What were the key takeaways from Howmet Aerospace's earnings call?

What factors drove the changes in Howmet Aerospace's revenue and profit?

What is Howmet Aerospace's latest dividend and current dividend yield?

What were the key takeaways from Howmet Aerospace’s earnings call?

Did Howmet Aerospace beat or miss consensus estimates last quarter?

What is the revenue and EPS growth rate for Howmet Aerospace year over year?

What is the market's earnings forecast for Howmet Aerospace next quarter?

What guidance did Howmet Aerospace's management provide for the next earnings period?

- **Revenue Growth**: Q3 2025 revenue up 14% YoY, driven by Commercial (15%) and Defense (24%) Aerospace.
- **Profitability**: EBITDA +26%, free cash flow $423M, net leverage 1.1x.
- **Share Buybacks**: $600M year-to-date, surpassing 2024 full-year buybacks.
- **2026 Outlook**: $9B+ revenue, 10% YoY growth, backed by new Michigan plant.
- **IGT Expansion**: Midsized turbines (45MW+) for data centers, similar margins to aerospace.
- **Tariff Mitigation**: Pass-through agreements limit net drag to $5M.
- **Dividend Growth**: 20% QoQ increase, EPS up 34%.
- **Liquidity**: $1B commercial paper program, BBB+ credit rating.


**【CEO Opening Remarks】**
- Q3 revenue grew 14% YoY, driven by Commercial Aerospace (15%) and Defense Aerospace (24%).
- EBITDA increased 26% to $600M, with operating income up 29%.
- $200M share buybacks in Q3,2025, and $600M year-to-date, surpassing 2024 full-year buybacks.
- Debt reduced by $63M, to achieve net leverage of 1.1x.
- Headcount increased by 265, with hiring expected to resume in early 2026.
- Free cash flow of $423M, with $1 108M in capex.

**【CFO Financial Commentary】**
- Commercial Aerospace revenue exceeded $1.1B, driven by engine spares and new aircraft orders.
- Defense Aerospace growth of 24% from F-35 builds.
- Free cash flow of $423M, with year-to-date capex of $330M.
- Dividend increased 20% QoQ, EPS up 34%.
- Net debt-to-EBITDA ratio improved to 1.1x, with S&P credit upgrade to BBB+.
- $1B commercial paper program and undrawn revolver provide liquidity.

**【CEO Outlook & Strategy】**
- 2026 revenue expected to exceed $9B, up 10% YoY.
- New Michigan plant on track for 2026, supporting aerospace and IGT growth.
- IGT demand from data centers and utilities, with midsized turbines (45MW+) seeing strong growth.
- Turbine blade technology similar to aerospace, enabling higher efficiency.
- 2026 capex to remain high, backed by customer contracts.

**【Q&A Highlights】**
- **IGT Growth**: Midsized turbines (45MW+) driven by data centers, with similar margins to aerospace.
- **Tariffs Impact**: Net drag ~$5M, with pass-through agreements protecting margins.
- **Incremental Margins**: Q3 at 50%, sustained by automation and yield improvements.
- **2026 Guidance**: Revenue $9B+, EBITDA $2.375B, FCF $1.3B.
- **Spares Demand**: Expected to grow annually through 2030, offsetting OE volatility.
- **CapEx Allocation**: Aerospace majority, with increasing IGT share.


Howmet Aerospace Inc. (HWM) Q3 2025 Earnings Call Transcript

- **Record Q2 Performance**: Revenue $2.53B (+9% YoY), EBITDA $589M (28.7% margin), free cash flow $344M.
- **Strong Free Cash Flow Guidance**: Full-year free cash flow raised to $1.225B, driven by $220M CapEx in engines business.
- **Spares Growth Accelerating**: Spares revenue up 40% YoY, now 20% of total vs. 11% in 2019.
- **Defense & IGT Strength**: Defense revenue +21%, IGT/oil & gas +25%, with F-35 spares outpacing OE builds.
- **Share Buybacks Accelerated**: $400M repurchased YTD at $144/share, with $1.8B remaining under authorization.

**【CEO Summary Section】**
- Q2 revenue reached $2.53 billion, up 9% YoY, exceeding the high end of guidance. EBITDA was $589 million, with margins at 28.7%, up 300 basis points YoY.
- Free cash flow of $344 million enabled $175 million in share buybacks and a 20% dividend increase to $0.12 per quarter.
- Incremental margins were above 60% YoY, driven by strong demand in spares (40% YoY growth, 20% of total revenue) and defense aerospace (21% YoY growth).
- Guidance updated: Full-year revenue to $8.13 billion (+$100M), EBITDA to $2.32 billion (+$70M), EPS to $3.60 (+$0.20), and free cash flow to $1.225 billion (+$75M).

**【CFO Financial Commentary】**
- Commercial aerospace revenue up 8% YoY, driven by engine spares. Defense aerospace revenue rose 21% to $352 million, supported by F-35 builds and engine spares.
- Industrial and other markets grew 17% YoY, with IGT and oil & gas up 25% each. Wheels segment revenue was flat YoY but maintained 27.5% EBITDA margin despite 11% volume decline.
- Free cash flow of $344 million included $220 million in CapEx (60% YoY increase), with 70% allocated to engines business for future growth.
- Debt reduced by $76 million, lowering net debt to EBITDA to 1.3x. Share buybacks totaled $400 million YTD, with $1.8 billion remaining under repurchase authorization.

