stockrowWhat it does
Parker-Hannifin designs and manufactures components and systems that control motion, fluids and gases. Its products help equipment move, regulate pressure, seal connections, filter materials and manage temperature. It also supplies replacement parts and maintenance support after equipment enters service.
The company serves manufacturers of industrial machinery, vehicles and aircraft, as well as distributors and equipment users. Its markets include aerospace and defense, factories, transportation, off-highway equipment, energy, and heating, ventilation, air conditioning and refrigeration. Examples of its products range from hydraulic pumps, valves and seals to aircraft flight-control and fuel systems.
Parker operates through two segments. Diversified Industrial sells standard and custom components to equipment manufacturers and distributors. Aerospace Systems supplies aircraft and engine components to manufacturers and provides parts and maintenance directly to users. The company offers hundreds of thousands of individual part numbers.
Founded in 1917 and headquartered in Cleveland, Parker is led by Chairman and Chief Executive Officer Jennifer A. Parmentier. It uses a decentralized operating structure, with divisions operating close to their customers. In August 2026, Parker acquired Filtration Group Corporation, adding filtration products and capabilities for applications including life sciences, industrial equipment and transportation.
How it makes money
Parker earns revenue by selling components and systems for new equipment and by supplying replacement parts and maintenance after that equipment is in use. Diversified Industrial sells both standard products and products engineered to manufacturers’ specifications. Its catalog includes pumps, motors, valves, actuators, filtration products, seals, hoses and fittings.
Diversified Industrial also sells through distributors that serve replacement markets. Aerospace Systems sells products for aircraft airframes and engines, including braking, flight-control, fuel, hydraulic and thermal-management systems. It sells to aircraft and engine manufacturers and supplies aftermarket parts and maintenance directly to end users. Parker does not disclose a separate company-wide recurring-revenue figure in the material available here.
In fiscal 2026, Diversified Industrial revenue was $14.4 billion, or 67.2% of company revenue; Aerospace Systems revenue was $7.1 billion, or 32.8%. Aerospace sales increased with volume across its markets, especially commercial original equipment and aftermarket. Aerospace operating margin rose with higher volume, although product mix offset part of the increase.
Parker says it prices products, systems and services for the value they deliver. It also manages changes in costs through pricing measures. Filtration Group adds aftermarket business and products such as liquid, air and gas filtration media. Parker expects $220 million in cost synergies from the acquisition.
Total net sales were $21.5 billion in fiscal 2026 and $6 billion in the first quarter of fiscal 2027.
| Segment | Revenue, FY2026 | Share | Change on the year |
|---|---|---|---|
| Diversified Industrial | $14.4 billion | 67.2% | 5.66% |
| Aerospace Systems | $7.1 billion | 32.8% | 14.2% |
Customers and how it sells
Parker serves several hundred thousand original equipment manufacturer and distributor customer locations. Industrial customers buy both standard components and custom products made to their specifications. Distributors also supply customers replacing parts in existing equipment. Aerospace customers include aircraft and engine manufacturers, while airlines and other end users can buy aftermarket parts and maintenance directly from Parker.
No single product contributed more than one percent of net sales in the year ended June 30, 2026. Parker’s divisions operate in 44 countries. Diversified Industrial markets products mainly through field sales employees and independent distributors worldwide; Aerospace Systems uses regional sales organizations that sell directly to manufacturers and end users.
In fiscal 2026, revenue was $13.8 billion in the United States, and Parker also generated revenue outside it. Parker generated revenue in Europe, the Middle East and Africa; revenue was $2.7 billion in Asia Pacific, and $224.0 million in Latin America. Parker had 59,850 employees at June 30, 2026, including approximately 30,830 employed by foreign subsidiaries.
The acquired Filtration Group has sales split approximately 60% North America and 40% international. Its markets include life sciences, industrial equipment, transportation, and heating and refrigeration.
| Region | Revenue, FY2026 | Share | Change on the year |
|---|---|---|---|
| North America | $14.4 billion | 33.5% | 7.31% |
| United States | $13.8 billion | 32.1% | 7.52% |
| Non-US | $7.7 billion | 17.9% | 9.76% |
| EMEA | $4.2 billion | 9.72% | 8.18% |
| Asia Pacific | $2.7 billion | 6.30% | 14.7% |
| Latin America | $224.0 million | 0.52% | 2.75% |
Suppliers and costs
Parker uses steel, brass, copper, aluminum, nickel, rubber, thermoplastics and chemicals as principal raw materials. It expects these materials to be available from numerous sources in sufficient quantities. Electric power is the primary energy source for both segments; Parker manages some electricity costs through aggregation and contracts with established pricing.
The company manages its supply chain through local manufacturing for local markets, supplier management and a broadened supplier base. It also monitors trade policies and inflation and uses cost and pricing measures in response. Parker has seen increases across material inputs and logistics costs.
Higher material costs and unfavorable product mix partly offset the benefit of sales volume to fiscal 2026 gross margin. Selling, general and administrative expenses rose, driven in part by stock-based compensation, acquisition expenses, research and development, and amortization. Interest expense rose in the first quarter of fiscal 2027, principally because of debt issued for Filtration Group.
