Q3 2025 Curtiss-Wright Corp Earnings Call

To five earnings conference call.

At this time, all participants have been placed on a listen only mode and the floor will be opened for your questions. Following the presentation.

If you would like to ask a question at that time. Please press star one on your telephone keypad. If at any point. Your question has been answered you may remove yourself from the queue by pressing star two.

Mr time, we ask that you limit yourself to one primary question and one follow up.

Lastly, if you should require operator assistance, please press star zero.

I would now like to turn the call over to Jim Ryan Vice President of Investor Relations.

Lynn M. Bamford: Thank you. The floor is now open for questions. At this time, if you have a question or comment, please press star one on your telephone keypad. If at any point your question is answered, you may remove yourself from the queue by pressing star two. We ask that you pick up your handset when posing your question to provide optimal sound quality. Again, we ask that you please limit yourself to one question and one follow-up, and then queue up again with any additional. Thank you. Our first question is coming from Miles Walton with Wolfe Research. Please go ahead. Your line is open.

Thank you Erica and good morning, everyone.

Welcome to Curtiss Wright's third quarter 2025 earnings conference call.

Joining me on the call today are chairman and Chief Executive Officer, Lynn Bamford, and Vice President and Chief Financial Officer, Christopher <unk>.

A copy of today's financial presentation in the press release are available for download through the Investor Relations section of our website at Curtiss Wright Dot com.

A replay of this webcast will also be available on the website.

Speaker #3: Your program is about to begin . Welcome to the Curtiss-Wright third quarter 2020 Earnings Conference call . At this time , all participants have been placed on a listen only mode and the floor will be open for your questions .

Miles Walton: Thanks. Good morning.

Our discussion today include certain projections and forward looking statements that are based on management's current expectations and are not guarantees of future performance.

Lynn M. Bamford: Good morning.

Miles Walton: Lynn, I was wondering if you could pick up where you left off on the AP1000 and maybe speak to the ship set contents that you have currently on that reactor. I've classically thought about it as $30 million per reactor coolant pump for reactor coolant pumps, but is it a complement of your work scope improving there, increasing, maybe just to level setups?

Those risks and uncertainties associated with our forward looking statements in our public filings with the SEC.

As a reminder, the company's results and guidance include an adjusted non-GAAP view that excludes certain costs in order to provide greater transparency into Curtiss Wright's ongoing operating and financial performance.

Speaker #3: Following the presentation . If you would like to ask a question at that time , please press star one on your telephone keypad .

Lynn M. Bamford: Thank you. It's a timely question as we've been really looking into this and making sure we're appreciating the full range of content we have. Where you start out with the RCPs, the last time they were sold was just over $28 million per RCP, so you're in line with what you're thinking there. I'm really pleased. We've made some rough comments on this in the past, but we've historically set our content on top of the RCPs as $10 to $20 million of content, and the team is doing a really good job of increasing that incremental content, I think two, three times from what we had prior had is what today is in play for Curtiss-Wright. These are ongoing pursuits, so nothing is assured yet.

GAAP to non-GAAP reconciliations are available in the earnings release and on our website now.

Speaker #3: If at any point your question has been answered , you may remove yourself from the queue by pressing star two in the interest of time , we ask that you limit yourself to one question and one follow up .

Now I would like to turn the call over to Lynn to get things started.

Thank you Jim and good morning, everyone. As you saw in last Night's results, we continue to deliver on our pivot to growth strategy. Our topline is accelerating we continue to drive operational and commercial excellence initiatives throughout the organization, while making focused investments and remaining measured in our approach.

Speaker #3: Lastly , if you should require operator assistance , please press star zero . I would now like to turn the call over to Jim Ryan , Vice President of Investor Relations .

Speaker #4: Thank you , Erica , and good morning , everyone . Welcome to Curtiss-Wright third Quarter 2020 Earnings Conference call . Joining me on the call today are Chair and Chief Executive Officer , Lynn Bamford and Vice President and Chief Financial Officer Chris Farkas , a copy of today's financial presentation and the press release are available for download through the Investor Relations section of our website at Curtiss-Wright .

The capital allocation looking ahead I am encouraged by the positioning of our technologies across the A&D and commercial markets, we serve and see meaningful growth opportunities for Curtis rate well into the next decade.

Later in our prepared remarks, I'll spend some more time discussing Curtiss Wright's opportunities for growth within those markets and we will provide some high level commentary on our outlook for 2026.

Lynn M. Bamford: I do think we are going to really add meaningful business on top of the RCPs to the content we have per AP1000 plant.

Speaker #4: Com A replay of this webcast will also be available on the website . Our discussion today include certain projections and forward looking statements that are based on management's current expectations and are not guarantees of future performance .

Miles Walton: Okay. Great. Just to follow up, if I could, on the bookings, could you provide that by segments? Defense electronics in particular, did that bounce back, and is there any concern on the government shutdown?

The momentum continues to build and the team and I are excited about the long runway ahead.

Speaker #4: In detail , those risks and uncertainties associated with our forward looking statements in our public filings with the SEC . As a reminder , the company's results and guidance include an adjusted non-GAAP view that excludes certain costs in order to provide greater transparency into Curtiss-Wright ongoing operating and financial performance .

With that I will turn to the highlights of our third quarter 2025 results. We delivered another strong operational performance with revenue and growth in operating income across all three segments.

Lynn M. Bamford: Maybe I'll start with a little color on bookings, and then maybe Chris can walk through a little bit more of the specifics after that. Broadly speaking, good quarter, 1.1 times book to bill. The government shutdown and CR, and now shutdown, is having some impact on portions of our business. In our largest end market, the naval defense market, there really hasn't been much disruption. Our year-to-date results, and especially the growth in submarine programs, are very strong. We work on large multi-year contracts, and so that portion of the business has not been very affected. The most prominent impact within our order book has been in the defense electronics segments, where the team has identified over $50 million of orders that have pushed out of Q3 during the CR. This is definitely something that we're very closely tracking with you.

Overall sales of $869 million represented an increase of 9% year over year in line with our expectations and highlighted by 6% organic growth operating income increased 14% year over year exceeding our sales growth and driving 90 basis points of overall.

Speaker #4: GAAP to non-GAAP reconciliations are available in the earnings release and on our website . Now , I'd like to turn the call over to Lynn to get things started .

Speaker #5: Thank you , Jim , and good morning , everyone . As you saw in last night's results , we continue to deliver on our pivot to growth strategy .

Operating margin expansion to 19, 6% this translated into a 14% year over year increase in diluted earnings per share. This results slightly exceeded our expectations based on improved operational performance and fewer shares outstanding.

Speaker #5: Our top line is accelerating . We continue to drive operational and commercial excellence initiatives throughout the organization while making focused investments and remaining measured in our approach to capital allocation .

Speaker #5: Looking ahead , I am encouraged by the positioning of our technologies across the A and D and commercial markets we serve and see meaningful growth opportunities for Curtiss-Wright well into the next decade .

Free cash flow was $176 million up 8% year over year, reflecting nearly 140% conversion due to higher cash earnings and lower tax payments, while increasing growth investments and capital spending.

Speaker #5: Later , in our prepared remarks , I'll spend some more time discussing Curtiss-Wright opportunities for growth within those markets and will provide some high level commentary on our outlook for 2026 .

Lynn M. Bamford: Very confident none of this business has gone away. The guys in the field talk to the customers, and it's really a matter of being able to process this business, that the pipeline of business. Across defense electronics is healthy and growing. There's a lot of things I want to take the time to just talk on, a couple of things that we're doing that gives understanding as to why we are able to grow the pipeline of business for this so much. There are things that have kind of come up, but just to touch on them briefly. We are confident we have the strongest, most associate CMOS aligned offering in the marketplace. This year alone, we've introduced over 20 new product instructions into this family of products, which is a very strong contribution out of the team, and something we're really proud of.

Regarding our order book, New orders increased 8% and resulted in an overall book to Bill of one one times, providing continued confidence in future topline growth.

Speaker #5: The momentum continues to build , and the team and I are excited about the long runway ahead . With that , I'll turn to the highlights of our third quarter 2020 results .

Starting with our A&D markets, we continue to experience strong demand for commercial aerospace products.

Speaker #5: We delivered another strong operational performance with revenue and growth in operating income across all three segments . Overall sales of $869 million represented an increase of 9% year over year , in line with our expectations and highlighted by 6% organic growth , operating income increased 14% year over year , exceeding our sales growth and driving 90 basis points of overall operating margin expansion to 19.6% .

<unk>, a low risk of Destocking as production ramps across the major OEM platforms in Naval Defense, we saw higher orders for nuclear propulsion equipment supporting the U S. Navy's current and next generation submarine program.

Those increases in demand were partially offset by the timing of orders within our aerospace defense and ground defense markets, where despite some delays due to the extended continuing resolution our pipeline remained strong within our commercial markets, we experienced tremendous growth in commercial nuclear orders, including two new Doa.

Lynn M. Bamford: We have talked about our NVIDIA partnership, that we are now delivering NVIDIA-based products at the GTC show. Just a little while back, we were the only company to demo a CMOS-based Blackwell processor. Again, that's something very special to Curtiss-Wright. Our Fabric 100, which is the highest speed interconnect available in the marketplace, is out and helping really provide a very unique differentiator for Curtiss-Wright in our ability to provide solutions at that tactical edge. We're also doing things that we also are continuously looking at, new capabilities that widen the application space where we can sell our products to keep pushing those walls out. To name just one, we recently achieved Microsoft Azure validated across several of our small form factor products. That means these products have been added to the Microsoft Azure locale or catalog, which obviously has a huge customer reach.

Speaker #5: This translated into a 14% year over year increase in diluted earnings per share . This results slightly exceeded our expectations based on improved operational performance and fewer shares outstanding .

Ended multiyear contract in support of Idaho National Laboratory and other government site.

This is a small but growing opportunity, which leverages Curtiss Wright's nuclear pedigree and broad portfolio of products and services in support of increased government focus towards commercial nuclear.

Speaker #5: Free cash flow was $176 million , up 8% year over year , reflecting nearly 140% conversion due to higher cash earnings and lower tax payments .

Beyond that we continue to experience solid demand for aftermarket equipment supporting planned outages and restarts. In addition to new development contracts supporting SMS.

Speaker #5: While increasing growth , investments in capital spending . Regarding our order book , new orders increased 8% and resulted in an overall book to bill of 1.1 times , providing continued confidence in future top line growth .

Overall, the continued growth in orders builds on Curtiss Wright's already strong backlog, which is now up 14% year to date, reaching a new record in excess of $3 9 billion.

Speaker #5: Starting with our and markets , we continue to experience strong demand for commercial aerospace products , signaling a low risk of destocking as production ramps across the major OEM platforms .

Regarding our updated full year 2025 guidance, our strong year to date performance and growing backlog that provided confidence to once again raise our overall outlook for sales operating income and earnings per share. We now expect sales to increase 10% to 11%, reflecting the strength within our A&D markets.

Speaker #5: In naval defense , we saw higher orders for nuclear propulsion equipment supporting the US Navy's current and next generation submarine programs . Those increases in demand were partially offset by the timing of orders within our aerospace , defense and ground defense markets where , despite some delays due to the extended continuing resolution , our pipeline remains strong within our commercial markets .

Lynn M. Bamford: That's something we're very excited about. Again, another notable capability of taking cloud applications to the tactical edge. I list those to say these are the types of things the team is always doing that is ensuring that that pipeline is healthy and growth in spite of the fact we did see the push out in Q3. Chris, I don't know if you want to add some color on the segments.

This in turn supports our new range of 16% to 19% growth in operating income we continue to expect more than 100 basis points in margin expansion and remain on track to deliver record operating margin in excess of 18, 5%.

Speaker #5: We experienced tremendous growth in commercial nuclear orders , including two new Doe funded multi-year contracts in support of Idaho National Laboratory and other government sites .

K. Christopher Farkas: Sure. Yeah. Let me try to jump into some of the numbers here, Miles. I think it's important to note, I think, as you look at the overall orders and what's been happening for Curtiss-Wright, that we had a very strong first half in naval bookings. The first thing is, if you just remove that off the table, we have seen sequential growth in our orders since Q1, and that includes defense electronics. Important to kind of pull that out. The Q3 book to bill was about 1.1x, and that was on 9% sales growth. We had a one-time book to bill in aerospace and defense, and we had a 1.2x in commercial. The orders were up 8% year over year. The backlog was up 14%. We're at a record backlog right now, $3.9 billion.

Diluted EPS is now expected to grow 19% to 21%, which also includes the benefits of our increased 2025 share repurchase activity and lastly, we maintained our free cash flow guidance, while accelerating overall capital expenditures to support future growth initiatives and.

Speaker #5: This is a small but growing opportunity , which leverages Curtiss-Wright nuclear pedigree and broad portfolio of products and services in support of increased government focus towards commercial nuclear .

Speaker #5: Beyond that , we continue to experience solid demand for aftermarket equipment supporting plant outages and restarts . In addition to new development contracts supporting Smrs .

We continue to expect strong free cash flow conversion exceeding a 105%.

In summary, Curtiss Wright's strong year to date execution and demonstrated success under our pivot to growth strategy ensures that we remain well positioned to deliver exceptional results for the full year now I would like to turn the call over to Chris to provide a more in depth review of our financials.

Speaker #5: Overall , the continued growth in orders builds on Curtiss-Wright already strong backlog , which is now up 14% year to date , reaching a new record in excess of $3.9 billion .

Speaker #5: Regarding our updated full year 2025 guidance , our strong year to date performance and growing backlog have provided confidence to once again raise our overall outlook for sales , operating income and earnings per share .

Thank you Lynn.

Turning to slide four I'll begin by reviewing the key drivers of our third quarter 2025 performance.

