Financial Performance - Net sales for the thirteen-week period ended December 27, 2025, were $2,285 million, a 13.9% increase from $2,006 million in the same period last year[10] - Gross profit increased to $1,352 million, up 9.5% from $1,235 million year-over-year[10] - Net income attributable to TD Group was $445 million, a decrease of 9.8% compared to $493 million in the prior year[10] - Earnings per share attributable to TD Group common stockholders decreased to $6.62 from $7.62, reflecting a 13.1% decline[10] - Total segment EBITDA for the same period was $1,221 million, compared to $1,113 million in the prior year, reflecting an increase of about 9.7%[78] - Income from continuing operations before income taxes for the thirteen-week period was $572 million, down from $619 million year-over-year, a decrease of approximately 7.6%[10] Cash Flow and Investments - Net cash provided by operating activities was $832 million, an increase of 10.7% from $752 million in the same period last year[14] - The company reported a net cash used in investing activities of $973 million, significantly higher than $24 million in the prior year, primarily due to acquisitions[14] - Capital expenditures for the period were $60 million, compared to $42 million in the prior year, reflecting ongoing investment in growth[14] - The company recognized stock-based compensation expense of $28 million for the thirteen-week period ended December 27, 2025, compared to $35 million in the prior year, a decrease of 20%[14] Acquisitions - The Company entered into a definitive agreement to acquire Jet Parts Engineering and Victor Sierra Aviation Holdings for approximately $2.2 billion in cash, expected to be financed using existing cash and additional debt capacity[22] - The acquisition of Stellant Systems, Inc. was agreed upon for approximately $960 million in cash, also to be financed through existing cash and additional debt capacity[26] - The Company completed the acquisition of Simmonds Precision Products, Inc. for approximately $757 million in cash, financed through existing cash on hand[29] - For the thirteen-week period ended December 27, 2025, the Company completed several acquisitions for a total aggregate purchase price of $151 million in cash, financed through existing cash on hand[33] Assets and Liabilities - As of December 27, 2025, total assets were $23,757 million, an increase from $22,909 million as of September 30, 2025, representing a growth of approximately 3.7%[79] - The company’s total debt as of December 27, 2025, was $29,322 million, with a current portion of $125 million[56] - Total inventories increased to $2,373 million from $2,095 million as of September 30, 2025, with raw materials and purchased component parts at $1,458 million[53] - Goodwill increased to $11,075 million as of December 27, 2025, from $10,612 million at the end of the previous quarter, with $449 million in goodwill acquired during the period[54] Tax and Regulatory Matters - The effective income tax rate for the thirteen-week period ended December 27, 2025, was 22.2%, up from 20.4% in the same period last year, primarily due to a less significant benefit associated with share-based payments[58] - The company reported unrecognized tax benefits as not material as of December 27, 2025[60] - The company is currently under examination for its federal income taxes in Canada, France, and Germany for various fiscal years[59] Risk Management - The company has entered into interest rate collar agreements with a notional amount of $2,750 million to manage interest rate risk, establishing a floor and ceiling for the three-month Term SOFR rate[69] - The company’s risk management program utilizes derivative financial instruments to hedge against foreign currency and interest rate risks, without entering into transactions for trading purposes[66] - The company has outstanding foreign currency forward exchange contracts to sell U.S. dollars with notional amounts of $89 million, with a maximum duration of nine months[73] Stock Repurchase - The company repurchased 85,212 shares of common stock at an average price of $1,249.73 per share, totaling $106 million, with $5,681 million remaining available for repurchase under the existing stock repurchase program[52][51] - The company has authorized an additional $5.0 billion in share repurchases under its existing stock repurchase program, which has no expiration date[51] Segment Reporting - The Company adopted ASU 2023-07 for segment reporting, which expands disclosures about reportable segments and is effective for annual periods beginning after December 15, 2023[19] - The company’s segments are organized into Power & Control, Airframe, and Non-aviation, with performance evaluated using EBITDA As Defined[74]

