What does Twin Disc do and what are its main business segments?

What factors drove the changes in Twin Disc's revenue and profit?

What is the market's earnings forecast for Twin Disc next quarter?

What is the revenue and EPS growth rate for Twin Disc year over year?

What is Twin Disc's gross profit margin?

What were the key takeaways from Twin Disc's earnings call?

Did Twin Disc beat or miss consensus estimates last quarter?

What guidance did Twin Disc's management provide for the next earnings period?

- **Record backlog signals growth**: $175.3 million backlog (+41.4% YoY) highlights strong demand across defense and international markets.
- **Defense expansion accelerates**: 18% sequential backlog growth from U.S. Navy and NATO programs, with pipeline exceeding $50 million.
- **Tariff mitigation on track**: ARFF assembly relocation to Lufkin set to reduce margin impact by ~10% starting FY27.
- **Veth margins improving**: Pricing discipline and cost management driving margin expansion, supported by India-based supply chain diversification.
- **China oil & gas rebound**: Unexpected order surge in Q2 FY26, signaling recovery in international markets.

**【CEO Summary Section】**
- **Diversified portfolio resilience**: Despite challenges, Q2 sales remained stable across marine, defense, and industrial segments. Backlog reached a record $175.3 million, up 41.4% YoY, driven by defense and international demand.
- **Tariff mitigation progress**: Implemented strategies like relocating ARFF assembly to Lufkin (effective FY27) to reduce 10%+ margin impact from tariffs. Current tariff costs at ~3% of COGS.
- **Defense growth acceleration**: Defense-related pipeline exceeds $50 million, with 18% sequential backlog growth from U.S. Navy unmanned vessels and NATO land-based vehicle programs.
- **Segment performance highlights**:
  - **Marine**: Flat sales YoY, but Veth propulsion outperformed with strong engagement in autonomous vessels.
  - **Aftermarket**: Short-term softness due to customer timing, but early Q3 indicators suggest recovery.
  - **Industrial**: 22% YoY sales growth, leveraging Katsa's engineering capabilities for higher-content solutions.

**【CFO Financial Commentary】**
- **Top-line stability**: Q2 sales $90.2 million (0.3% YoY growth), driven by Marine and Industrial segments. Organic sales down 7.9% YoY due to tariff-related delays.
- **Gross margin dynamics**: 24.8% gross margin (+70bps YoY), pressured by unfavorable mix (aftermarket delays) and one-time warranty costs. Sequential improvement expected as shipment patterns normalize.
- **Profitability challenges**: EBITDA $4.7 million (-25% YoY) due to higher ME&A expenses and tariff impacts. Net income $22.4 million (vs. $0.07 YoY) driven by tax benefit reversal.
- **Cash flow management**: Free cash flow $1.2 million (sequential improvement), with working capital headwinds from elevated inventory levels.

**【Q&A Key Highlights】**
- **Tariff outlook**: Expect moderate tariff impact in H2 FY26 as customers normalize order timing. ARFF assembly relocation to Lufkin will reduce margin drag by ~10% starting FY27.
- **Veth margin confidence**: Pricing discipline and cost estimation improvements driving margin expansion, with India-based supply chain diversification underway.
- **China oil & gas recovery**: Unexpected order surge in Q2 FY26, exceeding prior expectations, reflecting domestic production focus post-supply chain disruptions.
- **Defense program momentum**: U.S. Navy unmanned vessel orders and NATO land-based vehicle programs driving 18% sequential defense backlog growth.


Twin Disc, Incorporated (TWIN) Q2 2026 Earnings Call Transcript

- **Revenue Growth**: Q1 sales up 9.7% YoY to $80M, driven by marine and industrial segments.
- **Margin Expansion**: Gross margin improved 220bps to 28.7%, with EBITDA up 172% YoY.
- **Defense Strength**: Defense orders up 45% YoY, 15% of $163.3M backlog, with autonomous vessel programs doubling annually.
- **Tariff Mitigation**: 1-3% Q2 cost impact expected to normalize to 1% in H2FY26.
- **Cash Flow Target**: 60% EBITDA conversion, with Q1 inventory investments to be recovered in Q2.
- **Sustainability**: 40% incremental margin target for future growth, supported by Veth supply chain stabilization.

**【Management Opening Remarks】**
- CFO Jeff Knutson provided standard disclaimers on forward-looking statements and non-GAAP financial measures, emphasizing caution regarding potential future results and the use of non-GAAP metrics for performance evaluation.

