How did GHM's revenue and expenses shift in Q3 2025?

**Graham Holdings Co (GHM) experienced a positive shift in revenue and several key financial metrics in Q3 2025, reflecting improved operational efficiency and market demand for its diversified product portfolio.** Here's a detailed analysis:

1. **Revenue Growth**: GHM's revenue increased by 7.3% to $47.0 million in Q3 2025, compared to the previous year's same quarter. This growth was driven by strong demand in key end-markets, including defense, space, and aftermarket sectors.
2. **Gross Margin Improvement**: The company's gross margin improved significantly, expanding by 260 basis points to 24.8% of sales. This improvement was attributed to higher sales volume, a favorable project mix, and enhanced operational efficiency.
3. **EBITDA Expansion**: Adjusted EBITDA (Earnings Before Interest, Taxes, Depreciation, and Amortization) margin expanded by 180 basis points to 8.6% of sales. This indicates robust bottom-line growth and improved cash flow generation capabilities.
4. **Net Income Increase**: GHM reported a GAAP net income of $1.6 million, translating to $0.14 per diluted share. This represents a substantial increase from the previous year's net income in the same quarter.
5. **Adjusted Net Income Growth**: Adjusted net income per diluted share increased by 38% to $0.18, reflecting improved profitability and a stronger bottom line.
6. **Positive Cash Flow and Liquidity**: The company maintained a strong balance sheet with no outstanding debt and $30 million in cash. Additionally, it had access to $43 million under its revolving credit facility, providing a solid liquidity position to support growth initiatives.
7. **Strategic Investments**: GHM is investing strategically in new facilities and technologies, such as the Batavia manufacturing facility and cryogenic propellant test facility, to support future growth.

In conclusion, GHM's Q3 2025 financial performance demonstrates robust growth in revenue and profitability, driven by strategic market positioning and operational excellence. The company's focus on diversified product portfolios and technological advancements is likely to bolster its competitive edge and sustain growth momentum in the foreseeable future.