Fortrea Reports Third Quarter 2026 Results
Nine-month operating cash flow turned positive, while revenue remained below the comparable 2025 period.
Sentiment and the balance of points
Rhea-AI Sentiment reads the wording of the document, how positive or negative its language is on a 1 to 5 scale. The balance of points shown with the takes weighs what the document actually discloses, so the two can disagree, for example when a trial that missed its main goal is described in upbeat language.
Rhea-AI Summary
Fortrea (FTRE) reported third-quarter 2026 net income of $0.6 million, returning to profitability despite lower revenue than a year earlier. Revenue was $691.5 million versus $701.3 million, while diluted earnings per share were $0.01 versus a $0.17 loss. Adjusted EBITDA—earnings before interest, taxes, depreciation and amortization, with additional adjustments—rose to $58.0 million from $50.7 million.
Quarterly operating cash flow was $60.8 million and free cash flow was $52.5 million. A contract review reduced backlog by $558 million to $7,316 million, without affecting historical results, 2026 guidance or near-term revenue estimates. Orders relative to revenue, or book-to-bill, were 1.12x for both the quarter and trailing 12 months. Fortrea raised its full-year guidance midpoints and narrowed the ranges, expecting revenue of $2,665 million–$2,690 million and adjusted EBITDA of $210 million–$218 million.
How this balance works
Rhea-AI gives every point it takes from this document a weight. Minor counts 1, Moderate 3 and Major 9, so one Major point outweighs several Minor ones. The bar adds up the weights on each side, and when neither side holds more than 65% of the total the balance reads Mixed.
It reads the document as published, with the same rules for every company, and it does not look at what the market expected or at how the stock traded, so a point can be objectively good on a day the stock falls.
Rhea-AI Sentiment measures something else, the tone of the wording.
Hollow bars mark forward-looking points. How the balance works
Positive
- Major point. Forward-looking: it has not happened yet and may not happen.Full-year revenue guidance midpoint increased; Fortrea now expects $2,665 million to $2,690 million, a narrower range.
- Moderate pointThird-quarter adjusted EBITDA increased to $58.0 million from $50.7 million a year earlier.
- Moderate pointThird-quarter adjusted net income rose to $27.9 million from $11.7 million; adjusted diluted EPS reached $0.28 versus $0.12.
- Moderate pointThird-quarter operating cash flow was $60.8 million, with free cash flow of $52.5 million.
- Moderate pointThird-quarter operating income reached $15.0 million versus an $8.6 million loss a year earlier.
13 minor points
- Minor pointThird-quarter GAAP net income reached $0.6 million, or $0.01 diluted EPS, versus a $15.9 million loss.
- Minor point. Forward-looking: it has not happened yet and may not happen.Full-year adjusted EBITDA guidance midpoint increased; Fortrea now expects $210 million to $218 million, a narrower range.
- Minor pointBook-to-bill was 1.12x for both the third quarter and trailing 12 months.
- Minor pointNine-month GAAP loss narrowed to $36.2 million from $953.7 million, which included $797.9 million in goodwill impairment.
- Minor pointNine-month adjusted net income rose to $65.8 million from $31.2 million; adjusted diluted EPS reached $0.66 versus $0.34.
- Minor pointNine-month adjusted EBITDA increased to $163.7 million from $135.9 million a year earlier.
- Minor pointNine-month operating cash flow improved to $72.7 million from $15.6 million used a year earlier.
- Minor pointCash increased to $220.6 million at September 30, 2026 from $174.6 million at December 31, 2025.
- Minor pointNine-month operating income reached $26.4 million versus an $859.0 million loss a year earlier.
- Minor pointThird-quarter total costs and expenses fell to $676.5 million from $709.9 million a year earlier.
- Minor pointNine-month total costs and expenses fell to $1,979.8 million from $2,921.9 million a year earlier.
- Minor pointThird-quarter interest expense fell to $20.2 million from $22.6 million a year earlier.
