Executive Summary

Q2 2025 was a strong beat: revenue $730.6M (+21% YoY) and non-GAAP EPS $0.58 both exceeded the high end of guidance; GAAP EPS was $0.40 .
Strength was broad—record quarterly revenues in Aerospace & Defense and Data Center Computing; non-GAAP operating margin reached 11.1% (+210 bps YoY) and Adjusted EBITDA was $109.7M (15.0% margin) .
Q3 2025 guidance: revenue $690–$730M and non-GAAP EPS $0.57–$0.63; CFO detailed operating assumptions (SG&A ~8.9% of sales, R&D ~1%, interest expense ~$10.5M, tax rate 13–17%, ~104M diluted shares) .
Key catalysts: continued AI-driven demand (data center and networking), robust A&D backlog (~$1.46B), new US capacity option (Eau Claire, WI), and CEO succession plan announced; near-term investor focus on Penang ramp pace and margin drag .

What Went Well and What Went Wrong

What Went Well

Record non-GAAP EPS and above-range revenue: “revenues and non-GAAP EPS above the high end of the guided range…non-GAAP EPS at a quarterly record high” .
AI demand tailwinds: “increased demand in…Data Center Computing and Networking…driven by the requirements of generative AI” .
Strategic footprint expansion and resilience: acquisition of Eau Claire, WI facility and land rights in Penang to accelerate US capacity and Southeast Asia diversification .

What Went Wrong

Penang ramp slower than planned, increasing margin drag: management now expects break-even later; operating margin drag from Penang ~210 bps, worse by ~30 bps YoY .
Automotive softness persisted: sales - YoY decline due to inventory adjustments and soft demand at several customers .
A&D book-to-bill <1 in Q2 (0.69) on timing (not demand), which can create near-term visibility concerns despite healthy multi-year backlog .

Financial Results

Consolidated Performance vs Prior Periods

Metric	Q2 2024	Q1 2025	Q2 2025
Revenue ($USD Millions)	$605.1	$648.7	$730.6
GAAP Diluted EPS ($)	$0.25	$0.31	$0.40
Non-GAAP Diluted EPS ($)	$0.39	$0.50	$0.58
Gross Margin (GAAP, %)	19.4%	20.2%	20.3%
Gross Margin (Non-GAAP, %)	20.0%	20.8%	20.9%
Operating Margin (GAAP, %)	6.4%	7.7%	8.5%
Operating Margin (Non-GAAP, %)	9.0%	10.5%	11.1%
Adjusted EBITDA ($USD Millions)	$84.6	$99.5	$109.7
Adjusted EBITDA Margin (%)	14.0%	15.3%	15.0%
Cash from Operations ($USD Millions)	$41.9	($10.7)	$97.8

Actual vs S&P Global Consensus (Q2 2025)

Metric	Consensus	Actual
Revenue ($USD Millions)	$668.4*	$730.6
EPS – Primary ($)	$0.523*	$0.58
EBITDA ($USD Millions)	$99.0*	$109.7

Values retrieved from S&P Global.*

Segment Breakdown

Segment	Q2 2024 Sales ($M)	Q1 2025 Sales ($M)	Q2 2025 Sales ($M)
Aerospace & Defense	$274.5	$310.1	$327.6
Commercial	$323.3	$332.7	$395.6
RF & Specialty Components	$9.1	$8.8	$10.1
Intersegment Eliminations	($1.7)	($3.0)	($2.7)
Total	$605.1	$648.7	$730.6

Segment	Q2 2024 Operating Income ($M)	Q1 2025 Operating Income ($M)	Q2 2025 Operating Income ($M)
Aerospace & Defense	$25.5	$40.8	$45.3
Commercial	$49.7	$43.6	$60.1
RF & Specialty Components	$2.1	$1.6	$2.9
Total Segment OI	$77.2	$86.0	$108.2
Unallocated & Corporate	($38.2)	($35.7)	($46.4)
Total Operating Income	$39.0	$50.3	$61.8

End Market Mix (% of Sales)

End Market	Q2 2024	Q1 2025	Q2 2025
Aerospace & Defense	45%	47%	45%
Data Center Computing	21%	21%	21%
Medical/Industrial/Instrumentation	14%	13%	15%
Automotive	14%	11%	11%
Networking	6%	8%	8%

KPIs

KPI	Q2 2024	Q1 2025	Q2 2025
A&D Program Backlog ($B)	~$1.45	$1.55	~$1.46
90-day Backlog ($M)	$484.8	N/A	$496.8
Book-to-Bill (Total)	N/A	1.10	0.89
Top 5 Customers (% of Sales)	42%	N/A	41%
Free Cash Flow ($M)	$31.9	($73.9)	$37.6

Guidance Changes

Metric	Period	Previous Guidance	Current Guidance	Change
Revenue	Q3 2025	N/A	$690–$730M	New
Non-GAAP Diluted EPS	Q3 2025	N/A	$0.57–$0.63	New
SG&A (% of Sales)	Q3 2025	N/A	~8.9%	New
R&D (% of Sales)	Q3 2025	N/A	~1%	New
Interest Expense ($M)	Q3 2025	N/A	~$10.5	New
Interest Income ($M)	Q3 2025	N/A	~$2.6	New
Effective Tax Rate (%)	Q3 2025	N/A	13–17%	New
Depreciation ($M)	Q3 2025	N/A	~$28.2	New
Amortization ($M)	Q3 2025	N/A	~$9.2	New
Stock-Based Compensation ($M)	Q3 2025	N/A	~$11.8	New
Diluted Shares (M)	Q3 2025	N/A	~104	New
Revenue	Q2 2025	$650–$690M	Actual $730.6M	Raised vs prior guidance (beat high end)
Non-GAAP Diluted EPS	Q2 2025	$0.49–$0.55	Actual $0.58	Raised vs prior guidance (beat high end)

Note: Company does not reconcile non-GAAP EPS guidance to GAAP due to variability in certain items .

