Patrick Fischer - Goldman Sachs Group, Inc., Research Division
Joshua Spector - UBS Investment Bank, Research Division
John Roberts - Mizuho Financial Group, Inc.
Abigail Eberts - Wells Fargo Securities, LLC, Research Division
Laurent Favre - BNP Paribas, Research Division
Patrick Cunningham - Citigroup Inc., Research Division
Arun Viswanathan - RBC Capital Markets, Research Division
Laurence Alexander - Jefferies LLC, Research Division

Presentation

Operator

Ladies and gentlemen, thank you for standing by. Welcome to the Axalta Coating Systems Q3 2026 Earnings Call. [Operator Instructions] Today's call is being recorded, and a replay will be available through November 5. Those listening after today's call should please note that the information provided in the recording will not be updated and therefore, may no longer be current. It is now my pleasure to turn the call over to Colleen Lubic, Vice President of Investor Relations. Please go ahead.

Colleen Lubic
Vice President of Investor Relations

Good morning, everyone, and thank you for joining us to discuss Axalta's third quarter 2026 Financial Results. I'm Colleen Lubic, Vice President of Investor Relations. Joining me today are Chris Villavarayan, our Chief Executive Officer; and Carl Anderson, our Chief Financial Officer. You can find today's presentation and supporting materials on the Investor Relations section of our website at axalta.com. Before we begin, please turn to Slide 2 for our forward-looking statements and non-GAAP disclosures.

LOS ANGELES, Oct. 29, 2026 (GLOBE NEWSWIRE) -- The Law Offices of Frank R. Cruz reminds investors of upcoming lead plaintiff deadlines in securities class action lawsuits filed on behalf of shareholders of Fluence Energy, Inc., Qfin Holdings, Inc., Endava plc, and Anavex Life Sciences Corp. Investors who wish to seek appointment as lead plaintiff must file a motion by the deadlines listed below.

If you lost money on these investments, contact The Law Offices of Frank R. Cruz about these class actions to learn about your legal rights, by calling 310-914-5007 or emailing [email protected].

Fluence Energy, Inc. (NASDAQ: FLNC)

Class period: November 24, 2025 through September 16, 2026Lead plaintiff motion deadline: November 30, 2026Case: Hatweek v. Fluence Energy, Inc., et al., filed in the U.S. District Court for the Southern District of New York
According to the Fluence Energy, Inc. complaint, throughout the class period the defendants made false and/or misleading statements and/or failed to disclose that: (i) the Company's ability to deliver its backlog and recognize the revenue underlying its fiscal 2026 guidance depended on new contract manufacturing facilities, including facilities that were not completed, not operational, and/or not capable of producing at the volumes the guidance assumed; (ii) the corrective measures the Company had implemented to address production problems at its contract manufacturers were not remediating those problems, which persisted and extended to the Company's new facilities; and (iii) as a result, a material portion of the backlog that Defendants represented as "securing" or "covering" the Company's fiscal 2026 revenue guidance were likely to be delivered and recognized in fiscal 2026.

If you are a Fluence Energy, Inc. shareholder who suffered a loss, click here to participate.

Qfin Holdings, Inc. (NASDAQ: QFIN)

Class period: March 18, 2026 through August 25, 2026Lead plaintiff motion deadline: November 30, 2026Case: Kassam v. Qfin Holdings, Inc. et al., filed in the U.S. District Court for the Eastern District of New York
According to the Qfin Holdings, Inc. complaint, throughout the class period the defendants made false and/or misleading statements and/or failed to disclose that: (i) Defendants have overstated the resiliency and stability of Qfin’s business and financial results despite regulatory changes; and (ii) Defendants likewise downplayed the true scope and severity of the negative impact that regulatory headwinds were likely to have, and were already having, on the Company’s business and financial results.

If you are a Qfin Holdings, Inc. shareholder who suffered a loss, click here to participate.

Endava plc (NYSE: DAVA)

Class period: September 4, 2025 through September 21, 2026Lead plaintiff motion deadline: November 30, 2026Case: Salgado Laguna v. Endava plc, et al., filed in the U.S. District Court for the Southern District of New York
According to the Endava plc complaint, throughout the class period the defendants made false and/or misleading statements and/or failed to disclose that: (i) the accounting treatment for certain customer and supplier agreements and related matters required additional review; (ii) as a result of the foregoing, the Company would delay the release of its fourth quarter and full year 2026 financial results; and (iii) there was reason to doubt the effectiveness of the Company’s internal controls and procedures.

