Moog Inc. (NYSE:MOG), a worldwide designer, manufacturer and systems integrator of high-performance precision motion and fluid controls and control systems, today reported fiscal second quarter 2025 diluted earnings per share of $1.75 and adjusted diluted earnings per share of $1.92, reflecting strong operational performance.

(in millions, except per share results)	Three Months Ended
	Q2 2025			Q2 2024			Deltas
Net sales	$	935		$	930			0	%
Operating margin		11.7	%		12.0	%	(30) bps
Adjusted operating margin		12.5	%		13.6	%	(110) bps
Diluted net earnings per share	$	1.75		$	1.86			(6	)%
Adjusted diluted net earnings per share	$	1.92		$	2.19			(12	)%
Net cash provided (used) by operating activities	$	39		$	(44	)	$	83
Free cash flow	$	2		$	(84	)	$	86
See the reconciliations of adjusted financial results and free cash flow to reported results included in the financial statements herein for the periods ended March 29, 2025, and March 30, 2024.

Quarter Highlights

Net sales increased primarily in Military Aircraft and Commercial Aircraft, while sales in Industrial declined due to simplification actions.
Operating margin declined modestly due to the absence of the prior year's one-time 150 basis point benefit from the Employee Retention Credit (ERC), masking stronger operational performance.
Adjusted operating margin declined due to the absence of prior year benefit which offset stronger operational performance, primarily in Industrial and in Military Aircraft.
Diluted net earnings per share declined due to last year's ERC, partially offset by lower adjustments and higher operating margin.
Adjusted diluted net earnings per share declined due to last year's ERC, partially offset by higher adjusted operating margin.
Free cash flow was driven by lower working capital requirements.
Twelve-month backlog remained steady at $2.5 billion.
Reiterated 2025 guidance, noting potential net tariff risk to operating profit of $10 million to $20 million.

"We have delivered another quarter of strong financial results due to our unrelenting focus on operational performance," said Pat Roche, CEO. "We achieved record sales and drove improved operating margin and earnings per share, both net of the prior year's one-time Employee Retention Credit. In addition, we delivered free cash flow in line with our plan."

Segment Results

Sales in the second quarter of 2025 increased marginally to $935 million compared to the second quarter of 2024. Military Aircraft sales increased 6% to $214 million, driven by the continued ramp-up of the FLRAA program. Commercial Aircraft sales increased 4% to $216 million, reflecting strong aftermarket demand partially offset by production delays on certain business jet and narrow-body programs. Space and Defense sales increased 1% to $270 million, supported by broad-based defense demand. These gains were partially offset by a 7% decline in Industrial sales to $234 million, primarily due to divestitures and purposeful product exits.

Operating margin was 11.7% in the second quarter, down 30 basis points compared to the second quarter of 2024, which included a one-time 150 basis point benefit from the ERC. Space and Defense operating margin declined 370 basis points to 12.1%, reflecting the absence of the prior year's ERC benefit. Commercial Aircraft operating margin declined 20 basis points to 11.8%, driven by pressures arising from OEM customers' production delays, partially offset by stronger aftermarket activity. Partially offsetting these margin declines was a Military Aircraft operating margin increase of 280 basis points to 11.1%. Lower amounts of restructuring and other charges, along with stronger operational performance in the current quarter, were partially offset by the prior year's benefits of the mature product line sale and the ERC. Additionally, Industrial operating margin increased 50 basis points to 11.6%, driven by simplification initiatives.

Adjusted operating margin excludes $14 million and $7 million in restructuring and other charges in the second quarters of 2024 and 2025, respectively. Excluding these charges, total company adjusted operating margin decreased 110 basis points from 13.6% in 2024 to 12.5% in 2025. However, adjusted operating margin increased 40 basis points from a year ago, excluding the ERC benefit. Adjusted operating margin in Industrial increased 90 basis points to 13.4% driven by simplification initiatives. Commercial Aircraft adjusted operating margin declined 20 basis points to 11.8%, driven by pressures arising from OEM customers' production delays, partially offset by stronger aftermarket activity. Military Aircraft adjusted operating margin decreased 140 basis points as the prior year's benefits of the mature product line sale and the ERC were partially offset by stronger operational performance in the current quarter. Space and Defense adjusted operating margin decreased 330 basis points due to the absence of the prior year's ERC.

