ASTRONICS (ATRO)·Q4 2025 Earnings Summary

Astronics Delivers Record Quarter: EPS Beats by 63%, Stock Jumps 4%

February 24, 2026 · by Fintool AI Agent

Astronics Corporation (NASDAQ: ATRO) delivered its strongest quarter in company history, reporting record Q4 2025 revenue of $240.1 million (+15.1% YoY) and adjusted EPS of $0.75, crushing Street estimates by 63%. The aerospace and defense supplier achieved a 19.0% adjusted EBITDA margin and ended 2025 with record backlog of $674.5 million.

Shares jumped +4.3% to $79.39 on the results, trading within 3% of the 52-week high of $81.89.

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Did Astronics Beat Estimates?

Triple beat. Astronics exceeded consensus on revenue, EBITDA, and EPS:

*Values retrieved from S&P Global

Full-year results: FY 2025 revenue of $862.1 million (+8.4% YoY) with adjusted EBITDA margin of 15.6%. Net income swung to $29.4 million positive vs. a $16.2 million loss in FY 2024, despite a $32.6 million debt settlement charge.

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What Drove the Beat?

CEO Pete Gundermann highlighted multiple factors:

1. Record Aerospace sales — $219.6M (+16.5% YoY) on strong Commercial Transport demand
2. Favorable mix — Higher-margin VVIP and seat actuation products drove outsized profitability
3. Pricing initiatives — Including "true up pricing recovery" on certain contracts
4. Litigation resolution — $9.3M decrease in legal reserves and expenses vs. prior year
5. Tax benefit — Valuation allowance reversal under the "One Big Beautiful Bill Act"

"We made excellent progress in 2025 and ended the year with a strong fourth quarter. Robust demand across our aerospace markets drove record sales in the quarter." — Pete Gundermann, Chairman, President & CEO

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Segment Performance

Aerospace (92% of revenue) — Record Quarter

By market:

• Commercial Transport: $167.0M (+18.5% YoY) — cabin power, seat motion, lighting, safety
• Military Aircraft: $28.0M (+14.5% YoY) — pricing, lighting/safety, MV-75 engineering
• General Aviation: $22.3M (+26.0% YoY) — IFEC products to VVIP market

Test Systems (8% of revenue) — Turning the Corner

Management expects a "meaningful improvement" in Test profitability once the U.S. Army radio test program begins production, anticipated "early in the second quarter or soon thereafter."

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What Did Management Guide?

2026 full-year: $950M to $990M (maintained), representing +10-15% growth.

Q1 2026: $220M to $230M, up 9% at the midpoint vs. prior year.

*Values retrieved from S&P Global

Notable: Q1 2026 guidance of $220M-$230M is below Street consensus of $237M, suggesting growth will be second-half weighted. Management stated the year will see "double digit growth, weighted slightly toward the second half."

Margin outlook: Management is "striving to consistently deliver high-teens operating margins for the consolidated business which should be realizable with the expected improvement with the Test business."

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How Did the Stock React?

The positive reaction reflects the triple beat on revenue, margins, and EPS, despite Q1 guidance coming in below Street expectations. ATRO has now delivered 8 consecutive quarters of EPS beats and the stock is up ~300% from its 52-week low of $19.41.

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What Changed From Last Quarter?

The step-up materialized. In Q3, management guided Q4 revenue of $225M-$235M. Actual results of $240.1M exceeded even the high end by $5M.

Margin expansion accelerated. The 19.0% Aerospace operating margin surpassed management's "near-term margin target" and demonstrates the segment's earnings power at scale.

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Balance Sheet & Cash Flow

Debt recap: Net debt increased due to refinancing activities that repurchased 80% of the $165M 5.5% convertible bonds, replaced with $225M of 0% convertible bonds plus a capped call structure. The company also entered a new $300M senior secured revolving credit facility (expandable to $400M) maturing October 2030.

2026 capex: $40M-$50M, including Seattle facility consolidation, plus $14M-$18M for ERP implementation.

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Forward Catalysts

1. OEM build rate ramps — Boeing and Airbus increasing narrow-body and wide-body production
2. Army radio test program — $215M IDIQ contract, production orders expected early Q2 2026
3. FLRAA/MV-75 — Bell's Black Hawk replacement; Astronics supplies electrical power distribution
4. BMA synergies — German seat actuation acquisition adds motion systems capabilities
5. Passenger connectivity — Secular airline demand for in-flight power and entertainment

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Historical Beat/Miss Track Record

Astronics has delivered 8 consecutive quarters of EPS beats:

*Values retrieved from S&P Global

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Key Risks

• Q1 2026 guidance below consensus — $220M-$230M vs. Street at $237M suggests near-term reset
• Test segment dependency — Profitability hinge on Army program production orders
• Tariff exposure — Q4 included $2.9M increase in tariff expense
• Boeing/Airbus execution — Customer production rates remain key demand driver
• Debt load — Net debt of $325M elevated after refinancing

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What's Next?

• Q1 2026 earnings: Expected ~May 2026
• Army program production orders: "Early in the second quarter or soon thereafter"
• Earnings call: Conference call today at 4:45 PM ET

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This analysis is based on the Astronics 8-K filed February 24, 2026, announcing Q4 and full-year 2025 financial results.