**【CEO Commentary】**
- **Revenue Growth**: Q1 sales of $80 million (+9.7% YoY), driven by marine and industrial segments, with organic growth of 1.1% excluding acquisitions.
- **Gross Margin Expansion**: 28.7% (up 220bps YoY) due to cost initiatives and improved product mix, particularly in Veth thrusters.
- **Defense Momentum**: Defense-related orders up 45% YoY, comprising 15% of $163.3M backlog, with key contracts in NATO vehicles and U.S. Navy autonomous vessels.
- **Tariff Impact**: 1-3% Q2 cost of sales impact from tariffs, expected to normalize to 1% in H2FY26.
- **Backlog Strength**: 6-month backlog up 13% YoY, supported by sustained demand across marine, land, and industrial segments.

**【CFO Financial Commentary】**
- **Profitability**: Net loss of $0.04M (-89% YoY loss reduction), EBITDA of $4.7M (+172% YoY), reflecting margin improvements and reduced currency losses.
- **Cash Flow**: Q1 cash balance $14.2M (down 14.8% YoY) due to seasonal working capital needs, with net debt at 1.3x leverage.
- **Free Cash Flow Target**: 60% of EBITDA, aiming to recover Q1 inventory investments in Q2.

**【Q&A Highlights】**
- **Military Growth Timing**: Finland NATO vehicle program to double in 12-18 months; U.S. Navy autonomous vessels to double annually.
- **Oil & Gas Resilience**: Despite China slowdown, ARFF rebuilds and e-frac orders ($2.3M) offset volume declines, with natural gas demand supporting long-term outlook.
- **Gross Margin Sustainability**: 220bps improvement driven by Veth supply chain stabilization; 40% incremental margin target for future growth.
- **Free Cash Flow Outlook**: Targeting 60% EBITDA conversion, with Q1 drag from tariffs and inventory expected to normalize in Q2.
- **Land-Based Transmission**: Flat sales due to ARFF capacity constraints, offset by Katsa integration and emerging rebuild demand.

Twin Disc, Incorporated (TWIN) Q1 2026 Earnings Call Transcript

- **Revenue Growth**: Full year +15.5% to $340.7M, driven by defense (+45% orders) and marine propulsion systems.
- **Defense Momentum**: $50-75M pipeline with Katsa production constrained by demand for NATO vehicles.
- **Acquisition Synergies**: Katsa's cost efficiencies reduced gear production costs; Kobelt's brakes being globalized via Twin Disc network.
- **Gross Margin Expansion**: 31% in Q4 (vs. 27.2% full year), with 130bps improvement from product mix and cost control.
- **Free Cash Flow Target**: 60% of EBITDA, with $8.8M generated in FY25 and $16.1M cash on hand.
- **Oil & Gas Recovery**: E-frac orders and natural gas engine modifications position for 2027 growth, targeting 15% revenue share.


**【CEO Opening Remarks】**
- Fiscal 2025 full year revenue grew 15.5% to $340.7 million, driven by broad-based demand and strong order activity across all segments.
- Defense-related backlog grew 45% YoY, now comprising 15% of total backlog ($50-75M pipeline).
- Acquisitions of Katsa and Kobelt expanded capabilities, with Kobelt fully integrated into marine controls business.
- 6-month backlog rose to $150.5 million, up sequentially and YoY, reflecting strength in government and hybrid marine programs.

**【Segment Performance】**
- **Marine & Propulsion Systems**: Q4 sales +12.2% to $53M, driven by Veth ELITE thrusters and unmanned Navy vessels. Aftermarket revenue in Marine reached $4.7M (60% margin contribution).
- **Land-Based Transmissions**: Q4 sales +4.5% to $26.1M, with first meaningful E-frac order ($2.3M). Aftermarket sales down 44% YoY due to idle fleets.
- **Industrial Segment**: Q4 sales +82% YoY, led by Katsa acquisition. Sequential growth 35%, with organic growth 13% excluding Katsa.
- **Lufkin**: Q4 shipments $4.1M, up from $3.1M average run rate, signaling recovery in oilfield services.

**【CFO Financial Commentary】**
- Q4 2025 revenue $96.7M (+14.5% YoY), full year $340.7M (+15.5% YoY). Organic revenue declined 8.4% Q4 due to reduced oil & gas activity in China.
- Gross profit $30M (31% margin), up 19.7% YoY, driven by favorable product mix and one-time inventory adjustment.
- ME&A expenses $24.6M Q4 (+20% YoY), reflecting Kobelt/Katsa integration and inflation.
- Net income $1.4M ($0.10 EPS) vs. $7.4M ($0.53 EPS) prior year. Full year EBITDA $19M vs. $26.5M prior year.
- Free cash flow $8.8M for the year, with $16.1M cash balance and $15.3M net debt.