**【Q&A Highlights】**
- **Product Rationalization**: Structures segment rationalized low-margin products, driving EBITDA margin to 21.4% (up 690 bps YoY). Management expects margins to stabilize at current levels.
- **CapEx Timing**: New engine facilities in Michigan and Japan will begin contributing in late 2025/early 2026, with full capacity by 2027. Near-term costs are offset by volume growth.
- **Defense Growth**: F-35 spares demand exceeds OE production, with Lockheed's 150/yr build rate expected through 2030. IGT and aero derivatives margins match commercial aerospace levels.
- **Supply Chain Risks**: Tariff drag reduced to below $5 million in Q2. Commercial truck market softness expected to persist, but 2026 outlook is stable.
- **Pricing Discipline**: Long-term agreements maintain pricing discipline, with no material changes to net price increases expected.


Howmet Aerospace Inc. (HWM) Q2 2025 Earnings Call Transcript

- **Record Q1 Growth**: Revenue up 6% YoY to $1.87B, EBITDA margin 28.8%, free cash flow $134M.
- **Segment Strength**: Commercial Aerospace +9%, Defense +19%, Industrial spares +33%.
- **Tariff Mitigation**: $15M net impact in 2025, costs passed to customers with 90-day lag.
- **Balance Sheet Health**: 1.4x net debt/EBITDA, $537M cash, upgraded to BBB+ credit rating.
- **Future Investment**: $1.15B free cash flow guidance, $100M+ share buybacks, and 1,000+ new hires.

**【CEO Opening Remarks】**
- Q1 revenue reached a record $1.87 billion, up 6% YoY, driven by strong performance across all segments.
- EBITDA margin expanded to 28.8%, with free cash flow of $134 million, marking a significant improvement from prior quarters.
- Key highlights include a 13% increase in Engine Products revenue and a 38% rise in Fastening Systems EBITDA.
- Management emphasized confidence in future growth, despite near-term uncertainties in Commercial Transportation and U.S. economic policies.

**【CFO Financial Breakdown】**
- Commercial Aerospace revenue grew 9% YoY, supported by engine spares demand and a record backlog for fuel-efficient aircraft.
- Defense Aerospace outperformed with 19% YoY growth, driven by F-35 spares and new builds.
- Industrial markets (Oil & Gas, IGT) contributed 10% growth, with spares revenue up 33% YoY.
- Financial highlights include GAAP net income of $420 million and Non-GAAP EPS of $0.86, exceeding expectations.
- Capital deployment included $125 million in share buybacks and a 25% dividend increase.

**【Q&A Key Takeaways】**
- **Tariff Impact**: Net impact of $15 million in 2025, with costs passed through to customers with a 90-day lag.
- **Market Share**: Fastening Systems secured $20-30 million in new orders, targeting $100 million+ by end of 2025.
- **Investment Strategy**: $120 million Q1 CapEx for engine spares production, with plans to hire 1,000+ employees by year-end.
- **Risk Management**: 1.4x net debt/EBITDA ratio, upgraded to BBB+ credit rating, and $1.15 billion free cash flow guidance.
- **Supply Chain**: 10-year yttrium inventory and alternative solutions for rare earth metals ensure production continuity.

Howmet Aerospace (HWM)-1 May 25-2025 Q1 Earnings call transcript

- **Record Financials**: Q4 EBITDA margin 26.8%, full-year EBITDA $2.13 billion (+27% YoY). Free cash flow $977 million, up 88% of net income.
- **Growth Drivers**: Engines (+14% QoQ), Fasteners (27.7% margin), and IGT (19% Oil & Gas growth) lead the way.
- **2025 Outlook**: 8% revenue growth, $1.075 billion free cash flow, and 25% dividend increase.
- **Key Risks**: Commercial trucking recovery, OE build rates, and supply chain disruptions.


**【CEO Summary Section】**
- Q4 2024 revenue reached $1.935 billion, up 9% YoY, with full-year revenue of $8.03 billion (+12%). EBITDA margin hit 25.8%, a 310bps improvement YoY, driven by strong commercial aerospace and defense growth.
- Free cash flow for the year was $977 million, up 88% of net income, with $500 million returned to shareholders via buybacks and a 25% dividend increase.
- 2025 guidance: Revenue $8.03 billion (+8%), EBITDA $2.13 billion, EPS $3.17. Free cash flow expected at $1.075 billion, with capital allocation focused on buybacks and debt reduction.

**【CFO Financial Commentary】**
- Engines segment revenue +14% QoQ to $972 million, EBITDA margin 31.1%, up 380bps YoY, driven by spares growth and OE builds.
- Fasteners segment EBITDA margin expanded to 27.7% (+550bps YoY), Structures segment EBITDA +55% YoY to $51 million.
- Forged Wheels revenue down 12% YoY but maintained 27.2% EBITDA margin through cost management.
- 2024 capital expenditures $321 million, up $100 million YoY, targeting growth in IGT and commercial aerospace.

**【Market Outlook & Risks】**
- Commercial aerospace: Boeing 737 MAX builds expected at 25/month in 2025, spares revenue targeting 20% of total revenue.
- Defense: F-35 spares growth to exceed OE production by 2026.
- Industrial: IGT demand driven by data center buildouts, with Howmet securing 50%+ global turbine blade market share.
- Risks: Tariff pass-through costs, supply chain constraints, and commercial trucking market recovery timing.

**【Q&A Highlights】**
- Fasteners margins: 28%+ sustainable due to mix shift to wide-body aircraft and productivity gains.
- 2025 headcount: ~1,000 net hires, focused on engine and IGT capacity expansion.
- GTF certification: Expected mid-2025, with potential for 200+ new engines/year.
- Tariffs: Commercial agreements allow cost pass-through, limiting margin impact.


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