Howmet Aerospace reported strong financial results for the fourth quarter and full year of 2025, highlighting record revenue, profit, and cash flow generation. The company also provided guidance for continued revenue growth and improved profitability in 2026. This update reflects Howmet’s solid operational performance and ongoing capital return to shareholders through share repurchases and dividends.
The results underscore Howmet’s growth momentum, driven primarily by its Commercial Aerospace segment, and its ability to convert revenue gains into higher margins and cash flow. Investors can note the company’s disciplined capital allocation, including significant debt reduction and shareholder returns.
Key details from Howmet Aerospace’s Q4 and full-year 2025 results:
Revenue and Profitability:
- Fourth quarter revenue reached $2.2 billion, up 15% year-over-year (YoY), with Commercial Aerospace sales increasing 13%.
- Full year 2025 revenue totaled $8.3 billion, an 11% increase YoY, again led by a 12% rise in Commercial Aerospace.
- Fourth quarter GAAP operating income margin was 22.6%, slightly down by 90 basis points compared to the prior year.
- Full year GAAP operating income margin improved to 24.8%, up 280 basis points YoY.
- Net income for Q4 was $372 million, a 19% increase YoY, with earnings per share (EPS) of $0.92.
- Full year net income rose to $1.5 billion from $1.2 billion in 2024, with EPS increasing to $3.71 from $2.81.
Adjusted Results (excluding special items):
- Adjusted EBITDA for Q4 was $653 million, up 29% YoY, with an adjusted EBITDA margin of 30.1%, improving by 330 basis points.
- Adjusted operating income margin for Q4 was 26.8%, up 380 basis points YoY.
- Adjusted EPS for Q4 was $1.05, a 42% increase YoY.
- For the full year, adjusted EBITDA rose 26% to $2.4 billion, with an adjusted EBITDA margin of 29.3%, up 350 basis points.
- Adjusted operating income margin for the year was 25.8%, up 380 basis points.
- Adjusted EPS for 2025 was $3.77, up 40% YoY.
Cash Flow and Capital Allocation:
- Howmet generated $654 million in cash from operations in Q4 and $1.9 billion for the full year.
- Free cash flow was $530 million in Q4 and $1.4 billion for the year.
- The company used $449 million in financing activities and $122 million in investing activities during Q4.
- For the full year, financing activities consumed $1.3 billion, and investing activities used $0.4 billion.
- Howmet repurchased $200 million of common stock in Q4 and $700 million over the full year.
- Dividends paid were $0.12 per share in Q4 and $0.44 per share for the full year.
- The company reduced debt by $265 million during 2025.
2026 Outlook:
- Howmet expects approximately 10% revenue growth in 2026.
- The company anticipates improved profitability and cash generation compared to 2025.
Implications for investors:
- Howmet Aerospace’s strong revenue growth, particularly in Commercial Aerospace, is translating into higher margins and earnings, reflecting operational efficiency and pricing power.
- The company’s robust cash flow generation supports ongoing debt reduction and substantial capital returns through share buybacks and dividends, enhancing shareholder value.
- The guidance for continued double-digit revenue growth and margin improvement in 2026 suggests confidence in the underlying demand environment and Howmet’s competitive positioning.
- Investors can view Howmet’s disciplined capital allocation and improving profitability as indicators of financial strength and strategic execution.