Free Cash Flow Results

Free cash flow in the second quarter was $2 million. This result reflects strong earnings, halted growth in physical inventories and secured customer advances, partially offset by the timing of collections.

2025 Financial Guidance

"Our underlying business is strong, and we are reiterating our guidance on sales, adjusted operating margin and adjusted earnings per share," said Jennifer Walter, CFO. "We acknowledge the potential for pressure on our results from tariffs and we are taking appropriate steps to significantly mitigate the impact on our business."

	FY 2025 Guidance
	Current ⁽¹⁾			Previous
Net sales (in billions)	$	3.7		$	3.7
Operating margin		12.7	%		12.9	%
Adjusted operating margin		13.0	%		13.0	%
Diluted net earnings per share⁽²⁾	$	7.89		$	8.06
Adjusted diluted net earnings per share⁽²⁾	$	8.20		$	8.20
Free cash flow conversion		50	%		50 - 75	%
(1) Current guidance excludes potential net tariff risk. (2) Diluted net earnings per share and Adjusted diluted net earnings per share figures are forecasted to be within range of +/- $0.20.

Conference call information

In conjunction with today's release, Pat Roche, CEO, and Jennifer Walter, CFO, will host a conference call today beginning at 10:00 a.m. ET, which will be simultaneously broadcast live online. Listeners can access the call and supplemental financial materials at www.moog.com/investors/communications.

Cautionary Statement

This press release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, which can be identified by words such as: "may," "will," "should," "believes," "expects," "expected," "intends," "plans," "projects," "approximate," "estimates," "predicts," "potential," "outlook," "forecast," "anticipates," "presume," "assume" and other words and terms of similar meaning (including their negative counterparts or other various or comparable terminology). These forward-looking statements are made pursuant to the Private Securities Litigation Reform Act of 1995, are neither historical facts nor guarantees of future performance and are subject to several factors, risks and uncertainties, the impact or occurrence of which could cause actual results to differ materially from the expected results described in the forward-looking statements.

Although it is not possible to create a comprehensive list of all factors that may cause our actual results to differ from the results expressed or implied by our forward-looking statements or that may affect our future results, some of these factors and other risks and uncertainties are described in Item 1A "Risk Factors" of our Annual Report on Form 10-K and in our other periodic filings with the Securities and Exchange Commission ("SEC") and include, but are not limited to, risks relating to: (i) our operation in highly competitive markets with competitors who may have greater resources than we possess; (ii) our operation in cyclical markets that are sensitive to domestic and foreign economic conditions and events; (iii) our heavy dependence on government contracts that may not be fully funded or may be terminated; (iv) supply chain constraints and inflationary impacts on prices for raw materials and components used in our products; (v) failure of our subcontractors or suppliers to perform their contractual obligations; and (vi) our accounting estimations for over-time contracts and any changes we need to make thereto. You should evaluate all forward-looking statements made in this press release in the context of these risks and uncertainties.

While we believe we have identified and discussed in our SEC filings the material risks affecting our business, there may be additional factors, risks and uncertainties not currently known to us or that we currently consider immaterial that may affect the forward-looking statements we make herein. Given these factors, risks and uncertainties, investors should not place undue reliance on forward-looking statements as predictive of future results. Any forward-looking statement speaks only as of the date on which it is made, and we disclaim any obligation to update any forward-looking statement made in this press release, except as required by applicable law.

Moog Inc. CONSOLIDATED STATEMENTS OF EARNINGS (UNAUDITED) (dollars in thousands, except per share data)

	Three Months Ended				Six Months Ended
	March 29, 2025		March 30, 2024		March 29, 2025		March 30, 2024
Net sales	$	934,840	$	930,303	$	1,845,155	$	1,787,153
Cost of sales		676,648		663,350		1,344,688		1,287,001
Inventory write-down		2,149		175		2,149		175
Gross profit		256,043		266,778		498,318		499,977
Research and development		24,481		28,382		48,086		58,961
Selling, general and administrative		133,102		124,961		260,883		243,686
Interest		19,548		18,003		36,550		34,697
Asset impairment		—		6,750		—		6,750
Restructuring		2,425		6,750		6,209		8,639
Other		2,908		3,183		4,432		5,884
Earnings before income taxes		73,579		78,749		142,158		141,360
Income taxes		17,825		18,746		33,291		33,545
Net earnings	$	55,754	$	60,003	$	108,867	$	107,815