K. Christopher Farkas: Diving into the segments and just the book to bill for the quarter, we were about a 1.04 on aerospace and industrial, and we were about a 1.14 in naval and power. We talked about the strength of the commercial aerospace orders and the nuclear orders on the call. To dive into defense electronics, maybe just a little bit more on that topic. The order book did improve sequentially here in the third quarter. As Lynn had mentioned, the push-outs had affected that. It was a 1x book to bill. Had we not had the push-outs, we're confident that it would have been a 1.1x book to bill. The backlog in that segment is up 3%. Strong revenue growth at 10%. It's above the prior year September backlog number. The book to bill has been holding steady at a 1x.

Speaker #5: We now expect sales to increase 10 to 11% , reflecting the strength within our R&D markets . This , in turn supports a new range of 16 to 19% growth in operating income .

I'll start with aerospace and industrial segment of our overall sales increased 8%.

And the segment's commercial aerospace market growth was driven by continued strong demand supporting increased production on both narrow body and wide body platforms.

Speaker #5: We continue to expect more than 100 basis points in margin expansion and remain on track to deliver record operating margin in excess of 18.5% , diluted EPs is now expected to grow 19 to 21% , which also includes the benefits of our increased 2025 share repurchase activity .

In aerospace defense, we experienced modest growth for sensors and surface treatment services supporting both domestic and international fighter jet programs.

Within the segments ground defense market, our results reflected increased M. Actuation sales supporting ground based mobile launcher systems for the U S. Army's FPC program.

Speaker #5: And lastly , we maintained our free cash flow guidance while accelerating overall capital expenditures to support future growth initiatives . And we continue to expect strong free cash flow conversion exceeding 105% .

And the general industrial market sales were flat overall, despite the ongoing macro challenges affecting global industrial vehicle markets.

K. Christopher Farkas: As we look ahead, I mean, right now, we're assuming that the shutdown is going to get resolved here in mid-November. We believe that once that gets resolved, it's a 30 to 45-day turnaround time before orders begin to resume a more normal flow. Fortunately for us, the businesses that are most impacted are generally short-cycle in nature, and we would expect to recover very quickly. I think it's important to note that there's nothing that's affecting our 2025 guidance. Lynn mentioned the pipeline is strong. We have good confidence levels in 2026, and strong alignment to the customer's priorities. Next year's defense spending between the budget and the reconciliation bill are up 13%. We see positivity as we look out into the future. We just need these guys to come to agreement in the meantime.

And turning to the segments third quarter profitability operating income grew 17%, while operating margin expanded 140 basis points to 18, 6%.

Speaker #5: In summary , Curtiss-Wright strong year to date execution and demonstrated success under our pivot to growth strategy ensures that we remain well positioned to deliver exceptional results for the full year .

These strong results were driven by favorable absorption on higher A&D sales restructuring savings and a more favorable mix of business.

Speaker #5: Now , I would like to turn the call over to Chris to provide a more in-depth review of our financials .

Next to the defense electronics segment.

Sales growth of 4% exceeded our expectations, mainly due to the timing of tactical communications equipment revenues within ground defense as some revenues and deliveries accelerated into the third quarter.

Speaker #4: Thank you, Lynn. Turning to slide four.

Speaker #6: I'll begin by reviewing the key drivers of our third quarter 2025 performance . I'll start with the Aerospace and Industrial segment , where overall sales increased 8% in the segments commercial , Aerospace market growth was driven by continued strong demand , supporting increased production on both narrowbody and widebody platforms .

Within the segments Aerospace defense market, Thanks for embedded computing equipment supporting European Fighter Jets, and domestic UAV programs was partially offset by the timing of revenue on helicopter programs.

Growth in this segment stable defense market was driven by higher embedded computing equipment revenue supporting both domestic and foreign military customers.

Speaker #6: In aerospace defense , we experienced modest growth for sensors and surface treatment services , supporting both domestic and international fighter jet programs within the segments ground Defense market .

Miles Walton: That's great. Lynn, I'm sorry. Just to clarify, in your prior AP1000 comment, is the $10 to 20 million of incremental content on AP1000, is that a historical benchmark of which I should think about it's grown two or three times, or is that the current benchmark?

In this segments commercial aerospace market, we once again experienced solid sales growth mainly for our flight data recorder supporting the <unk> 25 hour safety mandate.

Speaker #6: Our results reflected increased M actuation , sales , supporting ground based mobile launcher systems for the US Army's Espc program and the General industrial market .

Lynn M. Bamford: No, that's the historical benchmark, Miles, that we had back in the mid-teens.

Regarding the segment's operating performance, we delivered a strong operating margin of 29, 2% up 270 basis points ahead of our expectations, reflecting favorable absorption on higher revenues the benefits of our ongoing operational excellence initiatives and a more favorable mix of higher margin business.

Speaker #6: Sales were flat overall , despite the ongoing macro challenges affecting global industrial vehicle markets . And turning to the segment's third quarter profitability , operating income grew 17% while operating margin expanded 140 basis points to 18.6% .

Miles Walton: Thanks so much.

Lynn M. Bamford: Sure thing.

Lynn M. Bamford: Thank you. We'll go next to the line of Christine Lewitt with Morgan Stanley. Please go ahead.

Christine Lewitt: Hey, guys. Good morning. Maybe following up on Miles' question on the AP1000 pricing, I just want to make sure we get it right. In the past, when you guys looked at your content, each cooling tower used to be like $250 million, roughly. A build with twin towers would be about $500 million. I think the Poland one, they're doing triplets, so that would be $750 million. The numbers that you're saying incremental to that, the 2x, 3x, is that off of that specific base, or are we talking about the initial US order from 2007, which is a much lower amount?

Of note. This favorable mix is mainly due to the timing between the third and fourth quarters and we expect this to normalize across the remainder of the year.

Speaker #6: These strong results were driven by favorable absorption on higher end sales , restructuring savings , and a more favorable mix of business . Next , in the defense electronics segment , sales growth of 4% exceeded our expectations , mainly due to the timing of tactical communications equipment revenues within ground defense .

Turning to the enabling power segment, where overall sales increased 12%.

And enabled defense market, we once again experienced strong revenue growth driven by the acceleration of production on both the Columbia class and Virginia class submarine programs.

Speaker #6: As some revenues and deliveries accelerated into the third quarter, within the segments, Aerospace and Defense market growth for embedded computing equipment supporting European fighter jets and domestic UAV programs was partially offset by the timing of revenue on helicopter programs.

Those gains were partially offset by lower sales within the segments Aerospace defense market based on the timing of arresting systems revenues.

And as a result, as we look ahead to the fourth quarter. We now expect a strong sequential increase in revenues for arresting systems products, principally supporting international customers.

Lynn M. Bamford: Maybe just to back up a second, if you look in our, even in our investor day briefing from last year, we think of it as a plant which has four RCPs, and that's how we've, when we talk about our revenue per plant, that's the framework for it. We talked about we have $110 million plus of revenue per plant. Poland's talking about building six plants, Bulgaria is talking about building two plants, Fermi is talking about building four plants. That's just to keep the terminology because it's easy to get confused between the RCPs versus the plants and such. Having that as a baseline, prior, we had the RCPs and about $10 to $20 million of content per plant. That is the area where we've been working very purposefully to see where else we can supply.

Speaker #6: Growth in this segment enabled defense market was driven by higher embedded computing equipment revenues , supporting both domestic and foreign military customers in this segment's commercial aerospace market , we once again experienced solid sales growth , mainly for our flight data recorders supporting the FAA's 25 hour safety mandate .

And the power and process market our results reflected yet another solid contribution from our <unk> solutions acquisition.

And as ultra energy driving higher sales to both our commercial nuclear and process markets.

On an organic basis commercial nuclear sales grew more than 10%, reflecting the ramp up in development across several of similar designs as well as higher government nuclear revenues.

Speaker #6: Regarding the segment's operating performance , we delivered a strong operating margin of 29.2% , up 270 basis points , and ahead of our expectations , reflecting favorable absorption on higher revenues .

Sales in the process market were slight down slightly overall, but reflected modest growth in subsea pump development revenues.

Speaker #6: The benefits of our ongoing Operational excellence initiatives and a more favorable mix of higher margin business . Of note , this favorable mix is mainly due to the timing between the third and fourth quarters , and we expect this to normalize across the remainder of the year .

Regarding the segment's operating performance operating income grew 14%, while operating margin expanded 20 basis points to 16, 6%, mainly reflecting favorable absorption on higher sales, which was partially offset by higher research and development supporting next generation SLR designs.

Speaker #6: Turning to the naval and power segment , where overall sales increased 12% and the naval defense market , we once again experienced strong revenue growth driven by the acceleration of production on both the Columbia class and Virginia class submarine programs .

Lynn M. Bamford: Westinghouse as a supplier to them and engaging with them on different work scopes. At this time, it looks like we are targeting taking that incremental on top of the RCPs content, that 10 to 20, and doubling it or tripling it. It is still a work in progress as they are still working through their supply chain things. We are just trying to be there and support them as much as we can to make them successful. Pretty excited that that would be pushing that content per plant up into the mid-100s for sure.

The sum of Curtiss Wright's third quarter results. The strong top line performance resulted in an overall operating margin of 19, 6% driving 90 basis points and operating margin expansion.

Speaker #6: Those gains were partially offset by lower sales within the segments Aerospace Defense market . Based on the timing of arresting systems revenues and as a result , as we look ahead to the fourth quarter , we now expect a strong sequential increase in revenues for arresting systems , products , principally supporting international customers in the power and process market .

Turning to our full year 2025 guidance I'll begin on slide five of our end market sales outlook for total sales are now expected to grow 10% to 11% driven by improved expectations for organic growth across our A&D markets.

Lynn M. Bamford: Gotcha. That makes sense. Thank you very much for that clarification. Maybe digging more into this AP1000, I mean, it looks since your investor day last year, we've seen a lot more support for US large nuclear power plant builds. We've seen the supportive executive orders from the White House, but then also last week, we saw Cameco and Brookfield establish a transformational partnership with the US government to accelerate deployment of Westinghouse nuclear reactors. I was wondering, can you give us more color regarding the potential of the US market and the timing? Also, following up on the expected order that you have for 2026, are you expecting a Poland order and a US order, or is that just Poland and Bulgaria?

Speaker #6: Our results reflected yet another solid contribution from our ink solutions acquisition, formerly known as Ultra Energy, driving higher sales to both our commercial nuclear and process markets on an organic basis.

Starting in aerospace defense, our outlook of 7% to 9% sales growth remains unchanged and continues to reflect strong growth in defense electronics as well as higher sales of aircraft arresting systems equipment.

Within ground defense full year sales are now expected to grow 7% to 9% based upon increased Ian actuation sales as well as higher tactical communications equipment revenues.

Speaker #6: Commercial nuclear sales grew more than 10% , reflecting the ramp up in development across several SMR designs , as well as higher government nuclear revenues .

Speaker #6: Sales in the process market were slight , down slightly overall , but reflected modest growth in subsea pump development . Revenues . Regarding the segment's operating performance , operating income grew 14% while operating margin expanded 20 basis points to 16.6% , mainly reflecting favorable absorption on higher sales , which was partially offset by higher research and development .

In Naval Defense, while we expect a sequential decline in revenues in the fourth quarter based upon the timing of material receipts. The strong year to date performance on submarine platforms provides us with confidence to raise our full year sales guidance to a new range of 9% to 11%.

Looking more broadly across all three different markets and based upon our strong backlog supporting key platforms globally, we're well positioned for continued solid growth in these markets in 2026.

Lynn M. Bamford: Yeah. We work very closely with Westinghouse to try and, I mean, this is a fast-moving market, and that announcement with A is just fantastic to see because it's really the money that needs to really get this machine running. We were very excited to see that partnership get announced. There was also the announcement with Japan of putting some money into building nuclear in the US. All these things are sort of taking form, but two separate pretty positive announcements in October relative to that. Really, what's in the public knowledge is funding for these 10 plants. How the Japan money overlaps with that, I don't think there's a clear vision of it. We have some insights from Westinghouse, but really sticking to what's in the public eye, we're focused on those first 10 plants, which is great.

Speaker #6: Supporting next generation SMR designs . To sum up , Curtiss-Wright third quarter results , the strong top line performance resulted in an overall operating margin of 19.6% , driving 90 basis points in operating margin expansion .

Yeah.

Turning to commercial aerospace our outlook for 13% to 15% sales growth is unchanged and we remain on track to deliver strong growth based upon both the ramp up in OEM production as well as increased sales of flight data recorders within our defense electronics segment.

Speaker #6: Turning to our full year 2025 guidance . I'll begin on slide five with our end market sales outlook for total sales are now expected to grow 10 to 11% , driven by improved expectations for organic growth across our R&D markets .

Additionally, our order book and commercial aerospace continues to demonstrate tremendous growth providing increased confidence in our 2025 outlook and our ability to once again deliver strong growth in this market in 2026.

Speaker #6: Starting in aerospace , defense , our outlook of 7 to 9% sales growth remains unchanged and continues to reflect strong growth in defense electronics , as well as higher sales of aircraft , arresting systems , equipment within ground defense , full year sales are now expected to grow 7 to 9% based upon increased ECM actuation sales , as well as higher tactical communications equipment revenues .

Wrapping up our aerospace and defense outlook, we now project total sales in these markets to increase 10% to 11%.

Okay.

Moving to our commercial markets and power and process. Despite some timing between the third and fourth quarters, our outlook for 16% to 18% sales growth remains unchanged.

Lynn M. Bamford: Today, the team still does believe the first order we get will be driven by the Poland opportunity, although Bulgaria is right there with it. The thinking is those will be ahead of the US. How this $80 billion, which is targeted at long lead material types of expenditures, is going to play out, that still needs to take some form. Whether that happens in 2026 is very much TBD. I wouldn't foreshadow that yet at this point. We do feel good overall about getting our first order in 2026, and the team's doing a lot of work to get ready for it and to think through the various ramp scenarios. With this accelerated activity in the US and then what's going on elsewhere, along with it's exciting, but our work on our SMR opportunities continues to grow and move towards prototyping too.

