Howmet Aerospace (NYSE:HWM) reported fourth-quarter record revenue of $2.168 billion on Thursday, a 15% increase year over year. Net income was $372 million, or 92 cents per share, compared to $314 million, or 77 cents per share, in the prior year.
The stock traded higher following the results. Adjusted EPS, excluding special items, was $1.05, exceeding the 97 cents estimate. Sales also surpassed the $2.125 billion estimate.
Operating income margin was 22.6%. Adjusted EBITDA, excluding special items, increased 29% to $653 million, with a record margin of 30.1% (up 330 basis points year over year).
Segment Performance
Engine Products revenue rose 20% year over year to $1.163 billion. Segment adjusted EBITDA was $396 million, with a margin of 34.0%.
Fastening Systems revenue increased 13% to $454 million. Segment adjusted EBITDA was $139 million, with a margin of 30.6%.
Engineered Structures revenue grew 4% to $287 million. Segment adjusted EBITDA was $63 million, with a margin of 22.0%.
Forged Wheels revenue increased 9% to $264 million. Segment adjusted EBITDA was $79 million, with a margin of 29.9%.
Special Items And Cash
The quarter included approximately $54 million in net charges from special items, primarily related to a non-cash settlement charge to annuitize the remainder of the company’s U.K. pension plan.
On December 1, 2025, Howmet reduced its gross pension obligation by approximately $125 million, resulting in a non-cash settlement charge of about $89 million.
Cash from operations was $654 million, and free cash flow was $530 million. Howmet repurchased $200 million of common stock during the quarter and paid a $0.12 per share dividend.
Full-Year Results
For the full year 2025, revenue increased 11% to $8.3 billion. Net income was $1.5 billion, or $3.71 per share, compared to $1.2 billion, or $2.81 per share, in 2024.
Adjusted EPS, excluding special items, was $3.77. Cash from operations totaled $1.9 billion, and free cash flow was $1.4 billion.
As of December 31, 2025, cash and cash equivalents were $742 million, and total debt was $3.05 billion.
Capital Deployment and M&A
On December 22, 2025, the company entered into a definitive agreement to acquire Consolidated Aerospace Manufacturing, LLC from Stanley Black & Decker for approximately $1.8 billion in cash. The transaction is expected to close in the first half of 2026.
On February 6, 2026, Howmet acquired Brunner Manufacturing Co. Inc., a small, privately-held producer of high-quality fastener products based in Mauston, WI, in an all-cash transaction.
In the fourth quarter of 2025, Howmet Aerospace repurchased $200 million of common stock at an average price of $194.61 per share, retiring approximately 1.0 million shares.
As of February 12, 2026, total share repurchase authorization available was approximately $1.347 billion.
Management Commentary
Executive Chairman and Chief Executive Officer John Plant stated, “Turning to 2026, the vast majority of the markets we serve are in a growth phase, while the commercial transportation market shows signs of stabilizing.”
“Defense markets are also very healthy, while engine spares continue to grow to support the expanding aircraft fleet. The gas turbines business is entering its largest growth phase in years, with extremely high demand for electricity generation, especially from natural gas for data centers. In commercial transportation, we anticipate that the first quarter 2026 will be the quarterly low point and then we will begin to see healthy demand in the second half of 2026. Howmet is well positioned for growth in 2026 and beyond.”
Outlook
The company forecast first-quarter 2026 revenue of $2.225 billion to $2.245 billion and adjusted EPS of $1.09 to $1.11, above estimates of $2.162 billion and $1.02.
For fiscal 2026, it forecast revenue of $9.000 billion to $9.200 billion, versus the $9.151 billion estimate, and adjusted EPS of $4.35 to $4.55, versus the $4.47 estimate.
The company mentioned that fiscal 2026 revenue is projected to rise about 10%, with profit and cash generation expected to improve.
HWM Price Action: Howmet Aerospace shares were up 8.47% at $250.39 at the time of publication on Thursday. The stock is trading at a new 52-week high, according to Benzinga Pro data.
Photo by T. Schneider via Shutterstock
Recent Comments