Regal Rexnord Explores Sale Of Autonomous Mobile Solutions Business After $119 Million Goodwill Charge
The industrial company posted a third-quarter net loss of $12 million but raised its adjusted profit outlook as its new CEO reviews the portfolio.
Regal Rexnord, which makes electric motors, power transmission components and automation products, said Tuesday it is exploring a sale of its autonomous mobile solutions business, after a $119 million non-cash goodwill impairment pushed third-quarter results to a net loss of $12 million, per its 8-K. The company's GAAP net income was $80 million a year earlier.
A review that starts with a sale
CEO Aamir Paul said the company has begun a comprehensive review of its portfolio, working with its board and outside advisors. "Ultimately the goal is directing capital to our most attractive opportunities," he said.
The autonomous mobile solutions business sits in the Automation & Motion Control segment, and the goodwill charge relates primarily to it. Paul said the sale exploration shows the company is "moving with urgency" when it sees opportunity, and that it plans to share updates "when we have something definitive to share." He is four months into the role.
The charge cut $1.78 from diluted earnings per share. The company's loss was $0.19 per share, against earnings of $1.20 a year earlier.
Sales rise while profit measures diverge
Sales rose 6% to $1,588 million. Adjusted EBITDA, the company's earnings measure before interest, taxes, depreciation, amortization and certain items, was $351 million versus $339 million a year earlier. Excluding tariff refunds under the IEEPA, it was $337 million, which the company said was slightly ahead of its expectations.
Automation & Motion Control sales climbed 24.5% to $500.6 million, with strength in data centers and discrete automation, including $25 million tied to E-Pods. Data center sales rose 307%, or 169% excluding E-Pods. Industrial Powertrain Solutions fell 1.9% to $649.5 million on weakness in metals and mining. Power Efficiency Solutions rose 1.2% to $437.9 million, as commercial HVAC growth was partly offset by residential HVAC and pool weakness.
Orders rose 13% excluding data centers, Paul said, with commercial HVAC orders up 47%.
Guidance moves in opposite directions
The company lowered and narrowed its 2026 GAAP earnings guidance to $3.76 to $4.06 per share, a range that includes the impairment. It raised and narrowed its adjusted range to $10.60 to $10.90, with a midpoint of $10.75.
Net debt stood at 2.9 times adjusted EBITDA including synergies at quarter-end.
Management has said it will share further word on the autonomous mobile solutions sale once it has something definitive.
