Aug 27, 2026 earnings call — Improving inventory and margins across ag business
Titan's consolidated gross profit margin expanded 150 basis points to 18.6% in Q2.
Revenue $0.5B (est $0.5B) · EPS $-0.40 (est $-0.36)
Key quotes
"This improvement reflects the work our team has done over the last 2 years to reduce aged inventory, improve inventory mix and strengthen inventory management processes across our organization."
"This year-over-year improvement primarily reflects stronger equipment margins, which improved 190 basis points year-over-year to 8.5%, driven by the continued improvement in inventory health alongside a higher mix of parts and service revenue in our consolidated totals."
"In Europe, we are revising our outlook to a decrease of 30% to 40% and widening the range to reflect the uncertainty we're seeing in the region."
Analyst Q&A 4
Black Sea disruption effect on other markets
Q (Liam Burke · B. Riley): He asked whether the Black Sea turmoil ripples to other markets you serve, especially the U.S. He also asked how long corn needs to stay at $5 or the current $5.50 area before Agriculture customers loosen spending.
A: He said small grains from Ukraine and Russia are heavily impacted and they are monitoring Ukraine customers and managing inventories there. He said the disruption is a positive for the U.S. and Australia and they expect wheat and other small grain prices to rise; if these price moves sustain, farmers could be profitable in 2026 and buying could pick up into '27.
"Yes, certainly, a lot of small grain especially comes out of that area between Ukraine and Russia and both have been heavily impacted." — Bryan Knutson (CEO)
U.S. ag outlook and equipment margins
Q (Matthew Raab · Craig-Hallum Capital Group): He asked if your view of U.S. ag next year lines up with Deere's mid-single-digit comments. He also asked about Domestic Ag equipment gross margins now and how they should trend into the second half and into next year.
A: They said U.S. indications generally line up with the OEMs and early signs are in line with Deere; structural factors like biofuels, livestock markets, and an aging fleet should support parts, service, and replacement demand. Domestic Ag equipment margin was 6.7% in the first half and they expect about 6.9% for the full year, with a normal range around 8% to 11% or 12% and gradual improvement as industry volumes recover.
"Generally speaking, our guide, I mentioned first half was 6.7%, generally expecting about 6.9% for full year Domestic Ag equipment margin." — Bo Larsen (CFO)
Australia margins and aged inventory
Q (Mircea Dobre · Baird): He asked what is causing the drag on Australia margins and what must happen to reach breakeven. He also asked whether geographic expansion (Europe, Australia) is an asset or if focusing on the U.S./Canada would give better returns.
A: They said the drag is mainly softer equipment margins while they work through aged inventory and weaker farmer sentiment earlier in the year. For the full year, they expect Australia to show a pretax loss of low single digits; they view Australia as a future asset but say timing was unfavorable and they remain focused on Upper Midwest U.S. opportunities.
"So from a full year perspective, for Australia, we're expecting a total pretax loss of low single digits." — Bo Larsen (CFO)
Early shipments and inventory management
Q (David Raso · Evercore): He asked why presold equipment arrived earlier than expected and how much earlier. He also asked whether improving farm economics are changing your inventory management, and whether you are seeing more buying activity near year-end or due to bonus depreciation.
A: They said some suppliers shipped equipment a little earlier than requested and customers want machines as soon as possible, so they do standard predelivery work and then deliver. They said inventory is generally flat and they are not materially changing management now; year-to-date used equipment is down $40 million, new equipment is up $60 million, total Domestic Ag inventory is down $16 million, construction inventory is up $30 million, and they are pushing for higher presale rates and about 2.5x turns.
"So just from our suppliers, they essentially shipped us some of these a little earlier than requested and anticipated." — Bryan Knutson (CEO)