Of note the continued strength of our commercial nuclear order book now provides us with increased confidence to be closer to the high end of our full year guidance range in this market.

Speaker #6: In naval defense , while we expect a sequential decline in revenues in the fourth quarter based upon the timing of material receipts , the strong year to date performance on submarine platforms provides us with confidence to raise our full year sales guidance to a new range of 9 to 11% .

Overall, our outlook continues to reflect the combination of strong organic revenue growth as well as the contribution from IFC solutions.

Speaker #6: Looking more broadly across all three different markets and based upon our strong backlog , supporting key platforms globally , we're well positioned for continued solid growth in these markets .

And lastly in the general industrial market, while we continue to expect flat sales in 2025, our team has done a great job positioning Curtiss Wright to overcome the ongoing global macro challenges facing industrial vehicle markets.

Speaker #6: In 2026 . Turning to commercial aerospace , our outlook for 13 to 15% sales growth is unchanged , and we remain on track to deliver strong growth based upon both the ramp up in OEM production as well as increased sales of flight data recorders within our defense electronics segment .

Wrapping up our total commercial markets, we continue to target strong full year sales growth of 9% to 11%.

Moving onto our full year 2025 outlook by segment on slide six I'll begin in aerospace and industrial where we raised before with both our revenue and operating income guidance based upon our strong year to date performance in our A&D markets.

Speaker #6: Additionally , our order book in commercial aerospace continues to demonstrate tremendous growth , providing increased confidence in our 2025 outlook and our ability to once again deliver strong growth in this market in 2026 .

Lynn M. Bamford: The team's busy. I'll leave it at that.

Lynn M. Bamford: Yeah. I mean, it seems like when it rains, it pours. Can you just remind us, Lynn, what your capacity is to build an AP1000, especially because, right, the US Navy content is also increasing? Just trying to understand what could you produce in a given year. You had called out elevated CapEx this year or next year. What is that supporting? Is this in anticipation of commercial nuclear power or the opportunities in the other segments that you had highlighted?

Overall, we continue to project sales growth of 4% to 5%.

Regarding the same profitability, we continue to project operating income growth of 6% to 9% and operating margin expansion of 30 to 60 basis points ranging from 17, 3% to 17, 6%.

Speaker #6: Wrapping up our aerospace and defense outlook , we now project total sales in these markets to increase 10 to 11% . Moving to our commercial markets and power and process .

Speaker #6: Despite some timing between the third and fourth quarters , our outlook for 16 to 18% sales growth remains unchanged . Of note , the continued strength of our commercial nuclear order book now provides us with increased confidence to be closer to the high end of our full year guidance range in this market .

Next in defense Electronics, we increased our revenue guidance to a new range of 10% to 11%, reflecting solid growth projections across all A&D markets and improved confidence as we close out the year.

Lynn M. Bamford: Yeah. We think of our capacity as 12 to 16 reactors per year. That needs dovetailed exactly as you just said with the naval work. I will say the team is committed from a CapEx standpoint to our investor day targets of 105% pre-cash flow conversion. We increased our CapEx spending both last year and this year by 30% each year, and a lot of that is geared around preparing for expansion in this space. The $10 million that Chris spoke of in his prepared remarks is geared at expansion capabilities tied to nuclear. What we need to be prepared for to support Westinghouse is a very active discussion with them. We're trying to make sure we're doing the things that we're ahead of it and prepared to support them.

Regarding the segments profitability, we now expect operating income growth of 19% to 22% and operating margin expansion of 220 to 240 basis points to a new all time high range of 27, 1% to 27, 3% reflecting more.

Speaker #6: Overall , our outlook continues to reflect a combination of strong organic revenue growth as well as the contribution from Ink Solutions . And lastly , in the general industrial market .

Speaker #6: While we continue to expect flat sales in 2025 , our team has done a great job positioning Curtiss-Wright to overcome the ongoing global macro challenges facing industrial vehicle markets .

More favorable absorption the benefits of our commercial and operational excellence and mix on higher sales.

It enabled empower we now expect sales to grow 13% to 15%, including 7% to 8% organic growth, reflecting our increased stable defense market outlook and our overall strong backlog, which provides solid long term visibility.

Speaker #6: Wrapping up our total commercial markets , we continue to target strong full year sales growth of 9 to 11% . Moving on to our full year 2025 outlook by Segment on slide six .

Speaker #6: I'll begin in aerospace and industrial , where we raised the floor of both our revenue and operating income guidance based upon the strong year to date performance in our A&E markets .

Regarding the segments profitability, we raised our operating income guidance to a new range of 17% to 20% based on the higher revenue growth. However, we maintain our prior margin outlook of 16, 3% to 16, 5%, reflecting the increasing mix towards naval revenues.

Speaker #6: Overall , we continue to project sales growth of 4 to 5% . Regarding the segment's profitability , we continue to project operating income growth of 6 to 9% and operating margin expansion of 30 to 60 basis points , ranging from 17.3 to 17.6% .

Lynn M. Bamford: That $10 million is part of us getting ahead of it.

To summarize our 2025 outlook overall, we now anticipate total Curtiss Wright operating income to grow 16% to 19% and we continue to expect operating margin to range from 18, 5% to 18, 7% up 100 to 120 basis points.

Lynn M. Bamford: Great. Thank you very much. Thank you. We'll take our next question from Peter Arment with Baird. Please go ahead.

Speaker #6: Next , in defense electronics , we increased our revenue guidance to a new range of 10 to 11% , reflecting solid growth projections across all A&E markets and improved confidence as we close out the year .

Peter Arment: Yeah. Good morning, Lynn and Chris, Jim. Nice results.

Lynn M. Bamford: Thank you.

And as a reminder, we are delivering these strong results, while continuing to grow our total research and development across the portfolio positioning us for future organic growth.

Peter Arment: Hey, Chris, maybe just to stay on the theme of AP1000, if you get an order in 2026, maybe could you just give us a high level how quickly you begin to recognize revenues on that? I remember back with the China direct order, how that all works back in the day. Maybe just level set us on how quickly that begins to flow through on the financials. I have a follow-up.

Speaker #6: Regarding the segment's profitability , we now expect operating income growth of 19 to 22% and operating margin expansion of 220 to 240 basis points to a new all time high range of 27.1 to 27.3% , reflecting more favorable absorption .

Continuing with our financial outlook on slide seven.

Building upon our year to date performance and expectations for continued strong growth in earnings we've increased our full year adjusted diluted EPS guidance to a new range of $12 95 to $13 20.

K. Christopher Farkas: Yeah, sure. I think we've had a lot of discussion on the call today regarding reactor coolant pumps and then other content. I'll focus on the reactor coolant pumps to begin with. When we get that first order, I think a lot of it's going to depend upon the timing of receipts and long lead materials and how quickly we can get that in the door. Lynn's talked about the fact that we're in active discussions with our customer regarding capacity and how to accelerate potentially some of those flows. As you look at the receipt of the order, it's going to be under POC accounting. Typically, in the past, it was maybe a five-year bell curve. I think the China contract went out seven years because their schedule was delayed. With this flood of activity that we're seeing here, I could see that be accelerated.

Speaker #6: The benefits of our commercial and operational excellence and mix on higher sales . And enabling power . We now expect sales to grow 13 to 15% , including 7 to 8% organic growth , reflecting our increased naval Defense market outlook and our overall strong backlog , which provides solid long term visibility .

Were up 19% to 21%.

Note that our guidance now includes a reduction in other income due to lower year over year interest income, resulting from the accelerated share repurchase activity, which also supports a lower share count.

We also reduced the bottom end of our tax rate, which now reflects a range of 21, 75% to 22% as we continue to pursue and demonstrate success in our tax optimization strategies.

Speaker #6: Regarding the segment's profitability , we raised our operating income guidance to a new range of 17 to 20% based on the higher revenue growth .

Speaker #6: However , we maintained our prior margin outlook of 16.3 to 16.5% , reflecting the increasing mix towards naval revenues . To summarize , our 2025 outlook overall , we now anticipate total Curtiss-Wright operating income to grow 16 to 19% , and we continue to expect operating margin to range from 18.5 to 18.7% , up 100 to 120 basis points .

Overall, we remain well ahead of the EPS growth targets that we set at our May 2024, Investor day, as we continue to compound earnings at a mid teens pace over time.

And lastly, we're maintaining our free cash flow outlook.

Expecting to deliver record free cash flow of $520 to $535 million up 8% to 11%.

K. Christopher Farkas: Into a tighter window than a five-year period of recognition. Again, a lot's going to depend upon the timing of the material receipts and then the labor that kind of follows that. There would be some revenue recognition up front for 2026, but then it would quickly accelerate in 2027. When we talk about this extra or the other product that kind of can go into the AP1000 power plants, a lot of that won't be long lead material type items. You've got to get some of that bigger stuff into the plant first. I would expect that to be recognized a little bit farther towards the back end of the bell curve, but certainly an opportunity for us as well.

Speaker #6: And as a reminder , we are delivering these strong results while continuing to grow our total research and development across the portfolio . Positioning us for future organic growth .

Of note based on the strength and earnings we increased the low end of our expectations for operational cash flow by $10 million.

That increase was equally offset by a $10 million acceleration anticipated capital expenditures.

Speaker #6: Continuing with our financial outlook on slide seven , building upon our year to date performance and expectations for continued strong growth in earnings , we've increased our full year adjusted diluted EPs guidance to a new range of $12.95 to $13.20 , or up 19 to 21% .

As a result, our outlook for $85 million in capital expenditures now reflects an increase of approximately 40% year over year and is reflective of our ongoing investments to support near and medium term growth.

And despite these increased investments we continue to expect cash flow in excess of earnings and our free cash.

Speaker #6: Note that our guidance now includes a reduction in other income due to lower year over year interest income resulting from the accelerated share repurchase activity , which also supports the lower share count .

Okay.

108%.

Now I'd like to turn the call back over to Lynn.

Peter Arment: I appreciate that, Colette. Thank you for that. Lynn, on the near-term, when you think about your targets that you put out there for doubling the business by 2028, did you contemplate a lot of these restarts that we're seeing, whether it's Palisades or Three Mile Island or some of the others, when you were thinking about that planning, just because it seems like that is, again, an incremental tailwind to all things else nuclear?

Thank you, Chris and turning to slide eight where I will wrap up today's prepared remarks as we demonstrated today, we continued to build momentum and deliver consistently strong financial performance through our relentless focus on execution. As a result, we are positioned for a strong finish in 2025 with expectations to Jennie.

Speaker #6: We also reduced the bottom end of our tax rate , which now reflects a range of 21.75 to 22% . As we continue to pursue and demonstrate success in our tax optimization strategies .

Speaker #6: Overall , we remain well ahead of the EPs growth targets that we set at our May 2024 Investor Day . As we continue to compound earnings at a mid-teens pace over time .

<unk> record full year financial results across all major metrics.

Lynn M. Bamford: Yeah, I mean, that was. There might have been talk about it, but that was not on the table at a level that we would have had that in how we put together our targets. There's a lot of things, a lot of good things have happened since we put our targets out just 15 months ago, 18 months ago, however long it was. It's amazing how the industry has come alive. Announcements around Europe, the GBN announcement with picking Rolls-Royce. I mean, there's a lot of things that are incrementally happening. You're right, that is new.

Speaker #6: And lastly , we're maintaining our free cash flow outlook and expecting to deliver record free cash flow of 520 to $535 million , up 8 to 11% .

As mentioned in my opening remarks, as I look to the future of Curtiss Wright I am excited about.

The positioning of our technology across the A&D in commercial markets. We serve this position is driven by thoughtful and targeted investment to ensure that our businesses remain deeply aligned to the major near medium and long term growth vectors within our end markets I would like to spend just.

Speaker #6: Of note , based on the strength in earnings , we increased the low end of our expectations for operational cash flow by $10 million .

Speaker #6: That increase was offset by a $10 million acceleration in anticipated capital expenditures . As a result , our outlook for $85 million in capital expenditures now reflects an increase of approximately 40% year over year and is reflective of our ongoing investments to support near and medium term growth .

Few of the next minutes highlighting several of those critical market dynamics that have and will continue to provide compelling upside for Curtiss Wright well into the future.

Starting off we are.

K. Christopher Farkas: Yeah. This whole AI wave has been something that's been new for us as well. That's a lot of positive momentum. I would just remind the listeners as you go back and look at what we provided at investor day, and we said we would be doing $1.5 billion in annual commercial nuclear revenue by the middle of this next decade, that really only contemplated the European opportunity at that point in time. I know we're still several years away from that, the middle of this next decade, but we feel much stronger and more confident in the art of the possible as it was labeled at that point than we did back in May.

Speaker #6: And despite these increased investments , we continue to expect cash flow in excess of earnings in free cash flow conversion rate of approximately 108% .

To capitalize on the continued deceleration in global defense spending based on the accelerated pace of NATO and Allied funding and our strong alignment to use priorities.

Speaker #6: Now , I'd like to turn the call back over to Lynn .

For example, in shipbuilding, which ranks near the top of the priority list of the combined FY 'twenty six budget and reconciliation Bill we have significant content on Columbia class and Virginia class submarines and the Ford Class aircraft carrier program and also continue to receive significant development funding.

Speaker #5: Thank you , Chris . And turning to slide eight , where I will wrap up today's prepared remarks . As we demonstrated today , we continue to build momentum and deliver consistently strong financial performance through our relentless focus on execution .

Speaker #5: As a result , we are positioned for a strong finish in 2025 with expectations to generate record full year financial results across all major metrics .

On the next generation SaaS and <unk> submarine.

Additionally, furnace rates position as a mission critical partner to the U S. Navy has led to a meaningful increase in maritime industrial base funding now up to $40 million and nearly double our pace entering the year for.

