Blue Bird Q1 2026 Blue Bird Corp Earnings Call | AllMind AI Earnings | AllMind AI
Q1 2026 Blue Bird Corp Earnings Call
Speaker #1: Hello, everyone. Thank you for attending today's Blue Bird Fiscal 2026 first-quarter earnings call. My name is William, and I'll be your moderator today. All lines will be muted during the presentation portion of the call, with an opportunity for questions and answers at the end.
Operator: Hello, everyone. Thank you for attending today's Blue Bird Fiscal 2026 Q1 Earnings Call. My name is William, and I'll be your moderator today. All lines will be muted during the presentation portion of the call, with an opportunity for questions and answers at the end. If you would like to ask a question, please press star one on your telephone keypad. At this time, I would now like to pass the conference over to our host, Mark Benfield, Blue Bird's Head of Investor Relations. Mark?
Operator: Hello, everyone. Thank you for attending today's Blue Bird Fiscal 2026 Q1 Earnings Call. My name is William, and I'll be your moderator today. All lines will be muted during the presentation portion of the call, with an opportunity for questions and answers at the end. If you would like to ask a question, please press star one on your telephone keypad. At this time, I would now like to pass the conference over to our host, Mark Benfield, Blue Bird's Head of Investor Relations. Mark?
Speaker #1: If you would like to ask a question, please press star one on your telephone keypad. At this time, I would now like to pass the conference over to our host, Mark Benfield, Blue Bird's Head of Investor Relations.
Speaker #1: Mark.
Speaker #2: Thank you. And welcome to Blue Bird's
Mark Benfield: Thank you, and welcome to Blue Bird's Fiscal 2026 Q1 earnings conference call. The audio for our call is webcast live on blue-bird.com under the Investor Relations tab. You can access the supporting slides on our website by clicking on the Presentations box on the IR landing page. Our comments today include forward-looking statements that are subject to risks that could cause actual results to be materially different. Those risks include, among others, matters we have noted on the following two slides and in our filings with the SEC. Blue Bird disclaims any obligation to update the information in this call. This afternoon, you will hear from Blue Bird's President and CEO, John Wyskiel, and CFO, Razvan Radulescu. Then we'll take some questions. Let's get started. John?
Mark Benfield: Thank you, and welcome to Blue Bird's Fiscal 2026 Q1 earnings conference call. The audio for our call is webcast live on blue-bird.com under the Investor Relations tab. You can access the supporting slides on our website by clicking on the Presentations box on the IR landing page. Our comments today include forward-looking statements that are subject to risks that could cause actual results to be materially different. Those risks include, among others, matters we have noted on the following two slides and in our filings with the SEC. Blue Bird disclaims any obligation to update the information in this call. This afternoon, you will hear from Blue Bird's President and CEO, John Wyskiel, and CFO, Razvan Radulescu. Then we'll take some questions. Let's get started. John?
Speaker #2: Fiscal 2026 first-quarter earnings conference call. The audio for our call is webcast live on Blue-Bird.com under the Investor Relations tab. You can access the supporting slides on our website by clicking on the presentations box on the IR landing page.
Speaker #2: Our comments today include forward-looking statements that are subject to risks that could cause actual results to be materially different. Those risks include—among others—matters we have noted on the following two slides and in our filings to SEC.
Speaker #2: Blue Bird disclaims any obligation to update the information in this call. This afternoon, you will hear from Blue Bird's President and CEO, John Wyskiel, and CFO, Razvan Radulescu.
Speaker #2: Then we'll take some questions. Let's get started. John?
Speaker #3: Thanks, Mark. And good afternoon, everyone. And thanks for joining us today. It's great to be here, and we are excited to share with you our Fiscal 2026 first-quarter financial results.
John Wyskiel: Thanks, Mark, and good afternoon, everyone, and thanks for joining us today. It's great to be here, and we are excited to share with you our fiscal 2026 first quarter financial results. Once again, the Blue Bird team delivered outstanding Q1 sales and Adjusted EBITDA, and we are off to a great start. Razvan will take you through the details of our financial results shortly, but I will walk you through some of the key takeaways for the first quarter on slide 6. First, Blue Bird beat guidance on all metrics for the quarter. This is despite the impact and volatility associated with the administration's policy on tariffs. We continue to navigate this situation well and have beat guidance for the last 13 quarters, validating the strength in our management and business model. Order intake for the period was exceptionally strong.
John Wyskiel: Thanks, Mark, and good afternoon, everyone, and thanks for joining us today. It's great to be here, and we are excited to share with you our fiscal 2026 first quarter financial results. Once again, the Blue Bird team delivered outstanding Q1 sales and Adjusted EBITDA, and we are off to a great start. Razvan will take you through the details of our financial results shortly, but I will walk you through some of the key takeaways for the first quarter on slide 6. First, Blue Bird beat guidance on all metrics for the quarter. This is despite the impact and volatility associated with the administration's policy on tariffs. We continue to navigate this situation well and have beat guidance for the last 13 quarters, validating the strength in our management and business model. Order intake for the period was exceptionally strong.
Speaker #3: Once again, the Blue Bird team delivered outstanding Q1 sales and adjusted EBITDA. And we are off to a great start. Razvan will take you through the details of our financial results shortly.
Speaker #3: But I will walk you through some of the key takeaways for the first quarter on slide six. First, Blue Bird beat guidance on all metrics for the quarter.
Speaker #3: This is despite the impact in volatility associated with the administration's policy on tariffs. We continued to navigate this situation well in a beat guidance for the last 13 quarters.
Speaker #3: Validating the strength in our management and business model. Order intake for the period was exceptionally strong. Our Q1 order intake was up 45% from the first quarter of 2025.
John Wyskiel: Our Q1 order intake was up 45% from Q1 2025, which pushed our backlog to a seasonally strong 3,400 units. This is a great start to the year, especially as we come into the order season. Operationally, we continue to perform with all metrics pointing in the right direction, and the team has been able to execute on a day-to-day basis while simultaneously developing detailed manufacturing plans for the future. In terms of pricing, we remain extremely disciplined. Bus prices remain higher than the previous year and the previous quarter. As I've communicated before, this process is just how we manage the business. In the Alternative Power segment, our dominance continues. Our EV backlog is now into 2027. We remain exclusive in propane, which has the lowest Total Cost of Operation, and our gas variant continues to be a leader.
John Wyskiel: Our Q1 order intake was up 45% from Q1 2025, which pushed our backlog to a seasonally strong 3,400 units. This is a great start to the year, especially as we come into the order season. Operationally, we continue to perform with all metrics pointing in the right direction, and the team has been able to execute on a day-to-day basis while simultaneously developing detailed manufacturing plans for the future. In terms of pricing, we remain extremely disciplined. Bus prices remain higher than the previous year and the previous quarter. As I've communicated before, this process is just how we manage the business. In the Alternative Power segment, our dominance continues. Our EV backlog is now into 2027. We remain exclusive in propane, which has the lowest Total Cost of Operation, and our gas variant continues to be a leader.
Speaker #3: Which pushed our backlog to a seasonally strong 3,400 units. This is a great start to the year, especially as we come into the order season.
Speaker #3: Operationally, we continue to perform, with all metrics pointing in the right direction. The team has been able to execute on a day-to-day basis while simultaneously developing detailed manufacturing plans for the future.
Speaker #3: In terms of pricing, we remain extremely disciplined. Us prices remain higher than the previous year, and the previous quarter. As I've communicated before, this process is just how we manage the business.
Speaker #3: In the all-power segment, our dominance continues. Our EV backlog is now into 2027. We remain exclusive in propane, which has the lowest total cost of operation.
Speaker #3: And our gas variant continues to be a leader. All-Power is a segment we created more than 15 years ago, and we continue to maintain our lead position.
John Wyskiel: Alternative Power is a segment we created more than 15 years ago, and we continue to maintain our lead position. We continue to develop our investment thesis, as I explained before. Our manufacturing strategy encompasses many Factory of the Future concepts that will be rolled into our new assembly plant. During the quarter, we completed our analysis of automation use cases and have locked in on a roadmap. The initiative has a strong return, but this strategy also creates a path for ongoing cost improvement through other Industry 3.0 and 4.0 opportunities. And finally, we continue to manage the impact of the administration's executive orders and tariff volatility. We are fortunate to be well-positioned to navigate this situation to a margin-neutral outcome. Consistent with past communications, it is our objective to position this business to be a strong long-term investment.
John Wyskiel: Alternative Power is a segment we created more than 15 years ago, and we continue to maintain our lead position. We continue to develop our investment thesis, as I explained before. Our manufacturing strategy encompasses many Factory of the Future concepts that will be rolled into our new assembly plant. During the quarter, we completed our analysis of automation use cases and have locked in on a roadmap. The initiative has a strong return, but this strategy also creates a path for ongoing cost improvement through other Industry 3.0 and 4.0 opportunities. And finally, we continue to manage the impact of the administration's executive orders and tariff volatility. We are fortunate to be well-positioned to navigate this situation to a margin-neutral outcome. Consistent with past communications, it is our objective to position this business to be a strong long-term investment.
Speaker #3: We continue to develop our investment thesis as I've explained before. Our manufacturing strategy encompasses many factory of the future concepts that will be rolled into our new assembly plant.
Speaker #3: During the quarter, we completed our analysis of automation use cases. And have locked in on a roadmap. The initiative has a strong return. But this strategy also creates a path for ongoing cost improvement through other industry 3.0 and 4.0 opportunities.
Speaker #3: And finally, we continue to manage the impact of the administration's executive orders and tariff volatility. We are fortunate to be well positioned to navigate this situation to a margin-neutral outcome.
Speaker #3: Consistent with past communications, it is our objective to position this business to be a strong, long-term investment. Let's turn the page and take a closer look at the financial and key business highlights for the quarter.
