10-Q · May 7, 2026
Howmet Aerospace's Q1 2026 results showed strong revenue and earnings growth, driven by increased demand in commercial aerospace and gas turbines. The company reported revenue of $2.31 billion, exceeding estimates by…
Earnings analysis · 10-Q
HWM earnings analysis
Filed October 29, 2026 · Our reading of the company's report
The latest report
Howmet delivered strong third-quarter execution, with revenue up 29% year over year to $2,703 million, diluted GAAP EPS up 49% to $1.42, and operating margin expanding to 28.7% from 25.9%. Engine Products drove the…
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Howmet delivered strong third-quarter execution, with revenue up 29% year over year to $2,703 million, diluted GAAP EPS up 49% to $1.42, and operating margin expanding to 28.7% from 25.9%. Engine Products drove the improvement, while Fastening Systems benefited from acquisitions and Engineered Structures improved profitability despite lower sales. Cash generation was strong, but the balance sheet reflects $1,929 million of acquisition spending, debt growth to approximately $4,443 million, and higher receivables and inventories. The 10-Q contains no numeric revenue or EPS guidance, but management expects continued aerospace and gas-turbine demand growth and 2026 capital expenditures of approximately 5% of sales.
Gross and operating margin
How much of each revenue dollar the business keeps.
One point per quarterly or annual filing. Both margins are shares of that report's revenue.
From revenue to operating profit
Where each $100 of revenue went in this report.
Cost of sales, operating expenses, and what remained. Figures are rounded to whole dollars.
Where revenue came from
The business segments reported by the company.
Shares of the segments disclosed in this filing, largest first.
How we read each report
Our analysis across the last few reports.
Our model's reading of each filing, not the share price or the market's reaction. Annual and quarterly reports each occupy one position.
Reported figures
- Earnings per share
- $1.42
What stood out
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Strong revenue and EPS growth
Third-quarter sales were $2,703 million, up $614 million, or 29%, from $2,089 million in the prior-year quarter and up approximately 6% from $2,550 million in Q2 2026. Diluted GAAP EPS was $1.42 versus $0.95 year over year and $1.33 in Q2.
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Margins expanded materially
Gross margin increased to 37.1% from 34.7% in Q3 2025, while operating margin rose to 28.7% from 25.9%. Operating income increased to $777 million from $542 million.
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Engine Products accelerated
Engine Products led segment growth with revenue of $1,451 million, up 33%, and Segment Adjusted EBITDA of $567 million, up 57%; its margin expanded to 39.1% from 33.3%.
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Operating cash generation strengthened
Operating cash flow for the first nine months was $1,745 million, up 42% from $1,230 million. Nine-month capital expenditures were $345 million, implying reported cash generation before acquisitions of approximately $1,400 million.
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Acquisitions and productivity helped
Fastening Systems revenue increased 41% to $630 million, including CAM and Brunner, while Engineered Structures EBITDA rose 9% to $70 million despite revenue declining 4% to $295 million.
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Aggressive shareholder returns
The company repurchased $1,100 million of common stock during the first nine months and received authorization for an additional $5,000 million increase on October 28, 2026; approximately $5,397 million remained available after repurchases through that date.
What to watch
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Higher leverage and lower cash
Cash and cash equivalents declined to $507 million from $742 million at December 31, 2025, while total debt increased to approximately $4,443 million from $3,050 million. Commercial paper outstanding was $390 million versus $0 at year-end.
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Working-capital intensity increased
Receivables increased to $1,116 million from $779 million and inventories to $2,113 million from $1,849 million, consuming working capital. The company also sold $1,069 million of receivables through its securitization program during the first nine months.
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Acquisition and input-cost pressure
Fastening Systems' Segment Adjusted EBITDA margin fell to 29.4% from 30.8%, primarily due to the CAM and Brunner acquisitions. Forged Wheels' margin declined to 26.3% from 29.6%, with management citing aluminum and inflationary cost pass-through.
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Portfolio actions weigh on revenue
Engineered Structures revenue declined 4% to $295 million in Q3, and management expects optimization and product rationalization to result in lower 2026 commercial and defense aerospace revenue. The disk forging divestiture contributed to the decline.
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Acquisition-related cash outflow
The CAM and Brunner acquisitions required $1,929 million of investing cash during the first nine months, contributing to investing cash usage of $2,046 million versus $316 million in the prior-year period.
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Tariffs and aerospace-cycle exposure
Management identifies tariff recovery timing as a margin risk: tariffs may increase costs before customer pass-through is received. Approximately 68% of nine-month revenue came from commercial and defense aerospace markets, exposing results to aircraft-build timing and geopolitical volatility.
Management's outlook
The 10-Q provides no quantitative revenue or EPS guidance. Management expects 2026 demand to increase in commercial and defense aerospace and gas turbines, expects a modest commercial transportation recovery, and anticipates capital expenditures of approximately 5% of 2026 sales.
Earlier filings 4
10-K · February 12, 2026
Howmet Aerospace reported strong performance in 2025, with revenues increasing by 11% to $8.25 billion and net income reaching $1.51 billion, up 31% from the previous year. The company primarily benefited from growth in…
10-Q · October 30, 2025
Howmet Aerospace's Q3 2025 results showed continued growth with revenues of $2.09 billion, up 14% year-over-year. The company reported a gross margin of 34.7% and an operating margin of 26%, both representing…
10-Q · July 31, 2025
Howmet Aerospace's second quarter 2025 financial results show significant growth, with revenue reaching $2.05 billion, marking a 9% increase year-over-year. The company also reported a diluted EPS of $1.00, an increase…
This is our reading of a public filing, not the filing itself. Analysis can contain errors; check the source document for full context.