Speaker #5: As mentioned in my opening remarks , as I look to the future of Curtiss-Wright , I am excited about the positioning of our technologies across the A and D and commercial markets we serve .

Peter Arment: Appreciate all the calls. Thanks, guys.

Lynn M. Bamford: Thank you. We'll go next to Scott Duchamp with Jefferies. Please go ahead.

Speaker #5: This position is driven by thoughtful and targeted investment to ensure that our businesses remain deeply aligned to the major near , medium , and long term growth vectors within our end markets .

Scott Duchamp: Hey, good morning. Lynn, are you seeing meaningful retrofit demand for the 25-hour flight data recorder yet, or is it primarily only OEM demand at this point? How should we think about the retrofit gross margins on that product relative to the OE gross margins?

Our investments in capital equipment and capacity expansion to support our near and long term growth.

And we continue to believe there are still more funding expected to come our way.

Speaker #5: I would like to spend just a few of the next minutes highlighting several of those critical market dynamics that have and will continue to provide compelling upside for Curtiss-Wright well into the future .

Beyond the strong support for Shipbuilding I would also like to highlight our confidence in defense electronics, where we continue to maintain our leading position with the broadest and most differentiated portfolio of products and with our alignment to open standards like <unk> and Cmos.

Lynn M. Bamford: It is a blend, but a lot of the retrofit is, I think, staging of material to prepare for the retrofit more than the actual retrofit is our understanding with dealing with our customer that is Honeywell. I think that's very much another layer that's ahead of us as this market. We just have continued to say it's going to continue to grow through the back half of that year as that comes to reality. It's not even just the retrofit market. We are working with Honeywell to figure out how we would have an appropriate product offering that would target the regional jets that are over 30 seats that are also part of this mandate. Those are obviously big, big numbers.

Speaker #5: Starting in defense , we are well positioned to capitalize on the continued acceleration in global defense spending . Based on the accelerated pace of growth in NATO and allied funding and our strong alignment to US priorities , for example , in shipbuilding , which ranks near the top of the priority list of the combined FY 26 budget and reconciliation bill , we have significant content on Columbia class and Virginia class submarines , and the Ford class aircraft carrier program , and also continue to receive significant development funding on the next generation SSN submarine .

We are investing in and developing a broad range of technologies to support the battlefield of the future focused on the highest processing capacity interconnect speeds and secure communications, which in turn will allow us to seek care positions on a wide range of applications at the tactical edge.

We also have a great opportunity to support Golden Dome Curtiss Wright has the potential to provide numerous solutions across our <unk>.

Hence electronic segments, including embedded computing tactical communications tactical data links and actuation equipment.

Lynn M. Bamford: Our work with Airbus continues in a positive manner, and we think we will receive certification in the first half of 2026. We need to see how our production ramps with those. We've really not given a 10-year view of revenue on this program yet because there are still a lot of moving parts that are taking form. Really, how this retrofit is going to take place is still a little bit of a work in progress. We haven't given much color on the ship set content or the margin on this for the OEM or the projection. I will say it's inside of our defense electronics segment, as you know, and we like the products we produce to support the margins in the segments.

Speaker #5: Additionally , Curtiss-Wright position as a mission critical partner to the US Navy has led to a meaningful increase in maritime industrial base funding .

Elsewhere, we remain aligned with Ryan Mattel to support increases in ground vehicle production throughout Europe with our current drive stabilization systems and we were pleased to recently announce Curtiss Wright's collaboration on the prototype phase of the U S Army's new <unk> combat vehicle program.

Speaker #5: Now up to $40 million and nearly double our pace entering the year for investments in capital , equipment and capacity expansion . To support our near and long term growth .

Speaker #5: And we continue to believe there's still more funding expected to come our way beyond the strong support for shipbuilding . I would also like to highlight our confidence in defense electronics , where we continue to maintain a leading position with the broadest and most differentiated portfolio of products .

In commercial aerospace we have a strong foundation with established content on every Boeing and Airbus platform and remain well positioned to support the <unk> <unk> production rate increases going forward beyond our existing content, we continue to address our customers' future needs through development of sensor technology in the heart.

Speaker #5: And with our alignment to open standards like Sosa , Mosa and CMOs , we are investing in and developing a broad range of technologies to support the battlefield of the future .

Sections of the engine.

<unk> equipment and specialized coding all of which are yielding new opportunities for growth.

Scott Duchamp: Okay. Lynn, can you give an update on the state of the M&A pipeline and how we might think about the opportunity for re-acceleration in M&A activity in 2026?

And as Chris noted earlier, we are delivering improved cockpit voice per quarter solutions to the market to meet FAA and the asset safety mandates for longer recording capacity.

Speaker #5: Focused on the highest processing capacity , interconnects , speeds and secure communications , which in turn will allow us to secure positions on a wide range of applications at the tactical edge .

Lynn M. Bamford: Yeah. I mean, we're not bashful about saying it's our top priority, and the team is definitely out there. We have a couple properties that we are having discussions with that are more ones that I like when we work with somebody possibly to come join Curtiss-Wright in a proprietary fashion more than we're in an auction. I know some people have noted we've kind of acted like there was more excitement and then not announced anything over the past. Earlier part of 2026, I do remind everybody we only closed on Ultra, at INC, at the end of last year, changed my terminology, at the end of last year. That's going great. We do have some properties we're looking at that are very strategic in nature for how they would add to our portfolio, and there's still a lot of focus on it.

While we have yet to define the full opportunity set this is begun to translate into meaningful revenues. This year and is forecasted to accelerate over the next several years to support both retrofit and new build opportunities.

Speaker #5: We also have a great opportunity to support Golden Dome . Curtiss-Wright has the potential to provide numerous solutions across our defense Electronics segments , including embedded computing , tactical communications , tactical data links , and M actuation equipment .

Turning to our commercial markets and starting with general General industrial despite the ongoing global macro challenges affecting the industrial vehicle market. Our order book has remained generally stable over the past 12 months and actually inflect it slightly higher in the third quarter, which is an encouraging sign heading into.

Speaker #5: Elsewhere , we remain aligned with Rheinmetall to support increases in ground vehicle production throughout Europe . With our turret drive stabilization systems , and we were pleased to recently announce Curtiss-Wright collaboration on the prototype phase of the US Army's new XM 30 Combat Vehicle Program in commercial aerospace .

<unk> 2026, our team has done a great job navigating the impact of tariffs driving pricing initiatives and building upon its leadership positions to generate market share gains, which is enabling us to remain essentially flat. Despite the declining industry growth rates in this market.

Speaker #5: We have a strong foundation with established content on every Boeing and Airbus platform and remain well-positioned to support the anticipated production rate increases going forward.

Lynn M. Bamford: Strategic fit and financial fit, we're not going to overpay for a property. Some of the things that we thought were strategic fits, just the price tag. I don't think it would create value for our shareholders, and we're not going to do it if it won't.

Speaker #5: Beyond our existing content , we continue to address our customers future needs through development of sensor technology in the hottest sections of the engine , ECM actuation equipment and specialized coatings , all of which are yielding new opportunities for growth .

In the process market, we continue to drive innovation and diversification of our critical valve technologies to position the business support future growth segments, such as the LNG market, which is expected to experience a significant surge in production by the end of this decade.

Scott Duchamp: Okay. Thank you.

Speaker #5: And as Chris noted earlier , we are delivering improved cockpit voice recorder solutions to the market to meet FAA and EASA safety mandates for longer recording capacity .

Lynn M. Bamford: Thank you. As a reminder, once again, if you do have a question, you may press star one on your telephone keypad at this time. We'll take our next question from Nathan Johns with CFO. Please go ahead.

In addition, we are developing applications to drive enormous value and savings to customers that operate deep sea drilling and offshore production facilities. Our first subsea pump was delivered to shell in the third quarter, while our development testing and support activities with Petrobras and others continue to progress through.

Speaker #5: While we have yet to define the full opportunity set , this has begun to translate into meaningful revenues . This year and is forecasted to accelerate over the next several years to support both retrofit and new build opportunities .

Nathan Johns: Good morning, everyone.

K. Christopher Farkas: Hey, Nathan.

Nathan Johns: I guess I'll ask you a non-nuclear question. You talked about stabilization in industrial vehicles and maybe a little bit of a positive inflection in orders during the quarter. Maybe just a little bit more color on regions, geographies, or end markets that might be driving that improvement, or any color you've got for us there.

Through the advancement of this new technology, we have an opportunity to win significant new business by the end of this decade.

Speaker #5: Turning to our commercial markets and starting with general general industrial . Despite the ongoing global macro challenges affecting the industrial vehicle market , our order book has remained generally stable over the past 12 months and actually inflected slightly higher in the third quarter , which is an encouraging sign .

Lastly, turning to commercial nuclear which continues to play an important role in meeting future energy demand Curtiss Wright is very well positioned to support the strong growth anticipated to drive this market over the next 25 plus years, our technologies are aligned to support the entire lifecycle both in.

K. Christopher Farkas: Yeah. I'll start out. I mean, obviously, it's been a very challenging situation for industrial vehicle markets as a whole. The team has been doing a great job at staying above that and flat for the year. I think as we position ourselves for this next year and look forward, while we do recognize that the North American on-highway markets are going to continue to be challenged, we do feel that there are some opportunities and pockets in Europe, as the team continues to try to expand its customer and market reach in a few areas. The team's doing, we're seeing some good signs within the order book. We actually had an improvement here in the third quarter that was roughly 4% year over year.

Speaker #5: Heading into 2026 , our team has done a great job navigating the impact of tariffs , driving pricing initiatives , and building upon its leadership positions to generate market share gains , which is enabling us to remain essentially flat despite the declining industry growth rates in this market .

Newbuild from AP 1000 reactors to small modular reactors and in our growing global support in the aftermarket our opportunity to reach our Investor day objectives has been reinforced by the administration's focus on nuclear as a matter of National security.

Speaker #5: In the process market , we continue to drive innovation and diversification of our critical valve technologies to position the business support future growth segments such as the LNG market , which is expected to experience a significant surge in production by the end of this decade .

In addition, it is encouraging to see more and more technology companies address their base note power needs and support future datacenters through new fare power App.

Adding to that while we have been seeing continued progress from Poland in Bulgaria, and other European countries to build new one gigawatt plant hybrid enterprises, such as permitting and Texas have raised the possibility of beginning construction on new AP 1000 plants within the next 12 to 18 months.

Speaker #5: In addition , we are developing applications to drive enormous value and savings to customers that operate deep sea drilling and offshore production facilities .

K. Christopher Farkas: I'm sometimes reluctant to talk about these data points that are hot off the presses, but we had a very strong October. That's a real positive, kind of a standout month over the past few years. With the conversations that we're having with some of our customers, we feel like we're positioning ourselves for a very strong fourth quarter. I don't want to diminish the fact that there will be challenges again for this market in 2026. We expect uplift in 2027. The team is doing a great job, and they continue to kind of push the boundaries to gain more share.

Speaker #5: Our first subsea pump was delivered to shell in the third quarter , while our development , testing and support activities with Petrobras and others continue to progress through the advancement of this new technology , we have an opportunity to win significant new business by the end of this decade .

As a result, we see the potential for significant order supporting AP 1000 reactors likely as soon as 2026.

This in turn provides us with increased confidence in our ability to meet our 2028 target to double our 2023 revenue base in this market and then generate more than $1 $5 billion in annual commercial nuclear revenues by the middle of the next decade.

Speaker #5: Lastly , turning to commercial nuclear , which continues to play an important role in meeting future energy demands . Curtiss-Wright is very well positioned to support the strong growth anticipated to drive this market over the next 25 plus years .

Speaker #5: Our technologies are aligned to support the entire life cycle , both in new build from Ap1000 reactors to small modular reactors , and in our growing global support in the aftermarket .

Our momentum and pace of activity continued to grow.

Overall looking across all our end markets. These are just a few of the many examples highlighting the alignment of our technology strong positive market growth vectors that are driving confidence in our outlook for 2026 and beyond.

Nathan Johns: Maybe one just on following up on the government shutdown potential impact. I think historically, when we've had these kinds of disruptions, it tends to make the defense electronics business, especially, maybe a little more second-half weighted once it gets resolved. I think, Chris, you were talking about some of the delays being more on the short cycle side. Maybe just any color you can give us on expected cadence through the year in 2026 relative to historical patterns, just based on what's happened so far and what you know so far. Thanks.

Speaker #5: Our opportunity to reach our Investor Day objectives has been reinforced by the administration's focus on nuclear . As a matter of national security .

Next I wanted to share a few comments on the topic of capital allocation and highlight our third quarter announcements regarding the acceleration and timing of our share repurchase activity in may the board approved a $400 million increase in our share repurchase authorization, reflecting their confidence in the company's strong free.

Speaker #5: In addition , it is encouraging to see more and more technology companies address their base load power needs and support future data centers through nuclear power .

Speaker #5: Adding to that , while we have been seeing continued progress from Poland and Bulgaria and other European countries to build new one gigawatt plants , private enterprises such as Fermi in Texas have raised the possibility of beginning construction on new Ap1000 plants within the next 12 to 18 months , as a result , we see the potential for significant orders supporting Ap1000 reactors likely as soon as 2026 .

Cash flow generation and the momentum we are building in the pivot to growth strategy.

Thirdly in August and then again in September the board approved our request for two separate $200 million expansion of our 2025 share buyback program. As a result, we are now anticipate a record of more than $450 million in share repurchases. This year, we continue to see.

K. Christopher Farkas: Yeah. We have been very focused over the past few years at trying to make the fourth quarter less dramatic. I think as you look at what's happening here in the fourth quarter, we've got very strong backlog. We raised the bottom end of our guidance here to show a little bit of increased confidence as we go to close out the year in 2025. To the extent that the government shutdown continues and we have delays in the receipt of those orders, yeah, it will take a little bit of time to kind of pick back up. I'm assuming that there will be a little bit more pressure on Q1 at this point in time than there would historically, and that that'll force this to be a little bit more back half weighted.

