Core Insights - The company reported improved margins with an adjusted gross margin of 37.6%, up 50 basis points year over year, driven by synergies, price realization, and volume leverage [1] - Fourth-quarter organic revenue rose 2.9% year over year, with significant growth in the Automation and Motion Control (AMC) segment, which grew over 15% organically [2] - The CEO highlighted solid adjusted EPS growth, strong orders, and a rising backlog, with fourth-quarter orders increasing 53.8% year over year and a book-to-bill ratio of 1.48 [4][5] Financial Performance - Adjusted EBITDA margin was 21.6%, roughly flat year over year, while adjusted EPS for the quarter was $2.51, reflecting a 7.3% increase [1] - For fiscal year 2025, orders grew 15.5% on a daily basis, with adjusted EPS rising to $9.65, up nearly 6% [14] - The company generated $141 million of free cash flow in the quarter and ended with net leverage of 3.1x [7] Segment Performance - The AMC segment saw organic sales grow 15.2% year over year, with adjusted EBITDA margin at 20.5%, down about one point from the prior year [17] - Industrial Powertrain Solutions (IPS) reported organic sales growth of 3.7% year over year, with adjusted EBITDA margin at 25.7% [17] - Power Efficiency Solutions (PES) experienced a decline in organic sales by 10.7% year over year, primarily due to weaker residential HVAC performance [17] Order Activity and Backlog - The company highlighted $735 million in fourth-quarter orders for its E-Pod data-center power solution, contributing to a backlog that is approximately 50% higher year over year [5][7] - Daily order growth surged 53.8% in Q4, with a current pipeline of about $600 million for the broader data center business [6][13] - Management expects E-Pod projects to carry adjusted EBITDA margins in the 20%+ range, with shipments anticipated to begin in early 2027 [10][12] Guidance and Future Outlook - For 2026, management guided to roughly 3% sales growth, an adjusted EBITDA margin of 22.5%, and adjusted EPS of $10.20–$11.00 [6][17] - The company plans to lower net leverage to approximately 2.7x by year-end 2026, with a focus on debt paydown as a primary capital allocation priority [20] - Management expects to realize $40 million of cost synergies in 2026, treating it as a contingency against potential P&L pressures [16] Strategic Focus - The company is addressing ongoing headwinds from rare earth magnet availability, particularly affecting parts of AMC, with mitigation plans in place [19] - Data centers remain a strategic focus, with management emphasizing the importance of this segment for future growth [13]

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Financial Data and Key Metrics Changes - The company reported a solid fourth quarter performance with adjusted earnings per share (EPS) of $2.51, up 7.3% year-over-year [8] - Fourth quarter sales increased by 2.9% on an organic basis, demonstrating accelerating organic growth [8] - Adjusted EBITDA margin for the fourth quarter was 21.6%, roughly flat compared to the prior year [8][10] - For the full year 2025, adjusted earnings per share was $9.65, up nearly 6% versus the prior year [10] Business Line Data and Key Metrics Changes - The Automation and Motion Control (AMC) segment saw sales up 15.2% year-over-year in the fourth quarter, driven by strong performance in data center, aerospace and defense, and discrete automation [18] - Industrial Powertrain Solutions (IPS) sales increased by 3.7% year-over-year, with notable strength in metals and mining and energy markets [22] - Power Efficiency Solutions (PES) sales decreased by 10.7% year-over-year, primarily due to weaker performance in residential HVAC [23] Market Data and Key Metrics Changes - Orders in the fourth quarter were up 53.8% year-over-year, with a book-to-bill ratio of 1.48 [6] - The backlog exiting 2025 was up 50% compared to the prior year, indicating strong demand [4] - The company experienced a 15.5% increase in orders for the full year 2025, led by AMC [9] Company Strategy and Development Direction - The company is focusing on high-potential secular markets, including data centers, eVTOL, and robotics, with significant investments in new products and solutions [15][16] - The ePOD offering is expected to drive substantial growth, with a defined path to approximately $1 billion in sales over the next two years [14] - The company is actively pursuing a robust pipeline of bids in the data center business, which could translate into orders eligible for shipment within 2026 [26] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the strength of the ISM index but emphasized the need for sustained improvement before adjusting growth assumptions [40][26] - The company is adopting a measured approach to guidance for 2026, reflecting ongoing monitoring of market dynamics [26] - Adjusted EBITDA margin is forecasted to rise by 50 basis points to 22.5% in 2026, supported by expected cost synergies [27] Other Important Information - The company generated $141 million of free cash flow in the fourth quarter and ended the quarter with net debt leverage of 3.1 [9] - The CEO search is progressing, with updates expected in the near future [4][92] Q&A Session Summary Question: Can you discuss the margin profile of the ePOD business? - Management expects adjusted EBITDA margins to be in the 20%+ range for the ePOD orders, with potential for improvement over time [38] Question: What are the underlying demand trends in the industrial businesses? - Management noted mixed signals, with OEMs accelerating while distribution slowed, and emphasized the need for more data before confirming a recovery [40] Question: Can you provide an update on the free cash flow guidance? - The guidance for free cash flow was set at approximately $650 million, reflecting investments in working capital and a more measured approach to setting guidance [56] Question: What is the status of the rare earth magnet supply issue? - Management is on track to mitigate exposure by the end of 2026 through alternative sourcing and expects to recover most of the lost share by the end of the year [66] Question: How is the company positioned in the robotics market? - The company anticipates low double-digit growth in robotics, supported by strong order rates and new product launches [81]