**【Q&A Highlights】**
- **Defense Growth**: 45% YoY increase in defense orders, with $50-75M pipeline. Katsa's gearbox production for NATO vehicles is capacity-constrained.
- **Integration Success**: Katsa's machining expertise reduced gear production costs; Kobelt's industrial brakes being globalized through Twin Disc's distribution network.
- **Margin Outlook**: Gross margin improved 130bps Q4 to 31%, with focus on cost optimization and favorable product mix.
- **CapEx**: $12-14M for 2026, driven by Katsa's machine-intensive operations.
- **Oil & Gas**: Now 8% of revenue (down from 15% prior), but E-frac orders and natural gas engine modifications position for recovery in 2027.


Twin Disc, Incorporated (TWIN) Q4 2025 Earnings Call Transcript

- **Topline Growth**: Q3 sales up 9.5% YoY to $81.2M, driven by acquisitions and 1.7% organic growth.
- **Margin Expansion**: Gross margin improved to 26.7%, with EBITDA of $4M and positive cash flow.
- **Key Drivers**: Marine & Propulsion segment up 10.7%, backed by Veth product strength and defense demand; Industrial segment stable with Kobelt/Katsa contributions.
- **Tariff Resilience**: $500k Q4 tariff impact (1% of COGS) to be fully offset by pricing and sourcing strategies.
- **Backlog Confidence**: $134M backlog signals sustained demand, with no material order cancellations despite macro headwinds.


**【CEO Summary Section】**
- **Revenue Growth**: Q3 2025 sales reached $81.2 million, up 9.5% YoY, driven by acquisitions and organic growth in key segments (e.g., Veth product line). Organic growth (excluding acquisitions) was 1.7%.
- **Gross Margin Improvement**: Gross margin rose to 26.7% from 24.1% Q2, due to operational efficiencies and favorable product mix.
- **Segment Performance**: 
  - **Marine & Propulsion**: 10.7% sales growth, driven by Katsa and Kobelt acquisitions, and strong demand in commercial marine and luxury yachts.
  - **Industrial**: Stable performance with contributions from Kobelt's brake products and Katsa's hydraulic clutches.
  - **Oil & Gas**: North American new build activity muted, but resilient aftermarket business.
- **Tariff Mitigation**: Estimated $500k Q4 tariff impact (1% of COGS), to be offset by pricing actions and alternative sourcing.
- **Backlog Strength**: $134 million backlog, up sequentially, reflecting sustained demand across product lines.

**【CFO Financial Commentary】**
- **Net Loss**: $1.5 million ( -$0.11 EPS) vs. $3.8 million ( $0.27 EPS) prior year, due to $1.6 million currency translation impacts.
- **Cash Flow**: Positive operating cash flow of $3.4 million, with $16.2 million cash on hand.
- **EBITDA**: $4 million for the quarter.
- **Cost Management**: 5% YoY decline in operating expenses, supporting margin improvement.

**【Q&A Highlights】**
- **Order Trends**: Stable backlog growth (8% YoY), no significant cancellations despite macro uncertainty. Marine orders (work boats, defense) remain strong, while pleasure craft may face minor delays.
- **Tariff Strategy**: Proactive pricing adjustments and sourcing diversification limit margin impact; Q4 tariff-related costs expected to be fully mitigated.
- **Acquisition Integration**: Kobelt's global dealer network and Katsa's EU-based growth opportunities driving synergies. ARFF transmission operational improvements boosting margins.
- **Operational Flexibility**: Relocation of production to mitigate tariffs under review, pending clarity on trade policies.


Twin Disc (TWIN)-7 May 25-2025 Q3 Earnings call transcript

- **Topline Growth**: 23.2% YoY sales driven by Katsa integration and Veth product demand.
- **Segment Strengths**: Marine & Propulsion up 23.9%, ARFF vehicles dominate land-based transmissions.
- **Financial Challenges**: 420bps gross margin decline due to inventory write-downs and product mix.
- **Oil & Gas Recovery**: Quoting activity up in North America/South America, but exports remain down 24% YoY.
- **Cash Flow Focus**: Targeting 60% EBITDA conversion, Q2 operating cash up $4.3M.