Speaker #5: This , in turn , provides us with increased confidence in our ability to meet our 2028 target , to double our 2023 revenue base in this market , and then generate more than $1.5 billion in annual commercial nuclear revenues by the middle of the next decade .

The value in our stock price relative to the strong growth and earnings potential in front of Curtiss Wright.

Aside from share repurchases, our record free cash flow generation and efficient balance sheet continue to provide flexibility to enable future growth under our strategy, including ongoing investments in R&D talent and systems as well as acquisitions, which remains our top priority beyond <unk>.

Speaker #5: The momentum and pace of activity continue to grow . Overall , looking across all our end markets , these are just a few of the many examples highlighting the alignment of our technology to strong positive market growth vectors that are driving confidence in our outlook for 2026 and beyond .

K. Christopher Farkas: We are confident in the orders that are out there and coming our way. We'll cautiously balance that against things like advanced buys and other positions in inventory that'll help us to kind of recover and deliver those revenues to our customers as fast as possible because I know that they want the orders, they want the product, and they're equally disappointed with what's happening here right now. I would expect there to be a little bit of pressure on Q1, but then we will recover over the course of the year, and we'll continue to try to keep the fourth quarter from being a dramatic data point.

The core.

Lastly to conclude our prepared remarks overall, we remain on track to exceed the three year objectives provided at last year's Investor Day note that these targets exclude an AP 1000 order, which as we mentioned earlier is anticipated in 2026.

Speaker #5: Next , I wanted to share a few comments on the topic of capital allocation and highlight our third quarter announcements regarding the acceleration and timing of our share repurchase activity .

Speaker #5: In May , the board approved a $400 million increase in our share repurchase authorization , reflecting their confidence in the company's strong free cash flow generation and the momentum we are building in the pivot to growth strategy .

As we look ahead to next year and beyond the strength of our order book expanding positions across our end markets and the contributions from our capital allocation strategy and sure that we are well positioned for continued profitable growth well into the future. In 2026, we are targeting solid topline growth in each of our.

Speaker #5: Subsequently , in August , and then again in September , the board approved our request for two separate $200 million expansions of our 2025 share buyback program .

Nathan Johns: Thanks very much for taking the questions.

Three segments and continued operating margin expansion, while increasing investments in research and development. In summary, we are executing on our pivot to growth strategy by compounding earnings at a mid teens pace and delivering consistent financial performance across all major metrics momentum continues to build it.

Lynn M. Bamford: Thanks, Nathan.

Speaker #5: As a result , we are now anticipating a record of more than $450 million in share repurchases . This year . We continue to see the value in our stock price relative to the strong growth in earnings potential in front of Curtiss-Wright .

Lynn M. Bamford: Thank you. We'll go next to Pete Skibitzky with Olympic Global. Please go ahead.

Pete Skibitzky: Hey, good morning, guys. Nice quarter. I want to ask specifically about the Switzerland business in defense electronics, the turret drive stabilization business, because it seems like some of your key customers, like Rheinmetall, for instance, are getting a good amount of new orders for ground vehicles. I was just wondering if you could talk to kind of the visibility in that business. It seems like the growth outlook could maybe even outperform the rest of that segment. I was wondering if you could talk that through with us and maybe validate also, I'm assuming that unit doesn't use commercial pricing, unlike some of the rest of DE. Maybe you could clarify that as well. Thanks.

Speaker #5: Aside from share repurchases , our record free cash flow generation and efficient balance sheet continue to provide flexibility to enable future growth under our strategy , including ongoing investments in R&D talent and systems , as well as acquisitions , which remains our top priority .

Curtiss Wright and we remain committed to driving our business to new heights, and delivering exceptional results for our shareholders. Thank you and at this time I would like to open up today's conference call for questions.

Thank you the floor is now open for questions. At this time, if you have a question or comment. Please press star one on your telephone keypad. If at any point. Your question is answered you may remove yourself from the queue by pressing star two.

Speaker #5: Beyond fueling the core . Lastly , to conclude , our prepared remarks , overall , we remain on track to exceed the three year objectives provided at last year's Investor Day .

We ask that you pick up your handset when posing your question to provide optimal sound quality.

Speaker #5: Note that these targets exclude an AP 1000 order , which , as we mentioned earlier , is anticipated in 2026 . As we look ahead to next year and beyond , the strength of our order book expanding positions across our end markets and the contributions from our capital allocation strategy ensure that we are well positioned for continued profitable growth well into the future .

Lynn M. Bamford: I mean, this is just to put the nature on the team. I mean, they've been part of Curtiss-Wright for several decades. It's had periods of strength years gone by. We talked about the Kingdom of Saudi Arabia program about a decade ago, and it was on a growth trajectory. Prior to the Ukraine war and such, it had been a very slow growth portion of our business. We expected it to pick up. I think when Europe woke up and realized what they had for militarized vehicles. It has been slower than we thought, but it's pretty exciting that it does feel like it has turned a corner and those orders are going to deliver. We have a very good relationship with Rheinmetall, and their strategic partner for turret drive stabilization. It was nice.

Again, we ask that you please limit yourself to one question and one follow up and thank you up again with any additional thank you. Our first question is coming from mile Myles Walton with Wolfe Research. Please go ahead. Your line is open.

Thanks, Good morning.

Good morning.

And then I was wondering if you could pick up where you left off on the AP 1000, and maybe speak to the ship set content that you have currently on that reactor classically thought about it as $30 million per reactor coolant pump four reactor coolant pumps, but it is a complement of your work scope improving they're increasing.

Speaker #5: In 2026 , we are targeting solid top line growth in each of our three segments and continued operating margin expansion while increasing investments in research and development .

Speaker #5: In summary , we are executing on our pivot to growth strategy by compounding earnings at a mid-teens pace and delivering consistent financial performance across all major metrics .

<unk>.

Maybe just level set us.

Thank you.

It's a timely question as we've been really looking into this and making sure were.

Speaker #5: Momentum continues to build at Curtiss-Wright , and we remain committed to driving our business to new heights and delivering exceptional results for our shareholders .

Appreciating the full range of content, we have and where you start out with the Rcp's last time. They were sold was just over $28 million per RCP. So.

Speaker #5: Thank you . And at this time , I would like to open up today's conference call for questions .

Lynn M. Bamford: I mentioned in the prepared remarks, the wins for the XM-30. That's a first for them getting outside of the European market. Germany's kind of leading the charge of being committed to ramping their vehicles, and we're very much aligned with them to be participation of that. I don't think it's appropriate really to talk about their pricing at this point. They're not subject to the FAR, obviously. The product does have applicability into some commercial markets outside of defense. We sell it into tilting trains and a couple other end markets. There is a commercial capability, but I'll just leave it at that.

Speaker #3: Thank you . The floor is now open for questions . At this time , if you have a question or comment , please press star one on your telephone keypad .

In line with what Youre thinking there I'm really pleased we've made some rough comment on this in the past that we've historically said our content on top of the RCP uses $10 million to $20 million of content and the team is doing a really good job of increasing that incremental content I think two three times from what we had prior had.

Speaker #3: If at any point your question is answered , you may remove yourself from the queue by pressing star two . We ask that you pick up your handset when posing your question to provide optimal sound quality .

Speaker #3: Again , we ask that you please limit yourself to one question and one follow up , and then queue up again with any additional thank you .

Is what today is in play for Curtiss Wright.

Our ongoing pursuit. So nothing is assured yet, but I do think we are going to really add meaningful business on top of the <unk> to the content, we have per AP 1000 plant.

Speaker #3: Our first question is coming from mile . Miles Walton with Wolfe Research . Please go ahead . Your line is open .

Speaker #7: Thanks . Good morning .

Speaker #6: Morning , morning .

Okay great.

Speaker #7: Lynn was wondering if you could pick up where you left off on the Ap1000 and maybe speak to the ships at content that you have currently on on that reactor .

And then just a follow up if I could on the bookings could you provide that.

Bye Bye segments defense electronics in particular did that bounce back and is there any concern on the government shutdown.

Pete Skibitzky: Okay, no, it's helpful. Thanks, guys.

Speaker #7: I've classically thought about it as $30 million per reactor coolant pump for reactor coolant pumps , but is it complement of your work scope improving there , increasing ?

Lynn M. Bamford: Thank you. We'll take our next question from Tony Bancroft with Gabelli Funds. Please go ahead.

So maybe I'll.

Start with a little color on bookings and then maybe Chris can walk through a little bit more of the specifics after that so.

Tony Bancroft: Hey, thank you so much. Congratulations, Lynn, Chris, and Jim. Great numbers and great job doing managing this. I just had a bigger picture here. You have four businesses that have very strong growth outlooks going forward, a lot of secular, just secular tailwinds for the long term. You've talked about M&A relating. Could you just maybe sort of just very high level walk me through, these are four big opportunities? How do you see you prioritize them? I mean, you only have so much CapEx that you can probably do and reinvesting in the business. Can you sort of prioritize those for me?

Speaker #7: Maybe just a level set us .

Broadly speaking good quarter, one one times book to Bill.

Speaker #5: Thank you . It's a timely question as we've been really looking into this and making sure we're appreciating the full range of content we have .

But the government shutdown and CR now shutdown.

<unk> is having some impact some portions of our business.

Speaker #5: And you start out with the Rcp's . Last time they were sold was just over $28 million per RCP . So you're , you know , in line with what you're thinking there .

In our largest end market the naval defense market, there really hasnt been much disruption.

Our year to date results and especially the growth in marine programs are very strong we work on large multi year.

Speaker #5: I'm really pleased we've made some rough comments on this in the past that , you know , we've historically said our content on top of the rcp's is 10 to $20 million of content , and the team is doing a really good job of increasing that incremental content .

Contracts and so that portion of the business has not been very affected the most prominent impact within our order book has been in the defense electronics segments, where the team has identified over $50 million of orders that have pushed out of Q3.

Speaker #5: I think 2 or 3 times from what we had prior had is , you know , what today is in play for Curtiss-Wright of , you know , these are ongoing pursuits .

During the CR and so this is definitely.

Speaker #5: So , you know , nothing is assured yet . But I do think , you know , we are going to really add meaningful business on top of the to the content we have per Ap1000 plant .

Lynn M. Bamford: I think we've been pretty transparent that our CapEx allocation and acquisition focuses over the recent past have been around our aerospace and defense and commercial nuclear markets, and those are priorities for the company in places where we see really strong growth, really differentiated technologies. I think one of the things we always remind people of, you take just, for example, pick one thing randomly, the electromechanical actuation capability that goes into industrial markets. It also is the same capability, engineering teams, manufacturing floors that builds this for the aerospace and defense markets. Even though our business lays on paper as if it has these different buckets and there's isolated pieces from an engineering capability, manufacturing standpoint, our businesses are intertwined across those end markets. It's something we're proud of and pursue that we've always believed.

Something that we're very closely tracking with your very competent none of this business has gone away the guys.

In the field talk to the customers and it's really a matter of being able to process. This business that the pipeline of business across defense electronics is healthy and growing.

Speaker #7: Okay , great . And then just to follow up , if I could on the bookings , could you provide that by by segment and defense electronics in particular .

Speaker #7: Did that bounce back . And is there any concern on the government shutdown .

And Theres a lot of things.

I want to take the time just talk on a couple of things that we're doing that is.

Speaker #5: So maybe I'll start with a little color on bookings and then maybe Chris can walk through a little bit more of the specifics after that .

Give us understanding as to why we are able to grow the pipeline of business for this so much and the things that would have kind of come up but just to touch on them briefly.

Speaker #5: So , you know , broadly speaking , you know , good quarter 1.1 times book to bill . But the government shutdown and you know KR and now shutdown , you know is is having some impacts on portions of our business .

Our confident we have the strongest most associates Cmos aligned offering in the marketplace.

And this year alone we've introduced 20 over 20, new product introductions into this.

Speaker #5: You know our largest end market , the naval defense market . There really hasn't been much disruption . You know , our year to date results and especially the growth in submarine programs are very strong .

Family of products, which is a very strong contribution out of the team and something we're really proud of we've talked about our Nvidia partnership.

We are now delivering Nvidia based products at the GTC show just a little while back we were the only company to.

Speaker #5: You know , we work on large multi-year contracts . And so that portion of the business is not been very affected . The most prominent impact within our order book has been in the defense Electronics segments , where the team has identified over $50 million of orders that have pushed out of Q3 during the CR .

Lynn M. Bamford: Investing in a technology once and taking it to different end markets is part of how Curtiss-Wright has achieved the margin expansion we've achieved over the past years. The latest, very visible example of that is the flight data recorder technology that was developed decades ago for defense applications and now has this fantastic foothold in a commercial application. I know I didn't really directly answer your question, but it's hard because the business, I see a business, and I see it going across many of our end markets. They're not just like, I can look at that business over there and that business over there and say it's just serving one of the end markets.

Demo Cmos based Blackwell processor. So again, that's something very special to Curtiss Wright, our fabric 100, which is the highest speed interconnect available in the marketplace is out and helping really provide a very unique differentiator for Curtiss Wright and our ability to provide <unk>.

Speaker #5: And so this is definitely , you know , you know , something that we're very closely tracking . We feel very confident . None of this business has gone away .

Speaker #5: The guys , you know , in the field talked to the customers and it's really a matter of being able to process this business that , you know , the pipeline of business , you know , across defense electronics is healthy and growing .

<unk> at that tactical edge.

But we're also doing things that we also are continuously looking at new capabilities that widen the application space, where we can sell our products to keep pushing those walls out and to name just one we've recently achieved.

Speaker #5: And there's a lot of things , you know , I want to take the time to just talk on a couple of things that we're doing that is , you know , gives understanding as to why we are able to grow the pipeline of business for this so much .

Microsoft Azure validated across several of our small form factor products.

