Curtiss-Wright Corp ((CW)) has held its Q1 earnings call. Read on for the main highlights of the call.
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Curtiss-Wright Corp’s recent earnings call painted a picture of robust growth and strategic confidence, as the company reported significant year-over-year increases in both sales and operating income. Despite some challenges, such as tariffs and stagnation in the general industrial market, the overall sentiment was positive, with the company expressing optimism about its future performance and market positioning.
Strong Start to 2025
Curtiss-Wright Corp kicked off 2025 with impressive financial results, surpassing expectations with a 13% year-over-year increase in sales, totaling $806 million. The company also reported a 34% rise in operating income, accompanied by a 260 basis point expansion in operating margins, underscoring its operational efficiency and strategic execution.
Record Backlog and New Orders
The company achieved a record backlog exceeding $3.6 billion, with new orders increasing by 13% year-over-year to over $1 billion. This resulted in a strong book-to-bill ratio of 1.26, highlighting the company’s ability to secure new business and sustain growth momentum.
Raised Full Year 2025 Guidance
In light of its strong start, Curtiss-Wright raised its full-year 2025 guidance, projecting sales growth of 8% to 9%. Operating margins are expected to increase by 80 to 100 basis points, reaching a record high of 18.3% to 18.5%, reflecting the company’s confidence in its strategic initiatives and market positioning.
Defense Electronics Segment Performance
The Defense Electronics segment was a standout performer, achieving a 16% sales growth and delivering a record first-quarter operating margin of 27.5%. This performance underscores the segment’s critical role in the company’s overall growth strategy.
Positive Free Cash Flow Outlook
Curtiss-Wright reported a 5% year-over-year improvement in free cash flow for the first quarter, with full-year guidance raised to $495 million to $515 million. This represents a 27% increase over 2024, indicating strong cash flow conversion and financial health.
Tariff-Related Challenges
The company anticipates a $10 million net impact from tariffs, affecting primarily the Aerospace & Industrial and Naval & Power segments. Despite this challenge, Curtiss-Wright is implementing pricing and operational strategies to mitigate the impact.
General Industrial Market Stagnation
Sales in the general industrial market remained flat, with modest growth in industrial automation offset by reduced sales of industrial vehicle products. This stagnation presents a challenge, but the company remains focused on strategic initiatives to drive future growth.
Forward-Looking Guidance
Curtiss-Wright’s forward-looking guidance reflects improved expectations across several key metrics, with sales projected to increase by 8% to 9%, driven by strong performance in the Aerospace and Defense markets. Operating margins are expected to expand, and diluted EPS is forecasted to grow by 14% to 17%. The company also anticipates robust cash flow conversion, supported by strategic initiatives and solid market positioning.
In summary, Curtiss-Wright Corp’s earnings call highlighted a strong start to 2025, with significant growth in sales and operating income. Despite some challenges, the company’s raised guidance and strategic initiatives underscore its confidence in continued strong financial performance. Investors and market watchers can look forward to Curtiss-Wright’s optimistic outlook and strategic execution in the coming year.