- Minor pointNine-month interest expense fell to $58.6 million from $68.2 million a year earlier.
Negative
- Moderate pointBacklog was reduced by $558 million after reviewing estimated scope and study delivery requirements, including inactive trials. 23% of market cap
- Moderate pointThird-quarter revenue declined to $691.5 million from $701.3 million a year earlier.
- Minor pointNine-month revenue declined to $2,006.2 million from $2,062.9 million a year earlier.
- Minor pointNine-month capital expenditures increased to $25.3 million from $17.7 million a year earlier.
- Minor pointCurrent debt rose to $23.4 million at September 30, 2026 from $4.8 million at December 31, 2025.
3 minor points
- Minor pointShares outstanding increased to 96.5 million at September 30, 2026 from 93.1 million at December 31, 2025.
- Minor pointTotal equity declined to $532.3 million at September 30, 2026 from $563.5 million at December 31, 2025.
- Minor pointNine-month income tax expense increased to $19.1 million from $6.3 million a year earlier.
News Explained
Fortrea reports common shares outstanding at
Key Figures
- Revenue
- $691.5 million
- Q3 2026; compared with $701.3 million in Q3 2025
- GAAP net income
- $0.6 million
- Q3 2026; compared with a $15.9 million GAAP net loss in Q3 2025
- Adjusted EBITDA
- $58.0 million
- Q3 2026; compared with $50.7 million in Q3 2025
- Backlog reduction
- $558 million
- Adjustment following review of customer contracts
- Adjusted backlog
- $7,316 million
- As of September 30, 2026
- Book-to-bill ratio
- 1.12x
- Q3 2026
- 2026 revenue guidance
- $2,665 million to $2,690 million
- Full-year 2026; midpoint raised and range narrowed
- 2026 adjusted EBITDA guidance
- $210 million to $218 million
- Full-year 2026; midpoint raised and range narrowed
Previous Earnings Reports
-
Reported $678.2 million revenue, $58.7 million adjusted EBITDA, and raised full-year 2026 guidance.
-
Reported third-quarter results and raised 2025 revenue guidance while narrowing adjusted EBITDA guidance.
24h Move is the share-price change in the day after each event; other market factors may also have contributed.
Key Terms
cro technical
gaap financial
adjusted ebitda financial
book-to-bill ratio financial
AI-generated analysis. How Rhea-AI works. Not financial advice.
Sustained commercial momentum, continued margin improvement, and targeted investments strengthen growth foundation
Highlights
For the three months ended September 30, 2026:
- Revenues of
$691.5 million - Book-to-bill ratio of 1.12x, resulting in 1.12x book-to-bill for the trailing 12 months
- GAAP net income of
$0.6 million , or$0.01 per diluted share - Adjusted EBITDA of
$58.0 million - Adjusted net income of
$27.9 million , or$0.28 per diluted share - Cash provided by operations of
$60.8 million and free cash flow of$52.5 million - Raised midpoints of full-year revenue and adjusted EBITDA guidance and narrowed ranges
DURHAM, N.C., Oct. 29, 2026 (GLOBE NEWSWIRE) -- Fortrea (Nasdaq: FTRE) (the “Company”), a leading global contract research organization (“CRO”), today reported financial results for the third quarter ended September 30, 2026.
“Fortrea delivered another quarter of progress on our return-to-growth strategy, reflecting stronger commercial execution, continued operational improvements and financial discipline,” said Anshul Thakral, CEO of Fortrea. “Our sustained bookings momentum is building a foundation for growth, while targeted investments in early clinical development and technology enhance our ability to deliver differentiated value to clients. I’m proud of how Fortrea’s teams around the world are embracing our future direction while delivering for clients today. Our continued execution against our priorities gives us confidence to raise the midpoints of full-year guidance while narrowing ranges. We remain focused on translating stronger demand into revenue growth, margin expansion and long-term shareholder value.”