Tony Bancroft: Great, thank you so much.

And that means these products have that been added to the Microsoft Azure locale, our catalog, which obviously has a huge customer reach and so that's something we're very excited about and again another another notable capability of taking cloud applications to the tactical edge. So.

Speaker #5: And there are things that have kind of come up . But just to touch on them briefly , you know , we are confident we have the strongest , most associate CMOs aligned offering in the marketplace .

Lynn M. Bamford: Thank you. We do have another question. We'll go to Alexandra Manderi with Truist Securities.

Speaker #5: And this year alone , we've introduced over 20 new product introductions into this . You know , family of products , which is a very strong contribution out of the team and something we're really proud of .

Alexandra Manderi: Hi. This is Alexandra Manderi on for Michael Chamoli, Truist Securities. Thanks for taking my question. How are you guys thinking about 2026 in terms of growth trajectories, markets, and margin expansion?

As <unk> said these are the types of things. The team is always doing that is ensuring that that pipeline is healthy and growth in spite of the fact, we did see the push out in Q3.

Speaker #5: We've talked about our Nvidia partnership , the you know , we are now delivering Nvidia based products at the GTC show . Just a little while back , we were the only company to demo a CMOs based Blackwell processor .

Lynn M. Bamford: I touched a little bit on 2026 in the prepared remarks that we feel good about driving growth across all three of the segments, so that's really positive. I tried to talk about some of the things that are going on in those closing remarks of what are the market dynamics, what are our technologies that support. You can look at things in the industry, whether it's the growth rates in commercial aerospace that Boeing and Airbus are talking about, to defense spending, to all things nuclear, which are sort of the ones that are top of everyone's minds, that will support that growth into 2026. We do believe we'll be well ahead of our 2024 investor day targets, really down the line. We're committed to driving operating margin expansion faster than cash.

So Chris I don't know if you want add some color on the segments sure. Let me, let me try to jump into some of the numbers here Myles and I think it's important to.

To note I think as you look at the overall orders and what's been happening for Curtis rates that we had a very strong first half enabled bookings.

Speaker #5: So again , that's something very special to Curtiss-Wright . Our fabric 100 , which is the highest speed interconnect available in the marketplace , is out and helping really provide a very unique differentiator for Curtiss-Wright in our ability to provide solutions at that tactical edge .

First thing is if you just remove that off the table, we have seen sequential growth.

And our orders since Q1.

And that includes defense electronics, so important to kind of pull that out.

Speaker #5: But we're also doing things that we also are continuously looking at new capabilities that widen the application space where we can sell our products to keep pushing those walls out , and to name just one .

The Q3 book to Bill was about one one times and that was on 9% sales growth we had a onetime.

Book to Bill in Aerospace and defense and we had a one two times.

Speaker #5: We recently achieved Microsoft Azure validated across several of our small form factor products , and that means these products have been added to the Microsoft Azure locale or catalog , which obviously has a huge customer reach .

Commercial so the orders were up 8% year over year on the.

Backlog.

Lynn M. Bamford: We'll be given more specific guide, obviously, on 2026 when we close out the year and have our Q1 call.

Was up 14%, we had a record backlog right now $3 9 billion.

Diving into the segments and just the book to Bill for the quarter, we were about a 104 on aerospace and industrial and Eurobond of 114 and naval empower we talked about the strength of the commercial aerospace orders and the nuclear orders on the call, but the dive into defense electronics, maybe just a little bit more on that.

Speaker #5: And so that's something we're very excited about. And again, another notable capability is taking cloud applications to the tactical edge.

K. Christopher Farkas: I would just say I hope we were able to kind of project some of that confidence in the script today in the areas that we kind of called out. We're excited for what's happening now, and as we look out into the future.

Speaker #5: So I list those to say these are the types of things the team is always doing . That is ensuring that that pipeline is healthy and growth in spite of the fact we did see the push out in Q3 .

Topic.

Speaker #5: So , Chris , I don't know if you want to add some color on the segments .

The order book did improve sequentially in the third quarter.

Lynn M. Bamford: At this time, there are no further questions in Q, and I would like to turn the floor back over to Lynn Bamford, Chair and Chief Executive Officer, for additional closing remarks.

Speaker #4: Sure .

Speaker #6: Yeah . Let me let me try to jump into some of the numbers here . Miles . And I think it's important to note , I think as you look at the overall orders and what's been happening for Curtiss-Wright , that we had a very strong first half in naval bookings , you know , the first thing is if you if you just remove that off the table , we have seen sequential growth , you know , in our orders since Q1 .

As Linda mentioned, the push outs had affected that it was a one times book to Bill had we not had the push outs. We're confident that it would have been one one times book to Bill backlog in that segment was up 3%.

Lynn M. Bamford: Thank you, everybody, for joining us today. We look forward to speaking with you possibly on the road or with our Q4 results out in the beginning of 2026. Have a good day.

Strong revenue growth of 10% it's above the prior year September backlog number.

But the book to Bill has been holding steady at a one time. So as we look at I mean right now we're assuming that the shutdown is going to get resolved here in mid November we believe that once that gets resolved. It's a $30 to 45 day turnaround time before orders begin to reserve resume a more normal flow.

Lynn M. Bamford: Thank you. This concludes today's Curtiss-Wright earnings conference call. Please disconnect your line at this time and have a.

Speaker #6: And that includes defense electronics . So important to kind of pull that out . The Q3 book to bill was about 1.1 times , and that was on 9% sales growth .

Speaker #6: We had a one time book to bill in aerospace and defense , and we had a 1.2 times in commercial . So the orders were up , you know , 8% year over year in the backlog is now , you know , up was up 14% .

But fortunately for us the businesses that are most impacted are generally short cycle in nature.

We would expect to recover very quickly so.

It is important to note that there is nothing thats affecting our 2025 guidance Johann mentioned the pipeline is strong we have good confidence levels in 2026.

Speaker #6: We're at a record backlog right now , 3.9 billion diving into the segments . And just the book to bill for the quarter .

Speaker #6: We were about a 1.04 on aerospace and industrial . And we were about a 1.14 in naval and power . We talked about the strength of the commercial aerospace orders and the nuclear orders on the call .

And <unk>.

Strong alignment to the customers' priorities next year's defense spending between the budget and reconciliations are up 13%. So we see positivity as we look out into the future. We just need these guys to come to agreement in the meantime.

Speaker #6: But to dive into defense electronics , maybe just a little bit more on that topic . The order book did improve sequentially here in the third quarter .

That's great.

I'm sorry, just to clarify on your prior thinking 1000 comment is the 10% to $20 million $10 million to $20 million of incremental content on AP 1000 is that historical.

Speaker #6: As Lynn had mentioned . You know , the push outs had affected that . It was a one times book to Bill . Had we not had the push outs , we're confident that it would have been a 1.1 times book to bill the backlog in that segment is up 3% on strong revenue growth .

Historical benchmark, which I should think about it as growing two to three times or is that the current spec alright benchmark.

That's the historical benchmark miles.

Add back in the niche.

Speaker #6: At 10% . It's above the prior year . September backlog number . But the book to Bill's been holding steady at a one time .

Thanks, so much.

Sure thing.

Thank you and we'll go next to the line of Christine Lewis with Morgan Stanley. Please go ahead.

Speaker #6: So as we look ahead I mean right now we're assuming that the shutdown is going to get resolved here in mid November . You know , we believe that once that gets resolved , it's a 30 to 45 day turnaround time before orders begin to resume .

Hey, guys. Good morning, and maybe following up on Michael's question on the AP 1000 pricing I just want to make sure we get it right.

When I mean in the past when you guys looked at your content. So each cooling tower used to be like $250 million roughly.

Speaker #6: Resume a more normal flow . But you know , fortunately for us , the businesses that are most impacted are generally short cycle in nature .

And then so build with <unk>.

Speaker #6: And we would expect to recover very quickly . So , you know , I think it's important to note that there's nothing that's affecting our 2025 guidance .

Twin towers would be about $500 million and I think the pull on what they are doing triplets, so that would be $750 million. So the numbers that you are seeing incremental to that the <unk> is that off of that specific piece or are we talking about the initial.

Speaker #6: Lynn mentioned the pipeline strong . We have a good confidence levels in 2026 . And , you know , strong alignment to the customers priorities .

Initial U S order from 2007, which has a much lower amount.

Speaker #6: Next year is defense spending between the budget and the reconciliation bill are up 13% . So we see positivity as we look out into the future .

So maybe just.

Back up a second and.

Speaker #6: We just need these guys to come to an agreement. In the meantime.

You look at our like even in our Investor day briefing from last year, we think of as a plant which has for RCP is and Thats. How we when we talk about our revenue per plant that's the framework for it.

Speaker #7: That's great . I'm sorry . Just to clarify , in your prior Ap1000 comment , is that 10 to 20 million , 10 to 20 million of incremental content on Ap1000 ?

Speaker #7: Is that a historical benchmark of which I should think about ? It's grown 2 or 3 times , or is that the current current benchmark ?

It's about we had 110 plus million dollars of revenue per plant.

Speaker #5: No , that's the historical benchmark . Miles that we had back in the mid-teens .

<unk>.

Poland is talking about building six plants, Bulgaria is talking about building two plants firm. He is talking about building four plants. So thats just the.

Speaker #7: So thanks so much .

Speaker #5: Sure . Thank .

Speaker #3: Thank you. And we'll go next to the line of Christine Lueg with Morgan Stanley. Please go ahead.

To keep the terminology because it's easy to get confused between the RCP sources, the plants and such and so.

Having that as a baseline.

Speaker #8: Hey guys . Good morning . And maybe following up on Miles question on the Ap1000 pricing . I just want to make sure we get it right .

Prior we had the rcp's and about 10% to $20 million of content.

Speaker #8: You know when I mean in the past when you guys looked at your content . So each cooling tower used to be like 250 million roughly dollars .

Per plant and that is the area, where we've been working very purposefully to.

Speaker #8: And then so a build with a Twin Towers would be about 500 million . And I think to Poland , one , they're doing triplets .

See where else we can supply.

Yes in house as a supplier to them and engaging with them on different work scopes and at this time.

Speaker #8: So that would be 750 million . So the numbers that you're saying incremental to that , the 2X3X is that off of that specific base or are we talking about the initial , you know , initial US order from , you know , 2007 , which is a much lower amount .

It looks like we are.

<unk>, taking that incremental on top of the Rtp's content that 10 to 20, and doubling or tripling it and it's still a work in progress as Theyre still working through their supply chain things and we're just trying to be there and support them as much as we can to make them successful so.

Speaker #5: So maybe just to back up a second . And if you look in our like even in our Investor Day briefing from last year , we think of as a plant which has four rcp's .

Pretty excited that that would be pushing that content per plant up into the mid one hundreds for sure.

Got you that makes sense. Thank you very much very much for that clarification and maybe.

Speaker #5: And that's how we've , you know , when we talk about our revenue per plant , that's the framework for it . We talked about we have 110 plus million dollars of revenue per plant .

Digging more into this on EP 1000, I mean look since your Investor day last year.

And we've seen a lot more support for U S.

Speaker #5: So , you know , Poland's talking about building six plants . Bulgaria is talking about building two plants . Fermi's talking about building four plants .

Large nuclear power plant builds and so we've seen the supportive executive orders from the White House, but then also last week, we saw cameco and Brookfield establish a transformational partnership with the U S government to accelerate deployment of Westinghouse nuclear reactors. I was wondering can you give us more color regarding the potential of the.

Speaker #5: So that's just, you know, to keep the terminology, because it's easy to get confused between the RCPs versus the plants and such.

Speaker #5: And so , you know , having that as a baseline , you know , prior , you know , we had the rcp's and about 10 to $20 million of content per plant .

<unk> market and the timing and also following up on the expected order that you have for 2026 are you expecting a Poland order and the U S order or is that just pull it in Bulgaria.

Speaker #5: And that is the area where we've been working very purposefully to see where else we can supply Westinghouse as a supplier to them .

Yes, so we.

<unk>.

Speaker #5: And engaging with them on different work scopes . And at this time , you know , it looks like we are , you know , targeting , taking that incremental on top of the RCP content that 10 to 20 and doubling or tripling it .

We work very closely with Westinghouse to try and I mean, this is a fast moving market and that announcement with age of fantastic to see because it's really the money that needs to really get this machine running. So we are very excited to see that partnership get announced and then there was also the announcement with Japan of putting some money into building nuclear in the U.

Speaker #5: And it's still a work in progress as they're still working through their supply chain things . And we're just trying to be there and support them as much as we can to make them successful .

And all of these things are sort of taking form, but two separate pretty positive announcements in October.

Speaker #5: So pretty excited that , you know , that would be pushing that content per plant , you know , up into the mid one hundreds for sure .

Relative to that so really well.

Speaker #8: Gotcha . That makes sense . Thank you very much . Very much for that clarification . And maybe you know , digging more into this Ap1000 , I mean , look , since your Investor Day last year and you know , we've seen a lot more support for us , large nuclear power plant builds .

What's in the public knowledge as funding for these 10 plants, how the Japan money overlaps with that I don't think there is I don't think there is a clear vision of it and we are.

Some insights from Westinghouse, but really sticking to what's in the public eye. We're focused on those first 10 plants, which is great and so.

Speaker #8: And so we've seen the supportive executive orders from the White House. But then also last week we saw Cameco and Brookfield establish a transformational partnership with the U.S. government to accelerate the deployment of Westinghouse nuclear reactors.

Today. The team is still does believe that first order, we get will be driven by the Poland opportunity, although both areas right there with it and the thinking is those will be ahead of the U S. But how this AED.

Speaker #8: I was wondering , can you give us more color regarding the potential of the US market and the timing and also following up on the expected order that you have for 2026 ?

<unk> one.

$1 billion, which as you know targeted that long lead material types of expenditures is going to play out now that still needs to take some form but.

