ATS Shares Slide on Modest Growth Guidance, Weaker Orders

Dow Jones05-28

By Adriano Marchese

ATS shares fell sharply Thursday after the company said growth is expected to moderate in fiscal 2027, following weaker new orders and a shrinking backlog in the fourth quarter.

Shares fell 16% to 41.21 Canadian dollars ($29.77).

ATS, an automation and industrial technology company, expects modest revenue growth in the current year. Interim Chief Financial Officer Anne Cybulski said in an earnings call Thursday that transportation revenue will be lower as ATS shifts away from large-scale automotive work. The life sciences business, historically ATS' strongest growth driver, posted a 9% revenue decline in the fourth quarter, contributing to the softer outlook.

While the company said it has entered the new fiscal year with what it calls a more normalized backlog after the previous year's strong bookings, Cybulski noted that its underlying life sciences demand picture or the company's own expectations remain unchanged.

New orders from customers in the fourth quarter fell over 18%, with order bookings sitting at C$704 million. This weighed on the company's backlog, which fell 8.5% to C$1.96 billion at quarter's end.

For the first quarter, the company expects revenue of C$700 million to C$740 million. Analysts polled on FactSet expected C$758.6 million.

For the full year, the company didn't provide detailed numbers for its outlook but said it projects modest revenue growth.

Adjusted earnings from operations margin is projected to improve 50 to 75 basis points, thanks to cost-savings and stronger aftermarket mix, but the company warned that inflation, tariffs and project-timing volatility could affect growth.

In the fourth quarter ended March 31, revenue rose 30% to C$747.1 million. Adjusted revenue rose 3.2% to C$744.3 million, and came in ahead of forecasts of C$736.4 million.

Loss narrowed to C$16.2 million, or C$16 a share, compared with a loss of C$68.9 million, or C$0.70 a share, in the comparable quarter a year ago. Adjusted earnings missed expectations by C$0.08 a share at C$0.36.

Write to Adriano Marchese at adriano.marchese@wsj.com

(END) Dow Jones Newswires

May 28, 2026 11:20 ET (15:20 GMT)

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ATS Shares Slide on Modest Growth Guidance, Weaker Orders

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