Badger Meter, Inc. (NYSE: BMI) reported financial results for the third quarter ended September 30, 2026, showing modest growth in sales and improved profit margins compared to the prior year. Total sales for the quarter were $235.9 million, which was flat year-over-year but increased 6% sequentially from the second quarter of 2026. Base sales, which exclude the impact of the UDlive acquisition completed on May 1, 2026, were $230.3 million.
Operating earnings for the third quarter were $47.7 million, a 4% increase from the prior year, resulting in an operating profit margin of 20.2%. The company noted that gross margins improved to 41.9%, a 120-basis point increase over the prior year's 40.7%, driven by higher sales and structural mix benefits. Diluted earnings per share (EPS) were $1.24, up 4% from $1.19 in the third quarter of 2025. The effective tax rate for the quarter was 25.1%.
Badger Meter announced an increase to its annual dividend rate of 10%, raising it to $1.76 per share. This marks the 34th consecutive year of dividend growth for the company. Additionally, during the third quarter, the company repurchased approximately $55 million of its outstanding common stock.
Management highlighted that utility water sales were flat year-over-year, including $5.6 million from the UDlive acquisition. Excluding this acquisition, utility water sales increased 5% sequentially. Sales of flow instrumentation products increased 2% year-over-year. The company stated that it continues to anticipate sequential and year-over-year Base revenue improvement for the fourth quarter of 2026 and into 2027.