Speaker #8: Are you expecting a Poland order and a US order , or is that just Poland and Bulgaria ?

So whether that happens in 2026 is very much TBD I wouldn't foreshadow that yet at this point, but we do feel good overall about getting our first order in 2026 and the team is doing a lot of work to get ready for it and to think through the various ramp scenarios.

Speaker #5: Yeah . So , you know , we we work very closely with Westinghouse to try and , you know , I mean , this is a fast moving market and that announcement was a just fantastic to see because it's really the money that needs to really get this machine running .

Speaker #5: So we were very excited to see that partnership get announced . And then there was also the announcement with Japan of , you know , putting some money into building nuclear in the US .

With this accelerated activity in the U S and then whats going on elsewhere.

Along with it.

Speaker #5: And , you know , all these things are sort of taking form . But , you know , two separate , you know , pretty positive announcements in October relative to that .

It's exciting, but our work on our <unk>.

Opportunities continues to grow and move towards prototyping to so the team's busy I'll leave it at that.

Speaker #5: So , you know , really what you know , what's in the public knowledge is this funding for these ten plants . You know how the Japan money , you know , overlaps with that ?

Yes, I mean, it seems like when it rains it pours and so can you just remind us what your capacity is to build an AP 1000, especially because right. The U S Navy content as.

Speaker #5: I don't think there's I don't think there's a clear vision of it . And , you know , we have , you know , some insights from Westinghouse .

He is also increasing so.

Just trying to understand what could you produce in a given year and you had called out elevated capex this year or next year.

Speaker #5: But really sticking to what's in the public eye . You know , we're focused on those first ten plants , which is great .

Speaker #5: And our work on our SMR opportunities continues to grow and move towards prototyping too . So the team's busy . I'll leave it at that .

Speaker #5: so today the team still does believe the first order we get will be driven by the Poland opportunity . Although Bulgaria is right there with it .

What is that supporting is this in anticipation of commercial nuclear power are the opportunities in the other segments that you had highlighted.

Yes so.

We think of our capacity.

It's 12 or 16 reactors per year, but again that needs dovetailed exactly as you just said with the with the naval work and I will say the.

<unk> is committed from a capex standpoint too.

Our investor day targets of 105% free cash flow conversion and we increased our capex spending both last year and this year by 30% each year and a lot of that is geared around preparing for expansion in this space and the $10 million that Chris spoke of in his prepared remarks.

Geared at expansion capabilities.

Tied to nuclear and so.

How what we need to be prepared for to support Westinghouse is a very active discussion with them.

Speaker #8: Yeah . I mean , it seems like when it rains , it pours . And so can you just remind us what your capacity is to build an EP 1000 especially because .

But we're we're trying to make sure we're doing the things that we're ahead of it.

We're prepared to support them and.

Speaker #8: Right , the US Navy content is also increasing . So just trying to understand what could you produce in a given year . And you had called out , you know , elevated CapEx this year or next year .

And that $10 million as part of US getting ahead of it.

Great. Thank you very much.

Thank you and we will take our next question from Peter Arment with Baird. Please go ahead.

Speaker #8: What is that supporting ? Is this an anticipation of commercial nuclear power or the opportunities in the other segments that you had highlighted ?

Hey, good morning, Lynn and Christian and nice results.

Hey, Chris maybe just to stay on the theme maybe 1000, if you get an order in 2020, maybe could you just give us a high level. How how quickly you can begin to recognize revenues on that I remember back in what the China direct order how that all works back in the day, but maybe just to level set us on how quickly that begins to flow through on the financials.

Speaker #5: Yeah . So , you know , we think of our capacity as 12 or to 16 reactors per year , but again , that's needs dovetailed exactly as you just said , with the with the naval work .

Speaker #5: And I will say , you know , the team is committed from a CapEx standpoint to , you know , our Investor Day targets of 105% free cash flow conversion .

And then I have a follow up.

Yes, sure I think we've got a lot of discussion on the call today regarding reactor coolant pumps, and then other content and I'll focus on the reactor coolant pumps to begin with.

Speaker #5: And we increased our CapEx spending both last year and this year by 30% each year . And a lot of that is geared around preparing for , expansion in this space .

When we get that first quarter I think a lot of it is going to depend upon.

The timing of receipts and long lead materials and how quickly we can get that in the door. When you talked about the fact that we are in active discussions with our customer regarding capacity and how to accelerate potentially some of those flows.

So.

As you look at it with the receipt of the order and what's going to be under PUC.

POC accounting and typically in the past it was made.

A five year Bell curve I think the China contract.

Went out seven years, because theyre schedule was delayed but with this flood of activity that we're seeing here.

You.

See that be.

<unk>.

Into a tighter window than its been a five year period of recognition.

So again, a lots going to depend upon the timing of the material receipts and then the labor that kind of follows that.

There would be some revenue recognition upfront for 2026, but then it quickly accelerate in 2027, when we talk about this extra or the sort of the other products that can go into the AP 1000 power plants.

Lot of that won't be long lead material type items, you have got to get some of that bigger stuff into the plant first so I would expect that to be recognized a little bit farther towards the backend of the bell curve, but certainly.

An opportunity for us as well.

I appreciate that color. Thank you for that and then just on the I.

I guess near term more when you think about your targets that you put out there for it.

A doubling of the business by 2028 did you contemplate a lot of these.

Restarts that we're seeing whether it's palisades, a three mile island or or some of the others when.

When you were thinking about that planning just because it seems like that is again, an incremental tailwind to all things else nuclear.

Yes, I mean that was.

There might've been talk about it but that was not on.

On the table at it at a level that we would've had that in how we put together our targets. So.

There is a lot of things a lot of good things have happened since.

Since we put our targets out.

15 months ago 18 months ago. However, long it was it's amazing how the industry has.

Come alive and.

Announcements around Europe.

<unk> announcement with picking Rolls Royce I mean, there's just there's a lot of things that are incrementally happening, but you are right that that is new.

This whole this whole AI wave has been something that's been new for us as well and that's a lot of positive momentum and I would just.

Remind.

The listeners.

If you go back and look at what we provided at Investor Day, and we said, we would be doing $1 $5 billion in annual promotion nuclear revenue by the middle of this next decade that willingly contemplated the European opportunity at that point in time so.

Several years away from that.

The middle of this next decade, but we feel much stronger and more confident in the yard with possible.

It was as it was labeled at that point then than we did back in May.

Appreciate all the color thanks, guys.

Thank you and we'll go next to Scott <unk> with Deutsche Bank. Please go ahead.

Hey, Good morning, Lynn are you seeing meaningful retrofit demands from the 25 hour flight data recorder, yet or is it primarily only OEM demand at this point and then how should we think about the retrofit gross margins on that product relative to the OE margins.

So.

It is it is a blend but a lot of the retrofit is I think staging of material to prepare for the retrofit more than the actual retrofits as our understanding with dealing with our customer that is honeywell.

Yes. This whole this whole AI wave has been something that's been new for us as well and that's a lot of positive momentum and I would just.

And so.

So I think thats very much another layer. That's ahead of us as this market. We just continue to say it.

It remind.

The listeners.

You go back and look at what we've provided in Investor Day, and we said, we would be doing $1 $5 billion in annual commercial nuclear revenue by the middle of this next decade that really only contemplated the European opportunity at that point in time. So I know, we're still several years away from that.

It's going to continue to grow through the back half of that year as that comes to reality, but it's not even just the retrofit market. It is also.

We are working with Honeywell to figure out.

How we would have an appropriate product offering that will target. The regional jets that are over 30 feet that are also part of this mandate as are obviously big big numbers and our work with Airbus continues on in a positive manner and we think we will receive certification in the first half of 2026, and then we need to see how our production ramp.

The middle of this next decade, but.

We feel much stronger and more confident in the art of the possible as it was as it was labeled at that point then than we did back in May.

I appreciate all the color thanks, guys.

So we've really not given a life.

Thank you and we'll go next to Scott <unk> with Deutsche Bank. Please go ahead.

10 year view of revenue on this program yet because there are there are still a lot of moving parts that are taking form and really how this retrofit is going to take place is it.

Hey, Good morning, Lynn are you seeing meaningful retrofit demand for the 25 hour flight data recorder, yet or is it primarily only OEM demand at this point and then how should we think about the retrofit gross margins on that product relative to the OE gross margins.

It's still a little bit of a work in progress and really we haven't given much color on the ship set content nor the margin on this.

So it is it is a blend but a lot of the retrofit is I think staging of material to prepare for the retrofit more than the actual retrofits as our understanding with dealing with our customer that is honeywell.

This for the OEM or the projection, but I will say it.

Neil inside of our defense Electronics segment as you know and.

We like the products, we produce to support the margins in the segment.

Okay and then when can you give an update on the state of the M&A pipeline and how we might think about the opportunity for a re acceleration in M&A activity in 2026.

And.

So I think that's very much another layer that's ahead of us as this market.

<unk> continued to say.

It's going to continue to grow through the back half of the ear as that comes to reality, but it's not even just the retrofit market. It is also.

Yeah, So I mean it.

We're not bashful about saying, it's our top priority.

And the team is definitely out there we have some a couple properties that we are having discussions with that.

Yes, we are working with Honeywell to figure out how we would have an appropriate product offering that will target. The regional jets that are over 30 seat. There also part of this mandate those are obviously big big numbers and our work with Airbus continues on in a positive manner and we think we will receive certification in the first half of 2000.

Our more ones that I like when we work with somebody possibly to come join Curtiss Wright in a proprietary fashion more than we are in an auction.

I know some people have noted.

We've kind of acted that there was more excitement and then not announced anything over the past.

26, and then we need to see how our production ramps with the so we've really not given a life.

Earlier part of 2020, I do remind everybody we only closed on ultra.

10 year view of of revenue on this program yet because there are there are still a lot of moving parts that are taking form and it really how this retrofit is going to take place is it still a little bit of a work in progress and really we haven't given much color on the ship set content nor the margin on.

<unk> at the end of last year change by a terminology.

At the end of last year, so that's going great but.

But we do have some properties were looking at that are very strategic in nature for how they would add to our portfolio and there's still a lot of focus on it but strategic fit and financial fit we're not going to overpay for a property and some of the things that we thought were strategic fit just the price tag.

This for the OEM or the projections, but I will say, it's Neil inside of our defense Electronics segment as you know and.

We like the products, we produce to support the margins in the segment.

I just I don't think it would create value for our shareholders and we're not going to do with at the moment.

Okay and then when can you give an update on the state of the M&A pipeline and how we might think about the opportunity for a re acceleration in M&A activity in 2026.

Okay. Thank you.

Thank you.

And then as a reminder, once again if you do have a question you May press star one on your telephone keypad at this time, we will take our next question from Nathan Jones with Stifel. Please go ahead.

Yeah. So I mean, it's you know we're not bashful about saying, it's our top priority and the team is definitely out there we have some a couple of properties that we are having discussions with that.

Good morning, everyone.

Thank you.

I guess I'll ask you a non nuclear question.

Our more ones that I like when we work with somebody possibly to come join Curtiss Wright in a proprietary fashion more than we're in an auction.

Talked about it.

Stabilization in industrial vehicles and.

Maybe a little bit of a positive inflection.

I know some people have noted.

In orders during the quarter, so maybe just a little bit more color on.

Yes.

Kind of acted there was more excitement and then not announced anything over the past.

Regions geographies or end markets that might be driving that improvement or any color you've got for today.

Earlier part of 2026, I do remind everybody you know we only closed on ultra.

Yes, so I'll start.

Obviously, it's been a very challenging situation for industrial vehicle markets as a whole.

<unk> at the end of last year change by terminology.

At the end of last year, so that's going great but.

And the team has been doing a great job in staying above that and flat for the year I think as we position ourselves for this next year and look forward, while we do recognize that the north American on highway markets are going to continue to be challenged channel. We do feel that there are some opportunities in pockets in Europe as the team.

But we do have some properties were looking at that are very strategic in nature for how they would add to our portfolio and there is still a lot of focus on it but strategic fit and financial fit we're not going to overpay for a property and some of the things that we thought were strategic fits just the price tag.

Continues to try to exceed.

Expand its market customer and market reach in a few areas.

I just I don't think it would create value for our shareholders and we're not going to do it at the moment.

But the team is doing and we're seeing some good signs within the order book.

Okay. Thank you.

Thank you and then as a reminder, once again if you do have a question you May press star one on your telephone keypad at this time, we will take our next question from Nathan Jones with Stifel. Please go ahead.

Actually had an.

An improvement here in the third quarter.

It was roughly 4% year over year and again.

Sometimes reluctant to talk about these data points that are hot off the presses, but where we had a very strong October.

Good morning, everyone.

Yes.

I guess I'll ask you a non nuclear question.

<unk>.

That's a real positive kind of a standout month over the past few years and with the conversations that we're having with some of our customers. We feel like we're positioning ourselves for a very strong fourth quarter. So I don't want to diminish the.

You talked about it.

Stabilization in industrial vehicles and.

Maybe a little bit of a positive inflection.

In orders during the quarter, so maybe just a little bit more color on.

Regions geographies or end markets that might be driving that improvement or any color you've got for today.

<unk>.

The fact that there will be challenges again for this market in 2006, we expect uplift in 2007, but.

Yeah. So I'll start out I mean, obviously, it's been a very challenging situation for industrial vehicle markets as a whole.

But the team is doing a great job and.

They continue to kind of push the boundaries to gain more share.

The team has been doing a great job at staying above that and flat for the year. I think you know as we position ourselves for this next year and look forward, while we do recognize that the north American on highway markets are going to continue to be challenged we do feel that there are some opportunities in pockets in Europe as the team continues.

And then maybe one just on.

Following up on that.

The government shutdown.

Potential impact.

Star equally that.

When we've had based kinds of disruption it tends to make the defense electronics business, especially maybe a little more second half weighted once it gets resolved I think Chris you were talking about some of the delays.

To try to expand.