Financial Data and Key Metrics Changes - The company reported a strong fourth quarter performance with adjusted earnings per share (EPS) of $2.51, up 7.3% year-over-year [8] - Fourth quarter orders increased by 53.8% on a daily basis compared to the prior year, with a book-to-bill ratio of 1.48 [6] - For the full year 2025, orders grew 15.5% on a daily basis, with adjusted EPS for the year at $9.65, up nearly 6% year-over-year [9][10] Business Line Data and Key Metrics Changes - The Automation and Motion Control (AMC) segment saw sales up 15.2% year-over-year in Q4, driven by strong demand in data centers, aerospace and defense, and discrete automation [18] - Industrial Powertrain Solutions (IPS) sales increased by 3.7% year-over-year in Q4, with particular strength in metals and mining and energy markets [22] - Power Efficiency Solutions (PES) sales decreased by 10.7% year-over-year in Q4, primarily due to weaker performance in residential HVAC [23] Market Data and Key Metrics Changes - The company experienced a backlog increase of 50% exiting 2025, indicating strong future demand [4] - The residential HVAC market saw a significant decline, with central air conditioners down about 26% year-to-date through November, while Regal was only down about 7% [24] - The company noted that January orders for AMC were up 3.9% on a daily basis, indicating positive momentum [21] Company Strategy and Development Direction - The company is focusing on high-potential secular markets, including data centers, eVTOL, and robotics, with significant investments in new products and solutions [15][16] - The E-Pod offering is expected to drive substantial growth, with a defined path to approximately $1 billion in sales over the next two years [14] - The company is actively pursuing a robust pipeline of bids in the data center business, which could translate into orders eligible for shipment within 2026 [26] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the strength of the ISM index but emphasized the need for sustained improvement before adjusting growth assumptions [40][26] - The company is adopting a measured approach to guidance for 2026, reflecting ongoing uncertainties in global industrial markets and geopolitical environments [32] - Adjusted EBITDA margin is forecasted to rise by 50 basis points to 22.5% in 2026, supported by growth initiatives and cost synergies [27] Other Important Information - The company generated $141 million of free cash flow in Q4 and ended the quarter with net debt leverage of 3.1 [9] - The CEO search is progressing, with updates expected in the near future [4][90] Q&A Session Summary Question: Can you discuss the margin profile of the E-Pod business? - Management expects adjusted EBITDA margins to be in the 20%+ range for the E-Pod orders, starting at around 20% and improving over time [38] Question: What are the underlying demand trends in the automation segment? - Orders in automation were up roughly 9% in the quarter, with expectations for double-digit growth in robotics [71] Question: How does the company view the outlook for residential HVAC in 2026? - The company expects residential HVAC to be down high single-digits for 2026, with a tough compare in Q1 but some rebounding in the second half [72]

