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- **Revenue decline**: Q3 revenue down 22% YoY to $55.3M, driven by truck and automotive market pullbacks.
- **Cost-saving measures**: $1.8M savings from restructuring, 2% share repurchases, and $7M debt reduction.
- **Gross margin challenges**: 22.3% (vs. 25.5%) due to volume and raw material costs.
- **USPS program success**: Oshkosh becomes major customer, offsetting truck market softness.
- **Cautious outlook**: Truck market recovery expected in 2026, with cautious near-term guidance.

**【Management Opening Remarks】**
Marianne Barr provided an overview of the earnings call, noting the company's issuance of a press release and cautioning about forward-looking statements. She emphasized the use of non-GAAP financial measures and the risks associated with future projections.

**【CEO Commentary】**
Ryan Schroeder highlighted a disappointing Q3 with revenue down 22% YoY to $55.3M, driven by a 36% decline in Class 8 truck production and a 34% drop in automotive projects due to EV model reductions. The company implemented cost-saving measures, including workforce reduction and plant closures, resulting in $1.8M savings. They repurchased 2% of shares and reduced debt by $7M, entering a new $100M credit facility. Schroeder expressed confidence in navigating the downturn.

**【CFO Commentary】**
Nicholas Vlahos detailed financials: net sales $55.3M (-22%), EBITDA $3.5M, EPS $0.10. Gross margin fell to 22.3% (from 25.5%) due to raw material costs and reduced volumes. SG&A expenses decreased 6.5% to $10.7M. Adjusted net income was $0.8M, with a leverage ratio of 1.64x. Inventory rose slightly, and share repurchases continued.

**【Q&A Highlights】**
Analysts inquired about gross margins, expecting recovery with volume. The USPS program with Oshkosh was highlighted as a bright spot. Model refresh cycles are expected to increase next year, improving backlog. The truck market outlook remains cautious, with softness forecasted for 2026.


The Eastern Company (EML) Q3 2025 Earnings Call Transcript

Revenue

Sales and Services Revenue

Financing Services Revenue

Other Revenue

Cost of Revenue

Cost of Goods and Services

Cost of Financing Services

Other Cost

Gross Profit

Other Operating Income

Operating Expenses

Selling, General and Administrative Expenses

Selling and Marketing Expenses

General and Administrative Expenses

Research and Development Expenses

Loss on Bad Debts

Loss on Impairment of Other Assets

Loss on Disposal of Assets

Other Operating Expenses

Operating Income

Non-Operating Income (Loss)

Income (Loss) from Affiliates

Income (Loss) from Associates

Income (Loss) from Joint ventures

Gain (Loss) on Other Investment

Gain (Loss) on Change in Fair Value

Gain (Loss) on Foreign Currency Exchange

Other Non-Operating Income (Loss)

Net Interest Expense

Interest Expense

Interest Income

Pretax Income From Continuing Operations

Income Tax Expense

Current Income Tax

Deferred Income Tax

Income Tax Adjustments

Net Income from Continuing Operations

Income from Discontinued Operations

Other Items Before Net Income

Net Income

Net Income Attributable to Minority Interests

Net Income Attributable to Owners of the Company

Preferred Stock Dividends

Other Adjustments

Net Income Attributable to Common Stockholders

Other Comprehensive Income

Total Comprehensive Income

Total Comprehensive Income Attributable to Minority Interests

Total Comprehensive Income Attributable to Owners of the Company

Basic EPS

Basic EPS from Continuing Operations

Basic EPS from Discontinued Operations

Diluted EPS

Diluted EPS from Continuing Operations

Diluted EPS from Discontinued Operations

EML

EML fundamentals

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