Woodward 2025 Q4 Earnings Record Revenue and 65.2% Net Income Surge

Woodward Inc. (NASDAQ:WWD) delivered a standout fiscal 2025 Q4 performance, surpassing revenue and EPS estimates while reaffirming its 2026 guidance. The company’s shares traded mixed in the post-earnings period, reflecting both optimism and caution among investors.

Revenue

Woodward’s total revenue surged 16.5% year-over-year to $995.26 million, driven by robust demand in both core segments. Aerospace led the charge with $661.21 million in revenue, reflecting 19.6% growth, while the Industrial segment contributed $334.06 million, a 10.7% increase. The aerospace segment’s strength was fueled by strong defense and commercial aftermarket activity, with defense OEM sales rising 8.5% and commercial aftermarket sales jumping 39.1%.

Earnings/Net Income

Earnings growth accelerated, with net income surging 65.2% to $137.62 million and EPS rising 64.3% to $2.30. This marked a significant outperformance against 2024 Q4 figures, underscoring the company’s margin expansion and operational efficiency. The EPS growth, while impressive, reflects a continuation of Woodward’s strategic focus on high-margin aerospace markets.

Post-Earnings Price Action Review

The strategy of buying Woodward shares on the date of its earnings announcement and holding for 30 days delivered moderate performance, with a 3-year CAGR of 14.5% and an average annual return of 17.3%. While the approach captured positive returns in 8 of 12 quarters, it faced a notable drawdown of -22.2% during the 2019 Q4 period. The 2021 Q4 purchase, however, was unprofitable, highlighting the importance of aligning the strategy with market conditions and quarterly performance.

CEO Commentary

CEO Charles Blankenship emphasized record 2025 performance, citing 14% aerospace sales growth (290 bps margin expansion) and 10% industrial growth (110 bps margin improvement). Strategic priorities include automation investments, the Spartanburg A350 facility, and operational excellence initiatives. Blankenship expressed confidence in 2026 execution, leveraging LEAP/GTF maintenance cycles and new programs, while acknowledging challenges in commercial OEM destocking.

Guidance

Woodward guided to 2026 revenue growth of 7–12% ($3.6B base), with aerospace sales up 9–15% and industrial up 5–9%. Adjusted EPS is targeted at $7.50–$8.00, reflecting 5% price realization and 3.5% nonsegment expenses. Free cash flow is projected at $300–$350M, with $650–$700M in shareholder returns via dividends/share buybacks.

Additional News

Woodward’s strategic acquisitions and capital allocation plans dominated recent headlines. The company finalized the acquisition of Safran’s North American electromechanical actuation business, enhancing its aerospace portfolio. A new $1.8 billion share repurchase program was authorized, and the company secured a key contract to supply 12 of 14 spoiler actuation systems for Airbus’s A350. These moves underscore Woodward’s commitment to innovation and market expansion, though investors remain cautious about valuation levels and insider selling activity.