Net earnings per share
Basic	$	1.77	$	1.88	$	3.43	$	3.38
Diluted	$	1.75	$	1.86	$	3.38	$	3.34

Weighted average common shares outstanding
Basic		31,558,372		31,967,828		31,764,917		31,934,965
Diluted		31,942,315		32,335,418		32,174,804		32,295,762

Moog Inc. RECONCILIATION TO ADJUSTED NET EARNINGS BEFORE TAXES, INCOMES TAXES, NET EARNINGS AND DILUTED NET EARNINGS PER SHARE (UNAUDITED) (dollars in thousands)

	Three Months Ended						Six Months Ended
	March 29, 2025			March 30, 2024			March 29, 2025			March 30, 2024
As Reported:
Earnings before income taxes	$	73,579		$	78,749		$	142,158		$	141,360
Income taxes		17,825			18,746			33,291			33,545
Effective income tax rate		*24.2*	%		23.8	%		*23.4*	%		23.7	%
Net earnings		55,754			60,003			108,867			107,815
Diluted net earnings per share	$	1.75		$	1.86		$	3.38		$	3.34

Restructuring and Other Charges:
Earnings before income taxes	$	7,343		$	7,590		$	13,399		$	9,479
Income taxes		1,801			1,852			3,313			2,350
Net earnings		5,542			5,738			10,086			7,129
Diluted net earnings per share	$	0.17		$	0.18		$	0.31		$	0.22

Asset Impairment:
Earnings before income taxes	$	—		$	6,750		$	—		$	6,750
Income taxes		—			1,593			—			1,593
Net earnings		—			5,157			—			5,157
Diluted net earnings per share	$	—		$	0.16		$	—		$	0.16

As Adjusted:
Earnings before income taxes	$	80,922		$	93,089		$	155,557		$	157,589
Income taxes		19,626			22,191			36,604			37,488
Effective income tax rate		*24.3*	%		23.8	%		*23.5*	%		23.8	%
Net earnings		61,296			70,898			118,953			120,101
Diluted net earnings per share	$	1.92		$	2.19		$	3.70		$	3.72
The diluted net earnings per share associated with the adjustments in the table above may not reconcile when totaled due to rounding.

Results shown above have been adjusted to exclude impacts associated with restructuring and other charges related to continued portfolio shaping and footprint rationalization activities, as well as asset impairments due to program termination and the devaluation of an investment. While management believes that these adjusted financial measures may be useful in evaluating the financial condition and results of operations of the Company, this information should be considered supplemental and is not a substitute for financial information prepared in accordance with GAAP.

Moog Inc. CONSOLIDATED SALES AND OPERATING PROFIT (UNAUDITED) (dollars in thousands)

	Three Months Ended						Six Months Ended
	March 29, 2025			March 30, 2024			March 29, 2025			March 30, 2024
Net sales:
Space and Defense	$	270,184		$	266,787		$	517,968		$	496,915
Military Aircraft		213,849			202,500			427,269			388,744
Commercial Aircraft		216,381			207,594			437,304			401,816
Industrial		234,426			253,422			462,614			499,678
Net sales	$	934,840		$	930,303		$	1,845,155		$	1,787,153
Operating profit:
Space and Defense	$	32,781		$	42,243		$	61,320		$	67,540
		*12.1*	%		15.8	%		*11.8*	%		13.6	%
Military Aircraft		23,722			16,769			46,638			36,358
		*11.1*	%		8.3	%		*10.9*	%		9.4	%
Commercial Aircraft		25,591			24,845			49,795			45,471
		*11.8*	%		12.0	%		*11.4*	%		11.3	%
Industrial		27,213			28,155			52,711			57,179
		*11.6*	%		11.1	%		*11.4*	%		11.4	%
Total operating profit		109,307			112,012			210,464			206,548
		*11.7*	%		12.0	%		*11.4*	%		11.6	%
Deductions from operating profit:
Interest expense		19,548			18,003			36,550			34,697
Equity-based compensation expense		3,695			3,047			8,020			7,212
Non-service pension expense		1,939			3,191			3,885			6,378
Corporate and other expenses, net		10,546			9,022			19,851			16,901
Earnings before income taxes	$	73,579		$	78,749		$	142,158		$	141,360

