Epiroc's Q2 Signals a Mining Upturn: Equipment Orders Surge, Margins Expand
Strong Demand, Sharper Earnings
Epiroc entered the second quarter with unmistakable momentum. “We delivered a strong second quarter supported by continued high customer activity and strong demand in mining.” — Helena Hedblom, CEO · 2026-07-17 Organic orders rose 13% to SEK 17.3bn, with equipment orders up an exceptional 30% organically, including SEK 720m of large brownfield and replacement orders. CFO Håkan Folin noted that “our EBIT increased 17% to SEK 3.3 billion, translating into an operating margin of 19.9% adjusted” — Håkan Folin, CFO · 2026-07-17 — a 20.1% adjusted margin versus 19.7% a year earlier. The improvement came even as equipment sales (a lower-margin mix) grew to 46% of segment revenue, thanks to high customer activity and aftermarket business resilience.
The standout was exploration, which CEO Helena Hedblom called “one of the strongest growing businesses” — Helena Hedblom, CEO · 2026-07-17, and she stressed its leading‑indicator quality: “exploration activity is an important indicator of long‑term confidence in the mining industry” — Helena Hedblom, CEO · 2026-07-17. With mid‑life upgrades and an aging installed base, the company sees an extended period of equipment replacements, a theme reinforced by the Epiroc World Expo that attracted 150 customers in June.
The Service Blip: A Temporary Pause, Not a Trend
Not everything moved in one direction. Service orders grew just 6% organically, down from 12% in the prior quarter. Management was quick to explain that this was driven by fewer mid‑life upgrades, not a deterioration in underlying demand. As Hedblom put it: “The pipeline, of course, with an aging fleet, the potential for mid‑life upgrade, it's great out there.” — Helena Hedblom, CEO · 2026-07-17 She added that high activity levels across commodities are helping customers maximize production, and the company continues to see strong traction in automation and digital solutions.
It's a solid quarter, but I'm still not happy with the margin. There is more that we can do.
The comment underscores management's commitment to further operating leverage. CFO Håkan Folin also highlighted that the tariff impact was lower than in Q1, and the tungsten cost headwind — which had clipped Tools & Attachments margins by more than 1pp — had been "mitigated to a large extent" thanks to surcharges and a recycling program.
Efficiency Programs Begin to Pay Off
The margin improvement is not just a cyclical tailwind. Since the start of 2025, Epiroc has been executing a series of efficiency measures — consolidating production sites, optimizing factory utilization, and rationalizing the cost base. In the prior quarter, Folin acknowledged the work was still in progress: “We are not happy with where we are from a margin point of view for E&S, and therefore, we are taking a number of action there as well.” — Hakan Folin, CFO · 2026-01-26 Now, with high activity levels in tunneling and mining, those efforts are showing up on the bottom line. The tariff headwind, which Folin had earlier quantified as “roughly 0.5 percentage point” — Hakan Folin, CFO · 2026-01-26, has now eased. The company also reiterated a "strong financial position" with net debt/EBITDA at 0.75x, giving it ample dry powder for the healthy M&A pipeline.
The key question is whether this momentum can persist. With equipment orders up 30% organically, production is being ramped to meet demand, and lead times remain normal. The company expects equipment revenues to remain strong into the second half of 2026. If exploration continues to grow, the early‑cycle indicator suggests a multi‑year upcycle in mining capex, which would be extremely favourable for Epiroc.
Overall, this was a quarter where the narrative shifted from "fixing the margin" to "capturing the upcycle." The combination of cyclically strong demand, a resilient aftermarket, and structural efficiency gains positions Epiroc for the prosperous phase of the mining cycle.