Operating Income

FY 2026

no prior guidance [N/A]

$660 million to $700 million " " "

no prior guidance

Adjusted Free Cash Flow

FY 2026

no prior guidance [N/A]

$240 million to $280 million " "

no prior guidance

Capital Expenditures

FY 2026

no prior guidance [N/A]

$300 million to $315 million "

no prior guidance

Effective Tax Rate

FY 2026

no prior guidance [N/A]

21% to 23% "

no prior guidance

Operating Income

Q1 FY 2026

no prior guidance [N/A]

$148 million to $152 million "

no prior guidance

SAO Segment Operating Income

Q1 FY 2026

no prior guidance [N/A]

$162 million to $165 million "

no prior guidance

PEP Segment Operating Income

Q1 FY 2026

no prior guidance [N/A]

$11 million to $12 million "

no prior guidance

Pricing Strategies & Tailwinds

In Q1–Q3 2025, pricing strategies were consistently discussed with emphasis on long‐term agreements, product mix optimization, and strong supply–demand support driving higher realized prices and profitability. " " " " " Tailwinds from aerospace, defense, and medical markets were highlighted with robust LTA activity and expectations of future growth. " " " " "

In Q4 2025, management reiterated the strength of pricing actions as a tailwind, supported by the persistent large supply–demand gap, complementary competitor capacity investments, and new long-term agreements signed at industry events. " "

Consistent and positive: The emphasis on pricing actions and tailwinds remains strong across periods with continued focus on LTAs and product mix optimization, supporting a bullish outlook. " " "

Order & Demand Trends

Across Q1–Q3 2025, the company consistently discussed a robust order backlog (often exceeding pre-COVID multiples), strong sequential order growth, emergency orders in aerospace and MRO demand, and cyclical variations that were managed by shifting customer emphasis from aerospace to energy and medical. " " " "

In Q4 2025, the discussion focused on strong aerospace and defense demand with sequential increases, continued high order backlog, and detailed explanations of variations (e.g., inventory management in aerospace and strong momentum in medical and energy). " "

Steady with cyclical variations: While the fundamentals (robust backlog and strong market demand) remain unchanged, management continues to monitor cyclical inventory fluctuations and adjust production priorities. " " "

Operating Margins & Efficiency

Throughout Q1–Q3 2025, operating margins improved steadily with record or near-record SAO segment margins, driven by productivity, product mix, and pricing actions. Efficiency improvements, controlled operating costs, and proactive maintenance were key themes in each call. " " " " "

In Q4 2025, margins reached new heights (SAO segment at 30.5% adjusted operating margin) with record operating income and improved gross profit. Efficiency was reinforced through enhanced productivity, targeted maintenance practices, and successful price execution. " " "

Continued improvement: The positive trajectory in operating margins and efficiency remains intact, with even better results in Q4, confirming effective cost management and execution. " "

Supply Chain Constraints & Extended Lead Times

In Q1–Q3 2025, extended lead times and high backlog levels were consistently noted. Q1 mentioned ongoing supply uncertainties with customers taking a “wait-and-see” approach, while Q2 reported slight lead time improvements (reductions by 2–3 weeks) and Q3 highlighted constant extended lead times (up to 60 weeks) due to capped order books and a tight aerospace supply–demand imbalance. " " " " "

In Q4 2025, extended lead times persisted, particularly within the aerospace sector, with continued tight supply conditions and expectations of further tightening as Boeing ramps up production; inventory adjustments by customers were also noted. " "

Persistent constraints with slight improvement earlier: While minor lead time improvements were noted in Q2, overall supply chain tightness persists into Q4, keeping a cautious tone regarding production scheduling. " " "

Tariff & Macroeconomic Risks

Q2 and Q3 2025 earnings calls discussed tariff risks—emphasizing minimal impact due to sourcing advantages (e.g. Canadian nickel exempt from tariffs) and the intention to pass through any costs—and broader macroeconomic positioning, while Q1 had no discussion. " " " " "

In Q4 2025, there was no mention of tariff or macroeconomic risks.

De-emphasized in current period: Previously disclosed tariff and macroeconomic concerns in Q2 and Q3 were not mentioned in Q4, indicating a reduced focus on these risks. " "

Aerospace Cyclical Demand & Boeing Exposure

In Q1–Q3 2025, discussions centered on mixed aerospace cyclicality. Q1 noted customer caution and uncertainty with Boeing exposure but maintained optimism; Q2 detailed broad aerospace exposure with some customer hesitancy due to Boeing’s production issues; and Q3 emphasized strong order growth, emergency orders, and capped lead times, with customers reacting to Boeing production status. " " " " " "

In Q4 2025, management highlighted increasing aerospace demand with improving build rates and confident Boeing progress, expecting that excess customer inventory from Boeing-linked orders would be rapidly absorbed as production ramps up. " " "

Optimistic shift: Although cyclical challenges persist, the narrative has shifted toward confidence in Boeing’s recovery and sustained aerospace demand despite earlier cautious tones. " " "

AI-Driven Preventive Maintenance

Q1–Q3 2025 did not mention AI-driven initiatives for maintenance, though conventional preventive maintenance was discussed in general terms. " "

In Q4 2025, a new emphasis was placed on AI-driven preventive maintenance as a strategic innovation to enable deeper insights, shorter targeted outages, and improved asset utilization. "

New emergence with positive impact: AI integration in preventive maintenance is a new topic in Q4, representing an innovative step forward in operational efficiency. "

Free Cash Flow & Margin Drivers Uncertainty

In Q1–Q3 2025, free cash flow generation was steadily improving (ranging from $13.3M in Q1 to $38.6M in Q2 and $34M in Q3) with margin drivers focused on productivity, pricing, and product mix; Q1 mentioned aerospace supply chain uncertainty as a margin risk while Q3 presented a more upbeat margin picture without new concerns. " " " " " "

In Q4 2025, the company generated strong free cash flow ($201.3M in Q4 and $287.5M for the fiscal year) while continuing to drive margin expansion via product mix and pricing improvements. Some uncertainties remained around the supply-demand gap, extended lead times, and inventory levels, but these were noted as manageable. " " " " "

Overall strong with manageable uncertainties: Free cash flow performance continues to strengthen and margins improve, though supply chain factors keep some uncertainty in focus; however, these risks are viewed as controllable. " " "

Additive Business Volatility

In Q1 2025, additive business volatility was noted due to inconsistent large orders from key aerospace players (e.g. SpaceX) alongside overall demand swings; Q2 described order deferrals impacting volatility, and Q3 de-emphasized it by focusing on Dynamet as the primary driver within the PEP segment. " " " "

In Q4 2025, the additive business was mentioned only briefly as part of the PEP segment with improved contribution and no focus on volatility, suggesting it is now de-emphasized relative to earlier discussions. "

De-emphasized over time: Where earlier periods noted volatility and order deferrals, the current period sees the additive business playing a smaller, more stable role, with a stronger emphasis on Dynamet driving overall performance. " "