John Wyskiel: Let's turn the page and take a closer look at the financial and key business highlights for the quarter on slide seven. We sold 2,135 buses in Q1 and recorded revenue of $333 million, 6% ahead of last year. On the EV side, we sold 121 vehicles, 6% of unit volume, and our long-term outlook for EVs remains optimistic. Adjusted EBITDA for the quarter came in at $50 million, $4 million stronger than last year, and free cash flow came in at an outstanding $31 million. Razvan will talk more to this and our outlook later in the call. Turning to the right side of the page, I'll touch on a few points. With the strong order intake I spoke about earlier, our backlog finished the quarter at 3,400 units.
John Wyskiel: Let's turn the page and take a closer look at the financial and key business highlights for the quarter on slide seven. We sold 2,135 buses in Q1 and recorded revenue of $333 million, 6% ahead of last year. On the EV side, we sold 121 vehicles, 6% of unit volume, and our long-term outlook for EVs remains optimistic. Adjusted EBITDA for the quarter came in at $50 million, $4 million stronger than last year, and free cash flow came in at an outstanding $31 million. Razvan will talk more to this and our outlook later in the call. Turning to the right side of the page, I'll touch on a few points. With the strong order intake I spoke about earlier, our backlog finished the quarter at 3,400 units.
Speaker #3: On slide seven. We sold 2,135 buses in Q1 and recorded revenue of $333 million, which is 6% ahead of last year. On the EV side, we sold 121 vehicles.
Speaker #3: 6% of unit volume and our long-term outlook for EVs remains optimistic. Adjusted EBITDA for the quarter came in at $50 million. 4 million stronger than last year.
Speaker #3: And free cash flow came in at an outstanding $31 million. Razvan will talk more to this and our outlook later in the call. Turning to the right side of the page, I'll touch on a few points.
Speaker #3: With the strong order intake, I spoke about earlier, our backlog finished the quarter at $3,400 units. This puts us in a good position coming into the order to reiterate the overall market season.
John Wyskiel: This puts us in a good position coming into the order season. I continue to reiterate the overall market fundamentals are still there. The fleet is aging, we are coming into a heavy replacement cycle, and there's been industry supply issues the last few years, leaving pent-up demand. The horizon ahead looks very good for school bus volumes. In January, we also took our first order for commercial chassis. The market remains excited about this product. We are continuing with the testing, validation, and normal engineering change loops. We are projecting to start production in late Q4, which pushes sales into fiscal 2027. Our emphasis is to get this product right from a design, cost, and quality perspective, and not force timing that can jeopardize any one of those elements. Back to school bus, year-over-year selling price for buses was up almost $8,800 per unit.
John Wyskiel: This puts us in a good position coming into the order season. I continue to reiterate the overall market fundamentals are still there. The fleet is aging, we are coming into a heavy replacement cycle, and there's been industry supply issues the last few years, leaving pent-up demand. The horizon ahead looks very good for school bus volumes. In January, we also took our first order for commercial chassis. The market remains excited about this product. We are continuing with the testing, validation, and normal engineering change loops. We are projecting to start production in late Q4, which pushes sales into fiscal 2027. Our emphasis is to get this product right from a design, cost, and quality perspective, and not force timing that can jeopardize any one of those elements. Back to school bus, year-over-year selling price for buses was up almost $8,800 per unit.
Speaker #3: The fundamentals are still there. The fleet is aging, and I continue aging. We are coming into a heavy replacement cycle, and there's been industry supply issues the last few years, leaving pent-up demand.
Speaker #3: The horizon ahead looks very good for school bus volumes. In January, we also took our first order for commercial chassis. The market remains excited about this product.
Speaker #3: We are continuing with the testing, validation, and normal engineering change loops. We are projecting to start production in late Q4, which pushes sales into fiscal 2027.
Speaker #3: Our emphasis is to get this product right from a design, cost, and quality perspective. And not force timing that can jeopardize any one of those elements.
Speaker #3: Back to school bus. Year-over-year selling price for buses was up almost 8,800 dollars per unit. But of course, this also includes tariff recovery as part of our margin-neutral strategy.
John Wyskiel: But of course, this also includes tariff recovery as part of our margin-neutral strategy. With tariffs excluded, pricing was still up year over year, and parts sales totals $25 million for the quarter. Alternative Power buses represented a strong 48% of mix per unit sales in the quarter. Our powertrain strategy is a differentiator in the market and allows us to maintain stronger margins, but we are not dependent on it. If you look at Q1, Alternative Power mix dipped below 50%, but there was no compromise in profitability. At the end of the quarter, we had 121 EVs booked and 855 EVs in our order backlog, pushing into 2027. Our updated guidance reflects approximately 800 EV unit sales for fiscal 2026. Again, we remain optimistic on EVs in the school bus sector.
John Wyskiel: But of course, this also includes tariff recovery as part of our margin-neutral strategy. With tariffs excluded, pricing was still up year over year, and parts sales totals $25 million for the quarter. Alternative Power buses represented a strong 48% of mix per unit sales in the quarter. Our powertrain strategy is a differentiator in the market and allows us to maintain stronger margins, but we are not dependent on it. If you look at Q1, Alternative Power mix dipped below 50%, but there was no compromise in profitability. At the end of the quarter, we had 121 EVs booked and 855 EVs in our order backlog, pushing into 2027. Our updated guidance reflects approximately 800 EV unit sales for fiscal 2026. Again, we remain optimistic on EVs in the school bus sector.
Speaker #3: With tariffs excluded, pricing was still up year-over-year. And parts sales totaled 25 million for the quarter. All-power buses represented a strong 48% of mix for unit sales in the quarter.
Speaker #3: Our powertrain strategy is a differentiator in the market and allows us to maintain stronger margins. But we are not dependent on it. If you look at Q1, RL power mix dipped below 50%.
Speaker #3: But there was no compromise in profitability. At the end of the quarter, we had 121 EVs booked and 855 EVs in our order backlog, pushing into 2027.
Speaker #3: Our updated guidance reflects approximately 800 EV unit sales for fiscal 2026. Again, we remain optimistic on EVs and school bus sector. EVs are a perfect fit for school buses when you look at the duty cycle, available charging intervals, range, and the proven health benefits for our children.
John Wyskiel: EVs are a perfect fit for school buses when you look at the duty cycle, available charging intervals, range, and the proven health benefits for our children. Rounds two and three of the EPA Clean School Bus program remain intact, with funds flowing to our end customers. Earlier this month, it seems there was some misinterpretation of media coverage and quotes that suggested rounds four and five would be discontinued. But I will highlight, from our subsequent discussions in Washington, there has been no such indication. It is our understanding that the EPA is still working through how and when these funds will be administered, and that the program is still bipartisan in support. Overall, when you look at state funding and fleet EV mandates, we believe this market will remain relevant, and our short-term guidance is not dependent on federal funding for rounds four and five.
John Wyskiel: EVs are a perfect fit for school buses when you look at the duty cycle, available charging intervals, range, and the proven health benefits for our children. Rounds two and three of the EPA Clean School Bus program remain intact, with funds flowing to our end customers. Earlier this month, it seems there was some misinterpretation of media coverage and quotes that suggested rounds four and five would be discontinued. But I will highlight, from our subsequent discussions in Washington, there has been no such indication. It is our understanding that the EPA is still working through how and when these funds will be administered, and that the program is still bipartisan in support. Overall, when you look at state funding and fleet EV mandates, we believe this market will remain relevant, and our short-term guidance is not dependent on federal funding for rounds four and five.
Speaker #3: Rounds two and three of the EPA Clean School Bus program remained intact, with funds flowing to our end customers. Earlier this month, it seems there was some misinterpretation of media coverage and quotes that suggested rounds four and five would be discontinued.
Speaker #3: But I will highlight from our subsequent discussions in Washington, there has been no such indication. It is our understanding that the EPA is still working through how and when these funds will be administered.
Speaker #3: And that the program is still bipartisan in support. Overall, when you look at state funding and the fleet EV mandates, we believe this market will remain relevant.
Speaker #3: And our short-term guidance is not dependent on federal funding for rounds four and five. And finally, the $80 million MAS contract with the DOE remains intact.
John Wyskiel: And finally, the $80 million MASS contract with the DOE remains intact. This is for their funding towards our new plant in Fort Valley. There's been a lot of rumor in the area of MASS grants, but again, there's been no unfavorable direction provided to us from the DOE. As a reminder, this project adds 400 well-paying American jobs to a century-old company with an iconic brand to build clean school buses, providing our children with the benefits of clean air. As I've said in prior earnings calls, it's a great story. Overall, we beat guidance for the 13th consecutive quarter with a 15% Adjusted EBITDA. This continued performance reflects the strength in the entire Blue Bird enterprise. I'm very proud of the team's accomplishments.
John Wyskiel: And finally, the $80 million MASS contract with the DOE remains intact. This is for their funding towards our new plant in Fort Valley. There's been a lot of rumor in the area of MASS grants, but again, there's been no unfavorable direction provided to us from the DOE. As a reminder, this project adds 400 well-paying American jobs to a century-old company with an iconic brand to build clean school buses, providing our children with the benefits of clean air. As I've said in prior earnings calls, it's a great story. Overall, we beat guidance for the 13th consecutive quarter with a 15% Adjusted EBITDA. This continued performance reflects the strength in the entire Blue Bird enterprise. I'm very proud of the team's accomplishments.
Speaker #3: This is for their funding towards our new plant in Fort Valley. There's been a lot of rumor in the area of mass grants, but again, there's been no unfavorable direction provided to us from the DOE.
Speaker #3: As a reminder, this project adds 400 well-paying American jobs to a century-old company with an iconic brand—to build clean school buses, providing our children with the benefits of clean air.
Speaker #3: As I've said in prior earnings calls, it's a great story. Overall, we seek guidance for the 13th consecutive quarter with a 15% adjusted EBITDA.