Core Insights - TransDigm Group Incorporated (TDG) reported first-quarter fiscal 2026 adjusted earnings of $8.23 per share, exceeding the Zacks Consensus Estimate of $8.02 by 2.6% and improving 5% from the prior-year quarter's figure of $7.83 [1][8] - The company also reported GAAP earnings of $6.62 per share, down from $7.62 in the year-ago quarter [1] Sales Performance - Sales for the quarter amounted to $2.29 billion, reflecting a 14% increase from $2.01 billion in the prior-year period and surpassing the Zacks Consensus Estimate of $2.25 billion by 1.4% [2][8] - Organic sales grew by 7.4% as a percentage of net sales [2] Operating Results - Gross profit was reported at $1.35 billion, up 9.3% from the year-ago quarter's level of $1.24 billion [3] - Interest expenses increased by 25.7% year over year to $475 million [3] - Net income declined by 9.7% year over year to $445 million [3] - During the 13-week period ended on Dec. 27, 2025, TransDigm repurchased nearly 85 thousand shares at an average price of $1,250 per share, totaling nearly $0.1 billion [3] Financial Position - Cash and cash equivalents as of Dec. 27, 2025, amounted to $2.53 billion, down from $2.81 billion as of Sept. 30, 2025 [4] - Long-term debt increased to $29.2 billion from $29.17 billion as of Sept. 30, 2025 [4] - Cash from operating activities was $832 million compared to $752 million in the year-ago period [4] Guidance for Fiscal 2026 - TransDigm expects net sales to be in the range of $9.845-$10.035 billion, an increase from the previous guidance of $9.75-$9.95 billion, with the Zacks Consensus Estimate at $9.96 billion [5] - The company anticipates adjusted earnings for fiscal 2026 to be in the band of $37.42-$39.34 per share, up from the previous guidance of $36.49-$38.53 per share, with the Zacks Consensus Estimate at $38.67 per share [6]

Financial Data and Key Metrics Changes - The company reported a strong start to fiscal Q1 2026, with revenue guidance raised by $90 million and EBITDA guidance increased by $60 million, reflecting solid performance [8][17] - EBITDA margin for the quarter was 52.4%, slightly better than expected, with strong operating cash flow generation of over $830 million [10][11] - The company ended the quarter with a cash balance of over $2.5 billion and a net debt to EBITDA ratio of 5.7 times, down from 5.8 times [33][34] Business Line Data and Key Metrics Changes - Total commercial OEM revenue increased approximately 17% year-over-year, driven by higher build rates from Boeing and Airbus [22][23] - Commercial aftermarket revenue grew by approximately 7%, with all submarkets experiencing positive growth, particularly in commercial transport [25][26] - Defense market revenue grew by approximately 7%, supported by new business wins and increased defense spending globally [26][27] Market Data and Key Metrics Changes - Commercial OEM bookings were up significantly, indicating a recovery from previous disruptions, with growth in the high teens percentage [23][24] - The commercial aftermarket is expected to grow in the high single-digit percentage range, supported by strong bookings and positive indicators [25][26] - Defense bookings were robust, significantly surpassing sales for the period, indicating a strong backlog in the defense segment [27] Company Strategy and Development Direction - The company maintains a consistent long-term strategy focused on proprietary aerospace businesses with significant aftermarket content, aiming for private equity-like returns [7][8] - Recent acquisitions, including Stellant Systems, Jet Parts Engineering, and Victor Sierra Aviation, align with the company's strategy to enhance its aftermarket revenue and strengthen partnerships with airlines [12][14] - The capital allocation priorities remain focused on reinvesting in businesses, disciplined M&A, and returning capital to shareholders [15][16] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the fiscal year, noting that underlying market fundamentals have not changed significantly, and they are encouraged by the current trends in commercial aerospace [17][18] - The company anticipates continued growth in commercial OEM and aftermarket segments, with guidance reflecting a conservative approach due to potential risks in production rates [18][19] - Management remains focused on operational excellence and value drivers, with a commitment to closely monitor market developments [19][20] Other Important Information - The company has signed agreements for three new acquisitions, with a total expected revenue contribution of approximately $580 million for the 2025 calendar year [11][12] - The company has significant M&A firepower remaining, approaching $10 billion, providing flexibility for future opportunities [16] Q&A Session Summary Question: Profitability in the quarter - Management noted that the EBITDA margin of 52.4% was better than expected, driven by strong growth in commercial OEM and effective cost management [40] Question: Distributor POS and aftermarket growth - Management confirmed that distributor POS growth has been strong, but there has been some headwind from inventory changes, which should turn into a tailwind as the year progresses [44][46] Question: Aftermarket bookings growth - Management indicated that aftermarket bookings grew faster than revenue, but specific numbers were not disclosed, emphasizing a rolling 12-month average for bookings [60][62] Question: Acquisitions and market trends - Management acknowledged that acquisition prices reflect current market trends but believe they paid fair prices that align with their targeted IRR [81][82] Question: Material share loss from PMAs - Management stated that there has been no material share loss from PMAs, and operational teams are effectively meeting customer demand [86] Question: Margin structure of acquired businesses - Management indicated that while the acquired businesses have growth potential, they do not expect their margins to reach the company's average levels [99]

