Trimble grew Q2 revenue 11% to $972.0M and ARR 14% to a record $2.51B, but a $562.0M non-cash goodwill write-down on its freight-software unit produced a GAAP loss of $(2.02) per share; full-year guidance was raised.
Revenue
$972M
+11.0% YoY
Net income
-$472M
Diluted EPS
$-2.02
Operating margin
13.6%
A strong operating quarter hidden behind a $562 million write-down
Trimble, the maker of positioning hardware (GPS survey instruments, machine-control systems for bulldozers and graders) and construction, engineering and freight software, had two very different stories in its second quarter of 2026, which ended July 3.
The operating business grew and got more profitable. Revenue rose 11% to $972.0 million, 10% on an organic basis (which strips out currency moves and businesses bought or sold in the past year). Revenue beat the top of the company's own May guidance of $938–963 million. Annualized recurring revenue (ARR), the yearly value of Trimble's subscription, maintenance and term-license contracts at the current run rate, reached a record $2.509 billion, up 14% (12% organic).
The bottom line went the other way. Trimble booked a $562.0 million goodwill impairment on its Transportation & Logistics (T&L) segment. Goodwill is the premium over the value of identifiable assets that a company paid when it bought other businesses. Writing it down admits that the business is worth less than its book value. That one charge turned last year's $89.2 million profit into a GAAP net loss of $471.7 million, or $(2.02) per share. It is a non-cash accounting entry: no money left the company this quarter.
Key figures
Metric
Q2 2026
Q2 2025
YoY Change
Revenue
$972.0M
$875.7M
+11.0% (organic +10%)
Product revenue
$331.4M
$292.8M
+13.2%
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n/m = not meaningful, because the result swung from a profit to a loss. Non-GAAP figures are the company's own adjusted measures. They exclude the impairment, amortization of acquired intangibles, stock-based compensation, restructuring and deal costs.
Why the write-down happened, and what it does not mean
The 10-Q says the test was triggered by "a sustained decline in market capitalization and stock price reflecting heightened macroeconomic uncertainty and lower market multiples for software businesses." In other words, investors now pay less for software companies in general, and that lowered the estimated fair value of the T&L unit below what it is carried at on the balance sheet. The 10-Q names Transporeon as T&L's subscription growth driver.
The segment's own numbers did not get worse this quarter. T&L revenue rose 6.3% to $141.0 million (5% organic, "primarily driven by subscription revenue growth from Transporeon"). Its operating margin improved to 24.0% from 21.6%. The impairment is about what the business is worth at today's valuations, not about a drop in its sales or profits. Total goodwill fell to $4.83 billion from $5.24 billion at year-end. That drop is smaller than the charge because the Document Crunch acquisition (below) added $207.0 million.
The charge also distorts tax. Because the impairment cannot be deducted for tax purposes, Trimble still recorded $26.9 million of tax expense on a pre-tax loss of $444.8 million. That gives a negative effective tax rate of (6.0)%.
Segment performance
Segment
Q2 2026 revenue
Q2 2025 revenue
YoY
Organic
Op. margin Q2 2026
Op. margin Q2 2025
AECO (architecture, engineering, construction & owners software)
$388.5M
$350.3M
+10.9%
+9%
30.6%
30.4%
Field Systems (survey, civil construction and geospatial hardware and software)
$442.5M
$392.7M
+12.7%
+12%
32.9%
30.8%
Transportation & Logistics
$141.0M
$132.7M
+6.3%
+5%
24.0%
21.6%
Field Systems was the surprise. It is the most hardware-heavy segment and grew fastest, at 12% organic. The 10-Q credits "hardware sales growth in Civil Construction and Surveying solutions due to strong end-user demand and competitive wins, and to a lesser extent, term license growth." Its margin rose 2.1 points. For a company that is steering toward subscriptions, strong hardware demand is a welcome extra, but it is also the part of the business most exposed to the construction cycle.
AECO, the core software segment, grew 9% organic on "strong demand for subscription offerings." The biggest gains came from Construction Management Systems, Architecture & Design, and MEP (mechanical, electrical and plumbing design) software.
T&L grew the slowest but posted the largest margin gain (see above).