Speaker #3: This continued performance reflects the strength in the entire Blue Bird enterprise. I'm very proud of the team's accomplishments. So, I'd like to now hand it over to Razvan to walk through our fiscal '26 first quarter financial results, as well as our full-year updated guidance in more detail.
John Wyskiel: So I'd like to now hand it over to Razvan to walk through our fiscal 2026 Q1 financial results, as well as our full-year updated guidance in more detail. Razvan?
John Wyskiel: So I'd like to now hand it over to Razvan to walk through our fiscal 2026 Q1 financial results, as well as our full-year updated guidance in more detail. Razvan?
Speaker #3: Razvan.
Speaker #2: Thanks, John, and good afternoon. It's my pleasure to share with you the financial highlights from Blue Bird's fiscal 2026 first quarter results. The quarter end is based on a close date of December 27, 2025, whereas the prior year was based on a close date of December 28, 2024.
Razvan Radulescu: Thanks, John, and good afternoon. It's my pleasure to share with you the financial highlights from Blue Bird's fiscal 2026 first quarter results. The quarter end is based on a close date of 27 December 2025, whereas the prior year was based on a close date of 28 December 2024. We will file the 10-Q today, 4 February 2026, after market close. Our 10-Q includes additional material and disclosures regarding our business and financial performance. We encourage you to read the 10-Q and the important disclosures that it contains. The appendix attached to today's presentation includes reconciliations of differences between GAAP and non-GAAP measures mentioned on this call, as well as other important disclaimers. Slide 9 is a summary of the fiscal 2026 first quarter record financial results.
Razvan Radulescu: Thanks, John, and good afternoon. It's my pleasure to share with you the financial highlights from Blue Bird's fiscal 2026 first quarter results. The quarter end is based on a close date of 27 December 2025, whereas the prior year was based on a close date of 28 December 2024. We will file the 10-Q today, 4 February 2026, after market close. Our 10-Q includes additional material and disclosures regarding our business and financial performance. We encourage you to read the 10-Q and the important disclosures that it contains. The appendix attached to today's presentation includes reconciliations of differences between GAAP and non-GAAP measures mentioned on this call, as well as other important disclaimers. Slide 9 is a summary of the fiscal 2026 first quarter record financial results.
Speaker #2: We will file the 10Q today, February 4th, after market close. Our 10Q includes additional material and disclosures regarding our business and financial performance. We encourage you to read the 10Q and the important disclosures that it contains.
Speaker #2: The appendix attached to today's presentation includes reconciliations of differences between GAAP and non-GAAP measures mentioned on this call, as well as other important disclaimers.
Speaker #2: Slide nine is a summary of the fiscal '26 first quarter record financial results. It was a strong operating quarter for Blue Bird, a great start for the new fiscal year, and beat our guidance provided in the last earnings call on all metrics.
Razvan Radulescu: It was a strong operating quarter for Blue Bird, a great start for the new fiscal year, and we beat our guidance provided in the last earnings call on all metrics. In fact, we delivered the best Q1 ever for Blue Bird, with $333 million in revenue and $50 million in Adjusted EBITDA in percent margin. The team pushed hard, continued doing a fantastic job, and generated 2,135 unit sales volume, which was just above prior year level. Record Q1 consolidated net revenue of $333 million was $19 million higher than prior year, driven by pricing actions, including tariffs, that materialized in this quarter. Adjusted EBITDA for the quarter was a record $50 million, driven by high margins, partially offset by increased labor and engineering costs.
Razvan Radulescu: It was a strong operating quarter for Blue Bird, a great start for the new fiscal year, and we beat our guidance provided in the last earnings call on all metrics. In fact, we delivered the best Q1 ever for Blue Bird, with $333 million in revenue and $50 million in Adjusted EBITDA in percent margin. The team pushed hard, continued doing a fantastic job, and generated 2,135 unit sales volume, which was just above prior year level. Record Q1 consolidated net revenue of $333 million was $19 million higher than prior year, driven by pricing actions, including tariffs, that materialized in this quarter. Adjusted EBITDA for the quarter was a record $50 million, driven by high margins, partially offset by increased labor and engineering costs.
Speaker #2: In fact, we delivered the best Q1 ever for Blue Bird, with $333 million in revenue and $50 million in adjusted EBITDA, a 15% margin. The team pushed hard and continued doing a fantastic job.
Speaker #2: And generated 2,135 unit sales volume, which was just above prior year level. Record Q1 consolidated net revenue of 333 million was 19 million higher than prior year, driven by pricing actions, including tariffs, that materialized in this quarter.
Speaker #2: Adjusted EBITDA for the quarter was a record $50 million, driven by high margins, partially offset by increased labor and engineering costs. The adjusted free cash flow was also a record Q1 of $31 million, and $9 million higher than the prior year first quarter.
Razvan Radulescu: The adjusted free cash flow was also a record Q1 of $31 million and $9 million higher than the prior year first quarter. This result to the continued strong profitability across all bus and powertrain types. Our liquidity position at the end of this quarter was a record $385 million. Moving on to slide 10, as mentioned before by John, our backlog at the end of Q1 continues to be solid at 3,400 units, including a record 25% EV. In fact, at the end of January, we have now close to 1,000 EVs sold in Q1 and in backlog, with some of them scheduled to be built and delivered in fiscal 2027 Q1.
Razvan Radulescu: The adjusted free cash flow was also a record Q1 of $31 million and $9 million higher than the prior year first quarter. This result to the continued strong profitability across all bus and powertrain types. Our liquidity position at the end of this quarter was a record $385 million. Moving on to slide 10, as mentioned before by John, our backlog at the end of Q1 continues to be solid at 3,400 units, including a record 25% EV. In fact, at the end of January, we have now close to 1,000 EVs sold in Q1 and in backlog, with some of them scheduled to be built and delivered in fiscal 2027 Q1.
Speaker #2: This result is due to the continued strong profitability across all bus and powertrain types. Our liquidity position at the end of this quarter was a record $385 million.
Speaker #2: Moving on to slide 10, as mentioned before by John, our backlog at the end of Q1 continues to be solid at 3,400 units, including a record 25% EVs.
Speaker #2: In fact, at the end of January, we have now close to 1,000 EVs sold in Q1 and in backlog, with some of them scheduled to be billed and delivered in fiscal 27 Q1.
Speaker #2: Breaking down the Q1 $333 million in revenue into our two business segments, the bus net revenue was $308 million, up $20 million versus prior year, due to increased prices across all products, including tariffs.
Razvan Radulescu: Breaking down the Q1, $333 million in revenue into our two business segments, the bus net revenue was $308 million, up $20 million versus prior year, due to increased prices across all products, including tariffs. As a result, our average bus revenue per unit increased by $9,000 from $135,000 to $144,000 or 6.5%. EV sales in Q1 were 121 units, just 11 units lower than last year, as planned. Parts revenue for the quarter was almost flat at a strong $25 million. This great performance was in part due to increased demand for our parts as the fleet is aging, as well as supply chain-driven pricing actions and throughput improvements.
Razvan Radulescu: Breaking down the Q1, $333 million in revenue into our two business segments, the bus net revenue was $308 million, up $20 million versus prior year, due to increased prices across all products, including tariffs. As a result, our average bus revenue per unit increased by $9,000 from $135,000 to $144,000 or 6.5%. EV sales in Q1 were 121 units, just 11 units lower than last year, as planned. Parts revenue for the quarter was almost flat at a strong $25 million. This great performance was in part due to increased demand for our parts as the fleet is aging, as well as supply chain-driven pricing actions and throughput improvements.
Speaker #2: As a result, our average bus revenue per unit increased by 9,000 from 135,000 to 144,000, or 6.5%. EV sales in Q1 were 121 units, just 11 units lower than last year, as planned.
Speaker #2: Bus revenue for the quarter was almost flat at a strong $25 million. This great performance was in part due to increased demand for our parts as the fleet is aging, as well as supply chain-driven pricing actions and throughput improvement.
Razvan Radulescu: Gross margin for the quarter were a record 21.4%, or 220 basis points higher than last year, due to pricing actions, manufacturing efficiencies, and quality improvements. Adjusted EBITDA of $50 million or 15% was higher compared with prior year by $4 million and 40 basis points. In fiscal 2026 Q1, adjusted net income was a record Q1 at $32.5 million, or $2 million higher than last year. Adjusted diluted earnings per share of $1 was up 8 cents versus the prior year. Slide 11 shows the walk from fiscal 2025 Q1 adjusted EBITDA to the fiscal 2026 Q1 results.
Razvan Radulescu: Gross margin for the quarter were a record 21.4%, or 220 basis points higher than last year, due to pricing actions, manufacturing efficiencies, and quality improvements. Adjusted EBITDA of $50 million or 15% was higher compared with prior year by $4 million and 40 basis points. In fiscal 2026 Q1, adjusted net income was a record Q1 at $32.5 million, or $2 million higher than last year. Adjusted diluted earnings per share of $1 was up 8 cents versus the prior year. Slide 11 shows the walk from fiscal 2025 Q1 adjusted EBITDA to the fiscal 2026 Q1 results.
Speaker #2: Gross margin for the quarter was a record 21.4%, or 220 basis points higher than last year, due to pricing actions, manufacturing efficiencies, and quality improvement.
Speaker #2: Adjusted EBITDA of 50 million, or 15%, was higher compared with prior year by 4 million, and 40 basis points. In fiscal 26 record Q1 at 32.5 Q1, adjusted net income was a million, or 2 million higher than last year.
Speaker #2: Adjusted diluted earnings per share of $1.00 was up $0.08 versus the prior year. Slide 11 shows the walk from fiscal '25 Q1 adjusted EBITDA to the fiscal '26 Q1 result.
Speaker #2: Starting on the left at $45.8 million, the impact of the bus segment gross profit in total was $11.1 million, split between volume and pricing effect, net of material cost increases of $7 million, and operational and quality improvements of $4.1 million.