Moog Inc. RECONCILIATION TO ADJUSTED OPERATING PROFIT AND MARGINS (UNAUDITED) (dollars in thousands)

	Three Months Ended						Six Months Ended
	March 29, 2025			March 30, 2024			March 29, 2025			March 30, 2024
Space and Defense operating profit - as reported	$	32,781		$	42,243		$	61,320		$	67,540
Asset impairment		—			304			—			304
Restructuring and other		1,138			—			2,068			—
Space and Defense operating profit - as adjusted	$	33,919		$	42,547		$	63,388		$	67,844
		12.6	%		15.9	%		12.2	%		13.7	%

Military Aircraft operating profit - as reported	$	23,722		$	16,769		$	46,638		$	36,358
Asset impairment		—			6,446			—			6,446
Restructuring and other		2,000			3,963			2,591			3,963
Military Aircraft operating profit - as adjusted	$	25,722		$	27,178		$	49,229		$	46,767
		12.0	%		13.4	%		11.5	%		12.0	%

Commercial Aircraft operating profit - as reported and adjusted	$	25,591		$	24,845		$	49,795		$	45,471
		11.8	%		12.0	%		11.4	%		11.3	%

Industrial operating profit - as reported	$	27,213		$	28,155		$	52,711		$	57,179
Restructuring and other		4,205			3,627			8,740			5,516
Industrial operating profit - as adjusted	$	31,418		$	31,782		$	61,451		$	62,695
		13.4	%		12.5	%		13.3	%		12.5	%

Total operating profit - as adjusted	$	116,650		$	126,352		$	223,863		$	222,777
		12.5	%		13.6	%		12.1	%		12.5	%

While management believes that these adjusted financial measures may be useful in evaluating the financial condition and results of operations of the Company, this information should be considered supplemental and is not a substitute for financial information prepared in accordance with GAAP.

Moog Inc. CONSOLIDATED BALANCE SHEETS (UNAUDITED) (dollars in thousands)

	March 29, 2025			September 28, 2024
ASSETS
Current assets
Cash and cash equivalents	$	62,124		$	61,694
Restricted cash		602			123
Receivables, net		537,179			419,971
Unbilled receivables		733,762			709,014
Inventories, net		902,551			863,702
Prepaid expenses and other current assets		95,554			86,245
Total current assets		2,331,772			2,140,749
Property, plant and equipment, net		960,015			929,357
Operating lease right-of-use assets		55,354			52,591
Goodwill		825,415			833,764
Intangible assets, net		57,915			63,479
Deferred income taxes		31,638			20,991
Other assets		57,146			52,695
Total assets	$	4,319,255		$	4,093,626
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities
Accounts payable	$	293,052		$	292,988
Accrued compensation		69,411			101,127
Contract advances and progress billings		306,772			299,732
Accrued liabilities and other		282,180			305,180
Total current liabilities		951,415			999,027
Long-term debt, excluding current installments		1,165,662			874,139
Long-term pension and retirement obligations		172,395			167,161
Deferred income taxes		26,384			27,738
Other long-term liabilities		167,982			164,928
Total liabilities		2,483,838			2,232,993
Shareholders' equity
Common stock - Class A		43,852			43,835
Common stock - Class B		7,428			7,445
Additional paid-in capital		750,119			784,509
Retained earnings		2,759,484			2,668,723
Treasury shares		(1,204,032	)		(1,082,240	)
Stock Employee Compensation Trust		(162,945	)		(194,049	)
Supplemental Retirement Plan Trust		(141,490	)		(163,821	)
Accumulated other comprehensive loss		(216,999	)		(203,769	)
Total shareholders' equity		1,835,417			1,860,633
Total liabilities and shareholders' equity	$	4,319,255		$	4,093,626

Moog Inc. CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED) (dollars in thousands)