Why GAAP operating margin fell while the business improved
Gross margin (the share of revenue left after the direct cost of the products and services sold) rose to a record second-quarter 69.4%. Management attributes this to "the improved mix of higher margin subscription and software term license sales." Yet GAAP operating margin (the share of revenue left after all operating costs, before interest and tax) fell to 13.6% from 14.6%. The gap came from costs below gross margin:
General and administrative expense rose 27% to $149.7 million. The 10-Q attributes this "primarily" to "increased transaction costs, higher compensation expenses, and software expenditures." Acquisition and divestiture items that the company adjusts out came to $23.9 million, against $2.7 million a year earlier.
Restructuring charges rose to $12.6 million from $4.0 million.
Once those deal and restructuring costs, stock pay and amortization are removed, non-GAAP operating margin expanded 1.4 points to 26.8%. The GAAP decline mainly reflects one-time costs rather than weaker underlying profitability. Those costs are still real money spent this quarter, though.
Acquisition, cash and buybacks
Document Crunch: On April 4, 2026, Trimble paid $246.4 million for this AI platform that reviews construction contracts and project documents for risk. It is being folded into AECO. It added less than 1% to revenue and was funded with $250.0 million of credit-facility borrowings.
Cash flow: Operating cash flow for the first half was $515.0 million, against $102.1 million a year earlier. Free cash flow (operating cash minus capital spending) was $501.8 million, against $89.6 million. The 10-Q says the jump was "primarily driven by lower cash taxes paid and higher operating income." The prior-year half included a $308.5 million cash outflow from income taxes payable. So the comparison flatters 2026, and the size of the increase is not the recurring run rate.
Buybacks: Trimble repurchased $329.0 million of stock in the first half, down from $677.4 million. The board approved a new $1.0 billion buyback authorization, which replaces the $608.2 million left under the old one.
Balance sheet: Long-term debt was $1.44 billion and cash $214.4 million at quarter-end.
Takeaway: The $2.02 GAAP loss per share is a valuation write-down, not an operating problem. The impaired T&L segment itself grew revenue 6% and widened its margin. Across the company, recurring revenue grew 14%, gross margin hit a second-quarter record, and non-GAAP EPS rose 21%. The write-down does tell investors that T&L is now valued below its carrying amount, at a time when software valuations are lower.
Controls still flagged
Management again concluded that Trimble's disclosure controls "were not effective" at quarter-end, because of material weaknesses in internal control over financial reporting that were first reported in its 2025 10-K. A material weakness means there is a reasonable chance that a significant error in the accounts might not be caught in time. Remediation is under way, and part of the "restructuring and other costs" line is one-time spending on a "re-audit and related remediation of control deficiencies." It does not change the reported numbers, but it is a governance issue to watch until the company declares it fixed.
Outlook
Management raised its full-year 2026 guidance:
Guidance
Prior (May 2026)
New (Aug 2026)
FY2026 revenue
$3,835–3,915M
$3,900–3,950M
FY2026 non-GAAP EPS
$3.47–3.64
$3.60–3.70
FY2026 GAAP EPS
$2.05–2.21
$(0.07)–$(0.12) loss
Q3 2026 revenue
—
$953–978M
Q3 2026 non-GAAP EPS
—
$0.83–0.88
Q3 2026 GAAP EPS
—
$0.39–0.44
The swing in GAAP guidance from a profit to a small loss comes entirely from the impairment ($2.40 per share) and the resulting 145% full-year GAAP tax-rate assumption. The underlying guide went up: the midpoint of revenue guidance rose about $50 million, and the non-GAAP EPS midpoint rose $0.095.
Our read: Trimble beat the top of its own Q2 revenue and non-GAAP EPS ranges ($0.86 against $0.78–0.82). Next quarter's guide is roughly flat with Q2 at the midpoint. Two things are worth watching in Q3:
Does Field Systems hardware demand hold up? This quarter's 12% organic growth rested on civil-construction and survey equipment. That demand is more cyclical than subscription revenue and more exposed to the tariffs and interest rates that management lists as risks.
Does ARR growth stay in the low teens? The software-led story depends on it. A second quarter of lower transaction and restructuring costs would also let the GAAP operating margin catch up with the non-GAAP improvement.
Source: Trimble Inc. Form 10-Q for the quarter ended July 3, 2026 (filed August 12, 2026), and the Q2 2026 earnings release (Exhibit 99.1) for guidance and non-GAAP reconciliations.