Razvan Radulescu: Starting on the left at $45.8 million, the impact of the bus segment gross profit in total was $11.1 million, split between volume and pricing effects, net of material cost increases of $7 million, and operational and quality improvements of $4.1 million. The parts segment gross profit was almost flat, and our fixed costs and other income were unfavorable year-over-year by $6.6 million. Out of this, $2.6 million comprises of EV emission credits that were sold in fiscal 2025 Q1, sale which did not repeat again so far this year. The sum total of all the above-mentioned developments drives our record fiscal 2026 Q1 reported Adjusted EBITDA results of $50.1 million or 15%. Moving on to slide 12, we have extremely positive development year-over-year also on the balance sheet.
Razvan Radulescu: Starting on the left at $45.8 million, the impact of the bus segment gross profit in total was $11.1 million, split between volume and pricing effects, net of material cost increases of $7 million, and operational and quality improvements of $4.1 million. The parts segment gross profit was almost flat, and our fixed costs and other income were unfavorable year-over-year by $6.6 million. Out of this, $2.6 million comprises of EV emission credits that were sold in fiscal 2025 Q1, sale which did not repeat again so far this year. The sum total of all the above-mentioned developments drives our record fiscal 2026 Q1 reported Adjusted EBITDA results of $50.1 million or 15%. Moving on to slide 12, we have extremely positive development year-over-year also on the balance sheet.
Speaker #2: The bus segment gross profit was almost flat, and our fixed costs and other income were unfavorable year over year by 6.6 million. Out of this, 2.6 million comprises of EV emission credits, that were sold in fiscal 25 Q1, sale which did not repeat again so far this year.
Speaker #2: The sum total of all the above-mentioned developments drives our record fiscal 26 Q1 reported adjusted EBITDA result of 50.1 million, or 15%. Moving on to slide 12, we have extremely positive developments year over year also on the balance sheet.
Speaker #2: We ended the quarter with a record $242 million in cash and reduced our debt by $5 million over the last year. Our liquidity sat very strong at a record $385 million at the end of fiscal 26 Q1, a $106 million increase compared to a year ago.
Razvan Radulescu: We ended the quarter with a record $242 million in cash and reduced our debt by $5 million over the last year. Our liquidity stood very strong at a record $385 million at the end of fiscal 2026 Q1, a $106 million increase compared to a year ago. Additionally, we have executed another tranche of share buyback of $15 million during fiscal 2026 Q1, $10 million of which concludes our $60 million prior stock buyback program, and $5 million began our new $100 million program, with another $95 million left to go. The operating cash flow was very strong for Q1 at $37 million, driven by great operational execution and margins, combined with a large advanced payment received for future EV units, which more than offset the seasonal increase in working capital.
Razvan Radulescu: We ended the quarter with a record $242 million in cash and reduced our debt by $5 million over the last year. Our liquidity stood very strong at a record $385 million at the end of fiscal 2026 Q1, a $106 million increase compared to a year ago. Additionally, we have executed another tranche of share buyback of $15 million during fiscal 2026 Q1, $10 million of which concludes our $60 million prior stock buyback program, and $5 million began our new $100 million program, with another $95 million left to go. The operating cash flow was very strong for Q1 at $37 million, driven by great operational execution and margins, combined with a large advanced payment received for future EV units, which more than offset the seasonal increase in working capital.
Speaker #2: Additionally, we have executed another tranche of share buybacks of $15 million during fiscal Q1 2026, $10 million of which concludes our $60 million prior stock buyback program, and $5 million began our new $100 million program, with another $95 million left to go.
Speaker #2: The operating cash flow was very strong for Q1 at $37 million, driven by great operational execution and margins, combined with a large advance payment received for future EV units, which more than offset the seasonal increase in working capital.
Speaker #2: On slide 10, we want to share with you our updated fiscal 26 guidance. Looking at Q1 actuals, we have beat in every metric our guidance this past quarter, so we had a very strong start for the fiscal year.
Razvan Radulescu: On slide – we want to share with you our updated fiscal 2026 guidance. Looking at Q1 actuals, we have beat in every metric our guidance this past quarter, so we had a very strong start for the fiscal year. Q2 is forecasted to be a repeat of Q1, with additional cost pressures coming from tariffs, labor costs, and inflation on our SG&A. We continue to plan for a strong second half at 15% to 16% adjusted EBITDA margin, with 800 EVs now scheduled for the year. We are maintaining our revenue to a range of $1.45 to $1.55 billion, and given our beat in Q1, we are raising our adjusted EBITDA to $225 million or 15%, with a range of $215 to $225 million.
Razvan Radulescu: On slide – we want to share with you our updated fiscal 2026 guidance. Looking at Q1 actuals, we have beat in every metric our guidance this past quarter, so we had a very strong start for the fiscal year. Q2 is forecasted to be a repeat of Q1, with additional cost pressures coming from tariffs, labor costs, and inflation on our SG&A. We continue to plan for a strong second half at 15% to 16% adjusted EBITDA margin, with 800 EVs now scheduled for the year. We are maintaining our revenue to a range of $1.45 to $1.55 billion, and given our beat in Q1, we are raising our adjusted EBITDA to $225 million or 15%, with a range of $215 to $225 million.
Speaker #2: Q2 is forecasted to be a repeat of Q1, with additional cost pressure coming from tariffs and labor costs and inflation, on our SG&A. We continue to plan for a strong second half at 15% to 16%, adjusted EBITDA margins, with 800 EVs now scheduled for the year.
Speaker #2: We are maintaining our revenue to a range of 1.45 to 1.55 billion, and given our beat on Q1, we are raising our adjusted EBITDA to 225 million, or 15%, with a range of 215 to 230 million.
Speaker #2: We will provide further updates at the beginning of May after we close Q2. Moving to slide 14 in summary, we are forecasting an improvement year over year to a new record, with revenue up to approximately 1.5 billion, adjusted EBITDA in the range of 215 to 235 million, or approximately 15%, and adjusted free cash flow of 40 to 60 million, in line with our typical target of 50% of adjusted EBITDA, and after accounting for the extraordinary CapEx of 75 million, as our 50% fiscal 26 portion of the new plant investment funded by a DOE mass grant, which is currently proceeding with the detailed planning and permitting phase.
Razvan Radulescu: We will provide further updates at the beginning of May after we close Q2. Moving to slide 14, in summary, we are forecasting an improvement year-over-year to a new record, with revenue up to approximately $1.5 billion, adjusted EBITDA in the range of $215 to $235 million, or approximately 15%, and adjusted free cash flow of $40 to $60 million, in line with our typical target of 50% of adjusted EBITDA. After accounting for the extraordinary CapEx of $75 million as our 50% fiscal 2026 portion of the new plant investment, funded by a DOE MESC grant, which is currently proceeding with the detailed planning and permitting phase. Moving on to slide 15.
Razvan Radulescu: We will provide further updates at the beginning of May after we close Q2. Moving to slide 14, in summary, we are forecasting an improvement year-over-year to a new record, with revenue up to approximately $1.5 billion, adjusted EBITDA in the range of $215 to $235 million, or approximately 15%, and adjusted free cash flow of $40 to $60 million, in line with our typical target of 50% of adjusted EBITDA. After accounting for the extraordinary CapEx of $75 million as our 50% fiscal 2026 portion of the new plant investment, funded by a DOE MESC grant, which is currently proceeding with the detailed planning and permitting phase. Moving on to slide 15.
Speaker #2: Moving on to slide 15. Today, we are reconfirming the medium-term outlook at a 15% margin with volumes of up to 10,000 units, including 500 strip chassis, generating revenues around $1.6 billion and with adjusted EBITDA of $140 million.
Razvan Radulescu: Today, we are reconfirming the medium-term outlook at 15% margin, with volumes of up to 10,000 units, including 500 street chassis, generating revenues around $1.6 billion and with Adjusted EBITDA of $40 million. Starting in 2029 and beyond, our long-term target remains to drive profitable growth to higher levels towards $1.8 to 2 billion in revenue, comprising of 12,000 to 15,500 units, including 1,000 to 1,500 street chassis... and generate EBITDA of $280 to 320+ million, or 15.5% to 16%+ at best-in-class levels.
Razvan Radulescu: Today, we are reconfirming the medium-term outlook at 15% margin, with volumes of up to 10,000 units, including 500 street chassis, generating revenues around $1.6 billion and with Adjusted EBITDA of $40 million. Starting in 2029 and beyond, our long-term target remains to drive profitable growth to higher levels towards $1.8 to 2 billion in revenue, comprising of 12,000 to 15,500 units, including 1,000 to 1,500 street chassis... and generate EBITDA of $280 to 320+ million, or 15.5% to 16%+ at best-in-class levels.
Speaker #2: Starting in 2029 and beyond, our long-term target remains to drive profitable growth to higher levels, towards $1.8 to $2 billion in revenue, comprising 12,000 to 14,500 units, including 1,000 to 1,500 strip chassis, and generate EBITDA of $280 to $320-plus million, or 15.5% to 16% plus, at best-in-class levels.
Speaker #2: The growth comes not only from improved EV mix, driven by sustained state funding and improved total cost of ownership over time, but also from our new Blue Bird commercial chassis addressable market expansion, as well as our Micro Bird U.S.
Razvan Radulescu: The growth comes not only from improved EV mix, driven by sustained state funding and improved total cost of ownership over time, but also from our new Blue Bird Commercial Chassis addressable market expansion, as well as our Micro Bird joint venture new plant expansion in the US. We continue to be incredibly excited about Blue Bird's future, and now I will turn it back over to John.
Razvan Radulescu: The growth comes not only from improved EV mix, driven by sustained state funding and improved total cost of ownership over time, but also from our new Blue Bird Commercial Chassis addressable market expansion, as well as our Micro Bird joint venture new plant expansion in the US. We continue to be incredibly excited about Blue Bird's future, and now I will turn it back over to John.
