Lineage, Inc. (LINE) Earnings & Analysis

Latest quarter

Lineage reported Q2 FY2026 revenue of $1.4 billion, up 0.81% from a year earlier and 0.01% above the consensus. Its diluted loss per share was −$0.13, compared with −$0.03 a year earlier.

The company’s filing shows Global Warehousing revenue rose 3.6% to $1,005 million, primarily because of growth outside its same-warehouse pool. Segment net operating income (NOI) remained $367 million: gains outside the same-warehouse pool offset a decline within it. Lineage attributed higher same-warehouse operating costs primarily to labor and international services growth.

Global Integrated Solutions revenue fell 6.3% to $356 million, principally because Lineage had divested its Spain transportation business. The filing says a preliminary legal settlement and higher fuel and third-party labor costs partly offset the reduction in segment costs from that divestiture.

Lineage reported gross margin of 31.2%, down from 31.9%, while operating margin rose to 3.97% from 1.70%. Free cash flow increased to $190.0 million from $99.0 million.

Adjusted EPS is the figure the consensus estimates, not the GAAP EPS above.

What management said on the call

CEO Greg Lehmkuhl said same-store physical occupancy increased 90 basis points year over year, while throughput pallets fell 1.8% and container volumes declined 14% amid trade-related port pressure. He said some customers had begun rebuilding inventories after cutting them too far, though he did not describe that as a widespread trend. “We broadly believe food inventory levels are healthy and relatively balanced,” he said.

Lehmkuhl said same-store rent, storage and blast revenue per physical pallet declined 0.7%, while services revenue per throughput pallet rose 2.1%. He cautioned that customer, commodity and geographic mix and foreign exchange can shift these measures from quarter to quarter. CFO Robb LeMasters said rising carrier rates pressured Global Integrated Solutions margins because customer pricing adjusts with a lag; he also cited a $7 million employment-related settlement.

Asked about industry supply, Lehmkuhl said Lineage had idled five facilities so far this year and was evaluating more, though he did not expect that pace to continue. On investment, he said Lineage had invested $1.1 billion in projects under construction or being ramped and expected over $134 million in incremental NOI once stabilized. He also said its LinOS technology had reached 14 conventional sites and remained on track for 20 by year-end.

LeMasters said the Big Bear fire would reduce expected adjusted EBITDA by approximately $15 million in the second half, including lost revenue and customer-support costs. He said it was too early to precisely quantify repair, remediation and other one-time costs. For the coming quarter, he expected same-store NOI growth to be below Q2’s year-over-year level, with foreign exchange a relatively minor factor for the rest of the year.

Guidance

Lineage raised its FY2026 AFFO outlook to $2.80 to $3.05 per share from $2.75 to $3. It also raised its same-store NOI growth outlook to negative 3% to flat, from negative 4% to negative 1%.

The company expects adjusted EBITDA of $1.26 to $1.29 billion, narrowing its prior $1.25 billion to $1.30 billion range. CFO Robb LeMasters lowered the Global Integrated Solutions NOI outlook to a decline of 4% to 2%, from growth of 0% to 2%, and tightened administrative expense guidance, excluding stock-based compensation, to $460 million to $470 million.