Lincoln Electric Holdings Inc Jefferies Global Industrials Conference 2026

Thank you, Steve. It is always great to be here.

Yeah, sure. One of the key things, Steve, as you know, on the earnings call for the second quarter at the end of July, we had increased our sales assumptions. We have seen strength, broadly speaking, across the Americas segment, across all the product lines, consumables, standard equipment, and automation, and continue to see that, in fact, through the August timeframe. I want to reinforce that the strength and the momentum that we saw in our business, we are continuing to affirm that kind of strength. Similarly, challenges in Europe, August is a tough timeframe to really gauge what is going on in Europe, so more of a choppy environment. Continue to see strength in the Indian, the Southeast Asia, Chinese portions of our Asia business. And then Harris, we are starting to see a little bit more volume.

Very good progression, consistent with what we saw at the end of July. That said, we've been managing through some persistent inflation. We talked about that in our call. We did take actions in pricing in the Americas segment. They have impacts beginning of September. You'll see that mature in the fourth quarter. We also took actions on the international side, price actions that are going to take effect towards the end of September. You'll see that fully realized in the fourth quarter. We estimate that at maturity is probably another 100 basis points of pricing actions that we'll see at maturity in the fourth quarter, and that's driven, again, by a lot of cost pressures. It's the logistics, some supply chain challenges. We're seeing the components, so pretty important for us.

What that implies is that we're looking at our incrementals for third quarter more into the low 20s. We had talked about mid-20s. But right now, we're tracking around the low 20s in terms of an update. We're really excited about the market profile, but we continue to manage the pressures of inflation and some supply chain dynamics we're working through.

As you recall on the call, we talked about second half being price-cost neutral, and that's the drivers of the action. More inflation, more cost pressures translates into more pricing actions, and that's driving to a price-cost neutral posture.

Well, the key drivers are seeing consistency in production levels across the different end markets we serve and how that translates into conviction of capital. I would point to that outside of what you see in automation, because we had already seen coming into 2026, significant increases in the order activity, the order book, the backlogs in automation that pointed to volume expectations towards the end of the second quarter, which was what you saw. We have, as you know, experienced an extended contraction on the industrial side. So when you see PMI now eight months in a row of expanding, that's real positive. The sentiment followed by steady increases in industrial production trends point to pretty positive trends in a broader macro sense.