Third Quarter 2026 Financial Results
Revenue for the third quarter was
Third quarter GAAP net income was
During the third quarter, the Company performed a detailed review of contracts included in its backlog. As a result, the Company reduced backlog by
Year-to-Date 2026 Financial Results
Year-to-date revenue was
Year-to-date GAAP net loss was
2026 Financial Guidance
The Company updated its full-year 2026 guidance, narrowing the revenue and adjusted EBITDA ranges and raising both midpoints. The Company now expects revenues of
Earnings Call and Replay
Fortrea will host a conference call at 8:00 am ET on October 29, 2026, to review its third quarter financial results and conduct a question-and-answer session. To participate in the earnings call, participants should register online at the Fortrea Investor Relations website. To avoid potential delays, please join at least 10 minutes prior to the start of the call. The conference call can also be accessed through the following earnings webcast link. A replay of the live conference call will be available shortly after the conclusion of the event and accessible on the events and presentations section of the Fortrea website. A supplemental slide presentation will also be available on the Investor Relations website prior to the start of the call.
About Fortrea
Fortrea (Nasdaq: FTRE) is a leading global provider of clinical development solutions to the life sciences industry. We partner with emerging and large biopharmaceutical, biotechnology, medical device and diagnostic companies to drive healthcare innovation that accelerates life changing therapies to patients. Fortrea provides phase I-IV clinical trial management, clinical pharmacology and consulting services, delivered in highly flexible models that include full service, functional service provider and hybrid service structures. Fortrea’s solutions leverage three decades of experience spanning more than 20 therapeutic areas, a passion for scientific rigor, technology innovation and a strong investigator site network. Our talented and diverse team working in about 100 countries is scaled to deliver focused and agile solutions to clients globally. Learn more about how Fortrea is streamlining drug development at Fortrea.com and follow us on LinkedIn, X and Bluesky.
Cautionary Statement Regarding Forward-Looking Statements
This press release contains “forward-looking statements” within the meaning of the federal securities laws, including Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, including, without limitation, the Company’s 2026 financial guidance. In this context, forward-looking statements often address expected future business and financial performance and financial condition, and often contain words such as “guidance,” “expect,” “assume,” “anticipate,” “intend,” “plan,” “forecast,” “believe,” “seek,” “see,” “will,” “would,” “target,” similar expressions, and variations or negatives of these words that are intended to identify forward-looking statements, although not all forward-looking statements contain these identifying words. Forward-looking statements, including the Company’s 2026 financial guidance, are not guarantees of future performance and are subject to known and unknown risks and uncertainties, many of which are beyond the Company’s control. Actual results may differ materially from the Company’s expectations due to a number of factors, including, but not limited to, the following: the Company’s dependence on third parties generally to provide services critical to its businesses; the Company’s ability to successfully implement the Company’s business strategies and execute the Company’s long-term value creation strategy; risks and expenses associated with the Company’s international operations, tariff policies, trade sanctions and other trade restrictions and currency fluctuations; the anticipated benefits of the Company’s acquisition of the Early Phase Services division of Worldwide Clinical Trials; the Company’s customer or therapeutic area concentrations; the Company’s adoption and use of technology within its business and the risks that the Company may not be able to capture the anticipated benefits of such technology or that such technology may have negative effects; the outcome and impact of pending or future litigation; any further deterioration in the macroeconomic environment, particularly within the pharmaceutical and biotechnology industry, or further changes in government regulations and funding, which could lead to defaults or cancellations by the Company’s customers; the risk that the Company’s backlog and net new business may not grow to the extent anticipated over a specified period of time or be indicative of the Company’s future revenues and that the Company might not realize all of the anticipated future revenue reflected in the Company’s backlog; the Company’s ability to generate sufficient net new business awards, or if net new business awards are delayed, terminated, reduced in scope, or fail to go to contract; if the Company underprices its contracts, overruns its cost estimates, or fails to receive approval for, or experiences delays in documentation of change orders; and other factors described from time to time in documents that the Company files with the Securities and Exchange Commission (the “SEC”). For a further discussion of the risks relating to the Company’s business, see the “Risk Factors” Section of the Company’s Annual Report on Form 10-K for the year ended December 31, 2025, as filed with the SEC, as such factors may be amended or updated from time to time in the Company’s subsequent periodic and other filings with the SEC, which are accessible on the SEC’s website at www.sec.gov. These factors should not be construed as exhaustive and should be read in conjunction with the other cautionary statements that are included in this release and in the Company’s filings with the SEC. Comparisons of results for current and any prior periods are not intended to express any future trends, or indications of future performance, unless expressed as such, and should only be viewed as historical data. All forward-looking statements are made only as of the date of this release and the Company does not undertake any obligation, other than as may be required by law, to update or revise any forward-looking statements to reflect future events or developments.