Speaker #2: We continue to joint venture new plant expansion and are incredibly excited about Blue Bird's future. And now, I will turn it back over to John.
Speaker #2: Thank you, Razvan. Let's move on to slide 17. Blue Bird is off to a great start for 2026. Starting at the top, we're tracking to 9,500 units for fiscal 2026.
John Wyskiel: Thank you, Razvan. Let's move on to slide 17. Blue Bird is off to a great start for 2026. Starting at the top, we're tracking to 9,500 units for fiscal 2026, but with a 6% CAGR projected for the school bus market, as well as entering new market adjacencies, we see our long-term volume growing to 13,500 units between school bus and commercial chassis. This translates to a revenue of $1.5 billion for 2026, with an adjusted EBITDA moving up to $225 million. But when you factor our growth opportunities, our long-term outlook moves up to $2 billion in revenue and $320 million in adjusted EBITDA, expanding to 16%+. And at the bottom of the page, you will see EV is still very relevant.
John Wyskiel: Thank you, Razvan. Let's move on to slide 17. Blue Bird is off to a great start for 2026. Starting at the top, we're tracking to 9,500 units for fiscal 2026, but with a 6% CAGR projected for the school bus market, as well as entering new market adjacencies, we see our long-term volume growing to 13,500 units between school bus and commercial chassis. This translates to a revenue of $1.5 billion for 2026, with an adjusted EBITDA moving up to $225 million. But when you factor our growth opportunities, our long-term outlook moves up to $2 billion in revenue and $320 million in adjusted EBITDA, expanding to 16%+. And at the bottom of the page, you will see EV is still very relevant.
Speaker #2: But with a 6% CAGR projected for the school bus market, as well as entering new market-adjacent fields, we see our long-term volume growing to 13,500 units between school bus and commercial chassis.
Speaker #2: This translates to a revenue of 1.5 billion for 2026, with an adjusted EBITDA moving up to 225 million. But when you factor our growth opportunities, our long-term outlook moves up to 2 billion in revenue and 320 million in adjusted EBITDA.
Speaker #2: Expanding to 16% plus. And at the bottom of the page, you'll see EV is still very relevant. This year, we are guiding 800 EVs, but continue to see 750 to 1,000 units per annum in our long-term outlook.
John Wyskiel: This year, we are guiding 800 EVs, but continue to see 750 to 1,000 units per annum in our long-term outlook. Overall, Q1 has been a great start, and with the strong fundamentals of the industry, our investment in the future, and our strength in this team, the outlook for Blue Bird is very strong. So as I close in on my 1-year anniversary and return to Blue Bird, I wanted to share a few high-level details about our updated strategy on slide 18. It is based off of four key elements and positions the company for the future. First, as an almost 100-year-old company, business continuity and long-term stability is a core element. This includes investing and updating our manufacturing facilities and products. A great example is our new assembly plant, which is scheduled to launch in 2028.
John Wyskiel: This year, we are guiding 800 EVs, but continue to see 750 to 1,000 units per annum in our long-term outlook. Overall, Q1 has been a great start, and with the strong fundamentals of the industry, our investment in the future, and our strength in this team, the outlook for Blue Bird is very strong. So as I close in on my 1-year anniversary and return to Blue Bird, I wanted to share a few high-level details about our updated strategy on slide 18. It is based off of four key elements and positions the company for the future. First, as an almost 100-year-old company, business continuity and long-term stability is a core element. This includes investing and updating our manufacturing facilities and products. A great example is our new assembly plant, which is scheduled to launch in 2028.
Speaker #2: Overall, Q1 has been a great start. And with the strong fundamentals of the industry, our investment in the future, and our strength in this team, the outlook for Blue Bird is very strong.
Speaker #2: So, as I close in on my one-year anniversary and return to Blue Bird, I wanted to share a few high-level details about our updated strategy on slide 18.
Speaker #2: It is based off of four key elements and positions the company for the future. First, as an almost 100-year-old company, business continuity and long-term stability is a core element.
Speaker #2: This includes investing in and updating our manufacturing facilities and products. A great example is our new assembly plant, which is scheduled to launch in 2028.
Speaker #2: Infrastructure and competitive products are an essential part of our plan. The next element is a theme that has been consistent the last few years: profitable growth.
John Wyskiel: Infrastructure and competitive products are an essential part of our plan. The next element is a theme that has been consistent the last few years: profitable growth. Of course, the school bus market is projected to grow over the next few years, and our new plant will allow us to capitalize on that. But for Blue Bird, it also means organically expanding our total addressable market by entering new adjacencies. The Blue Bird commercial chassis and the Micro Bird JV by America Shuttle Bus is a great example of profitable growth opportunities. Margin expansion is the next element. This area focuses on advancing competitiveness and cost reduction. For Blue Bird, this means continuing our Industry 3.0 automation initiative, as I discussed at the beginning of the call.
John Wyskiel: Infrastructure and competitive products are an essential part of our plan. The next element is a theme that has been consistent the last few years: profitable growth. Of course, the school bus market is projected to grow over the next few years, and our new plant will allow us to capitalize on that. But for Blue Bird, it also means organically expanding our total addressable market by entering new adjacencies. The Blue Bird commercial chassis and the Micro Bird JV by America Shuttle Bus is a great example of profitable growth opportunities. Margin expansion is the next element. This area focuses on advancing competitiveness and cost reduction. For Blue Bird, this means continuing our Industry 3.0 automation initiative, as I discussed at the beginning of the call.
Speaker #2: Of course, the school bus market is projected to grow over the next few years, and our new plant will allow us to capitalize on that.
Speaker #2: But for Blue Bird, it also means organically expanding our total addressable market by entering new adjacencies. The Blue Bird commercial chassis and the Micro Bird JV by America shuttle bus is a great example of profitable growth opportunities.
Speaker #2: Margin expansion is the next element. This area focuses on advancing competitiveness and cost reduction. For Blue Bird, this means continuing our Industry 3.0 automation initiative, as I discussed at the beginning of the call.
Speaker #2: We are on a good path in this area with a strong automation roadmap that will be incorporated into our new assembly plant. But as well, the new plant will allow us to further factor the future opportunities, including Industry 4.0 initiatives.
John Wyskiel: We are on a good path in this area with a strong automation roadmap that will be incorporated into our new assembly plant. But as well, the new plant will allow us to further Factory of the Future opportunities, including Industry 4.0 initiatives. And the last area is putting the balance sheet to work. Blue Bird has strong liquidity and generates solid cash flows. Our balance sheet position allows us to be strategically opportunistic. We have the ability to grow through acquisitions or exploit vertical integration. This is a tremendous area of opportunity for us. Overall, we have a balanced strategy that positions this great company for the future and delivers value to shareholders. I'll wrap it up on slide 19. This great company and iconic brand is almost 100 years old. Blue Bird has stood the test of time.
John Wyskiel: We are on a good path in this area with a strong automation roadmap that will be incorporated into our new assembly plant. But as well, the new plant will allow us to further Factory of the Future opportunities, including Industry 4.0 initiatives. And the last area is putting the balance sheet to work. Blue Bird has strong liquidity and generates solid cash flows. Our balance sheet position allows us to be strategically opportunistic. We have the ability to grow through acquisitions or exploit vertical integration. This is a tremendous area of opportunity for us. Overall, we have a balanced strategy that positions this great company for the future and delivers value to shareholders. I'll wrap it up on slide 19. This great company and iconic brand is almost 100 years old. Blue Bird has stood the test of time.
Speaker #2: And the last area is putting the balance sheet to work. Blue Bird has strong liquidity and generates solid cash flows. Our balance sheet position allows us to be strategically opportunistic.
Speaker #2: We have the ability to grow through acquisitions, or exploit vertical opportunity for us. Overall, we have a balanced strategy that positions this great company for the future and delivers value to shareholders.
Speaker #2: I'll wrap it up on slide 19. This great company and iconic brand is almost 100 years old. Blue Bird has stood the test of time.
Speaker #2: We delivered outstanding results in the first quarter of 2026. We continue to demonstrate credibility by delivering on our targets. And looking ahead, our strategy, discipline, and demonstrated execution will set this great company up for the future and deliver value to our shareholders.
John Wyskiel: We delivered outstanding results in Q1 2026. We continue to demonstrate credibility by delivering on our targets. Looking ahead, our strategy, discipline, and demonstrated execution will set this great company up for the future and deliver value to our shareholders. As always, I want to thank our employees, our dealer network, our supply partners, and of course, our investors. All are critical to our success. I remain excited about Blue Bird, and we had a great start for 2026. This company is a great American story with such a rich history and an exciting future ahead. Thank you. That concludes our formal presentation for today, and I'd now like to hand it back to our moderator for the Q&A session.
John Wyskiel: We delivered outstanding results in Q1 2026. We continue to demonstrate credibility by delivering on our targets. Looking ahead, our strategy, discipline, and demonstrated execution will set this great company up for the future and deliver value to our shareholders. As always, I want to thank our employees, our dealer network, our supply partners, and of course, our investors. All are critical to our success. I remain excited about Blue Bird, and we had a great start for 2026. This company is a great American story with such a rich history and an exciting future ahead. Thank you. That concludes our formal presentation for today, and I'd now like to hand it back to our moderator for the Q&A session.
Speaker #2: As always, I want to thank our employees, our dealer network, our supply partners, and of course, our investors. All are critical to our success.
Speaker #2: I remain excited about Blue Bird, and we had a great start for 2026. This company is a great American story with such a rich history and an exciting future ahead.
Speaker #2: Thank you. So that concludes our formal presentation for today, and I'd now like to hand it back to our moderator for the Q&A session.
Speaker #1: Thank you. We will now begin the Q&A session. If you would like to ask a question, please press star followed by one on your telephone keypad.
