ATI Inc.: Q1 FY2026 earnings call

What management said about Q1 FY2026, from the documents filed with the SEC on 30 April 2026: press release. Guidance figures: 3 raised, 3 new. The quarter’s numbers.

Read the filing

Key takeaways

• Sales up 1% year-over-year: Sales were $1.15 billion, up 1% year-over-year, with aerospace & defense up 6%; sales were down 2% from the fourth quarter. Source
• Adjusted EPS and EBITDA margin up: Adjusted EPS was $1.00 against $0.72; adjusted EBITDA was $231.7 million, or 20.1% of sales, against 17.0% a year earlier. Source
• HPMC margin rose to 24.9%: HPMC segment EBITDA was $152.9 million, at 24.9% of sales against 22.4%, on higher volume, sales mix and pricing. Source
• Contract positions cited for environment: Management cited long-term contractual positions and its role across aerospace and defense as reasons it is positioned to navigate the environment. Source
• Special items excluded from adjusted results: Pre-tax special items of $26.4 million, or $21.0 million after tax ($0.15 per share), were excluded from adjusted results. Source
• Operating cash flow up $221 million: Operating cash flow was $128.2 million, against negative $92.5 million a year earlier; capital expenditures were $55.2 million. Source
• Managed working capital rose: Managed working capital was 34.8% of annualized sales, up 230 basis points from the fourth quarter; inventories rose to $1,580.3 million. Source
• Share repurchases of $75 million: The company repurchased $75.0 million of stock at an average $157.84, retiring about 0.5 million shares; $545 million of authorization remained at quarter end. Source

“Our laser focus on operational discipline is delivering.”

Kimberly A. Fields, President and CEO

Guidance

What changed from last quarter

• Guidance raised: Full-year 2026 adjusted earnings and free cash flow guidance raised, and the adjusted EBITDA range moved up. Source
• New guidance: Second-quarter 2026 guidance provided for adjusted EBITDA and adjusted EPS; the prior release gave only first-quarter guidance. Source

Results and earnings growth

• Sales up 1% year-over-year: Sales were $1.15 billion, up 1% year-over-year, with aerospace & defense up 6%; sales were down 2% from the fourth quarter. Source
• Diluted EPS and net income rose: Diluted EPS was $0.85 against $0.67; net income attributable to ATI was $118 million, up 22% year-over-year. Source
• Adjusted EPS and EBITDA margin up: Adjusted EPS was $1.00 against $0.72; adjusted EBITDA was $231.7 million, or 20.1% of sales, against 17.0% a year earlier. Source

Segment results

• HPMC margin rose to 24.9%: HPMC segment EBITDA was $152.9 million, at 24.9% of sales against 22.4%, on higher volume, sales mix and pricing. Source
• HPMC sales up 5% year-over-year: HPMC sales were $614.3 million, up 5% from a year earlier and down 5% from the fourth quarter; commercial jet engine sales rose 8%. Source
• AA&S margin up year-over-year: AA&S segment EBITDA was $97.0 million, or 18.1% of sales, against 14.9% a year earlier, on sales mix and exotic alloy pricing. Source
• AA&S sales fell on conventional energy: AA&S sales were $537.2 million, down 4% year-over-year on lower conventional energy sales, partly offset by aerospace & defense up 6%. Source

“improved first quarter operating cash flow by more than $220 million - our best quarterly performance in fifteen years.”

Kimberly A. Fields, President and CEO

Products and end markets

• Commercial jet engines lead revenue: Commercial jet engine revenue was $472.0 million, 41% of sales, up from $421.4 million a year earlier and $460.1 million in the fourth quarter. Source
• Commercial airframe revenue declined: Commercial airframe revenue was $186.6 million, down from $205.8 million a year earlier; defense revenue rose to $139.0 million from $127.2 million. Source
• Conventional energy revenue fell: Conventional energy revenue was $84.2 million, down from $121.8 million a year earlier and up from $56.9 million in the fourth quarter. Source

Demand and aerospace exposure

• Contract positions cited for environment: Management cited long-term contractual positions and its role across aerospace and defense as reasons it is positioned to navigate the environment. Source
• Aerospace & defense share of HPMC: Aerospace & defense was 93% of HPMC sales, up from 91% in the fourth quarter of 2025. Source
• Electronics and specialty energy lower: Lower electronics and specialty energy sales partly offset sequential AA&S gains from aerospace & defense and conventional energy demand. Source

Costs, margins and tax

• Gross profit margin widened: Gross profit was $262.9 million, about 22.8% of sales, against $235.8 million, about 20.6%, a year earlier. Source
• Corporate expense down on incentives: Corporate expense was $17.0 million, down from $19.4 million in the fourth quarter, on lower incentive compensation costs. Source
• Effective tax rate fell to 11.8%: The effective tax rate was 11.8%, against 18.2% in the fourth quarter and 17.3% a year earlier, on the timing and amount of discrete tax benefits. Source
• Special items excluded from adjusted results: Pre-tax special items of $26.4 million, or $21.0 million after tax ($0.15 per share), were excluded from adjusted results. Source

Cash, working capital and shareholder returns

• Operating cash flow up $221 million: Operating cash flow was $128.2 million, against negative $92.5 million a year earlier; capital expenditures were $55.2 million. Source
• Adjusted free cash flow of $74.6 million: Adjusted free cash flow was $74.6 million, against negative $143.1 million a year earlier. Source
• Managed working capital rose: Managed working capital was 34.8% of annualized sales, up 230 basis points from the fourth quarter; inventories rose to $1,580.3 million. Source
• Share repurchases of $75 million: The company repurchased $75.0 million of stock at an average $157.84, retiring about 0.5 million shares; $545 million of authorization remained at quarter end. Source

Strategy, restructuring and efficiency

• Capital allocated between growth and returns: Management said it allocates capital in a disciplined way between growth investment and cash returns to shareholders. Source
• Facility rationalization charges: Restructuring-related severance and impairment costs of $8.1 million were recorded in the quarter, tied to rationalizing certain facilities. Source
• Operating efficiencies cited: Management attributed year-over-year margin and cash flow improvement to sustained operating efficiencies. Source

Figures management reported

Risks management discussed

• External: Management noted macro uncertainties alongside demand and customer production ramps. Source
• Operational: HPMC sales were lower sequentially on planned maintenance outages and seasonality. Source
• Demand: Conventional energy sales fell year-over-year, reducing AA&S revenue. Source

Earlier plans management reported on

• Ahead: Management said first-quarter results exceeded the upper end of the earnings guidance range it had given. Source

Other quarters

• Q2 FY2026 earnings call
• Q4 FY2025 earnings call
• Q3 FY2025 earnings call
• Q2 FY2025 results

Summarised with AI from the documents the company filed with the SEC. Every point is checked against the filing before it is shown: management’s own words word for word, figures against the line or table row they come from. A point that fails the check is left out. Source opens the filing at that line.