Expand its market its customer and market reach and in a few areas.

But the team is doing we're seeing some good signs within the order book, we actually had an.

More on the short cycle side. So maybe just any color you can give us on expected cadence through the year.

An improvement here in the third quarter.

2026 relative to our historical pattern just based on what's happened so far so far thanks.

That was roughly 4% year over year and again <unk>.

Sometimes reluctant to talk about these data points that are hot off the presses, but where we had a very strong October and.

Yes, so we have been very focused over the past few years of trying to make the fourth quarter less or not dramatic and I think as you look at what's happening here in the fourth quarter. We've got a very strong backlog. We raised the bottom end of our guidance here to show a little bit of increased confidence as we go to close out the year.

Thats.

Real positive kind of a standout month over the past few years and with the conversations that we're having with some of our customers. We feel like we're positioning ourselves for a very strong fourth quarter. So I don't want to diminish that.

2025, but to the extent that the government shutdown continues and we have delays in the receipt of of those orders, yes. It will take a little bit of time to kind of pick back up so im assuming that there will be a little bit more pressure on Q1 at this point in time.

<unk>.

The fact that there will be challenges again for this market in 2006, we expect uplift in 2007, but.

But the team is doing a great job and.

They continue to kind of push the boundaries to to gain more share.

Then then they would historically.

Shortly and that will force this to be a little bit more back half weighted.

And then maybe one just on.

Following up on the.

The government shutdown.

But we are confident in the orders that are out there and coming our way and we will cautiously balance that against things like advanced buys and other positions in inventory that will help us to kind of recover and deliver those revenues to our customers as fast as possible because I know that they want the orders they want.

Potential impact.

I think historically that.

When we've had these kinds of disruption it tends to make the defense electronics business, especially maybe a little more second half weighted once it gets resolved.

Chris you were talking about some of the delays being more on the short cycle side. So maybe just any color you can give us on expected cadence through the year in 2026 relative to our historical pattern just based on what's happened so far and so far thanks.

The product and.

They're equally disappointed with.

What's happening here right now so.

I would expect there to be a little bit of pressure on Q1, but then we will recover over the course of the year and we will continue to try to keep the fourth quarter from being.

Yes, so we have been very focused over the past few years is trying to make the fourth quarter less or not dramatic and I think as you look at what's happening here in the fourth quarter. We've got a very strong backlog. We raised the bottom end of our guidance here to show a little bit of increased confidence as we go to close out the year and.

A dramatic data point.

Thanks, very much for taking the questions.

Thanks Nathan.

Thank you and we'll go next to.

Keith.

<unk> with Alembic Global Please go ahead.

2025, but to the extent that the government shutdown continues and we have delays in the receipt of of those orders, yes. It will take a little bit of time to kind of pick back up so im assuming that there will be a little bit more pressure on Q1 at this point in time.

Hey, good morning, guys nice quarter.

I wanted to ask.

Specifically about the Switzerland business in defense electronics, the turret drive stabilization business because it seems like some of your key customers like <unk> for instance are getting.

Good amount of new orders for ground vehicles.

Then then there would historically and that that will force us to be a little bit more back half weighted.

Wondering if you could talk to the kind of the visibility in that business. It seems like the growth outlook and maybe even outperform your.

The rest of that segment. So I was wondering if you could talk that through with us.

But we are confident in the orders that are out there and coming our way and we will cautiously balance that against things like advanced buys and other positions in inventory that will help us to kind of recover and deliver those revenues to our customers as fast as possible because I know that they want the orders they want.

And may be valid also I'm assuming that does.

Does it use commercial pricing. Unlike some of the rest of day, maybe you can clarify that as well thanks.

So.

This is just to put the name on the team and the data have been part of Carter's right for several decades. It had periods of strength years gone by we talked about.

The product and.

They're equally disappointed with.

What's what's happening here right now so.

The Kingdom of Saudi Arabia program about a decade ago and it was on a growth trajectory and.

I would expect there to be a little bit of pressure on Q1, but then we will recover over the course of the year and we will continue to try to keep the fourth quarter from being a.

<unk>.

Prior to the Ukraine War and such.

Dramatic data point.

Been a very slow growth portion of our business.

Thanks, very much for taking the questions.

We expected it to pick up.

Thanks Nathan.

I think when Europe woke up and realized what they had for the military vehicles and it has been slower than we thought but it's pretty exciting that.

Thank you and we'll go next to.

Pete Dubicki with Alembic Global Please go ahead.

Hey, good morning, guys nice quarter.

It does feel like it has turned the corner and those.

I Wonder I wanted to ask.

Specifically about the Switzerland business in defense electronics.

So we have to elevate.

A very good relationship with Ryan Natal and.

Drive stabilization business because it seems like some of your key customers like <unk> for instance are getting.

Their strategic partner for turret drive stabilization with nice.

Good amount of new orders for ground vehicles. So I was just wondering if you could talk to the kind of the visibility in that business. It seems like the growth outlook and maybe even outperform your the rest of that segment. So I was wondering if you could talk that through with us.

As I mentioned in the prepared remarks, the wins for the <unk> 30, So that's a first for them getting outside of the European market, but.

Germany is kind of leading the charge of.

And may be valid also I'm, assuming that unit does it use commercial pricing. Unlike some of the rest of day, maybe you can clarify that as well thanks.

Being committed to ramping their vehicles and.

We're very much aligned with them to be participation of that so.

So.

Yes, I mean this is just the but the nature on the team I mean, they've been part of Curtiss Wright for several decades. It had periods of strength years gone by we talked about the the kingdom of Saudi Arabia program about a decade ago. When it was on a growth trajectory and.

I don't think its appropriate really to talk about the pricing at this point.

They are.

Not subject to the far obviously.

And.

The product does have applicability into some commercial markets outside of the defense, we sell it into utility trains in a couple of other end markets. So there is a commercial capability, but I'll just leave it at that.

Yeah.

Prior to the Ukraine War and such.

It's been a very slow growth portion of our business.

Yes, we expected it to pick up.

Okay. That's helpful. Thanks, guys.

I think when Europe woke up and realized.

Thank you and we will take our next question from Tony Bancroft with Gabelli. Please go ahead.

What they had for the militarized vehicles and it has been slower than we thought but it's pretty exciting.

Hey, Thank you so much congratulations Chris.

It does feel like it has turned the corner and those orders are going to deliver and we have.

Chris and Jim Great.

Numbers.

Great.

Great great job doing it.

A very good relationship with Ryan Mattel and.

Got it.

Bigger picture here.

Are there strategic partner for turret drive stabilization, yes. It was nice you mentioned in the prepared remarks the win for the <unk> 30. So you know that's a first for them getting outside of the European market, but.

<unk> businesses.

Very strong.

Growth outlooks.

Going forward a lot of secular secular tailwind.

Long term and you've talked about M&A.

Lighting.

Germany is kind of leading the charge of.

Sure just very high level walk me through.

Being committed to ramping their vehicles and.

These are four big opportunities how do you see you prioritize them and you only have so much capex that you can probably do it.

We're very much aligned with them to be participation of that so.

Reinvesting in the business can you sort of just sort of prioritize those for me.

Okay.

I don't think it's appropriate really to talk about their pricing at this point.

So.

I think as we've been pretty transparent that our capex allocation and acquisition focuses over the recent past has been around our aerospace and defense and commercial nuclear market and.

There.

Not subject to the far obviously.

And.

The product does have applicability into some commercial markets outside of defense, we sell it into tilting trains in a couple of other end markets. So there is a commercial capability, but I'll just leave it at that.

Our priorities for the company.

<unk>.

In places, where we see really strong growth really differentiated technologies, but I think one of the things we always.

Okay. That's helpful. Thanks, guys.

Thank you and we will take our next question from Tony Bancroft with Gabelli funds. Please go ahead.

We remind people of you take just for example pick one thing randomly the electromechanical actuation capability that goes into industrial markets. It also has the same capability engineering teams manufacturing floors that has built this for the aerospace and defense market, So even though our business.

Hey, Thank you so much and congratulations Lynn, Chris and Jim Great.

Great numbers.

Great great.

Great great job doing job managing this.

Sure.

Bigger picture here.

For businesses.

Lays on paper as if it has these different buckets and theres isolated pieces from an engineering capability manufacturing standpoint, our businesses are intertwined across those end markets and it's something we're proud of and pursue that we've always believed that <unk>.

Very strong.

Growth outlooks.

Going forward a lot of secular secular tailwind for the long term.

And you've talked about M&A.

Relating.

Could you just maybe sort of just very high level walk me through.

These are four big opportunities how do you see you prioritize them I mean, you only have so much capex that you can probably do it.

Investing in a technology, one and taking it to different end markets.

Part of how Curtiss Wright has achieved the margin expansion we've achieved over the past year then.

Reinvesting in the business and could you just sort of.

Prioritize those for me.

Latest very visible example of that is the flight data recorder technology that was developed.

So you know.

I think you is we've been pretty transparent that our capex allocation and acquisition focuses over the recent past has been around our aerospace and defense and commercial nuclear markets and.

Decades ago.

For defense applications and now has this fantastic foothold into commercial applications. So I know I didn't really directly answer your question, but it's hard because the business.

Our priorities for the company.

Our IC business and I see it going across many of our end markets Theyre not just like I can look at that business over there in that business over there and say it just serving one of the end markets.

You know in places, where we see really strong growth really differentiated technologies, but I think one of the things we always remind people of you take just for example pick one thing randomly the electromechanical actuation capability that goes into industrial markets. It also is the same.

Great. Thank you so much.

Thank you.

You have another question will go to.

Capability engineering teams manufacturing floors that is build this for the aerospace and defense market. So even though our business lays on paper as if it has these different buckets and theres isolated pieces from an engineering capability manufacturing standpoint, our business.

Alexandra memory that's true.

This does the engine andriy on for Michael Similarly Securities. Thanks for taking my question.

How are you guys thinking about 2026 in terms of cost trajectory and markets and margin expansion.

So I touched a little bit on 2026 in the prepared remarks that we feel good about driving growth across all three of the segments.

These are intertwined across those end markets and it is something we're proud of and pursue that we've always believed that <unk>.

So that's really positive.

Investing in the technology, once and taking it to different end markets.

Try to talk about.

Some of the things that are going on in those closing remarks of what are the market dynamics, what are our technologies that support.

Part of how Curtiss Wright has achieved the margin expansion, we've achieved over the past years and.

Hey, that's very visible example of that is the flight data recorder technology that was developed over.

Support you can look at things in the industry, whether the growth rates in commercial aerospace that Boeing and Airbus are talking about to defense spending to all things.

<unk> decades ago.

For defense applications and now has this fantastic foothold into commercial applications. So I know it didn't really directly answer your question, but it's hard because the business.

Nuclear is sort of the ones that are top of everyone's minds that.

We will support that growth into 2026th we do believe we'll be well ahead of our 2024 Investor day targets.

Our IC business and I see it going across many of our end markets Theyre not just like I can look at that business over there in that business over there and say, it's just serving one of the end markets.

Really down down the line.

And.

We're committed to driving operating margin expansion faster than <unk>.

Great. Thank you so much.

Cash and we'll be giving more specific guide obviously on 2026, when we close out the year and have our Q1 call.

Thank you and we do have another question will go to <unk>.

Alexandra <unk> with <unk> Securities.

This was an interim andriy on for Michael Tamales Turo Securities. Thanks for taking my question.

So I would just say I hope, we were able to kind of projection of that confidence in the script today, we and the areas that we kind of called out where we're excited for what's happening now and as we look out into the future.

How are you guys thinking about 2026 in terms of cost reductions and markets in March the expansion.

So I touched a little bit on 2026 in the prepared remarks that we feel good about driving growth across all three of the segments.

At this time there are no further questions in queue and I would like to turn the floor back over to London for chair and Chief Executive Officer for additional or closing remarks.

So that's really positive.

Good to talk about with some of the things that are going on in those closing remarks.

Thank you everybody for joining us today, and we look forward to speaking with you, possibly on the road or with our Q4 results out in the beginning of 2026, so have a good day.

What are the market dynamics, what are our technologies that.

Support you can look at things in the industry, whether it's the growth rates in commercial aerospace that Boeing and Airbus are talking about to defense spending to all things.

Thank you. This concludes today's Curtiss Wright earnings Conference call. Please disconnect. Your line at this time and have a.

Nuclear is sort of the ones that are top of everyone's minds that will.

We will support that growth into 2026th we do believe we'll be well ahead of our 2024 Investor day targets.

Really down down the line and.

We're committed to driving operating margin expansion faster than.

Cash and we'll be giving more specific guide obviously on 2026, when we close out the year and have our Q1 call.

So I would just say I hope, we were able to kind of projection of that confidence in the script today, we and the areas that we kind of called out where we're excited for what's happening now and as we look out into the future.

At this time there are no further questions in queue and I would like to turn the floor back over to Lindon for chair and Chief Executive officer for additional or closing remarks.

Thank you everybody for joining us today, and we look forward to speaking with you, possibly on the road or what.

Our Q4 results out in the beginning of 2026, so have a good day.

Thank you. This concludes today's Curtiss Wright earnings Conference call. Please disconnect your lines at this time and have a wonderful day.

Okay.

Hum.

Okay.

[music].

Okay.

[music] Hum.

Hum.

[music].

Hum.

Hum.

[music].

Okay.

Okay.

[music].

Okay.

[music].

Hum.

Uh huh.

[music].

Okay.

Mhm.

Hum.

[music].

Okay.

Hum.

Uh-huh.

Uh-huh.

[music].

Hum.

[music].

Okay.

Okay.

Hum.

Hum.

[music].

Hum.

Okay.

Okay.

Okay.

Hum.

[music].

Hum.

Okay.

Hum.

[music].

Mhm.

Okay.

Hum.

Hello.

Oh.

Mhm.

[noise] [music].

Oh.

[music].

Hum.