Operator: Thank you. We will now begin the Q&A session. If you would like to ask a question, please press star followed by one on your telephone keypad. If you would like to remove that question, please press star followed by two. Again, to ask a question, press star one. As a reminder, if you are using a speakerphone, please remember to pick up your handset before asking a question. We will pause here briefly as questions are registered. Our first question comes from the line of Greg Lewis with BTIG. Greg, your line is now open.
Operator: Thank you. We will now begin the Q&A session. If you would like to ask a question, please press star followed by one on your telephone keypad. If you would like to remove that question, please press star followed by two. Again, to ask a question, press star one. As a reminder, if you are using a speakerphone, please remember to pick up your handset before asking a question. We will pause here briefly as questions are registered. Our first question comes from the line of Greg Lewis with BTIG. Greg, your line is now open.
Speaker #1: If you would like to remove that question, please press star followed by two. Again, to ask a question, press star one. As a reminder, if you are using a speakerphone, please remember to pick up your handset before asking a question.
Speaker #1: We will pause here briefly as questions are registered. Our first question comes from the line of Greg Lewis with BPIG. Greg, your line is now open.
Speaker #3: Yeah, hi. Thank you and good afternoon, and thanks for taking my questions. You know, I guess I'd like to start off maybe talking a little bit about margins.
Greg Lewis: Yeah. Hi, thank you, and good afternoon, and thanks for taking my questions. You know, I guess I'd like to start off maybe talking a little bit about margins. You know, it was a good quarter around margins. You called out the benefit of, you know, maybe some of the cost efficiencies you're driving, and you've also called out the, you know, the, you know, having to kind of pass through the tariffs. Could you kind of give us some color around, you know, how much of that was pricing versus how much of that was maybe efficiencies that you've been able to squeeze out of the company?
Greg Lewis: Yeah. Hi, thank you, and good afternoon, and thanks for taking my questions. You know, I guess I'd like to start off maybe talking a little bit about margins. You know, it was a good quarter around margins. You called out the benefit of, you know, maybe some of the cost efficiencies you're driving, and you've also called out the, you know, the, you know, having to kind of pass through the tariffs. Could you kind of give us some color around, you know, how much of that was pricing versus how much of that was maybe efficiencies that you've been able to squeeze out of the company?
Speaker #3: You know, it was a good quarter around margins. You called out the benefit of, you know, maybe some of the cost efficiencies you're driving.
Speaker #3: And you've also called out, you know, having to kind of pass through the tariffs. Could you kind of give us some color around, you know, how much of that was pricing versus how much of that was maybe efficiencies that you've been able to squeeze out of the—
Speaker #3: company? Yeah, hi, Greg.
Razvan Radulescu: ... Yeah. Hi, Greg, this is Razvan. If you look at the slide 11, about 2/3 came from-
Razvan Radulescu: ... Yeah. Hi, Greg, this is Razvan. If you look at the slide 11, about 2/3 came from net pricing and about 1/3-
Speaker #4: This is Razvan. If you look at the slide 11 about two-thirds came from net pricing, and about one-third, more or less, is from better efficiency and quality.
Greg Lewis: Mm-hmm
Razvan Radulescu: - net pricing and about 1/3-
Greg Lewis: Yeah
Greg Lewis: Yeah.
Razvan Radulescu: - more or less, is from better efficiency and quality. That's, I think, the split that we have.
Razvan Radulescu: - more or less, is from better efficiency and quality. That's, I think, the split that we have.
Speaker #4: That's, I think, the split
Speaker #4: that we have. So as we look
Greg Lewis: So as we look out through, you know, the rest of the year, is that kind of how we should be thinking about, you know, the benefit of pricing, i.e., does it seem like we have the opportunity to kind of keep pushing that pricing through?
Speaker #3: Yeah, yeah. So as we look at—yeah, yeah. So as we look out through the rest of the year, is that kind of how we should be thinking about, you know, the benefit of pricing?
Greg Lewis: So as we look out through, you know, the rest of the year, is that kind of how we should be thinking about, you know, the benefit of pricing, i.e., does it seem like we have the opportunity to kind of keep pushing that pricing through?
Speaker #3: opportunity to kind of keep pushing that pricing, i.e., does it seem like we have the
Speaker #3: Through? So, I would say on
Razvan Radulescu: So I would say on the efficiency and quality, these are sustaining improvements that we are making. On the pricing side, however, this is pricing net of material cost increases, so you have the variability of the cost of goods sold, supplier inflation, maybe volatility in tariffs. While at the same time, our last pricing action was in November for the new model year, and those pricing effects will come in the second half of this fiscal year. So it's a bit too early to tell, especially on the cost of goods sold, how the second half of the year is gonna develop.
Razvan Radulescu: So I would say on the efficiency and quality, these are sustaining improvements that we are making. On the pricing side, however, this is pricing net of material cost increases, so you have the variability of the cost of goods sold, supplier inflation, maybe volatility in tariffs. While at the same time, our last pricing action was in November for the new model year, and those pricing effects will come in the second half of this fiscal year. So it's a bit too early to tell, especially on the cost of goods sold, how the second half of the year is gonna develop.
Speaker #4: the efficiency and quality, these are sustaining improvements that we are making. On the pricing side, however, this is pricing net of material cost increases.
Speaker #4: So you have the variability of the cost of goods sold, supplier inflation, maybe volatility in tariffs. While at the same time, our last pricing action was in November for the new model year.
Speaker #4: And those pricing effects will come in the second half of this fiscal year. So it's a bit too early to tell, especially on the cost of goods sold, how the second half of the year is going to—
Speaker #4: develop. Okay,
Greg Lewis: Okay, great. Thanks for that. And then I did have a question around the backlog. I know that there's, you know, as we think about the outlook for EV and, you know, just given some of the, you know, some of the delays maybe we've seen and the potential for that backlog to build. Have customers kind of been shifting to the other alternatives, or is it kind of, hey, you know, we were... I guess what I'm trying to understand is, as a percentage of the market, has diesel been gaining share here over the last couple quarters?
Greg Lewis: Okay, great. Thanks for that. And then I did have a question around the backlog. I know that there's, you know, as we think about the outlook for EV and, you know, just given some of the, you know, some of the delays maybe we've seen and the potential for that backlog to build. Have customers kind of been shifting to the other alternatives, or is it kind of, hey, you know, we were... I guess what I'm trying to understand is, as a percentage of the market, has diesel been gaining share here over the last couple quarters?
Speaker #3: Great, thanks for that. And then I did have a question around the backlog. I know that there's, you know, as we look at—as we think about the outlook for EV—and, you know, just given some of the, you know, some of the delays maybe we've seen in the potential for that backlog to build, have customers kind of been shifting to the other alternatives, or is it kind of, hey, you know—we were, I guess what I'm trying to understand is, as a percentage of the market, has diesel been gaining share here over the last couple—
Speaker #3: quarters?
Speaker #4: Yeah, this is Razvan. I'll
Razvan Radulescu: Yeah, this is Razvan. I'll start, and then my colleagues can join in for sure. In terms of the EV, we have a very strong backlog. So actually, between what we sold in Q1 and the backlog, we have over 1,000 units. And we said already some of these are bleeding into 2027 Q1 fiscal.
Razvan Radulescu: Yeah, this is Razvan. I'll start, and then my colleagues can join in for sure. In terms of the EV, we have a very strong backlog. So actually, between what we sold in Q1 and the backlog, we have over 1,000 units. And we said already some of these are bleeding into 2027 Q1 fiscal.
Speaker #4: start, and then my colleagues can join in for sure. In terms of the EV, we have a very strong backlog. So actually, between what we sold in Q1 and the backlog we have over 1,000 units.
Speaker #4: And we said already some of these are bleeding into 2027 Q1 fiscal. And this is because of the timing it takes for the infrastructure to be ready at the sites of our customers.
Greg Lewis: Mm-hmm.
Razvan Radulescu: This is because of the timing it takes for the infrastructure to be ready at the sites of our customers. So I would say on the EV, it's very strong, and we are already starting to fill 2027. In terms of diesel, we had a strong quarter for the diesel, which you could notice didn't affect our overall profitability because we have very strong margins across all our powertrains and product types. However, as people look at the emission regulations, potentially for 2027, there is still some uncertainty regarding where that's gonna land. So we may see a little bit pre-buy or a pull forward for some diesel units into this year.
Razvan Radulescu: This is because of the timing it takes for the infrastructure to be ready at the sites of our customers. So I would say on the EV, it's very strong, and we are already starting to fill 2027. In terms of diesel, we had a strong quarter for the diesel, which you could notice didn't affect our overall profitability because we have very strong margins across all our powertrains and product types. However, as people look at the emission regulations, potentially for 2027, there is still some uncertainty regarding where that's gonna land. So we may see a little bit pre-buy or a pull forward for some diesel units into this year.
Speaker #4: So I would say on the EV, it's very strong, and we are already starting to fill 2027. In terms of diesel, we had a strong quarter for the diesel, which you could notice it didn't affect our overall profitability because we have very strong margins across all our powertrains and prototypes.
Speaker #4: However, as people look at the emission regulations, potentially for 2027, there is still some uncertainty regarding where that's going to land. So we may see a little bit of pre-buy, or a pull-forward of some diesel units into this year.
Speaker #3: Yeah, and I don't have anything to add. We've always said diesel's sticky, and like you say, you've got this potential pull forward maybe for pricing.
John Wyskiel: Yeah, I don't have anything to add. We've always said diesel is sticky, and like you say, you've got this potential pull forward maybe for pricing with the new regs.
John Wyskiel: Yeah, I don't have anything to add. We've always said diesel is sticky, and like you say, you've got this potential pull forward maybe for pricing with the new regs.
Speaker #3: With the new regs.
Greg Lewis: Okay, super helpful. Thank you very much.
Greg Lewis: Okay, super helpful. Thank you very much.
