Acuity (NYSE:AYI) reported a strong start to fiscal 2026, with first-quarter net sales climbing 20.2% to $1.1 billion.
The Atlanta-based industrial technology company, formerly known as Acuity Brands, saw its adjusted diluted earnings per share jump 18.1% to $4.69, comfortably outpacing analyst estimates of $4.45.
The quarterly performance was characterized by disciplined execution in a "flat to down" lighting market.
While traditional commercial construction remained soft, Acuity leveraged its high-growth Intelligent Spaces Group (ISG) and the integration of the QSC acquisition to drive the top-line beat.
Adjusted operating profit rose nearly 24% to $196.3 million, with adjusted margins expanding by 50 basis points to 17.2%.
CEO Neil Ashe credited the company's "Better. Smarter. Faster." operating system for maintaining profitability even as the firm navigated higher tariff costs through strategic pricing.
During the quarter, Acuity generated $140.8 million in operating cash flow, which it deployed toward a $100 million debt repayment and the repurchase of 77,000 shares.
The company enters the remainder of the year with a reinforced balance sheet and a focus on expanding into specialized verticals like healthcare.
Management had previously set a full-year 2026 sales target of $4.7 billion to $4.9 billion, a trajectory that remains supported by the Q1 results.