Note on Non-GAAP Financial Measures
This release includes information based on financial measures that are not recognized under generally accepted accounting principles in the United States ("GAAP"), such as Adjusted EBITDA, Adjusted Net Income, Adjusted Basic and Diluted EPS, and Free Cash Flow. Non-GAAP financial measures are presented only as a supplement to the Company’s financial statements based on GAAP. Non-GAAP financial information is provided to enhance understanding of the Company’s financial performance, but none of these non-GAAP financial measures are recognized terms under GAAP, and non-GAAP measures should not be considered in isolation from, or as a substitute analysis for, the Company’s results of operations as determined in accordance with GAAP.
The Company uses non-GAAP measures in its operational and financial decision making and believes that it is useful to exclude certain items in order to focus on what it regards to be a more meaningful indicator of the underlying operating performance of the business. For example, in calculating Adjusted EBITDA, the Company excludes all the amortization of intangible assets associated with acquired customer relationships and backlog, databases, non-compete agreements and trademarks, trade names and other from non-GAAP expense and income measures, as such amounts can be significantly impacted by the timing and size of acquisitions. Although the Company excludes amortization of acquired intangible assets from the Company’s non-GAAP expenses, the Company believes that it is important for investors to understand that revenue generated from such intangibles is included within revenue in determining net income attributable to the Company. Internal management reports feature non-GAAP measures which are also used to prepare strategic plans and annual budgets and review management compensation. The Company also believes that investors may find non-GAAP financial measures useful for the same reasons, although investors are cautioned that non-GAAP financial measures are not a substitute for GAAP disclosures.
The non-GAAP financial measures are not presented in accordance with GAAP. Please refer to the schedules attached to this release for relevant definitions and reconciliations of non-GAAP financial measures contained herein to the most directly comparable GAAP measures. The Company’s full-year 2026 guidance measures (other than revenue) are provided on a non-GAAP basis without a reconciliation to the most directly comparable GAAP measure because the Company is unable to predict with a reasonable degree of certainty certain items contained in the GAAP measures without unreasonable efforts. Such items include, but are not limited to, acquisition-related expenses, restructuring and related expenses, goodwill impairment, stock-based compensation and other items not reflective of the Company's ongoing operations.
Non-GAAP measures are frequently used by securities analysts, investors and other interested parties in their evaluation of companies comparable to the Company, many of which present non-GAAP measures when reporting their results. Non-GAAP measures have limitations as an analytical tool. They are not presentations made in accordance with GAAP, are not measures of financial condition or liquidity and should not be considered as an alternative to profit or loss for the period determined in accordance with GAAP or operating cash flows determined in accordance with GAAP. Non-GAAP measures are not necessarily comparable to similarly titled measures used by other companies. As a result, you should not consider such performance measures in isolation from, or as a substitute analysis for, the Company’s results of operations as determined in accordance with GAAP.
