$CSL · CARLISLE COMPANIES INC
Carlisle Companies filed its Q3 FY2026 10-Q, reporting revenue of $1.463B (+8.6% YoY) and diluted EPS of $5.24 from continuing operations. Operating margin contracted to 20.0% from 21.8% as gross margin fell 220bps to 33.8%, driven by petrochemical raw-material inflation, diesel, and freight costs that outpaced price increases implemented in Q2 and Q3.
- Q3 revenue $1.463B, +8.6% YoY, driven by 6% volume and 3% price/freight surcharges
- Q3 diluted EPS $5.24 vs $4.98 YoY; operating margin contracted to 20.0% from 21.8%
- Gross margin fell to 33.8% from 36.0% as petrochemical input costs and diesel/freight inflation outpaced price increases
- CCM segment revenue $1.085B (+8.4%) but operating margin dropped to 25.9% from 28.0%
- Share count reduced to 38.8M from 41.0M at year-end; $850M in buybacks YTD vs $1.0B in prior-year period
Stock up 7.58% in regular session to $371.36 despite margin compression, suggesting the market focused on the 8.6% revenue beat and aggressive buyback program. After-hours session now; extended-hours reaction not yet captured.
Carlisle's margin squeeze reveals a real-time pass-through failure: 8.6% revenue growth couldn't prevent 220bps of gross-margin erosion, testing the pricing-power thesis.
Carlisle's re-roofing demand remains solid, consistent with broader commercial construction resilience, but raw-material cost pressure mirrors challenges across building-products peers reliant on petrochemical inputs.
Rapid oil-price increases from Middle East conflict are outpacing Carlisle's ability to pass through costs via price increases and freight surcharges. Gross margin compression of 220bps in Q3 could persist if petrochemical input inflation continues.