What does Gates Industrial do and what are its main business segments?

What is the revenue and EPS growth rate for Gates Industrial year over year?

What guidance did Gates Industrial's management provide for the next earnings period?

What is Gates Industrial's gross profit margin?

Did Gates Industrial beat or miss consensus estimates last quarter?

What factors drove the changes in Gates Industrial's revenue and profit?

What were the key takeaways from Gates Industrial's earnings call?

What is the market's earnings forecast for Gates Industrial next quarter?

- **Record Margins & Growth**: Q3 2025 EBITDA margin 22.9% (up 90bps YoY), driven by Personal Mobility (+20%+), despite macro challenges. 2025 EPS guidance raised to $1.50.
- **Restructuring Impact**: 2026 EBITDA margin target ~24% (excluding volume), with Q1 2026 headwinds of 100-200bps, offset by 75-125bps benefits in H2.
- **Strategic Initiatives**: $150M+ data center pipeline; Personal Mobility on track for 30%+ CAGR. Automotive Replacement stable at 2-3% growth.
- **Capital Allocation**: $300M share buyback authorization; prioritize debt reduction and M&A. Net leverage <2.0x by year-end.

**【CEO Summary Section】**
- **Q3 2025 Results**: Core revenue grew 1.7% year-over-year, driven by 20%+ growth in Personal Mobility and mid-single-digit growth in Off-Highway. Adjusted EBITDA margin expanded to 22.9%, a 90 basis point improvement, with record Q3 EBITDA dollars.
- **End Market Trends**: Off-Highway stabilized (construction growth offsetting ag weakness), while On-Highway declined mid-single digits due to North American truck production cuts. Automotive Replacement grew high single digits, offsetting OEM declines.
- **Restructuring & Capital Allocation**: Announced $300M share repurchase program (replacing prior $100M authorization). Net leverage reduced to 2.0x, targeting <2.0x by year-end. 2025 EPS guidance raised to $1.50 midpoint.

**【CFO Financial Commentary】**
- **Q3 Financials**: Total sales $856M, +3% YoY (2% core). Adjusted EBITDA $196M, +18% YoY. Free cash flow $73M (73% of net income). Restructuring costs expected to impact 2026 EBITDA margin by 100-200bps in Q1, with 25-75bps in Q2, followed by 75-125bps benefit in H2.
- **2025 Guidance Update**: Core sales growth midpoint narrowed to 1%, EBITDA maintained at $780M, EPS raised to $1.50. Free cash flow conversion revised to 80-90% due to restructuring outflows.
- **Segment Performance**: Power Transmission (+2.3% core) led by Personal Mobility; Fluid Power (+1% core) offset ag weakness with Automotive Replacement growth.

**【Q&A Highlights】**
- **Margin & Restructuring**: 2026 EBITDA margin target of ~24% (excluding volume) reflects restructuring savings. Q1 2026 EBITDA margin could decline 100-200bps due to restructuring costs, with normalization in H2.
- **Data Center & Growth**: $150M+ pipeline in design phase; expect 2026 contributions. Personal Mobility on track for 30%+ CAGR 2025-2028. Automotive Replacement stable at 2-3% growth.
- **Tariffs & Pricing**: 30-40bps EBITDA dilution from tariffs; 80/20 pricing strategy offsets inflation. No material volume destruction expected in 2026.
- **Capital Allocation**: Prioritize debt reduction (paid down $100M Q3) and M&A, with buybacks as a secondary option. Balance sheet strength supports strategic initiatives.

Gates Industrial Corporation plc (GTES) 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

GTES

GTES fundamentals

You can ask Aime