	Six Months Ended
	March 29, 2025			March 30, 2024
CASH FLOWS FROM OPERATING ACTIVITIES
Net earnings	$	108,867		$	107,815
Adjustments to reconcile net earnings to net cash provided (used) by operating activities:
Depreciation		45,822			42,276
Amortization		4,629			5,296
Deferred income taxes		(12,252	)		(17,805	)
Equity-based compensation expense		8,020			7,212
Asset impairment		—			6,750
Other		2,997			2,382
Changes in assets and liabilities providing (using) cash:
Receivables		(123,555	)		17,469
Unbilled receivables		(26,967	)		(86,197	)
Inventories		(54,209	)		(77,396	)
Accounts payable		1,975			1,847
Contract advances and progress billings		9,964			24,512
Accrued expenses		(30,966	)		903
Accrued income taxes		(24,986	)		10,833
Net pension and post retirement liabilities		12,986			5,687
Other assets and liabilities		(15,187	)		(35,195	)
Net cash provided (used) by operating activities		(92,862	)		16,389
CASH FLOWS FROM INVESTING ACTIVITIES
Acquisitions of businesses, net of cash acquired		—			(5,911	)
Purchase of property, plant and equipment		(70,382	)		(77,530	)
Net proceeds from businesses sold		13,487			—
Other investing transactions		(2,062	)		(515	)
Net cash provided (used) by investing activities		(58,957	)		(83,956	)
CASH FLOWS FROM FINANCING ACTIVITIES
Proceeds from revolving lines of credit		752,500			509,500
Payments on revolving lines of credit		(462,000	)		(425,000	)
Payments on finance lease obligations		(4,501	)		(2,741	)
Payment of dividends		(18,106	)		(17,572	)
Proceeds from sale of treasury stock		7,825			7,579
Purchase of outstanding shares for treasury		(126,425	)		(20,238	)
Proceeds from sale of stock held by SECT		19,289			15,788
Purchase of stock held by SECT		(14,808	)		(9,407	)
Other financing transactions		(1,457	)		—
Net cash provided (used) by financing activities		152,317			57,909
Effect of exchange rate changes on cash		(2,309	)		245
Increase (decrease) in cash, cash equivalents and restricted cash		(1,811	)		(9,413	)
Cash, cash equivalents and restricted cash at beginning of year ⁽¹⁾		64,537			69,144
Cash, cash equivalents and restricted cash at end of period	$	62,726		$	59,731
(1) Beginning of year cash balance at September 29, 2024, includes cash related to assets held for sale of $2,720.

Moog Inc. RECONCILIATION OF NET CASH PROVIDED (USED) BY OPERATING ACTIVITIES TO FREE CASH FLOW (UNAUDITED) (dollars in thousands)

	Three Months Ended						Six Months Ended
	March 29, 2025			March 30, 2024			March 29, 2025			March 30, 2024
Net cash provided (used) by operating activities	$	39,422		$	(44,002	)	$	(92,862	)	$	16,389
Purchase of property, plant and equipment		(37,604	)		(40,114	)		(70,382	)		(77,530	)
Receivables Purchase Agreement		—			—			—			(25,000	)
Free cash flow	$	1,818		$	(84,116	)	$	(163,244	)	$	(86,141	)
Adjusted net earnings	$	61,296		$	70,898		$	118,953		$	120,101
Free cash flow conversion		3	%		(119	)%		(137	)%		(72	)%

Free cash flow is defined as net cash provided (used) by operating activities, less purchase of property, plant and equipment, less the benefit from the Receivables Purchase Agreement. Free cash flow conversion is defined as free cash flow divided by adjusted net earnings. Free cash flow and free cash flow conversion are not measures determined in accordance with GAAP and may not be comparable with the measures as used by other companies. However, management believes these adjusted financial measures may be useful in evaluating the liquidity, financial condition and results of operations of the Company. This information should be considered supplemental and is not a substitute for financial information prepared in accordance with GAAP.

View source version on businesswire.com: https://www.businesswire.com/news/home/20250425602346/en/

Aaron Astrachan

716.687.4225

Moog Inc. Reports Second Quarter 2025 Results With Record Sales and Strong Operational Performance