Fortrea Contacts
Tracy Krumme (Investors) – 984-385-6707, tracy.krumme@fortrea.com
Sue Zaranek (Media) – 919-943-5422, media@fortrea.com
Kate Dillon (Media) – 646-818-9115, kdillon@prosek.com
| FORTREA HOLDINGS INC. CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (in millions, except per share data) (unaudited) | |||||||||||||||
| Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||
| 2026 | 2025 | 2026 | 2025 | ||||||||||||
| Revenues | $ | 691.5 | $ | 701.3 | $ | 2,006.2 | $ | 2,062.9 | |||||||
| Costs and expenses: | |||||||||||||||
| Direct costs, exclusive of depreciation and amortization | 552.0 | 578.6 | 1,603.9 | 1,690.2 | |||||||||||
| Selling, general and administrative expenses, exclusive of depreciation and amortization | 103.8 | 106.8 | 306.4 | 353.4 | |||||||||||
| Depreciation and amortization | 20.0 | 19.6 | 59.4 | 58.7 | |||||||||||
| Goodwill and other asset impairments | — | — | — | 797.9 | |||||||||||
| Restructuring and other charges | 0.7 | 4.9 | 10.1 | 21.7 | |||||||||||
| Total costs and expenses | 676.5 | 709.9 | 1,979.8 | 2,921.9 | |||||||||||
| Operating income (loss) | 15.0 | (8.6 | ) | 26.4 | (859.0 | ) | |||||||||
| Other income (expense): | |||||||||||||||
| Interest expense | (20.2 | ) | (22.6 | ) | (58.6 | ) | (68.2 | ) | |||||||
| Foreign exchange gain (loss) | 1.3 | (2.6 | ) | 14.5 | (28.1 | ) | |||||||||
| Other, net | 0.3 | 5.1 | 0.6 | 7.9 | |||||||||||
| Loss before income taxes | (3.6 | ) | (28.7 | ) | (17.1 | ) | (947.4 | ) | |||||||
| Income tax (benefit) expense | (4.2 | ) | (12.8 | ) | 19.1 | 6.3 | |||||||||
| Net income (loss) | $ | 0.6 | $ | (15.9 | ) | $ | (36.2 | ) | $ | (953.7 | ) | ||||
| Earnings (loss) per common share | |||||||||||||||
| Basic and diluted | $ | 0.01 | $ | (0.17 | ) | $ | (0.38 | ) | $ | (10.53 | ) | ||||
| FORTREA HOLDINGS INC. CONDENSED CONSOLIDATED BALANCE SHEETS (dollars and shares in millions) (unaudited) | |||||||
| September 30, 2026 | December 31, 2025 | ||||||
| ASSETS | |||||||
| Current assets: | |||||||
| Cash and cash equivalents | $ | 220.6 | $ | 174.6 | |||
| Accounts receivable and unbilled services, net | 641.1 | 589.7 | |||||
| Prepaid expenses and other | 91.0 | 132.9 | |||||
| Total current assets | 952.7 | 897.2 | |||||
| Property, plant and equipment, net | 158.6 | 149.5 | |||||
| Goodwill, net | 949.9 | 960.0 | |||||
| Intangible assets, net | 572.0 | 622.0 | |||||
| Deferred income taxes | 6.2 | 6.2 | |||||
| Other assets, net | 98.8 | 80.8 | |||||
| Total assets | $ | 2,738.2 | $ | 2,715.7 | |||
| LIABILITIES AND EQUITY | |||||||
| Current liabilities: | |||||||
| Accounts payable | $ | 53.0 | $ | 29.7 | |||
| Accrued expenses and other current liabilities | 372.1 | 395.8 | |||||
| Unearned revenue | 525.5 | 473.8 | |||||
| Current portion of long-term debt | 23.4 | 4.8 | |||||
| Short-term operating lease liabilities | 9.3 | 9.2 | |||||
| Total current liabilities | 983.3 | 913.3 | |||||
| Long-term debt, less current portion | 1,031.9 | 1,048.0 | |||||
