LIN · 10-Q · 2026Q2 · Full report
Gross Margin Drivers
LINDE PLC · 2026-07-31 · Importance 45 · Surprise 40 · No source text
Cost of sales increased $555 million, or 13%, in the second quarter and $921 million, or 11%, for the six months ended June 30, 2026. Cost of sales rose to 52.3% of quarterly sales and 51.9% of six-month sales, compared with 50.7% and 51.0% in the respective 2025 periods. Higher costs, cost inflation and cost pass-through pressured the ratio, while productivity gains provided a partial offset. Reported operating profit nevertheless increased 8% to $2,554 million in the quarter and 10% to $4,993 million year to date because pricing, currency translation and productivity initiatives more than offset cost inflation.
Key facts
- Cost of sales (excl. D&A) Q2 2026: $4,861 million, increased $555 million or 13% year-over-year; was 52.3% of sales source
- Reported Q2 2026 operating profit: $2,554 million, 27.5% of sales, 8% above prior year source
- Adjusted Q2 2026 operating profit: $2,744 million, 29.5% of sales, 7% higher versus prior year source
- EBITDA Q2 2026: $3,553 million, up $224 million from $3,329 million in Q2 2025; EBITDA was 38.2% of sales source
- Adjusted EBITDA Q2 2026: $3,572 million, increased $221 million from $3,351 million in Q2 2025; adjusted EBITDA as % of sales 38.5% source
Impact estimates
| metric | direction | stage | expected | basis |
|---|---|---|---|---|
| operating_income | negative | realized | -6.0% | Cost of sales (excl. D&A) Q2 2026: $4,861 million, increased $555 million or 13% year-over-year; was 52.3% of sales |
| operating_income | positive | realized | +2.0% | Reported Q2 2026 operating profit: $2,554 million, 27.5% of sales, 8% above prior year |
| operating_income | positive | realized | +1.9% | Adjusted Q2 2026 operating profit: $2,744 million, 29.5% of sales, 7% higher versus prior year |