TXT · 10-Q · 2026Q4 · Full report

Gross Margin Drivers

TEXTRON INC · 2026-10-29 · Importance 31 · Surprise 32

Consolidated cost of sales increased $138 million, or 5%, in the third quarter and $615 million, or 7%, in the first nine months of 2026. The year-to-date increase included $377 million from higher net volume and mix and $210 million from inflation. Gross margin as a percentage of Manufacturing revenues decreased 70 basis points year to date, primarily because of lower margin at Bell. Bell’s nine-month segment profit fell $39 million, or 15%, with margin down 150 basis points, reflecting military-program mix, lower commercial volume and mix, contract performance, and manufacturing inefficiencies.

Key facts

• TEXTRON INC’s cost of sales increased $615 million, or 7%, in the first nine months of 2026, including $377 million from higher net volume and mix and a $210 million inflation impact. source
• TEXTRON INC’s cost of sales increased $138 million, or 5%, in the third quarter of 2026, primarily due to a $75 million inflation impact and $45 million from higher net volume and mix. source
• TEXTRON INC’s gross margin as a percentage of Manufacturing revenues decreased 70 basis points in the first nine months of 2026, primarily due to lower margin at Bell. source