Earnings Call Themes & Trends

Topic	Previous Mentions (Q4 2024 & Q1 2025)	Current Period (Q2 2025)	Trend
AI/Data Center demand	Record 22% of revenue in Q4; continued strength guided for Q1	Data Center 21% of Q2; YoY +20%; guide to 24% in Q3; networking +52% YoY due to AI-related switches	Accelerating mix toward AI infrastructure
A&D demand/backlog	Record $1.56B backlog in Q4; $1.55B in Q1	~$1.46B backlog; A&D 45% of Q2 revenue; stronger-than-expected sales; Q3 mix ~43%	Strong but bookings lumpy; sustained multi-year visibility
Supply chain diversification	Syracuse build-out started in 2024	Eau Claire, WI facility acquired; Penang expansion land rights; Syracuse internal fab progressing (vol. production 2H26)	Footprint expanding; option value for US capacity
Tariffs/macro	Not explicitly quantified	Tariff exposure manageable due to diversified footprint; mitigation strategies; possible indirect macro demand risks not seen yet	Neutral; proactive mitigation
Penang ramp	New facility opened in 2024	Ramp slower; $5.2M Q2 revenue; break-even $30–$35M/qtr not reached by Q3; margin drag ~210 bps	Slower ramp; active customer qualifications
China capacity	Incremental capacity added; Guangzhou qualification [prior]	Added ~20% data center capacity; expanding asymmetric PCB capabilities	Capacity enhanced for advanced designs
Customer concentration	Top 5 customers ~42% in Q2’24	Top 5 41%; one >10% customer; diversification across hyperscalers improving	Slightly improved diversification
Regulatory/Defense	DoD/CMMC progress (post-Q2)	Achieved CMMC Level 2 (Aug 8)	Strengthened defense compliance posture

Management Commentary

“Revenue grew 21% year-on-year due to demand strength from our aerospace and defense, data center computing, networking, and medical industrial and instrumentation end markets…Non-GAAP EPS of $0.58 was a quarterly record…cash flow from operations was a solid 13.4% of revenues” .
“We acquired a facility in Wisconsin and land rights in Penang as we continue to support the regional diversification of our customers’ PCB supply chains” .
On A&D demand: “We maintain a solid A&D program backlog of approximately $1.46 billion…bookings for the Sabre and LTAMDS related programs” .
On Penang: “Slower-than-expected revenue ramp…$5.2 million in Q2; break-even $30–$35 million per quarter not yet reached…focus on yields and qualifications (3 of 5 anchor customers qualified)” .
On US cost parity: “Pricing in Eau Claire likely at least 50% higher than China; will require long-term customer commitments” .

Q&A Highlights

Eau Claire readiness: modular 750k sq ft facility can be phased by modules; move with customer commitments; primary interest from data center space .
Penang ramp risk: slower ramp reflects qualifications and yield optimization; expected linear increases, but break-even delayed; margin drag worsened to ~210 bps .
China capacity: added ~20% for data center; qualifying Guangzhou; capabilities for asymmetric PCB designs expanding .
Segments clarity: Commercial largely PCBs; A&D ~50% PCBs and balance integrated electronics (mission systems, RF/microwave, assemblies) .
Mix vs pricing: high ASP mix a larger driver of margin expansion vs unit growth .
M&A pipeline: near-term pause; expect more opportunities (microelectronics, RF/microwave) over next 12–18 months .
Cost competitiveness US: US capacity structurally higher cost; customer appetite exists for some domestic supply; pricing models under development .

Estimates Context

Q2 2025 beat: Revenue $730.6M vs $668.4M consensus; Primary EPS $0.58 vs $0.523; EBITDA $109.7M vs $99.0M. The magnitude of beat was driven by stronger A&D, Data Center Computing, Networking, and MII, plus higher ASP mix and execution . Values retrieved from S&P Global.*
Prior periods: Q1 2025 revenue $648.7M vs $621.4M consensus; Primary EPS $0.50 vs $0.395; Q4 2024 revenue $651.0M vs $630.1M; Primary EPS $0.60 vs $0.473 (note: FX-influenced quarter) . Values retrieved from S&P Global.*

Key Takeaways for Investors

TTMI’s AI infrastructure exposure is an increasingly material growth driver; management guides Data Center Computing to 24% of Q3 sales and sees strong networking demand tied to AI switches .
A&D remains a resilient anchor (45% of Q2 sales) with ~$1.46B backlog and program wins; NATO and US budget tailwinds support multi-year visibility .
Margin trajectory is positive (non-GAAP operating margin 11.1%), aided by mix and execution; watch Penang ramp and its ~210 bps drag near-term .
Strategic capacity optionality: Eau Claire enables faster US scale but requires customer commitment to offset higher costs; Syracuse targets ultra-HDI with volume in 2H26 .
Q3 guide implies sustained strength despite Penang start-up costs; consensus likely to adjust higher on the back of repeated beats and AI momentum. Values retrieved from S&P Global.*
CEO succession introduces headline risk but Board expects conclusion by year-end; narrative likely focused on continuity of AI/A&D strategy and footprint expansion .
Near-term trading: positive skew on AI and A&D prints; watch for updates on customer commitments for US capacity and Penang qualifications, plus any tariff-related macro signals .

Sourced from company filings and transcripts with citations above. Values retrieved from S&P Global.*

TTM TECHNOLOGIES INC (TTMI)·Q2 2025 Earnings Summary