| Operating lease liabilities | 53.8 | 54.0 | |||||
| Deferred income taxes and other tax liabilities | 97.1 | 97.6 | |||||
| Other liabilities | 39.8 | 39.3 | |||||
| Total liabilities | 2,205.9 | 2,152.2 | |||||
| Commitments and contingent liabilities | |||||||
| Equity: | |||||||
| Common stock, 96.5 and 93.1 shares outstanding at September 30, 2026 and December 31, 2025, respectively | 0.1 | 0.1 | |||||
| Additional paid-in capital | 2,152.6 | 2,116.6 | |||||
| Accumulated deficit | (1,419.4 | ) | (1,383.2 | ) | |||
| Accumulated other comprehensive loss | (201.0 | ) | (170.0 | ) | |||
| Total equity | 532.3 | 563.5 | |||||
| Total liabilities and equity | $ | 2,738.2 | $ | 2,715.7 | |||
| FORTREA HOLDINGS INC. CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (in millions) (unaudited) | |||||||
| Nine Months Ended September 30, | |||||||
| 2026 | 2025 | ||||||
| CASH FLOWS FROM OPERATING ACTIVITIES: | |||||||
| Net loss | $ | (36.2 | ) | $ | (953.7 | ) | |
| Adjustments to reconcile net loss to net cash provided by (used for) operating activities: | |||||||
| Depreciation and amortization | 59.4 | 58.7 | |||||
| Stock compensation | 36.0 | 59.6 | |||||
| Credit loss expense | 4.0 | 13.5 | |||||
| Operating lease right-of-use asset expense | 6.2 | 8.6 | |||||
| Operating lease right-of-use asset impairment | — | 1.3 | |||||
| Goodwill and other asset impairments | — | 797.9 | |||||
| Deferred income taxes | 1.0 | (24.4 | ) | ||||
| Unrealized foreign exchange movements | (13.2 | ) | 38.8 | ||||
| Other, net | 2.8 | 2.2 | |||||
| Changes in assets and liabilities: | |||||||
| Increase in accounts receivable and unbilled services, net | (55.3 | ) | (10.6 | ) | |||
| Decrease in prepaid expenses and other | 20.3 | 43.8 | |||||
| Increase (decrease) in accounts payable | 23.7 | (89.7 | ) | ||||
| Increase in unearned revenue | 51.0 | 54.6 | |||||
| Decrease in accrued expenses and other | (27.0 | ) | (16.2 | ) | |||
| Net cash provided by (used for) operating activities | 72.7 | (15.6 | ) | ||||
| CASH FLOWS FROM INVESTING ACTIVITIES: | |||||||
| Capital expenditures | (25.3 | ) | (17.7 | ) | |||
| Proceeds from sale of business, net | — | 39.6 | |||||
| Proceeds from sale of assets | 2.0 | — | |||||
| Net cash (used for) provided by investing activities | (23.3 | ) | 21.9 | ||||
| CASH FLOWS FROM FINANCING ACTIVITIES: | |||||||
| Proceeds from revolving credit facilities | — | 453.9 | |||||
| Payments on revolving credit facilities | — | (453.9 | ) | ||||
| Debt issuance costs | — | (0.6 | ) | ||||
| Net cash used for financing activities | — | (0.6 | ) | ||||
| Effect of exchange rate changes on cash and cash equivalents | (3.4 | ) | 7.1 | ||||
| Net change in cash and cash equivalents | 46.0 | 12.8 | |||||
| Cash and cash equivalents at beginning of period | 174.6 | 118.5 | |||||
| Cash and cash equivalents at end of period | $ | 220.6 | $ | 131.3 | |||
