Oshkosh's Q1 2025 Earnings: Tariff Strategies, NGDV Revenue, and Contradictory Market Signals

Tariff mitigation strategy, NGDV revenue ramp and margin trends, tariff impact and mitigation strategy, access segment performance and market outlook, electrified products and supply chain management are the key contradictions discussed in Oshkosh's latest 2025Q1 earnings call.



Revenue and Earnings Performance:
- Oshkosh Corporation reported revenue of $2.3 billion for Q1 2025, a decrease of $231 million, or 9%, from the same quarter last year.
- Adjusted operating income was $192 million, or 8.3% of sales, down from the prior year.
- Adjusted earnings per share was $1.92, aligning with expectations.

Segment Performance:
- The Vocational segment achieved strong year-over-year revenue growth of 12% with a robust adjusted operating income margin nearly 15%.
- The Access segment delivered an adjusted operating margin of 11.3% despite lower sales.
- The Defense segment reported lower volume and higher cumulative catch-up adjustments but is on track to increase NGDV volume to full rate production by year-end.

Impact of Tariffs:
- Oshkosh estimates the direct impact of tariffs, net of mitigation actions, could be about $1 per share, with potential offsets up to $0.50 per share.
- Tariffs primarily affect the Access segment, where nearly all products are built in the U.S. but have a global supply chain.
- The company is proactive in mitigating tariff impacts, focusing on strategic sourcing and supplier negotiations.

Investment and Growth Initiatives:
- The company invested in improving production levels and capacity, particularly in fire and refuse, to support strong demand.
- Innovations such as advanced technology and electric vehicle solutions were showcased, aiming to enhance productivity and customer satisfaction.
- The strategic ramp-up of NGDV production was highlighted to support growth in the Defense segment.