Martin Marietta's Q2 2026 revenue rose 21% to a record $1.95B on acquired quarries, but diluted EPS from continuing operations fell 12% to $4.26 on a $52M acquisition inventory charge and higher depreciation; organic aggregates volume rose 2.3% and price 2.1%.
Revenue
$1.9B
+21.0% YoY
Net income
$256M
-12.3% YoY
Diluted EPS
$4.26
-12.0% YoY
Operating margin
19.1%
Record sales, lower profit: acquisitions added tons, and one-time acquisition accounting took a bite
Martin Marietta, a national supplier of aggregates (crushed stone, sand and gravel used in roads, foundations and concrete), grew second-quarter 2026 revenue 21% to a record $1,947 million. Profit went the other way: earnings from operations fell 10% to $372 million and diluted earnings per share from continuing operations fell 12% to $4.26 (from $4.84).
The gap between the two is mostly deal-related, not a weakening business. The quarter was the first full one after the February 2026 asset swap with QUIKRETE, plus six weeks of the New Frontier Materials (NFM) quarries in St. Louis, bought May 15. Those deals added tons and revenue, but they also brought:
a $52 million charge in cost of revenues from selling inventory the company acquired, which purchase accounting had revalued upward to market value (so it earns almost no profit when sold), and
higher depreciation, depletion and amortization (the non-cash cost of wearing out equipment and using up quarry reserves), which rose to $191 million from $140 million in cost of revenues.
The company says that excluding $45 million of after-tax deal-related charges ($0.74 per share), adjusted EPS was $5.00, up 3%, and Adjusted EBITDA (earnings before interest, tax, depreciation and amortization, excluding those charges) rose 13% to a record $638 million.
All figures below are for continuing operations. The Texas cement plant and ready-mixed concrete business handed to QUIKRETE are reported separately as discontinued operations.
Key metrics
Metric
Q2 2026
Q2 2025
YoY Change
Revenue
$1,947M
$1,609M
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"Organic" means operations the company owned in both periods, so it strips out the acquired quarries. Operating margin is earnings from operations divided by revenue: the share of each sales dollar left after running the business, before interest and tax.
Aggregates: volume up, reported price down, and it's mostly mix
Aggregates are the core of the business: $1,533 million of revenue (+16%) and $418 million of gross profit (−3%).
Volume. Shipments hit a record 61.6 million tons. Of the 8.9 million-ton increase, about 1.1 million tons was organic growth (+2.3%). The company attributes that to "strong infrastructure and heavy nonresidential demand" across its footprint. The other ~7.8 million tons came from the QUIKRETE and NFM quarries.
Price. The reported average selling price fell 2.0% to $22.74 per ton, the first thing a headline reader will notice. The filing attributes this "primarily" to "acquisition mix headwinds": the newly acquired quarries sell stone at lower prices than the company average. From the filing's own figures, we estimate the acquired tons sold at about $16 per ton, versus $23.70 on the organic base. On like-for-like operations, price rose 2.1%. The company adds that its organic mix-adjusted price (which also corrects for faster growth in lower-priced regions) rose 3.7%. The filing notes that shipment growth was strongest in the Central and West divisions, "where average selling prices are below the Company's average", which drags the blended number down even when individual quarries raise prices.
Pricing is still positive on a like-for-like basis. But with acquired tons at lower prices and higher depreciation, price gains alone no longer lift per-ton profit.
Margin. Aggregates gross profit per ton fell to $6.78 from $8.15. The inventory charge accounts for $0.84 per ton of that drop. The rest is mainly higher depreciation and depletion: aggregates DD&A rose to $166 million from $125 million, or about $2.69 per ton versus $2.37 (our calculation). That is a real, recurring cost of owning the acquired reserves, not a one-off. Cash operating costs held up well. The company says organic cost of goods sold per ton rose only 3.6%, and 1.5 points of that came from pass-through freight, which is billed on to customers.
Other Building Materials: revenue up, profit down
Asphalt, paving and ready-mixed concrete (now reported only in the West Group, mainly Colorado and, since the QUIKRETE deal, British Columbia) grew revenue 12% to $303 million. Gross profit fell 14% to $34 million, which the filing puts down to "higher ready mix concrete raw material costs combined with lower organic paving revenues and reduced job margins." This is a small, low-margin part of the business, but it has been a drag two quarters running: first-half gross profit was down 11% to $18 million.