If you are a Endava plc shareholder who suffered a loss, click here to participate.

Anavex Life Sciences Corp. (NASDAQ: AVXL)

Class period: November 26, 2025 through August 28, 2026Lead plaintiff motion deadline: November 30, 2026Case: Kurey v. Anavex Life Sciences Corp. et al., filed in the U.S. District Court for the Southern District of New York
According to the Anavex Life Sciences Corp. complaint, throughout the class period the defendants made false and/or misleading statements and/or failed to disclose that: (i) Anavex lacked adequate internal controls; and (ii) Anavex understated its potential regulatory challenges as a result of misconduct by former CEO Christopher Missling.

If you are a Anavex Life Sciences Corp. shareholder who suffered a loss, click here to participate.

What should investors in these cases do now?

Investors need not take any action at this time to be class members in these cases. Investors may retain counsel of their choice or take no action and remain absent class members. No class has been certified yet in any of these cases.

For more information about these class actions or your rights, contact Frank R. Cruz of The Law Offices of Frank R. Cruz at 310-914-5007, by email at [email protected], or visit the firm's case page.

If you inquire by email, please include your mailing address, telephone number, and number of shares purchased.

About The Law Offices of Frank R. Cruz

The Law Offices of Frank R. Cruz investigates and prosecutes securities fraud and corporate malfeasance class actions. With nearly 20 years of litigation experience, the firm focuses on complex securities class actions and gives each client personal, one-on-one attention throughout the legal process.

Prior results do not guarantee a similar outcome.

Contact

Frank R. Cruz

The Law Offices of Frank R. Cruz

Los Angeles, CA

Email: [email protected]

Telephone: 310-914-5007

www.frankcruzlaw.com

Follow The Law Offices of Frank R. Cruz for updates on Twitter: twitter.com/FRC_LAW

This press release may be considered Attorney Advertising in some jurisdictions under the applicable law and ethical rules.

Baxter International Inc. (NYSE:BAX) on Thursday reported better-than-expected third-quarter financial results and raised its fiscal 2026 guidance.

Here at Zacks, our focus is on the proven Zacks Rank system, which emphasizes earnings estimates and estimate revisions to find great stocks. Nevertheless, we are always paying attention to the latest value, growth, and momentum trends to underscore strong picks.

Howard Hughes Holdings (HHH - Free Report) is expected to deliver a year-over-year decline in earnings on higher revenues when it reports results for the quarter ended September 2026. This widely-known consensus outlook gives a good sense of the company's earnings picture, but how the actual results compare to these estimates is a powerful factor that could impact its near-term stock price.

The stock might move higher if these key numbers top expectations in the upcoming earnings report, which is expected to be released on November 5. On the other hand, if they miss, the stock may move lower.

While management's discussion of business conditions on the earnings call will mostly determine the sustainability of the immediate price change and future earnings expectations, it's worth having a handicapping insight into the odds of a positive EPS surprise.

Zacks Consensus EstimateThis land developer is expected to post quarterly earnings of $1.03 per share in its upcoming report, which represents a year-over-year change of -49%.

Revenues are expected to be $642.79 million, up 64.7% from the year-ago quarter.

Estimate Revisions TrendThe consensus EPS estimate for the quarter has been revised 9.48% higher over the last 30 days to the current level. This is essentially a reflection of how the covering analysts have collectively reassessed their initial estimates over this period.

Investors should keep in mind that the direction of estimate revisions by each of the covering analysts may not always get reflected in the aggregate change.

Price, Consensus and EPS Surprise

Earnings WhisperEstimate revisions ahead of a company's earnings release offer clues to the business conditions for the period whose results are coming out. This insight is at the core of our proprietary surprise prediction model -- the Zacks Earnings ESP (Expected Surprise Prediction).

The Zacks Earnings ESP compares the Most Accurate Estimate to the Zacks Consensus Estimate for the quarter; the Most Accurate Estimate is a more recent version of the Zacks Consensus EPS estimate. The idea here is that analysts revising their estimates right before an earnings release have the latest information, which could potentially be more accurate than what they and others contributing to the consensus had predicted earlier.

Thus, a positive or negative Earnings ESP reading theoretically indicates the likely deviation of the actual earnings from the consensus estimate. However, the model's predictive power is significant for positive ESP readings only.

A positive Earnings ESP is a strong predictor of an earnings beat, particularly when combined with a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold). Our research shows that stocks with this combination produce a positive surprise nearly 70% of the time, and a solid Zacks Rank actually increases the predictive power of Earnings ESP.