Financial Data and Key Metrics Changes - The company reported a strong fourth quarter performance with adjusted earnings per share (EPS) of $2.51, up 7.3% year-over-year [7] - Fourth quarter adjusted gross margin was 37.6%, an increase of 50 basis points compared to the previous year [7] - Adjusted EBITDA margin for the fourth quarter was 21.6%, roughly flat year-over-year [7] - For the full year 2025, adjusted earnings per share was $9.65, up nearly 6% from the prior year [9] - Free cash flow generated in the fourth quarter was $141 million, with net debt leverage decreasing to 3.1 [8] Business Line Data and Key Metrics Changes - Orders in the fourth quarter increased by 53.8% year-over-year, with a book-to-bill ratio of 1.48 [5] - The Automation and Motion Control (AMC) segment saw sales up 15.2% year-over-year, driven by data center, aerospace and defense, and discrete automation [18] - Industrial Powertrain Solutions (IPS) sales increased by 3.7% year-over-year, with strong performance in metals and mining and energy markets [21] - Power Efficiency Solutions (PES) sales decreased by 10.7% year-over-year, primarily due to challenges in the residential HVAC market [23] Market Data and Key Metrics Changes - The company experienced a 15.5% increase in orders for the full year 2025, with AMC leading at 53% growth [8] - The aerospace and defense, discrete automation, and energy markets showed strength, while the residential HVAC market faced significant headwinds [9][24] - The ISM index showed improvement in January, indicating potential for stronger growth in 2026 [26] Company Strategy and Development Direction - The company is focusing on growth initiatives in high-potential secular markets, including data centers, eVTOL, and robotics [16] - The ePOD offering is expected to drive significant revenue growth, with a defined path to approximately $1 billion in sales over the next two years [13] - The company is investing in capacity expansion to support the growing demand in the data center market [37] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the order momentum and backlog, indicating positive momentum entering 2026 [8] - The company is adopting a measured approach to guidance, monitoring market developments closely before making adjustments [26] - Management highlighted the importance of sustaining ISM improvements for a more constructive outlook on market growth [26] Other Important Information - The CEO search is progressing, with updates expected soon [4] - The company is actively pursuing a robust pipeline of bids in the data center business, which could translate into orders for 2026 [26] Q&A Session Summary Question: Can you discuss the margin profile of the ePOD business? - Management expects adjusted EBITDA margins for ePOD projects to be in the 20%+ range, with potential for improvement over time as productivity increases [37][39] Question: What are the underlying demand trends in automation? - Orders in automation were up 9% in the quarter, with strong growth expected in robotics and new product launches [74] Question: How does the company view the residential HVAC market outlook? - The company anticipates high single-digit declines in residential HVAC for 2026, with expectations for a rebound in the second half of the year [75] Question: What is the status of the rare earth magnet supply issue? - Management is on track to mitigate exposure by the end of 2026 through alternative sourcing and other strategies [66] Question: What are the capital allocation priorities for 2026? - The company plans to prioritize debt paydown while also investing in growth initiatives, particularly in the data center business [83]

Louis Pinkham, Chief Executive Officer Industrial Rob Rehard, Executive Vice President, Chief Financial Officer Motion Control Solutions Systems 4Q 2025 FORWARD LOOKING STATEMENTS AND NON-GAAP FINANCIAL MEASURES All statements in this communication, other than those relating to historical facts, are "forward-looking statements." Forward-looking statements can generally be identified by their use of terms such as "anticipate," "believe," "confident," "estimate," "expect," "intend," "plan," "may," "will," "pr ...