| RECONCILIATION OF NON-GAAP MEASURES FORTREA HOLDINGS INC. NET INCOME TO ADJUSTED EBITDA RECONCILIATION (in millions) (unaudited) | |||||||||||||||||||
| Trailing Twelve Months Ended | Three Months Ended September 30, | Nine Months Ended September 30, | |||||||||||||||||
| September 30, 2026 | 2026 | 2025 | 2026 | 2025 | |||||||||||||||
| Adjusted EBITDA: | |||||||||||||||||||
| Net income (loss) | $ | (68.7 | ) | $ | 0.6 | $ | (15.9 | ) | $ | (36.2 | ) | $ | (953.7 | ) | |||||
| Income tax expense (benefit) | 16.0 | (4.2 | ) | (12.8 | ) | 19.1 | 6.3 | ||||||||||||
| Interest expense | 81.8 | 20.2 | 22.6 | 58.6 | 68.2 | ||||||||||||||
| Foreign exchange (gain) loss | (15.7 | ) | (1.3 | ) | 2.6 | (14.5 | ) | 28.1 | |||||||||||
| Depreciation and amortization (a) | 78.7 | 20.0 | 19.6 | 59.4 | 58.7 | ||||||||||||||
| Goodwill and other asset impairments | — | — | — | — | 797.9 | ||||||||||||||
| Restructuring and other charges (b) | 38.0 | 1.4 | 6.3 | 12.7 | 23.8 | ||||||||||||||
| Stock based compensation | 50.8 | 12.0 | 22.3 | 36.0 | 59.6 | ||||||||||||||
| Acquisition and disposition-related costs (c) | 3.9 | 2.8 | 2.3 | 2.8 | 8.9 | ||||||||||||||
| One-time spin-related costs (d) | 2.3 | — | 3.0 | 1.0 | 23.4 | ||||||||||||||
| CEO transition related costs | — | — | 0.3 | — | 5.1 | ||||||||||||||
| Receivables securitization yield expense | 17.3 | 4.2 | 4.5 | 13.0 | 13.4 | ||||||||||||||
| Cloud computing arrangements (e) | 4.6 | 1.2 | 0.9 | 3.6 | 2.1 | ||||||||||||||
| Other (f) | 8.7 | 1.1 | (5.0 | ) | 8.2 | (5.9 | ) | ||||||||||||
| Adjusted EBITDA | $ | 217.7 | $ | 58.0 | $ | 50.7 | $ | 163.7 | $ | 135.9 | |||||||||
(a) Includes amortization of intangible assets acquired as part of business acquisitions.
(b) Restructuring and other charges represent amounts incurred in connection with the elimination of redundant positions, organizational realignment initiatives, and other actions taken to reduce overcapacity, align resources and facilities, and restructure certain operations.
(c) Acquisition-related costs include transaction, integration, and other direct and incremental costs incurred in connection with acquisitions. Disposition-related costs are short-term incremental costs to support the transition services agreement associated with the sale of the Enabling Services Segment.
(d) Represents one-time or incremental costs required to implement capabilities to exit the transition services agreement with the Company’s former parent.
(e) Represents amortization of implementation costs deferred in connection with cloud computing arrangements.
(f) Includes adjustments to estimated contingent consideration on a sale of a facility, income related to services provided under transition services agreements, certain legal expenses related to specifically identified litigation matters, including the shareholder litigation and the CFO transition-related litigation, settlements related to litigation initiated prior to the spinoff of the Company as a standalone company, and non-recurring business advisory consulting services.