Please note that a negative Earnings ESP reading is not indicative of an earnings miss. Our research shows that it is difficult to predict an earnings beat with any degree of confidence for stocks with negative Earnings ESP readings and/or Zacks Rank of 4 (Sell) or 5 (Strong Sell).

How Have the Numbers Shaped Up for Howard Hughes Holdings?For Howard Hughes Holdings, the Most Accurate Estimate is lower than the Zacks Consensus Estimate, suggesting that analysts have recently become bearish on the company's earnings prospects. This has resulted in an Earnings ESP of -32.68%.

On the other hand, the stock currently carries a Zacks Rank of #1.

So, this combination makes it difficult to conclusively predict that Howard Hughes Holdings will beat the consensus EPS estimate.

Does Earnings Surprise History Hold Any Clue?While calculating estimates for a company's future earnings, analysts often consider to what extent it has been able to match past consensus estimates. So, it's worth taking a look at the surprise history for gauging its influence on the upcoming number.

For the last reported quarter, it was expected that Howard Hughes Holdings would post earnings of $0.49 per share when it actually produced earnings of $2.68, delivering a surprise of +446.94%.

Over the last four quarters, the company has beaten consensus EPS estimates three times.

Bottom LineAn earnings beat or miss may not be the sole basis for a stock moving higher or lower. Many stocks end up losing ground despite an earnings beat due to other factors that disappoint investors. Similarly, unforeseen catalysts help a number of stocks gain despite an earnings miss.

That said, betting on stocks that are expected to beat earnings expectations does increase the odds of success. This is why it's worth checking a company's Earnings ESP and Zacks Rank ahead of its quarterly release. Make sure to utilize our Earnings ESP Filter to uncover the best stocks to buy or sell before they've reported.

Howard Hughes Holdings doesn't appear a compelling earnings-beat candidate. However, investors should pay attention to other factors too for betting on this stock or staying away from it ahead of its earnings release.

Stay on top of upcoming earnings announcements with the Zacks Earnings Calendar.

The headline numbers for Life Time Group Holdings (LTH) give insight into how the company performed in the quarter ended September 2026, but it may be worthwhile to compare some of its key metrics to Wall Street estimates and the year-ago actuals.

The headline numbers for Tenet (THC) give insight into how the company performed in the quarter ended September 2026, but it may be worthwhile to compare some of its key metrics to Wall Street estimates and the year-ago actuals.

Trane Technologies (TT - Free Report) reported $6.76 billion in revenue for the quarter ended September 2026, representing a year-over-year increase of 17.7%. EPS of $4.86 for the same period compares to $3.88 a year ago.

The reported revenue compares to the Zacks Consensus Estimate of $6.44 billion, representing a surprise of +5%. The company delivered an EPS surprise of +2.53%, with the consensus EPS estimate being $4.74.

While investors scrutinize revenue and earnings changes year-over-year and how they compare with Wall Street expectations to determine their next move, some key metrics always offer a more accurate picture of a company's financial health.

As these metrics influence top- and bottom-line performance, comparing them to the year-ago numbers and what analysts estimated helps investors project a stock's price performance more accurately.

Here is how Trane Technologies performed in the just reported quarter in terms of the metrics most widely monitored and projected by Wall Street analysts:

Backlog - Total: $12.5 billion versus the two-analyst average estimate of $12.36 billion.Total Bookings: $7.25 billion versus $6.74 billion estimated by two analysts on average.Net Revenues- Americas: $5.65 billion versus $5.42 billion estimated by two analysts on average. Compared to the year-ago quarter, this number represents a +21.1% change.Net Revenues- Asia Pacific: $356 million versus the two-analyst average estimate of $339.12 million. The reported number represents a year-over-year change of +8%.Net Revenues- EMEA: $755.8 million versus $734.96 million estimated by two analysts on average. Compared to the year-ago quarter, this number represents a +0.8% change.View all Key Company Metrics for Trane Technologies here>>>

Shares of Trane Technologies have returned -0.8% over the past month versus the Zacks S&P 500 composite's +0.9% change. The stock currently has a Zacks Rank #3 (Hold), indicating that it could perform in line with the broader market in the near term.

Key Takeaways ESI's Q3 adjusted EPS rose 22% to 50 cents, beating estimates, while net sales surged 52% to $995.3 million.Electronics sales jumped 68% to $779.6 million, fueled by 18% organic growth and acquisitions.ESI raised its 2026 adjusted EBITDA outlook to $720 million and expects adjusted EPS growth of more than 20%.
Element Solutions Inc. (ESI - Free Report) reported adjusted earnings of 50 cents per share for the third quarter of 2026, up 22% from 41 cents a year ago. The figure beat the Zacks Consensus Estimate of 48 cents by 4.2%.

