The quarter beat both published expectations and Howmet’s own high-end targets. Adjusted EPS of $1.33 exceeded published consensus of approximately $1.24, while revenue of $2.55 billion topped consensus near $2.43 billion. It also cleared the prior Q2 high-end guidance of $2.41 billion revenue, $770 million adjusted EBITDA, and $1.24 adjusted EPS.
| Metric | Q2 2026 | Q2 2025 | Change / expectation |
|---|---|---|---|
| Revenue (Financial Highlights) | $2,547M | $2,053M | +24%; above ~$2,430M consensus |
| Adjusted EBITDA (Financial Highlights) | $817M | $589M | +39%; above prior $770M high-end guidance |
| Adjusted EBITDA margin (Financial Highlights) | 32.1% | 28.7% | +340 bps |
| Adjusted EPS (Financial Highlights) | $1.33 | $0.91 | +46%; above ~$1.24 consensus and prior $1.24 high end |
| Free cash flow (Financial Highlights) | $479M | $344M | +39% |
The beat was operational, not just acquisition-driven. Revenue rose 21% organically after removing the net effect of acquisitions and divestitures, while adjusted EBITDA margin expanded to 32.1% despite absorbing the CAM fastener acquisition. Engine Products led with 51% segment EBITDA growth and a 37.7% margin; Fastening Systems also grew strongly, though its results included CAM and Brunner. (Reconciliation of Organic Revenue; Segment Results — Engine Products; Segment Results — Fastening Systems)
Management raised the full-year framework sharply, extending the positive surprise beyond Q2. Baseline 2026 revenue guidance increased by $400 million to $10.05 billion, adjusted EBITDA by $170 million to $3.23 billion, adjusted EPS by $0.33 to $5.27, and free cash flow by $150 million to $1.90 billion. The new Q3 baseline also implies continued sequential growth: $2.575 billion revenue, $830 million adjusted EBITDA, and $1.35 adjusted EPS. (2026 Guidance)
The weaker pockets do not offset the core read. Engineered Structures revenue declined 13% because of the Savannah divestiture and product rationalization, while Forged Wheels still faced 8% lower commercial-transportation volumes. However, Forged Wheels improved volumes 7% sequentially and held margin expansion, and the larger aerospace and gas-turbine businesses delivered the quarter’s main growth and profitability gains. (Segment Results — Engineered Structures; Segment Results — Forged Wheels)
Cash generation and capital allocation strengthened the message, although leverage remains elevated after CAM. Six-month free cash flow reached $838 million, supporting $600 million of share repurchases through June and $800 million through July, alongside a 17% dividend increase. The company also reduced annualized interest expense by $12 million, but debt increased to $4.50 billion of current and long-term borrowings at June 30 after financing the $1.8 billion acquisition. (Cash Flow statement; Balance Sheet; Key Activity)
Read the original 8-K on SEC EDGAR ↗