Financial Data and Key Metrics Changes - The company reported a Q1 EBITDA margin of 52.4%, which includes about two full percentage points of dilution from recent acquisitions [10][19] - Operating cash flow generation in Q1 exceeded $830 million, with a cash balance of over $2.5 billion at the end of the quarter [11][32] - The midpoint of fiscal 2026 revenue guidance is now $9.94 billion, reflecting a 13% increase over the prior year, while EBITDA guidance was raised to $5.21 billion, up approximately 9% [17][18] Business Line Data and Key Metrics Changes - Commercial OEM revenue increased approximately 17% in Q1 compared to the prior year, driven by higher build rates from Boeing and Airbus [21][22] - Commercial aftermarket revenue grew by approximately 7%, with all submarkets experiencing positive growth [25] - Defense market revenue grew by approximately 7%, supported by new business wins and strong performance in both domestic and international markets [26] Market Data and Key Metrics Changes - Bookings in the commercial OEM channel were up significantly, indicating a recovery from previous disruptions [23] - The commercial aftermarket growth is lagging behind the broader market by approximately 5-6 percentage points, attributed to underexposure in engine content and distribution channel lumpiness [9] - Defense bookings were robust, surpassing sales for the period, indicating a strong backlog in the defense market segment [27] Company Strategy and Development Direction - The company focuses on proprietary aerospace businesses with significant aftermarket content, aiming for private equity-like returns with public market liquidity [7] - Recent acquisitions include Stellent Systems, Jet Parts Engineering, and Victor Sierra Aviation, which align with the company's strategy of enhancing aftermarket revenue [12][15] - The capital allocation strategy prioritizes reinvestment in businesses, disciplined M&A, and returning capital to shareholders [15] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the fiscal 2026 outlook, citing strong first-quarter results and favorable market trends in commercial aerospace [17][19] - The guidance assumes no additional acquisitions or divestitures, with a focus on maintaining a conservative approach to projections [40][64] - Management remains vigilant regarding potential risks in the aerospace and capital markets, while being encouraged by operational performance [19][30] Other Important Information - The company ended the quarter with a net debt to EBITDA ratio of 5.7 times, down from 5.8, indicating improved financial health [32][33] - Free cash flow for the quarter was just under $900 million, with a full-year guidance of approximately $2.4 billion [31][32] - The company continues to actively seek small to mid-size acquisition opportunities that fit its business model [14][101] Q&A Session Summary Question: How is the company thinking about profitability through the year? - Management noted a stronger start to the year on margins than expected, with a 52.4% EBITDA margin driven by a favorable mix and cost management efforts [39] Question: Can you comment on distributor POS and aftermarket growth? - Management confirmed that distributor POS growth has been strong, but some headwinds from inventory changes have affected overall aftermarket growth [44][66] Question: What is the expected growth for the aftermarket segment? - Management indicated that the aftermarket growth is expected to be in the high single-digit percentage range, with positive indicators in bookings and distribution sales [26][64] Question: What are the implications of the recent acquisitions? - The acquisitions of Jet Parts Engineering and Victor Sierra are expected to enhance aftermarket growth, but the primary rationale was their strong business fundamentals [73][81] Question: How does the company view the current M&A environment? - Management acknowledged that while valuations are high, they believe the prices paid for recent acquisitions are fair and aligned with their target IRR [81][82]