Net sales surged 52% year over year to $995.3 million and topped the consensus estimate of $968 million by 2.8%. Organic sales rose 13%, driven by strong demand across Electronics, acquisitions and higher pass-through metals pricing.

ESI's Segment HighlightsElectronics segment sales jumped 68% year over year to $779.6 million in the reported quarter. The figure beat the consensus estimate of $731 million. Organic net sales increased 18%, while acquisitions contributed 30% to reported growth. The segment benefited from $94.4 million of higher pass-through metals pricing and $138 million in sales contributions from acquisitions, including $93.1 million related to pass-through metals. Electronics adjusted EBITDA climbed 46% to $148.3 million.

Specialties segment sales increased 13% year over year to $215.7 million. The figure missed the consensus estimate of $224 million. Organic net sales rose 1%, while acquisitions net of divestitures contributed 12% to reported growth. Acquisitions added $23.4 million to the segment's consolidated revenues during the quarter. Specialties adjusted EBITDA declined 6% to $42.7 million.

Element Solutions' Cash Flow and Financial PositionElement Solutions ended the third quarter with cash and cash equivalents of $224.9 million compared with $189.6 million at the end of the preceding quarter. Total debt stood at $2.09 billion, while net debt was $1.87 billion at September-end.

Cash flows from operating activities increased to $159.2 million from $100.1 million a year ago. Capital expenditures rose to $30.4 million from $16.5 million. Free cash flow improved to $134.5 million from $84.1 million, reflecting stronger quarterly cash generation. The company also repurchased $37.7 million of common stock and paid $19.5 million in dividends during the quarter.

ESI Raises Full-Year 2026 Earnings OutlookElement Solutions raised its full-year 2026 adjusted EBITDA guidance to approximately $720 million from its previous range of $690-$710 million. The updated projection includes full-year contributions from the Micromax and EFC acquisitions and assumes stable foreign exchange rates and metal prices.

The company now expects adjusted earnings per share to grow more than 20% in 2026. Management attributed the improved outlook to sustained momentum in Electronics and meaningful contributions from recent acquisitions. Continued investment in innovation, capacity expansion and strategic supply-chain relationships remains central to its growth strategy.

ESI’s Price PerformanceShares of Element Solutions have gained 35.4% in a year compared with the 9.1% rise in the industry. 

Image Source: Zacks Investment Research

ESI’s Zacks Rank & Other Key PicksESIcurrently carries a Zacks Rank #2 (Buy).

Other top-ranked stocks in the Basic Materials space are Reliance, Inc. (RS - Free Report) , Avino Silver & Gold Mines Ltd. (ASM - Free Report) and Avient Corporation (AVNT - Free Report) .

RS currently sports a Zacks Rank #1 (Strong Buy), while ASM and AVNT carry a Zacks Rank #2 each. You can see the complete list of today’s Zacks #1 Rank stocks here

The Zacks Consensus Estimate for RS’ 2026 earnings is pegged at $23.70 per share, indicating a 66.2% year-over-year surge. RSshares have gained 56.2% over the past year.

The Zacks Consensus Estimate for ASM’s current fiscal-year earnings is pinned at 28 cents per share. Its earnings beat the Zacks Consensus Estimate in each of the trailing four quarters, with an average surprise of 75%.

The Zacks Consensus Estimate for AVNT’s 2026 earnings is pegged at $3.2 per share, indicating a year-over-year rise of 13.48%. Its earnings beat the Zacks Consensus Estimate in each of the trailing four quarters, with an average surprise of 3.4%.

For the quarter ended September 2026, Vulcan Materials (VMC - Free Report) reported revenue of $2.18 billion, down 4.7% over the same period last year. EPS came in at $2.83, compared to $2.84 in the year-ago quarter.

The reported revenue compares to the Zacks Consensus Estimate of $2.23 billion, representing a surprise of -1.93%. The company delivered an EPS surprise of +1.43%, with the consensus EPS estimate being $2.79.

While investors closely watch year-over-year changes in headline numbers -- revenue and earnings -- and how they compare to Wall Street expectations to determine their next course of action, some key metrics always provide a better insight into a company's underlying performance.

As these metrics influence top- and bottom-line performance, comparing them to the year-ago numbers and what analysts estimated helps investors project a stock's price performance more accurately.