Speaker #4: Okay.
Speaker #3: Super helpful. Thank you very
Speaker #3: much. Thanks,
Razvan Radulescu: Sure.
Razvan Radulescu: Sure.
John Wyskiel: Thanks, Greg.
John Wyskiel: Thanks, Greg.
Speaker #4: Greg.
Operator: Thank you. Our next question comes from the line of Eric Stine with Craig-Hallum. Eric, your line is now open.
Operator: Thank you. Our next question comes from the line of Eric Stine with Craig-Hallum. Eric, your line is now open.
Speaker #1: Our next question comes from the line of Thank you. Eric Stein with Greg Hallam. Eric, your line is now open.
Speaker #5: Hi, everyone. Maybe we could just stick with that last question and maybe ask it a little bit differently. So, obviously, EV has continued to be pretty strong here.
Eric Stine: Hi, everyone. Maybe we could just stick with that last question and maybe ask it a little bit differently. So, you know, obviously, EV has continued to be pretty strong here, and I know you've been in all fuels for, what, 15+ years, but I'm just curious, specific to propane. I know you're exclusive there. You know, school districts still, by and large, want to get off diesel. So, you know, what kind of trends are you seeing, you know, whether it's this quarter or going forward in propane, you know, what type of advantage is that? I would think that that continues to resonate quite a bit in the market, and, you know, how do you see that kind of playing out going forward?
Eric Stine: Hi, everyone. Maybe we could just stick with that last question and maybe ask it a little bit differently. So, you know, obviously, EV has continued to be pretty strong here, and I know you've been in all fuels for, what, 15+ years, but I'm just curious, specific to propane. I know you're exclusive there. You know, school districts still, by and large, want to get off diesel. So, you know, what kind of trends are you seeing, you know, whether it's this quarter or going forward in propane, you know, what type of advantage is that? I would think that that continues to resonate quite a bit in the market, and, you know, how do you see that kind of playing out going forward?
Speaker #5: What trends are you seeing, whether it's this quarter or going forward, in propane? What type of advantage is that? I would think that that continues to resonate quite a bit in the market.
Speaker #5: And how do you see that kind of playing forward?
John Wyskiel: Yeah, I'll start with a couple comments. I think from a marketplace, they still recognize propane as the best total cost of operation. They also like, you know, I guess the ease of converting a fleet over, because with propane, you can go to a propane seller, they can install the infrastructure relatively easily, you know, as part of the contract for fuel. So there's still a pretty strong acceptance, and I guess, you know, compared to EV, it really likes the infrastructure side. In terms of trends, I'm not sure I can comment anything there. Maybe my colleagues might be able to.
John Wyskiel: Yeah, I'll start with a couple comments. I think from a marketplace, they still recognize propane as the best total cost of operation. They also like, you know, I guess the ease of converting a fleet over, because with propane, you can go to a propane seller, they can install the infrastructure relatively easily, you know, as part of the contract for fuel. So there's still a pretty strong acceptance, and I guess, you know, compared to EV, it really likes the infrastructure side. In terms of trends, I'm not sure I can comment anything there. Maybe my colleagues might be able to.
Speaker #3: comments. I think from a marketplace, they still recognize propane as the best total cost of operation. They also like I guess the ease of converting a fleet over because with propane, you can go to a propane seller.
Speaker #3: They can install the infrastructure relatively easily. As part of the contract for fuel, so there's still a pretty strong acceptance. And I guess compared to EV, they really like the infrastructure side in terms of trends.
Speaker #3: I'm not sure I can comment anything there. Maybe my colleagues might be able to.
Razvan Radulescu: There's no significant change at this point in dynamics there.
Razvan Radulescu: There's no significant change at this point in dynamics there.
Speaker #4: significant change at this point in There's no dynamic there.
Speaker #5: Okay. Fair enough. Maybe just then talking about orders. I know on your last conference call, you talked about how it hadn't necessarily shown up in terms of order improvement in the quarter that you had reported.
Eric Stine: Okay, fair enough. You know, maybe just then talking about orders. I know on your last conference call, you talked about how it hadn't necessarily shown up, you know, in terms of order improvement in the quarter that you had reported, but that you were starting to see it in Q1. Obviously, that came to fruition. You mentioned a little bit about EVs, but just curious, you know, as we're part of the way into Q2, you know, maybe what you're seeing just on the overall order front and then what, you know, how you view. You know, as you said, you're about to get into, you know, where order season kind of starts to pick up. You know, so how do you feel about that? What kind of trends are you seeing?
Eric Stine: Okay, fair enough. You know, maybe just then talking about orders. I know on your last conference call, you talked about how it hadn't necessarily shown up, you know, in terms of order improvement in the quarter that you had reported, but that you were starting to see it in Q1. Obviously, that came to fruition. You mentioned a little bit about EVs, but just curious, you know, as we're part of the way into Q2, you know, maybe what you're seeing just on the overall order front and then what, you know, how you view. You know, as you said, you're about to get into, you know, where order season kind of starts to pick up. You know, so how do you feel about that? What kind of trends are you seeing?
Speaker #5: But that you were starting to see it in Q1. Obviously, that came to fruition. You mentioned a little bit—curious as we're part of the way into Q2—about EVs. But just for Q2, maybe what you're seeing just on the overall order front, and then how you see things as we get into where order season kind of starts to pick up.
Speaker #5: So how do you feel about that? What kind of trends are you
Speaker #5: seeing? Yeah,
John Wyskiel: Yeah, great question. So a couple comments. Just, first, I mean, very strong order intake period. I think, as you know, we've been mentioning 45% increase, and I think that's validation of what we did in terms of stabilizing pricing. Now, giving that certainty just allowed districts to go ahead and purchase. So I think that was a strong sign. And then, look, whenever we talk about, like, you know, in the backlog side, I'll talk a little bit just for a minute on EV. Continued strong state funding, you know, New York, California, Oregon, Illinois, Michigan, all have strong funding, $1.5 billion. All of that helped contribute as well. So order intake, I'd say good quarter, strong validation, perhaps a little bit of catch up from Q4 was in there as well.
John Wyskiel: Yeah, great question. So a couple comments. Just, first, I mean, very strong order intake period. I think, as you know, we've been mentioning 45% increase, and I think that's validation of what we did in terms of stabilizing pricing. Now, giving that certainty just allowed districts to go ahead and purchase. So I think that was a strong sign. And then, look, whenever we talk about, like, you know, in the backlog side, I'll talk a little bit just for a minute on EV. Continued strong state funding, you know, New York, California, Oregon, Illinois, Michigan, all have strong funding, $1.5 billion. All of that helped contribute as well. So order intake, I'd say good quarter, strong validation, perhaps a little bit of catch up from Q4 was in there as well.
Speaker #3: great question. So it's a couple comments. Just first, I mean, very strong order intake period. I think, as you know, we've been mentioning 45% increase.
Speaker #3: validation of what we did And I think that's in terms of stabilizing pricing. Not giving that certainty just allowed districts to go ahead and purchase.
Speaker #3: So I think that was a strong sign. And then look, whenever we talk about even in the backlog side, I'll talk a little bit just for a minute on EV.
Speaker #3: Continued strong state funding. New York, California, Oregon, Illinois, Michigan, all have strong funding. One and a half billion dollars all of that helped contribute as well.
Speaker #3: So order intake, I'd say good quarter, strong validation, perhaps a little bit of catch-up from Q4 was in there as well. So again, pumping up the numbers in terms of 45%.
John Wyskiel: So again, pumping up the numbers in terms of 45%, some of that's just catching up from orders that weren't placed, but overall, good validation.
John Wyskiel: So again, pumping up the numbers in terms of 45%, some of that's just catching up from orders that weren't placed, but overall, good validation.
Speaker #3: Some of that's just catching up from orders that weren't placed. But overall, good validation.
Eric Stine: Okay, and the last one for me, just on the capital allocation strategy. Obviously, the balance sheet quite strong. You mentioned, you know, some potential acquisitions. I'm just wondering if you can, you know, just expand on your thoughts there a little bit. You know, vertical integration makes sense. I would assume if it's, if it's something else, it wouldn't be too far afield from what you currently do.
Eric Stine: Okay, and the last one for me, just on the capital allocation strategy. Obviously, the balance sheet quite strong. You mentioned, you know, some potential acquisitions. I'm just wondering if you can, you know, just expand on your thoughts there a little bit. You know, vertical integration makes sense. I would assume if it's, if it's something else, it wouldn't be too far afield from what you currently do.
Speaker #5: capital allocation Okay. And last one for me, just on the strategy. Obviously, balance sheet quite strong. You mentioned some potential acquisitions. I'm just wondering if you can just expand on your thoughts there a little bit.
Speaker #5: Vertical integration, make sense. I would assume if it's something else, it wouldn't be too far afield from what you currently
Speaker #5: do.
Speaker #4: Yeah, this is Thanks for the question.
Razvan Radulescu: Yeah, this is Razvan. Thanks for the question. So on capital allocation, we have a very strong balance sheet, and we continue to remain focused and evaluate opportunities strategically, both on the growth side, but also on the vertical integration side. So at this point, nothing special to talk about. However, our balance sheet is now stronger as it has ever been, and therefore, it enables us to look strategically at different opportunities.
Razvan Radulescu: Yeah, this is Razvan. Thanks for the question. So on capital allocation, we have a very strong balance sheet, and we continue to remain focused and evaluate opportunities strategically, both on the growth side, but also on the vertical integration side. So at this point, nothing special to talk about. However, our balance sheet is now stronger as it has ever been, and therefore, it enables us to look strategically at different opportunities.
Speaker #4: capital allocation, we have a very strong balance sheet, and we continue to remain focused. And evaluate opportunities strategically, both on the growth side, but also on the vertical integration side.