| FORTREA HOLDINGS INC. NET INCOME TO ADJUSTED NET INCOME RECONCILIATION (in millions, except per share data) (unaudited) | |||||||||||||||
| Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||
| 2026 | 2025 | 2026 | 2025 | ||||||||||||
| Adjusted net income: | |||||||||||||||
| Net income (loss) | $ | 0.6 | $ | (15.9 | ) | $ | (36.2 | ) | $ | (953.7 | ) | ||||
| Foreign exchange (gain) loss | (1.3 | ) | 2.6 | (14.5 | ) | 28.1 | |||||||||
| Amortization (a) | 14.5 | 14.8 | 43.7 | 43.9 | |||||||||||
| Goodwill and other asset impairments | — | — | — | 797.9 | |||||||||||
| Restructuring and other charges (b) | 1.4 | 6.3 | 12.7 | 23.8 | |||||||||||
| Stock based compensation | 12.0 | 22.3 | 36.0 | 59.6 | |||||||||||
| Acquisition and disposition-related costs (c) | 2.8 | 2.3 | 2.8 | 8.9 | |||||||||||
| One-time spin-related costs (d) | — | 3.0 | 1.0 | 23.4 | |||||||||||
| CEO transition related costs | — | 0.3 | — | 5.1 | |||||||||||
| Receivables securitization yield expense | 4.2 | 4.5 | 13.0 | 13.4 | |||||||||||
| Cloud computing arrangements (e) | 1.2 | 0.9 | 3.6 | 2.1 | |||||||||||
| Other (f) | 1.1 | (5.0 | ) | 8.2 | (5.9 | ) | |||||||||
| Income tax impact of adjustments (g) | (8.6 | ) | (24.4 | ) | (4.5 | ) | (15.4 | ) | |||||||
| Adjusted net income | $ | 27.9 | $ | 11.7 | $ | 65.8 | $ | 31.2 | |||||||
| Basic shares | 95.6 | 91.2 | 94.6 | 90.6 | |||||||||||
| Diluted shares | 101.2 | 93.8 | 99.6 | 92.0 | |||||||||||
| Adjusted basic EPS | $ | 0.29 | $ | 0.13 | $ | 0.70 | $ | 0.34 | |||||||
| Adjusted diluted EPS | $ | 0.28 | $ | 0.12 | $ | 0.66 | $ | 0.34 | |||||||
(a) Includes amortization of intangible assets acquired as part of business acquisitions.
(b) Restructuring and other charges represent amounts incurred in connection with the elimination of redundant positions, organizational realignment initiatives, and other actions taken to reduce overcapacity, align resources and facilities, and restructure certain operations.
(c) Acquisition-related costs include transaction, integration, and other direct and incremental costs incurred in connection with acquisitions. Disposition-related costs are short-term incremental costs to support the transition services agreement associated with the sale of the Enabling Services Segment.
(d) Represents one-time or incremental costs required to implement capabilities to exit the transition services agreement with the Company’s former parent.
(e) Represents amortization of implementation costs deferred in connection with cloud computing arrangements.
(f) Includes adjustments to estimated contingent consideration on a sale of a facility, income related to services provided under transition services agreements, certain legal expenses related to specifically identified litigation matters, including the shareholder litigation and the CFO transition-related litigation, settlements related to litigation initiated prior to the spinoff of the Company as a standalone company, and non-recurring business advisory consulting services.
(g) Income tax impact of adjustments represents the amount of additional tax expense that the Company estimates it would record if it used Non-GAAP results instead of GAAP results in the calculation of its provision.
| FORTREA HOLDINGS INC. NET CASH PROVIDED BY OPERATING ACTIVITIES TO FREE CASH FLOW RECONCILIATION (in millions) (unaudited) | |||||||
| Three Months Ended September 30, 2026 | Nine Months Ended September 30, 2026 | ||||||
| Net cash provided by operating activities | $ | 60.8 | $ | 72.7 | |||
| Capital expenditures | (8.3 | ) | (25.3 | ) | |||
| Free cash flow | $ | 52.5 | $ | 47.4 | |||
FAQ
AI-generated questions and answers. How Rhea-AI works. Not financial advice.
What were Fortrea's third-quarter 2026 earnings?
Fortrea reported GAAP net income of $0.6 million, or $0.01 per diluted share, compared with a $15.9 million loss, or $0.17 per diluted share, a year earlier. Revenue was $691.5 million versus $701.3 million.
What is Fortrea's updated full-year 2026 guidance?
Fortrea expects revenue of $2,665 million to $2,690 million and adjusted EBITDA of $210 million to $218 million. The company raised both guidance midpoints and narrowed both ranges.