Here is how Vulcan performed in the just reported quarter in terms of the metrics most widely monitored and projected by Wall Street analysts:

Average unit sales price per ton - Aggregates (freight adjusted): $22.84 versus the three-analyst average estimate of $23.20.Average unit sales price per ton - Asphalt mix: $85.49 versus $86.01 estimated by three analysts on average.Unit Shipments - Ready-mixed concrete: 500.00 KCuYd versus 514.67 KCuYd estimated by three analysts on average.Unit Shipments - Aggregates: 62,700.00 KTon versus 64,386.57 KTon estimated by three analysts on average.Unit Shipments - Asphalt mix: 3,900.00 KTon versus the three-analyst average estimate of 3,999.33 KTon.Average unit sales price per cubic yard - Ready-mixed concrete: $192.21 compared to the $196.22 average estimate based on three analysts.Net Sales- Aggregates intersegment sales: $-111.5 million compared to the $-139.51 million average estimate based on four analysts. The reported number represents a change of -27.7% year over year.Net Sales- Concrete: $92.4 million versus $104.87 million estimated by four analysts on average. Compared to the year-ago quarter, this number represents a -61.1% change.Net Sales- Asphalt: $381.2 million versus the four-analyst average estimate of $395.04 million. The reported number represents a year-over-year change of -8.4%.Net Sales- Aggregates: $1.82 billion compared to the $1.89 billion average estimate based on four analysts. The reported number represents a change of +1.7% year over year.Gross Profit- Aggregates: $593.4 million versus $626.95 million estimated by four analysts on average.Gross Profit- Asphalt: $64.2 million compared to the $56 million average estimate based on four analysts.View all Key Company Metrics for Vulcan here>>>

Shares of Vulcan have returned +8.3% over the past month versus the Zacks S&P 500 composite's +0.9% change. The stock currently has a Zacks Rank #3 (Hold), indicating that it could perform in line with the broader market in the near term.

Faruqi & Faruqi, LLP Securities Litigation Partner James (Josh) Wilson Encourages Investors Who Suffered Losses In Duolingo To Contact Him Directly To Discuss Their Options

If you purchased or acquired securities in Duolingo between May 2, 2025 and February 26, 2026 and would like to discuss your legal rights, call Faruqi & Faruqi partner Josh Wilson directly at 877-247-4292 or 212-983-9330 (Ext. 1310).

[You may also click here for additional information]

New York, New York--(Newsfile Corp. - October 29, 2026) - Faruqi & Faruqi, LLP, a leading national securities law firm, is investigating potential claims against Duolingo, Inc. ("Duolingo" or the "Company") (NASDAQ: DUOL) and reminds investors of the December 7, 2026 deadline to seek the role of lead plaintiff in a federal securities class action that has been filed against the Company.

Faruqi & Faruqi is a leading national securities law firm with offices in New York, Pennsylvania, California and Georgia. The firm has recovered hundreds of millions of dollars for investors since its founding in 1995. See www.faruqilaw.com.

As detailed below, the complaint alleges that the Company and its executives violated federal securities laws by making false and/or misleading statements and/or failing to disclose that: (i) Daily Active User ("DAU") growth rates were being leveraged against deliberately added user friction in the form of significant increases in ad volume, subscription tier upsells, and worsened product quality, and defendants understood that any amount of user friction would cause users to leave the app and, ultimately, negatively impact DAU growth rates; (ii) Duolingo's rigorous A/B testing demonstrated to defendants that increased friction in the free user experience was having negative impacts on DAU growth rates; (iii) Duolingo's quickly generated AI content was worsening the quality of Duolingo's product offerings, negatively impacting the user experience and user trends, and threatening the sustainability of Duolingo's financial performance; and (iv) far from driving sustained growth and strong user momentum through content and "product improvements" that "get improved retention," Duolingo's constant A/B testing informed Duolingo that its monetization push and lower-quality, rapidly generated AI content were degrading the Duolingo product experience and the value proposition of its subscription tiers.

On November 5, 2025, the Company reported its third quarter ("3Q") financial results, revealing another sequential decline in DAU growth to 36%, a substantial drop from 49% in 1Q 2025 and 40% during 2Q 2025, and announced a long-term strategy change to pivot away from monetization and towards improving quality of teaching and prioritizing long-term DAU growth. On this news, Duolingo's stock price fell $66.28, or 25%, to close at $193.74 per share on November 6, 2025.