Specialties: the fastest-growing piece
The Specialties segment, which makes magnesia-based chemicals (magnesium oxide, hydroxide and sulfate) and dolomitic lime, set quarterly records: revenue of $152 million (up from $90 million) and gross profit of $50 million, up 39%. Much of the jump comes from the July 2025 Premier Magnesia acquisition, which was not in last year's quarter, so this is not all organic growth. The filing does cite "organic pricing gains across all products." In the legacy lime business, the company reports 4.0% price growth, 0.9% shipment growth and 7% gross profit growth. Specialties matters more than its size suggests because it is where the company's biggest deal lands (below).
Below the operating line
Interest expense was little changed at $59 million (vs. $57 million).
Effective tax rate for the quarter was about 20%, flat on last year. For the half year it rose to 23.3% from 20.3%, which the filing attributes to revaluing deferred tax liabilities after the QUIKRETE deal changed the company's state-by-state tax mix.
SG&A (overhead) fell to 5.9% of revenue from 6.5%, because revenue grew faster than overhead.
Total net earnings (including discontinued operations) were $251 million, or $4.17 per diluted share. For the first half they were $1,764 million, or $29.27 per share, almost entirely because of a $1.4 billion after-tax gain on handing the Midlothian cement plant to QUIKRETE. That gain is a one-time accounting item, not earning power.
Cash, debt and the $13.5 billion lime deal
First-half operating cash flow fell to $339 million from $605 million, mainly because of higher tax payments on the taxable gain from the QUIKRETE exchange. Capital spending fell to $314 million from $412 million. The company bought back 325,455 shares for $200 million (average $614.52) and returned $302 million in total including dividends.
The bigger story is the balance sheet. On June 27 the company agreed to buy Lhoist North America (LNA), a producer of high-calcium and dolomitic lime, for $13.5 billion: $7.0 billion in cash plus 10,953,543 new shares (about 15% of the company). A later 8-K shows the deal closed on August 21, 2026, after this quarter ended, so none of it is in these results. To prepare, the company:
amended its revolving credit covenant so net debt can reach 4.75× EBITDA for three quarters after closing, stepping down to 4.25× and then 3.75×, and
secured a $1.5 billion three-year term loan commitment.
At quarter-end the credit agencies already had it on watch: Fitch BBB+ with a negative outlook, Moody's Baa2 under review for downgrade, S&P BBB+ on CreditWatch negative. Short-term borrowings were also rising, with $560 million drawn on the receivables facility (used to fund NFM) and $95 million on the revolver.
Takeaway: The 12% EPS decline is mostly acquisition accounting ($52 million inventory markup charge plus higher depreciation on acquired reserves), and the core aggregates business still grew organic volume 2.3% and organic price 2.1%. What changes the investment case is the balance sheet, not this quarter's earnings. With LNA closed in August, Martin Marietta now carries far more debt and a much larger lime and industrial-minerals business, which management says broadens its exposure to manufacturing and industrial end markets beyond construction.
Outlook
Management's guidance (from the July 30 earnings release; excludes LNA):
Full-year 2026 revenue raised to $7.2–7.4 billion.
Adjusted EBITDA from continuing operations reaffirmed at $2.36–2.50 billion (midpoint $2.43 billion). The midpoint assumes $1,043 million of net earnings from continuing operations.
An enterprise review identified about $350 million of annualized cash-flow improvements from optimizing the asset base and sustaining capital. More than $200 million of cash has already been "unlocked" year to date through inventory and capex reductions.
Our read. Raising revenue guidance while holding EBITDA flat tells you the acquired volume comes in at thinner margins than the legacy business, which matches the falling reported price and gross profit per ton. The first half produced $1,001 million of Adjusted EBITDA, so hitting the midpoint requires about $1.43 billion in the second half. That is plausible because July–October is peak construction season, but it leaves little room for a wet autumn or a hurricane on the Southeast and Texas footprint. Weather is the biggest swing factor in any single quarter for this business.
From Q3 onward, reported figures will change sharply as LNA is consolidated. Expect another round of inventory step-up charges, much higher interest expense on the $7 billion cash portion, and roughly 11 million more shares diluting per-share earnings. The questions to watch are:
whether organic aggregates pricing holds around the 2–4% range,
how quickly the company brings leverage back toward its 3.75× covenant step-down, and
whether the rating agencies keep the company at investment grade.
Source: Martin Marietta Form 10-Q for the quarter ended June 30, 2026, and the Q2 2026 earnings release (Exhibit 99.1 to the July 30, 2026 Form 8-K). Adjusted EPS and Adjusted EBITDA are the company's non-GAAP measures. The acquired-ton selling price (~$16/ton) and DD&A per ton are our calculations from the filing's figures.