**【CEO Key Highlights】**
- **Q2 2025 Sales**: $89.3 million, up 23.2% YoY, driven by Katsa Oy integration and strong Veth product demand.
- **Segment Growth**:
  - Marine & Propulsion: +23.9% YoY, record Veth orders in luxury yachts and defense projects.
  - Land-Based Transmissions: +19.8% YoY, ARFF vehicle shipments supported by emissions compliance trends.
  - Industrial: +44.8% YoY, rebound in Lufkin orders and stabilization post-acquisition.
- **Strategic Focus**: Electrification, hybrid propulsion systems, and cross-selling opportunities with Katsa.

**【CFO Financial Breakdown】**
- **Revenue**: $89.9 million (Q2 2025) vs. $74.0 million (Q2 2024), +23.2% YoY.
- **Net Income**: $0.07 per share (vs. -$0.07 YoY), impacted by $1.6M inventory write-down and $0.3M purchase accounting expense.
- **Gross Margin**: 24.1% (vs. 28.3% YoY), pressured by unfavorable product mix and rationalization efforts.
- **Cash Flow**: Operating cash of $4.3M, EBITDA of $6.3M (+13.5% YoY), cash balance $15.9M.
- **Debt**: Net debt $9M (up $12.3M YoY) due to Katsa acquisition.

**【Q&A Key Takeaways】**
- **Oil & Gas**: 8% of Q2 revenue, down 24% YoY due to Asia-Pacific macro challenges, but quoting activity up in North America and South America.
- **R&D Focus**: Hybrid electric propulsion systems, with ongoing pilot testing of electric frac fleets.
- **Cash Flow Target**: 60% of EBITDA conversion, on track after Q2 improvement.
- **CapEx**: $12-14M FY2025, focused on facility enhancements and supply chain optimization.

Actual										-1.92	-0.13	-0.3	-0.33	0.01	-0.96	0.14	-0.29	0.17	0.58	-0.15	0.08	0.2	0.62	-0.09	0.07	0.27	0.53		0.07	-0.11	0.1	-0.04	1.55
Forecast										-0.11	-0.285	-0.385	-0.19	-0.125	-0.04	-0.005	-0.015	0.05	0.17	0.155	0.06	0.13	0.27	0.1	0.13	0.33	0.33			0.21	0.26	0.02	0.1
Surprise	0.00%	0.00%	0.00%	0.00%	0.00%	0.00%	0.00%	0.00%	0.00%	-1645.45%	+54.39%	+22.08%	-73.68%	+108.00%	-2300.00%	+2900.00%	-1833.33%	+240.00%	+241.18%	-196.77%	+33.33%	+53.85%	+129.63%	-190.00%	-46.15%	-18.18%	+60.61%	0.00%	0.00%	-152.38%	-61.54%	-300.00%	+1450.00%

Actual	--	--	--	--	--	--	--	--	--	68.64M	59.38M	46.14M	48.44M	57.64M	66.20M	47.76M	59.89M	59.29M	75.97M	55.91M	63.35M	73.77M	83.92M	63.55M	72.99M	74.16M	84.42M	--	89.90M	81.24M	96.68M	80.00M	90.18M
Forecast	--	--	--	--	--	--	--	--	--	56.35M	49.90M	42.90M	50.65M	57.70M	60.65M	58.95M	55.95M	67.60M	72.55M	59.05M	67.70M	65.20M	79.80M	61.20M	68.90M	71.80M	78.90M	--	--	83.40M	93.30M	81.00M	91.00M
Surprise	0.00%	0.00%	0.00%	0.00%	0.00%	0.00%	0.00%	0.00%	0.00%	+21.80%	+18.99%	+7.56%	-4.37%	-0.10%	+9.16%	-18.98%	+7.04%	-12.29%	+4.72%	-5.31%	-6.42%	+13.15%	+5.17%	+3.85%	+5.94%	+3.29%	+6.99%	0.00%	0.00%	-2.59%	+3.62%	-1.24%	-0.90%

TWIN

TWIN fundamentals

TWIN Q2 2026 Earnings

Earnings Call

You can ask Aime

TWIN

TWIN fundamentals

TWIN Q2 2026 Earnings

Earnings Call

TWIN Earnings Call Summary for Q2/20269:00 AM on Feb 4, 2026

TWIN Earnings Call Summary for Q1/20269:00 AM on Nov 5, 2025

TWIN Earnings Call Summary for Q4/20259:00 AM on Aug 21, 2025

TWIN Earnings Call Summary for Q3/20259:00 AM on May 7, 2025

TWIN Earnings Call Summary for Q2/20259:00 AM on Feb 5, 2025

You can ask Aime