Financial Data and Key Metrics Changes - The company reported a strong start to fiscal Q1 2026, with revenue guidance raised by $90 million and EBITDA guidance increased by $60 million, reflecting solid performance [14][15] - EBITDA margin for the quarter was 52.4%, slightly diluted by recent acquisitions, but overall margin performance improved compared to expectations [8][17] - Free cash flow for the quarter was just under $900 million, higher than average due to timing of interest and tax payments, with a full-year guidance of approximately $2.4 billion [30][31] Business Line Data and Key Metrics Changes - Commercial OEM revenue increased approximately 17% year-over-year, driven by higher build rates from Boeing and Airbus [19][20] - Commercial aftermarket revenue grew by approximately 7%, with all submarkets experiencing positive growth, particularly in commercial transport [23] - Defense market revenue grew by approximately 7%, supported by new business wins and increased defense spending globally [25] Market Data and Key Metrics Changes - The commercial OEM market is expected to see revenue growth in the high single digits to mid-teens percentage range, contingent on production rates from Boeing and Airbus [16][22] - Commercial aftermarket growth is anticipated to be in the high single-digit percentage range, with strong bookings supporting this outlook [24] - Defense revenue growth is projected in the mid-single-digit to high single-digit percentage range, with robust bookings indicating a healthy backlog [25] Company Strategy and Development Direction - The company maintains a consistent long-term strategy focused on proprietary aerospace businesses with significant aftermarket content, aiming for private equity-like returns [5][6] - Recent acquisitions, including Stellent Systems, Jet Parts Engineering, and Victor Sierra Aviation, align with the company's strategy to enhance its aftermarket revenue and strengthen partnerships with airlines [10][11] - The capital allocation priorities remain focused on reinvesting in businesses, pursuing disciplined M&A, and returning capital to shareholders [12][13] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the current fiscal year, noting favorable commercial aerospace trends and stable airline schedules [6][15] - The company is closely monitoring the aerospace and capital markets, with a focus on operational excellence and value drivers [17][28] - Despite potential risks, management believes the company is well-positioned for the remainder of fiscal 2026 [17] Other Important Information - The company ended the quarter with a cash balance of over $2.5 billion, providing significant liquidity for future capital requirements [31][33] - The net debt to EBITDA ratio improved to 5.7 times, down from 5.8, indicating a stronger financial position [31][32] Q&A Session Summary Question: How is the company thinking about profitability cadence through the year? - Management noted a stronger than expected margin performance in Q1, attributing it to a favorable mix and cost management efforts, with a conservative outlook for the remainder of the year [37][39] Question: Can you comment on distributor POS and aftermarket growth? - Management confirmed that distributor POS growth has been strong, but noted that inventory changes have created some headwinds, which are expected to turn into tailwinds as the year progresses [42][44] Question: What is the expected impact of the Jet Parts Engineering and Victor Sierra acquisitions? - Management emphasized that the acquisitions were made based on their strong business fundamentals and potential for a 20% IRR, rather than as a defensive strategy against competitors [73][74] Question: How does the company view the current M&A environment? - Management acknowledged that while acquisition prices are reflective of broader market trends, they believe the prices paid for recent acquisitions are fair and aligned with their return targets [80][81] Question: What is the outlook for the commercial OEM segment? - Management indicated that they believe they are through the destocking phase and are encouraged by the production rates from Boeing and Airbus, although risks remain in the supply chain [106][107]

FY 2026 Q1 Earnings Call February 3, 2026 1 Agenda TransDigm Overview, Highlights and Outlook Mike Lisman Market Review Patrick Murphy Operating Performance and Financial Results Sarah Wynne CFO Q&A CEO Co-COO Forward Looking Statements & Special Notice Regarding Pro Forma and Non-GAAP Information FORWARD LOOKING STATEMENTS This presentation contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, including information regarding our guidance for future ...

分组1 - TransDigm Group reported quarterly earnings of $8.23 per share, exceeding the Zacks Consensus Estimate of $8.02 per share, and showing an increase from $7.83 per share a year ago, representing an earnings surprise of +2.56% [1] - The company achieved revenues of $2.29 billion for the quarter ended December 2025, surpassing the Zacks Consensus Estimate by 1.36%, and up from $2.01 billion in the same quarter last year [2] - TransDigm has outperformed the S&P 500, with shares increasing about 8% since the beginning of the year compared to the S&P 500's gain of 1.9% [3] 分组2 - The current consensus EPS estimate for the upcoming quarter is $9.27 on revenues of $2.41 billion, and for the current fiscal year, it is $38.67 on revenues of $9.96 billion [7] - The Aerospace - Defense Equipment industry, to which TransDigm belongs, is currently ranked in the top 26% of over 250 Zacks industries, indicating a favorable outlook for the sector [8]

