Executive Summary

Q3 2025 revenue and EPS modestly beat S&P Global consensus: $178.7M vs $177.6M estimate and $0.27 vs $0.20 estimate; management reaffirmed FY25 revenue guidance of $750–$800M despite ongoing demand headwinds and channel inventory normalization efforts . Estimates from S&P Global marked with * below.
Mix shift away from chassis supported gross margin to 14.2% (vs 13.4% YoY), but lower volumes drove sharp declines in net income ($3.1M, -80% YoY) and EPS ($0.27, -80% YoY) .
Operating actions: production reductions to draw down field inventory, ~150-person workforce reduction in August, tariff surcharges and selective pre-buys; debt reduced by $10M in Q3 and another $10M in October; $1.2M of buybacks and 60th consecutive $0.20 dividend declared (call referenced 59th consecutive before the new declaration) .
Setup into 2026: management cites improving inventory balance (chassis below body inventory), growing Europe demand, and heightened military RFQ activity as potential tailwinds; Q4 margins could see slight seasonal pressure due to holidays/downtime .

What Went Well and What Went Wrong

What Went Well
- Gross margin expanded YoY to 14.2% on favorable mix (more units, fewer chassis) despite a 43.1% revenue decline; CFO framed mix as the driver and expects normalization over time .
- Balance sheet and cash conversion improved: AR fell to $232.6M (from $270.4M in Q2 and $313.4M at YE), cash rose to $38.4M, and debt cut to $45M in Q3 and $35M in October; “receivables convert into cash at a faster rate as inventory…returns to more normalized levels” .
- Capital returns continued: ~$1.2M buybacks plus dividend ($0.20), totaling ~$3.5M returned; “we believe that repurchasing our shares represents one of the most attractive investments…” .
What Went Wrong
- Demand remained weak and revenue fell 43.1% YoY to $178.7M, primarily due to normalized/lower chassis shipments after elevated prior-year OEM recovery; EPS fell to $0.27 (-80% YoY) .
- Industry headwinds persisted (higher ownership costs, macro uncertainty), forcing actions: production pullback and a ~150 role workforce reduction to right-size costs .
- Q4 caution: management flagged holiday downtime and potential slight downward margin pressure; SG&A still includes retirement program costs ($0.9M in Q3, remaining ~$1.8M in Q4) before a “clean” run rate in Q1 .

Financial Results

Metric	Q1 2025	Q2 2025	Q3 2025
Revenue ($USD Millions)	$225.7	$214.0	$178.7
Gross Profit ($USD Millions)	$33.9	$34.6	$25.3
Gross Margin %	15.0%	16.2%	14.2%
SG&A ($USD Millions)	$23.3	$23.4	$21.2
SG&A % of Sales	10.3%	10.9%	11.9%
Net Income ($USD Millions)	$8.1	$8.5	$3.1
Diluted EPS ($)	$0.69	$0.73	$0.27

YoY comparison (Q3 2025 vs Q3 2024):

Revenue: $178.7M vs $314.3M (-43.1%) .
Gross margin: 14.2% vs 13.4% (+80 bps) .
Net income: $3.1M vs $15.4M (-80.0%); EPS $0.27 vs $1.33 (-80.0%) .

Sequential deltas (Q3 vs Q2) per company deck:

Revenue: -16.5%; Gross profit: -26.8%; Net income: -63.6%; EPS: -63.0% .

Results vs S&P Global consensus (Q3 2025):

Metric	Actual	Consensus*	Surprise
Revenue ($USD Millions)	$178.7	$177.6*	+$1.1M (+0.6%)*
Diluted EPS ($)	$0.27	$0.20*	+$0.08 (+38.5%)*

Forward consensus snapshot:

Period	Revenue Consensus Mean ($M)*	Primary EPS Consensus Mean ($)*
Q4 2025	164.2*	0.08*
Q1 2026	249.4*	0.77*

*Values retrieved from S&P Global.

KPIs and balance sheet trends

KPI	Q1 2025	Q2 2025	Q3 2025
Cash ($M)	$27.4	$31.8	$38.4
Accounts Receivable ($M)	$292.6	$270.4	$232.6
Inventories ($M)	$164.9	$165.5	$180.7
Accounts Payable ($M)	$113.5	$98.0	$82.2
Long-term Obligations ($M)	$75.0	$55.0	$45.0

Notes: Debt reduced a further $10M in October post-quarter (to ~$35M), and inventories rose sequentially due to pre-purchasing to mitigate tariffs and slower chassis demand .

Guidance Changes

Metric	Period	Previous Guidance	Current Guidance	Change
Revenue	FY 2025	$750–$800M (revised on Aug 6, 2025)	$750–$800M (reaffirmed Nov 5–6, 2025)	Maintained
EPS	FY 2025	Suspended (Q2 update)	None provided	Maintained (no EPS guide)
Dividend	Q3 2025	$0.20 declared in Q2	$0.20 declared for Dec 9, 2025; press release calls this the 60th consecutive dividend	Maintained
One-time SG&A	2H 2025	—	Retirement program total $2.7M; $0.9M in Q3, ~$1.8M expected in Q4	New detail

Context: FY25 revenue guidance was originally $950–$1,000M in Q1 and was reduced to $750–$800M in Q2; Q3 maintained the revised range .

