ECL · 10-Q · 2026Q2 · Full report
Gross Margin Drivers
ECOLAB INC. · 2026-08-06 · Importance 25 · Surprise 32 · No source text
Second-quarter reported gross margin declined to 44.1% from 44.8%, while adjusted gross margin declined to 44.2% from 44.8%. Six-month reported gross margin declined to 43.8% from 44.5%, and adjusted fixed-currency gross margin declined to 44.0% from 44.6%. Acquisition and divestiture effects reduced second-quarter adjusted cost of sales by $96.0 million and six-month adjusted cost of sales by $163.0 million in the organic presentation. Reported cost of sales increased to $2,469.5 million in the second quarter from $2,222.8 million and to $4,764.8 million for six months from $4,283.0 million.
Key facts
- Product and equipment cost of sales for the second quarter ended June 30, 2026: $1,918.9 million and for the second quarter ended June 30, 2025: $1,728.4 million. source
- Service and lease cost of sales for the second quarter ended June 30, 2026: $550.6 million and for the second quarter ended June 30, 2025: $494.4 million. source
- Reported GAAP cost of sales for the second quarter ended June 30, 2026: $2,469.5 million with gross margin 44.1%; for second quarter 2025 COS $2,222.8 million with gross margin 44.8%. source
- Total amortization expense related to intangible assets during first six months of 2026: $167.7 million and total amortization expense during second quarter 2026: $85.1 million; expected amortization for remaining six-month period of 2026: approximately $171.3 million source
- Non-GAAP adjusted COS for the second quarter ended June 30, 2026: $2,464.8 million with gross margin 44.2%; for the six months ended COS $4,748.8 million with gross margin 44.0%. source
- Non-GAAP organic COS for the second quarter ended June 30, 2026: $2,361.3 million with gross margin 44.9%. source
- Second quarter 2026 cost of sales (including special charges): $2,469.5 million source
- Reported gross margin for Q2 2026 was 44.1%. source
Impact estimates
| metric | direction | stage | expected | basis |
|---|---|---|---|---|
| operating_income | negative | realized | -5.6% | Reported GAAP cost of sales for the second quarter ended June 30, 2026: $2,469.5 million with gross margin 44.1%; for second quarter 2025… |
| operating_income | negative | committed | -3.3% | Total amortization expense related to intangible assets during first six months of 2026: $167.7 million and total amortization expense… |
| operating_income | negative | realized | -1.9% | Total amortization expense related to intangible assets during first six months of 2026: $167.7 million and total amortization expense… |
| margin | negative | realized | -0.7% | Reported GAAP cost of sales for the second quarter ended June 30, 2026: $2,469.5 million with gross margin 44.1%; for second quarter 2025… |
| margin | unclear | realized | — | Non-GAAP adjusted COS for the second quarter ended June 30, 2026: $2,464.8 million with gross margin 44.2%; for the six months ended COS… |
| margin | unclear | realized | — | Non-GAAP organic COS for the second quarter ended June 30, 2026: $2,361.3 million with gross margin 44.9%. |