FOR RELEASE ON: February 4, 2026 CONTACT: Robert Barry VP - Investor Relations 608-361-7530 robert.barry@regalrexnord.com REGAL REXNORD REPORTS STRONG FOURTH QUARTER 2025 FINANCIAL RESULTS, INCLUDING ORGANIC GROWTH ACCELERATION AND DATA CENTER ORDERS WORTH ~$735M MILWAUKEE, WI - Regal Rexnord Corporation (NYSE: RRX) 4Q Highlights Full Year 2025 Highlights Full Year 2026 Guidance • Introducing Guidance For 2026 GAAP Diluted Earnings Per Share In A Range Of $5.29 To $6.09 And For Adjusted Diluted Earnings Per ...

Group 1 - Regal Rexnord reported revenue of $1.52 billion for the quarter ended December 2025, reflecting a 4.3% increase year-over-year [1] - The company's EPS for the quarter was $2.51, up from $2.34 in the same quarter last year, with an EPS surprise of +1.7% compared to the consensus estimate of $2.47 [1] - The reported revenue was slightly below the Zacks Consensus Estimate of $1.54 billion, resulting in a surprise of -1.12% [1] Group 2 - Regal Rexnord's shares have returned +8.6% over the past month, outperforming the Zacks S&P 500 composite's +0.9% change [3] - The stock currently holds a Zacks Rank 4 (Sell), indicating potential underperformance relative to the broader market in the near term [3] Group 3 - Revenue from Automation & Motion Control (AMC) was $480.4 million, exceeding the average estimate of $458.75 million by four analysts, representing a year-over-year increase of +17.2% [4] - Revenue from Industrial Powertrain Solutions (IPS) was $669.3 million, slightly below the average estimate of $671.55 million, with a year-over-year change of +5.4% [4] - Revenue from Power Efficiency Solutions (PES) was $373.5 million, falling short of the average estimate of $410.23 million, reflecting a year-over-year decline of -10.3% [4] Group 4 - Adjusted EBITDA for Automation & Motion Control (AMC) was $98.6 million, surpassing the average estimate of $96.51 million [4] - Adjusted EBITDA for Power Efficiency Solutions (PES) was $58.2 million, below the average estimate of $60.65 million [4] - Adjusted EBITDA for Industrial Powertrain Solutions (IPS) was $171.7 million, slightly below the average estimate of $173.99 million [4]

Company Performance - Regal Rexnord reported quarterly earnings of $2.51 per share, exceeding the Zacks Consensus Estimate of $2.47 per share, and showing an increase from $2.34 per share a year ago, representing an earnings surprise of +1.70% [1] - The company posted revenues of $1.52 billion for the quarter ended December 2025, which was below the Zacks Consensus Estimate by 1.12%, but an increase from $1.46 billion year-over-year [2] - Regal Rexnord has surpassed consensus EPS estimates three times over the last four quarters and has also topped consensus revenue estimates three times during the same period [2] Stock Performance - Regal Rexnord shares have increased approximately 22% since the beginning of the year, significantly outperforming the S&P 500's gain of 1.1% [3] - The current consensus EPS estimate for the upcoming quarter is $2.30 on revenues of $1.46 billion, and for the current fiscal year, it is $10.78 on revenues of $6.15 billion [7] Industry Outlook - The Manufacturing - General Industrial industry, to which Regal Rexnord belongs, is currently ranked in the top 30% of over 250 Zacks industries, indicating a favorable outlook [8] - Empirical research suggests a strong correlation between near-term stock movements and trends in earnings estimate revisions, which can impact Regal Rexnord's stock performance [5]

MILWAUKEE, Feb. 4, 2026 /PRNewswire/ -- Regal Rexnord Corporation (NYSE: RRX) 4Q Highlights Daily Orders Up 53.8% Versus PY, On Substantial Wins In Data Center Traction With Data Center E-Pod Solution, Which Embeds Our Proven Switchgear Technology, Winning Orders Worth ~$735 Million. Initial E- Pod Shipments Expected To Start In Early 2027 Sales Of $1,523.2 Million, Up 4.3% Versus PY, Up 2.9% On An Organic* Basis Gross Margin of 37.5%; Adjusted Gross Margin* Of 37.6%, Up 50 Basis Points Versus PY GAAP Net ...