Parker expects approximately $90 million in business realignment charges and approximately $25 million in acquisition integration charges in fiscal 2027. It cautions that changing business conditions could affect the ultimate costs.
- Revenue$21.5B
- Cost of revenue−$13.4B
- Selling, general and administrative−$3.5B
- Operating income$4.6B
Competitive position
Parker competes with hundreds of companies across product lines, end markets and geographies. It says no single competitor competes across all the products it makes and sells. In Diversified Industrial, named global competitors include Bosch Rexroth, Danfoss, Donaldson and Emerson/ASCO. Parker competes on product quality and innovation, customer experience, manufacturing and distribution, aftermarket support and price.
In Aerospace Systems, named global competitors include Crane, Eaton, Honeywell Aerospace, RTX and Safran. Parker says its engineering capabilities and performance in quality, delivery, service and price have helped it win equipment business on new aircraft programs, followed by repair and replacement work. Its portfolio spans hydraulics, pneumatics, filtration, fluid handling, engineered materials and other technologies.
Our reading: Aircraft program relationships and follow-on repair work are a meaningful competitive asset because Parker can serve an aircraft after the original component sale, although competitors also contest those programs. Our reading: The breadth of Parker’s products and distribution network supports its reach across customers and markets, but competition and the relevant rivals differ by product. Our reading: Intellectual property contributes to its position, but dependence on any single patent or other intellectual property right is not material.
| Competitor | Where they compete | Threat (our reading) |
|---|---|---|
| Bosch Rexroth AG | Diversified Industrial products | Medium |
| Danfoss A/S | Diversified Industrial products | Medium |
| Donaldson Company, Inc. | Diversified Industrial products | Medium |
| Emerson/ASCO | Diversified Industrial products | Medium |
| Crane Co. | Aerospace systems and components | Medium |
| Eaton Corporation plc | Aerospace systems and components | Medium |
| Honeywell Aerospace Inc. | Aerospace systems and components | Medium |
| RTX Corporation | Aerospace systems and components | Medium |
Growth opportunities
Parker intends to pursue opportunities in aerospace and defense, industrial equipment, transportation, off-highway equipment, energy, and heating and refrigeration. Its strategy includes engineering products and systems, acquisitions, and investments in organic growth and productivity.
Net sales increased 8.3% in fiscal 2026, primarily through organic growth in both segments. Diversified Industrial benefited from industrial equipment, aerospace and defense, and off-highway demand in North America, while transportation demand was lower. Aerospace Systems sales rose across its markets, especially commercial original equipment and aftermarket.
In the first quarter of fiscal 2027, organic sales growth was 11.5%, and backlog reached $13.7 billion. Parker raised its fiscal 2027 organic growth forecast to 9% at the midpoint. It expects approximately 10% organic growth in aerospace and defense and high single-digit growth in both industrial equipment and transportation. Parker says an aging aircraft fleet is supporting commercial aftermarket growth.
Filtration Group adds products and capabilities in markets including life sciences and industrial filtration. Parker sees opportunities to sell its technologies to Filtration Group customers and vice versa, although it does not model revenue synergies. It agreed to acquire CIRCOR International’s commercial and defense aerospace business; the agreement is subject to closing conditions, including regulatory approvals. Parker also sees data centers as a growth area and can supply liquid-cooling systems and components.
- $15.9BFY2022
- $19.1BFY2023
- $19.9BFY2024
- $19.9BFY2025
- $21.5BFY2026
Structural risks
- Industrial and end-market demand: Changes in industrial production, weakness in end markets and changes in purchases by customers or distributors can affect demand. Orders may also be delayed or cancelled, and market acceptance and product mix can change.
- Materials, supply chains and trade: Raw-material availability and prices can fluctuate. Transportation delays, supply-chain disruptions, tariffs, trade restrictions and currency movements can affect operations and costs. Parker has continued to see increases in material and logistics costs.
- Acquisition integration: Acquisitions can bring unknown liabilities, unforeseen expenses or integration delays. Parker faces challenges combining management teams, operations, products, systems and cultures, and retaining key employees. Anticipated acquisition benefits may not be fully realized.
- Debt and interest: Parker borrowed $7.75 billion to finance Filtration Group. The acquisition increased debt and interest expense; further borrowing for CIRCOR Aerospace could raise them again. Parker expects to remain compliant with its debt covenants.
- Environmental and regulatory obligations: Some operations use hazardous materials. Parker is involved in environmental remediation and litigation at current or former facilities and at disposal sites, and may face cleanup costs. Its international operations are also subject to anti-corruption and other laws.
Bottom line
Our reading
Parker combines a broad industrial components business with aircraft equipment and aftermarket support. Its customer relationships and replacement work provide channels for repeat business, while demand still depends on industrial activity and aircraft markets. Acquisitions extend the portfolio, but Filtration Group also adds integration work and debt at a time when material, logistics and trade costs remain exposures.