Earnings Call Themes & Trends

Topic	Previous Mentions (Q1 2025)	Previous Mentions (Q2 2025)	Current Period (Q3 2025)	Trend
Channel inventory & production	Deliberately slowed deliveries; chassis below body trending to optimal; expected normalization over next few quarters	Inventory still elevated; production cut to accelerate reduction	Chassis now below body; production pulled back; anticipate normalization into 2026	Improving
Tariffs & pricing	Implemented tariff surcharge, accessory/parts price increases; low direct China exposure	Continued surcharge and monitoring evolving landscape	Surcharges remain; pre-buy from low-tariff geographies to protect margins	Managed, monitored
CARB/ACT regulation	Limiting sales in regulated states; supplier CARB-compliant chassis expected late 2025/early 2026	Only California enforcing; sales into CA limited	Not highlighted in Q3 remarks; prior constraints still assumed in guide	Neutral
Military demand	Robust RFQ activity; confidence in tailwinds	Continued activity; Canada contract signed; large RFQs pending	“Notable increase” in RFQs; preparing for 2027 production; multi-year tailwind potential	Strengthening
Capital allocation (dividend, buybacks, debt)	$0.20 dividend; $2.1M buybacks; $20M authorization remaining	Dividend maintained; buyback authorization $20M remaining	$0.20 dividend approved; ~$1.2M buybacks; debt reduced to $45M in Q3 and to $35M in Oct	Shareholder-friendly; leverage falling
Gross margin mix (chassis vs body)	Margin sensitivity to mix; expect more chassis later in year to pressure margins	Record-like GP% in Q2; expect margins to settle mid-13% longer term	Q3 GM 14.2%; Q4 mix similar with slight seasonal pressure; normalize toward historical in 2026	Normalizing

Management Commentary

“Third-quarter revenue was in-line with our expectations, as industry-wide demand headwinds continued to weigh on results…[we] decreased production to reduce field inventory, right-sizing our costs… and securing our supply chain to mitigate the long-term impacts of tariffs.” – CEO William G. Miller II .
“We reduced our debt balance by $10 million during the quarter, and an additional $10 million in October… With strong interest in the global military market… and an improved cost-structure, we… will enter 2026 from a position of strength.” – CEO .
“Net sales… were $178.7 million (-43.1% YoY)… Gross profit was $25.3 million (14.2% margin)… SG&A was $21.2 million (11.9% of sales)… [including] a $900,000 one-time cost for retirement packages; total program $2.7 million with the remainder expected in Q4.” – CFO Debbie Whitmire .
“We reaffirm… 2025 fiscal year guidance for revenue in the range of $750–$800 million… Q4 impacted by holidays and maintenance.” – CEO .

Q&A Highlights

Mix and margins: With chassis revenue reattaching in 2026, top line should be higher at similar unit volumes; margins expected to return to historical levels as mix normalizes; Q4 margins could be slightly lower due to seasonal downtime .
SG&A cadence: “Clean” SG&A run rate expected from Q1 as retirements stagger through the remainder of 2025; retirement program roughly 50/50 salaried vs hourly .
Demand drivers intact: Underlying end-market factors (miles driven, aging fleet, accident incidence) “still intact” into 2026 .
Inventory balance: Order entry still slightly below retail activity; management looking for alignment before ramping production, likely late Q4 or early Q1 .

Estimates Context

Beat vs consensus (S&P Global): Revenue +$1.1M (+0.6%) and EPS +$0.08 (+38.5%) in Q3 2025, aided by mix and cost controls despite macro headwinds . Consensus values marked with * above. Values retrieved from S&P Global.
Forward setup: Consensus implies a softer Q4 then recovery in Q1 2026; management’s 2025 revenue reaffirmation and commentary on inventory normalization/military RFQs suggest potential upward estimate revisions for 2026 if demand and mix normalize as indicated . Values retrieved from S&P Global.

Key Takeaways for Investors

Q3 executed to plan with small top- and bottom-line beats vs S&P Global consensus; FY25 revenue guidance held at $750–$800M, signaling visibility despite headwinds . Values retrieved from S&P Global.
Mix aided margins; normalization of chassis attachment in 2026 should lift revenue per unit while margins revert toward historical, supporting operating leverage on recovery .
Cost actions (production curtailment, workforce reduction, tariff mitigation, pre-buys) plus improving cash conversion enabled debt reduction to $35M post-quarter and continued capital returns (buybacks + dividend) .
Near-term watch items: Q4 seasonality could modestly pressure margins; remaining ~$1.8M retirement program cost to flow through Q4; look for order entry to align with retail activity to trigger production increases .
2026 setup improving: distribution inventory trending optimal (chassis below body), Europe demand firming, military RFQs building into potential 2027 production – key swing factors for the medium-term thesis .
Note a small disclosure discrepancy: press release cites the 60th consecutive dividend, while the call referenced 59 consecutive with the newly approved payout; both imply continuity of the dividend program .
Trading lens: Stock likely sensitive to updates on order intake vs retail run-rate, CARB/compliance timing, and any formalization of large military contracts; sequential inflection in revenue/margins could catalyze estimate and multiple support .

Additional References and Documents

Q3 2025 earnings press release and 8-K exhibits .
Q3 2025 earnings call transcript –.
Q2/Q1 2025 results and calls for trend analysis – – – –.
Workforce reduction press release (Aug 14, 2025) .

MILLER INDUSTRIES INC /TN/ (MLR)·Q3 2025 Earnings Summary