On January 12, 2026, Duolingo announced that its Chief Financial Officer ("CFO"), Matthew Skaruppa ("Skaruppa"), had resigned, and provided limited, preliminary fourth quarter ("4Q") 2025 operating metrics revealing DAU growth of only 30% - nearly six points of additional deceleration from 3Q 2025. On this news, Duolingo's stock price fell $14.92, or 8.5%, to close at $161.74 per share on January 12, 2026.

On February 26, 2026, after the market closed, Duolingo announced its 4Q 2025 financial results, confirmed the slowdown in DAU growth, and revealed material negative impacts on 2026 bookings, DAU growth rates, revenue, and adjusted EBITDA, with 2026 DAU growth guidance of only 20% accompanied by lower bookings and less profitability. On this news, Duolingo's stock price fell $16.45, or 14%, to close at $101 per share on February 27, 2026.

The court-appointed lead plaintiff is the investor with the largest financial interest in the relief sought by the class who is adequate and typical of class members who directs and oversees the litigation on behalf of the putative class. Any member of the putative class may move the Court to serve as lead plaintiff through counsel of their choice, or may choose to do nothing and remain an absent class member. Your ability to share in any recovery is not affected by the decision to serve as a lead plaintiff or not.

Faruqi & Faruqi, LLP also encourages anyone with information regarding Duolingo's conduct to contact the firm, including whistleblowers, former employees, shareholders and others.

To learn more about the Duolingo class action, go to www.faruqilaw.com/DUOL or call Faruqi & Faruqi partner Josh Wilson directly at 877-247-4292 or 212-983-9330 (Ext. 1310).

Follow us for updates on LinkedIn, on X, or on Facebook.

Frequently Asked Questions (FAQ) for Investors Regarding the Duolingo Securities Class Action Lawsuit:

What is the Duolingo securities fraud lawsuit about?

The lawsuit alleges that Duolingo, Inc. made materially false and misleading statements during the Class Period regarding the company's daily active user ("DAU") growth and the drivers of its business performance. Specifically, the complaint alleges that defendants knew that deliberate increases in ad volume, subscription upsells, and other friction in the free user experience were negatively impacting DAU growth rates, a dynamic that Duolingo's own rigorous A/B testing allegedly confirmed. The lawsuit further alleges that rapidly generated AI content was worsening product quality and undermining the sustainability of Duolingo's financial performance, contrary to defendants' public statements touting content and product improvements as drivers of sustained growth and strong user retention. Investors allegedly were not told that Duolingo's internal testing had demonstrated these adverse trends until a series of corrective disclosures caused the company's stock price to decline significantly.

Who may be eligible to participate in the lawsuit?

Investors who purchased or otherwise acquired Duolingo, Inc. (NASDAQ: DUOL) securities between May 2, 2025 and February 26, 2026, inclusive (the "Class Period"), may be eligible to participate in the lawsuit. Participation in the litigation is not limited to those who apply to serve as lead plaintiff; any eligible class member may share in any recovery that may be obtained on behalf of the class. Investors who believe they purchased Duolingo securities during the Class Period and suffered a loss are encouraged to review the complaint and consult with counsel to understand their rights and options.

What is a lead plaintiff, and how can I seek appointment?

A lead plaintiff is a court-appointed representative who acts on behalf of all class members in directing the litigation, including decisions about litigation strategy and any settlement. The lead plaintiff is typically the class member with the largest financial interest in the relief sought by the class who also meets certain adequacy and typicality requirements under the federal securities laws. Any investor who purchased Duolingo securities during the Class Period and wishes to seek appointment as lead plaintiff must file a motion with the court no later than the lead plaintiff deadline specified in the notice. Importantly, investors are not required to serve as lead plaintiff in order to be a member of the class or to share in any recovery that may result from the litigation.

Why should investors contact Faruqi & Faruqi, LLP?

Faruqi & Faruqi, LLP has represented investors in securities litigation for decades and has recovered hundreds of millions of dollars for shareholders. Investors who purchased Duolingo securities during the Class Period may contact the firm to discuss their legal rights, potential claims, and the lead plaintiff process at no cost or obligation.

Attorney Advertising. The law firm responsible for this advertisement is Faruqi & Faruqi, LLP (www.faruqilaw.com). Prior results do not guarantee or predict a similar outcome with respect to any future matter. We welcome the opportunity to discuss your particular case. All communications will be treated in a confidential manner.

To view the source version of this press release, please visit https://www.newsfilecorp.com/release/321420

Source: Faruqi & Faruqi LLP

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