Financial Performance - Net sales for Q1 2026 increased by 13.9% to $2,285 million from $2,006 million in Q1 2025, with organic sales growth at 7.4%[3] - Net income for the quarter was $445 million, a decrease of 9.7% compared to $493 million in the prior year, primarily due to higher interest expenses[4] - Adjusted net income rose by 5.0% to $479 million, or $8.23 per share, compared to $456 million, or $7.83 per share, in the same quarter last year[6] - EBITDA for the quarter increased by 5.5% to $1,147 million, while EBITDA As Defined rose by 12.8% to $1,197 million, with a margin of 52.4%[7] - Gross profit for the same period was $1,352 million, up from $1,235 million, reflecting a gross margin of 59.2%[30] - EBITDA for the thirteen-week period was $1,147 million, compared to $1,087 million in the prior year, with an EBITDA As Defined margin of 52.4%[33][39] - Net income attributable to TD Group for the period was $445 million, down from $493 million, resulting in earnings per share of $6.62, compared to $7.62 in the previous year[30][34] - Adjusted diluted earnings per share for the thirteen-week period were $8.23, compared to $7.83 in the same period last year[34] Future Guidance - Fiscal 2026 financial guidance was raised, anticipating net sales between $9,845 million and $10,035 million, a 12.6% increase at the midpoint compared to $8,831 million in fiscal 2025[18] - Expected net income for fiscal 2026 is projected to be between $1,952 million and $2,064 million, reflecting a decrease of 3.2% at the midpoint compared to fiscal 2025[18] - Earnings per share for fiscal 2026 are expected to range from $32.47 to $34.39, an increase of 4.2% at the midpoint compared to $32.08 in fiscal 2025[18] - EBITDA As Defined for fiscal 2026 is anticipated to be between $5,140 million and $5,280 million, a 9.5% increase at the midpoint compared to $4,760 million in fiscal 2025[18] - The company provided guidance for fiscal year 2026, projecting net sales between $9,845 million and $10,035 million, and adjusted earnings per share between $37.42 and $39.34[41] - The current fiscal year 2026 guidance reflects an increase in net income expectations by $42 million compared to prior guidance, with a midpoint of $1,952 million to $2,064 million[41] Acquisitions and Capital Allocation - The company announced two acquisitions expected to cost approximately $3.2 billion, targeting businesses with proprietary products that generate significant aftermarket revenue[10] - The company remains focused on capital allocation and has significant liquidity to address capital requirements for future growth[10] Cash and Debt Management - Cash and cash equivalents as of December 27, 2025, were $2,528 million, a decrease from $2,808 million at the end of September 2025[37] - Long-term debt stood at $29,197 million, slightly up from $29,167 million in the previous quarter[37] - The company reported net cash provided by operating activities of $832 million for the thirteen-week period, an increase from $752 million in the prior year[35]

CLEVELAND, Feb. 3, 2026 /PRNewswire/ -- TransDigm Group Incorporated (NYSE: TDG), a leading global designer, producer and supplier of highly engineered aircraft components, today reported results for the first quarter ended December 27, 2025. First quarter highlights include: Quarter-to-Date Results Net sales for the quarter increased 13.9%, or $279 million, to $2,285 million from $2,006 million in the comparable quarter a year ago. Organic sales growth as a percentage of net sales was 7.4%. Net income for ...

Core Viewpoint - Transdigm Group (TDG) is expected to report its first-quarter fiscal 2026 results on February 3, with a prior earnings surprise of 5.6% in the last quarter [1] Group 1: Acquisition Impact - In October 2025, Transdigm completed the acquisition of Simmonds Precision Products, Inc. for nearly $765 million, enhancing its portfolio of proprietary aerospace components and increasing recurring aftermarket revenues [2] - This acquisition is anticipated to improve earnings visibility and cash-flow stability throughout the aircraft lifecycle, positively impacting fiscal first-quarter revenues [2] Group 2: Market Demand and Sales Growth - Strong sales from the commercial aftermarket, driven by improving air travel demand and higher aircraft utilization, are likely to have positively influenced revenues in the upcoming quarter [3] - Increased U.S. government defense spending is expected to further boost defense sales, contributing to the company's top line [3] Group 3: Profitability and Earnings Expectations - Robust revenue growth is likely to support margin expansion, with ongoing efficiency and cost-control efforts enhancing profitability and positively impacting quarterly earnings [4] - The Zacks Consensus Estimate for earnings is $8.02 per share, reflecting a year-over-year increase of 2.4%, while revenues are estimated at $2.25 billion, indicating a 12.4% year-over-year improvement [5] Group 4: Earnings Prediction Model - The earnings prediction model indicates a likely earnings beat for Transdigm, supported by a positive Earnings ESP of +4.12% and a Zacks Rank of 3 (Hold) [6][7]