A maker of high-reliability electronic gear and structural components for commercial and military aircraft, Ducommun supplies cable assemblies, printed circuit board assemblies, and lightning diversion systems for planes flown by airlines and armed forces. Its roots reach back to 1849, when Swiss-trained watchmaker Charles Louis Ducommun walked from Arkansas to Los Angeles on foot with a mule, opened a small watch-repair shop, and built a business that became the oldest continuously operating company in California.
Ducommun Q2 2026 gross margin hits 28.0% as revenue rises 11.8% to $224.5M, the highest quarterly level in the reported series.
Ducommun's reached a new quarterly high. rose 11.8% to $224.5 million and climbed 59.8% to $28.3 million, driven by higher volume across commercial aerospace and military programs and savings from facility consolidation. The company is now generating its strongest margins on record while paying down debt.
Key takeaways
expanded to 28.0% from 26.4% a year ago, the highest quarterly level in the reported series, as higher manufacturing volume and facility consolidation savings more than offset unfavorable product mix.
rose 11.8% to $224.5 million, with commercial aerospace up $12.0 million and military and space up $7.9 million, marking a second consecutive quarter of commercial aerospace growth after a year of declines.
rose 59.8% to $28.3 million, and rose 59.9% to $20.4 million, as was nearly flat —a $3.9 million compensation clawback offset higher compensation and professional services costs.
Section summaries
Management's Discussion and Analysis
Q2 FY2026 net revenues rose 11.8% to $224.5M, with net income up 60% to $20.4M driven by higher commercial aerospace and military volume.
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Consolidated net revenues increased 11.8% to $224.5M, led by a $12.0M rise in commercial aerospace and a $7.9M rise in military and space end-use markets.
expanded to 28.0% from 26.4%, primarily due to higher manufacturing volume and savings from the facility consolidation program, partially offset by unfavorable product mix.
reached $33.5 million for the quarter, up 49.7% , and was $30.0 million, as higher and increased from progress payments boosted cash generation.
Total debt fell to $272.5 million from $300.0 million at year-end, with $369.8 million available under the , and the company stated it faces no material near-term liquidity concerns.
What changed
Commercial aerospace sustained its Q1 2026 rebound, rising $12.0 million after a $12.5 million increase in Q1, suggesting the 's decline has reversed.
rose to 28.0%, exceeding the 26.9% record set in FY2025 and Q1 2026, showing the metric is still improving even after the Monrovia wind-down benefits were fully realized.
The $56.0 million Guaymas insurance recovery flagged in prior filings was not mentioned as collected this quarter; the company settled a $4.0 million subrogation claim in Q1 and stated no remaining material claims are expected.
was held flat by a $3.9 million compensation clawback, a new item not previously disclosed, which offset cost increases and contributed to the expansion.
What to watch
Whether the $56.0 million Guaymas insurance recovery is collected in the second half of 2026 and how it affects cash and debt paydown.
Whether can hold at 28.0% as product mix shifts and the facility consolidation savings are lapped.
Conversion of the record $1.20 billion into , particularly whether commercial aerospace growth continues alongside military and space strength.
The impact of variable interest rates on the $272.5 million in borrowings under the 2025 Credit Facilities as the Federal Reserve adjusts rates.
SG&A expenses were nearly flat , as a $3.9M compensation clawback reduction offset higher compensation, benefits, and professional services costs.
Electronic Systems grew $5.0M on higher volume, while Structural Systems operating income rose $3.5M, aided by volume and facility consolidation savings.
Net was $44.8M for the first six months, up from $23.2M, driven by higher and increased from progress payments.
Total debt was reduced to $277.5M from $305.0M at year-end, with $369.8M available under the and no material near-term liquidity concerns cited.
Quantitative and Qualitative Disclosures About Market Risk
Our main market risk exposure relates to changes in U.S. interest rates on our outstanding long-term debt. At July 4, 2026, we had total borrowings of $277.5 million under our 2025 Credit Facilities. The 2025 Term Loan bears interest, at our option, at a rate equal to either (i)…
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Our main market risk exposure relates to changes in U.S. interest rates on our outstanding long-term debt. At July 4, 2026, we had total borrowings of $277.5 million under our 2025 Credit Facilities.
The 2025 Term Loan bears interest, at our option, at a rate equal to either (i) Term Secured Overnight Financing Rate (“Term SOFR”) plus an applicable margin ranging from 1.250% to 2.125% per year or (ii) Base Rate (defined as the highest of [a] Federal Funds Rate plus 0.50%, [b] Bank of America’s prime rate, and [c] Term SOFR plus 1.00%, and if the Base Rate is less than zero percent, it will be deemed zero percent) plus an applicable margin ranging from 0.250% to 1.125% per year, in each case based upon the consolidated total net adjusted leverage ratio.
The 2025 Revolving Credit Facility bears interest, at our option, at a rate equal to either (i) Term SOFR plus an applicable margin ranging from 1.250% to 2.125% per year or (ii) Base Rate (defined as the highest of [a] Federal Funds Rate plus 0.50%, [b] Bank of America’s prime rate, and [c] Term SOFR plus 1.00%, and if the Base Rate is less than zero percent, it will be deemed zero percent) plus an applicable margin ranging from 0.250% to 1.125% per year, in each case based upon the consolidated total net adjusted leverage ratio.
A hypothetical 10% increase or decrease in the interest rate would have an immaterial impact on our financial condition and results of operations.
See Note 11 to our unaudited condensed consolidated financial statements included in Part I, Item 1 of this Form 10-Q for a description of our legal proceedings.
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See Note 11 to our unaudited condensed consolidated financial statements included in Part I, Item 1 of this Form 10-Q for a description of our legal proceedings.
See Part I, Item 1A of our Amendment No. 1 to our Annual Report on Form 10-K for the year ended December 31, 2025 (“2025 Form 10-K/A”) for a discussion of our risk factors. There have been no material changes during the three months ended July 4, 2026 to the risk factors disclos…
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See Part I, Item 1A of our Amendment No. 1 to our Annual Report on Form 10-K for the year ended December 31, 2025 (“2025 Form 10-K/A”) for a discussion of our risk factors. There have been no material changes during the three months ended July 4, 2026 to the risk factors disclosed in our 2025 Form 10-K/A for the year ended December 31, 2025.