Speaker #4: So at this point, nothing special to talk about. However, our balance sheet is now stronger than it has ever been, and therefore, it enables us to look strategically at different
Speaker #4: opportunities. Yeah, and Eric, maybe the only thing I'll add is,
John Wyskiel: Yeah, and Eric, maybe the only thing I'll add is, look, where we are, we can be opportunistic. Lots of options there for us in that regard, and I think, you know, for us, safe, accretive, those are key elements of anything we would do in that area.
John Wyskiel: Yeah, and Eric, maybe the only thing I'll add is, look, where we are, we can be opportunistic. Lots of options there for us in that regard, and I think, you know, for us, safe, accretive, those are key elements of anything we would do in that area.
Speaker #3: look, where we are, we can be opportunistic. Lots of options for us, safe or creative, those are key elements of anything we would do in that area.
Speaker #3: And I think we're I guess the best way to say it is we've done the use case analysis. We know what the returns are.
Speaker #5: Okay. That's great. Thank
Eric Stine: Okay, that's great. Thank you.
Eric Stine: Okay, that's great. Thank you.
Speaker #5: you.
Speaker #1: Thank you. Our next question comes from the line of Mike Schlisky with DA Davidson. Mike, your line is now open.
Operator: Thank you. Our next question comes from the line of Mike Shlisky with D.A. Davidson. Mike, your line is now open.
Operator: Thank you. Our next question comes from the line of Mike Shlisky with D.A. Davidson. Mike, your line is now open.
Mike Shlisky: Good afternoon. Thanks for taking my questions here. Can you help me frame the potential impact from your comments, John, about adding more, like, automation to the process? I was curious whether that was already baked into what you said last quarter, two quarters ago, about getting that to that 15% plus, or does adding more automation, is that the plus? Do you have more you can do, and just any kind of sense as to the size of the impact that it might have on your margins, given what you know today?
Mike Shlisky: Good afternoon. Thanks for taking my questions here. Can you help me frame the potential impact from your comments, John, about adding more, like, automation to the process? I was curious whether that was already baked into what you said last quarter, two quarters ago, about getting that to that 15% plus, or does adding more automation, is that the plus? Do you have more you can do, and just any kind of sense as to the size of the impact that it might have on your margins, given what you know today?
Speaker #4: Good afternoon. Thanks for taking my questions. Good to be here. Can you help me frame the potential impact from your comments, John, about adding more automation to the process?
Speaker #4: I was curious whether that was already baked into what you said last quarter, two quarters ago about getting to that 15% plus. Or there for us in that regard.
Speaker #4: does adding more automation is that the plus? Do you have more you can of sense as to the size of
Speaker #4: The impact that it might have on your margins, given what you know.
Speaker #4: today.
Speaker #3: Yeah, great
John Wyskiel: Yeah, great question, Mike. Look, we're. I guess the best way to say it is we've done the use case analysis. We know what the returns are. They're favorable, anything we're putting through, and I think, you know, the way we look at it, we have a longer term outlook there, and this, you know, fits within the outlook. You know, maybe it helps us in, in terms of being some, some tailwinds as we kind of move towards that. But a good story overall, in terms of the manufacturing story, manufacturing strategy, rather, coming together.
John Wyskiel: Yeah, great question, Mike. Look, we're. I guess the best way to say it is we've done the use case analysis. We know what the returns are. They're favorable, anything we're putting through, and I think, you know, the way we look at it, we have a longer term outlook there, and this, you know, fits within the outlook. You know, maybe it helps us in, in terms of being some, some tailwinds as we kind of move towards that. But a good story overall, in terms of the manufacturing story, manufacturing strategy, rather, coming together.
Speaker #3: They're favorable. Anything we're putting through. And I think the way we have a longer-term look at it, we outlook there. And this fits within the outlook.
Speaker #3: Maybe it helps us in terms of being some tailwinds as we kind of move towards that. But a good story overall in terms of the manufacturing strategy, rather, coming together.
Speaker #4: Great. And I also wanted to ask a question about the balance sheet and capital. Pre-pandemic, you were operating with cash of, like, $60 million.
Mike Shlisky: Great. I also wanted to ask a question about the balance sheet and capital allocation. You know, pre-pandemic, you were operating with cash of, like, $50 million, and now you're at $240 million. And, you know, adding together your portion of the CapEx, for the new facility, what you've got left on your buyback, you know, and other things you've got going on, and what you've got probably from a cash flow perspective for the rest of the year here, you're gonna have probably more cash than you know what to do with. I'm just curious, if new M&A, if new M&A, comes into view anytime soon, what is your kind of regular plan? Is it just to buy back more shares, or some other way to, put that cash to use?
Mike Shlisky: Great. I also wanted to ask a question about the balance sheet and capital allocation. You know, pre-pandemic, you were operating with cash of, like, $50 million, and now you're at $240 million. And, you know, adding together your portion of the CapEx, for the new facility, what you've got left on your buyback, you know, and other things you've got going on, and what you've got probably from a cash flow perspective for the rest of the year here, you're gonna have probably more cash than you know what to do with. I'm just curious, if new M&A, if new M&A, comes into view anytime soon, what is your kind of regular plan? Is it just to buy back more shares, or some other way to, put that cash to use?
Speaker #4: Now you're at And adding together 240. your portion of the CapEx, for the new facility, what you've got left on your buyback, and other things you've got going on, and what you've got probably from a cash flow for the rest of the year here, you're going to have probably more cash than you know what to do with.
Speaker #4: I'm just curious if new view anytime soon, what is M&A comes into your kind of regular plan? Is it just a buyback more shares?
Speaker #4: Or some other way to put that cash to use? I'm just not sure what else you could do if you don't find a deal.
Mike Shlisky: I'm just not sure what else you could do if you don't, if you don't find a deal going, forward.
Mike Shlisky: I'm just not sure what else you could do if you don't, if you don't find a deal going, forward.
Speaker #4: Going forward.
Razvan Radulescu: Hey, Mike. Yeah, thanks for the question. So we outlined our capital allocation strategy in the last earnings call. We didn't repeat it here today. However, you are correct. We have the share buyback program, up to $100 million, approved by the board. We spent $5 million already in Q1 out of this program, and we are looking at a big capital investment for the new plant of our portion of $200 million or so over 2 years. We also are increasing a bit our regular CapEx spending, and we are investing also a lot in engineering with the different engineering projects and emissions regulations that are coming in the next couple of years. But obviously, as time develops, at least on a yearly basis, we are gonna revisit that strategy and then potentially consider other avenues.
Razvan Radulescu: Hey, Mike. Yeah, thanks for the question. So we outlined our capital allocation strategy in the last earnings call. We didn't repeat it here today. However, you are correct. We have the share buyback program, up to $100 million, approved by the board. We spent $5 million already in Q1 out of this program, and we are looking at a big capital investment for the new plant of our portion of $200 million or so over 2 years. We also are increasing a bit our regular CapEx spending, and we are investing also a lot in engineering with the different engineering projects and emissions regulations that are coming in the next couple of years. But obviously, as time develops, at least on a yearly basis, we are gonna revisit that strategy and then potentially consider other avenues.
Speaker #5: So we outlined our capital Hey, Mike. Yeah, thanks for the question. allocation strategy in the last earnings call. We didn't repeat it here today.
Speaker #5: correct. However, you are We have the share buyback program up to 100 million, approved by the board. We spent 5 million already. In Q1, out of this program.
Speaker #5: And we are looking at a big capital investment for the new plant of our portion of 200 million or so, over two regular CapEx years.
Speaker #5: spending. And we are investing also a lot in engineering with the different engineering projects and the emissions regulations that are coming in the next couple of years.
Speaker #5: But obviously, as a basis, we are going to revisit that strategy, and then potentially consider other avenues. Maybe in the future, we could evaluate. We also are increasing a bit our quota there.
Razvan Radulescu: Maybe in the future we could evaluate a dividend program, but we are not quite there yet.
Razvan Radulescu: Maybe in the future we could evaluate a dividend program, but we are not quite there yet.
Speaker #1: Got it. yet. I'm going to squeeze one more in here. About market share going forward. Because of some previous issues last year or two about one of your competitors having some issues with reducing on time and getting things out the door, there were some weird swings in market share.
Mike Shlisky: Got it. Let me just squeeze one more in here about market share going forward. Because of some previous issues the last year or two, about one of your competitors having some issues with producing on time and getting things out the door, there were some weird swings in market share. Do you have anything that's on your radar screen for the rest of calendar 2026, as far as any company that's been also acting strangely, or new models, or things like that, that might affect your share one way or the other, or is it pretty steady from here?
Mike Shlisky: Got it. Let me just squeeze one more in here about market share going forward. Because of some previous issues the last year or two, about one of your competitors having some issues with producing on time and getting things out the door, there were some weird swings in market share. Do you have anything that's on your radar screen for the rest of calendar 2026, as far as any company that's been also acting strangely, or new models, or things like that, that might affect your share one way or the other, or is it pretty steady from here?
Speaker #1: Do you have anything that you that's on your radar screen for the rest of calendar 26 here as far as any company that's been also acting strangely or new affect your share one way or the other?
Speaker #1: Or is it pretty steady from here?
Speaker #3: No, I think maybe competitors had a couple of things. As you know, one of ours is supply issues. Seems like they've gotten through that.
John Wyskiel: No, I think it may be a couple of things, though. As you know, one of our competitors had some supply issues. Seems like they've gotten through that, and I think it's maybe normalized the market share that we're seeing right now.
John Wyskiel: No, I think it may be a couple of things, though. As you know, one of our competitors had some supply issues. Seems like they've gotten through that, and I think it's maybe normalized the market share that we're seeing right now.
Speaker #3: And I think it's maybe normalized the market share that we're seeing right now. I don't know if Mark or Razvan has
[Analyst] (ROTH Capital Partners): ... I don't know if Mark or Razvan has anything else to add?
John Wyskiel: ... I don't know if Mark or Razvan has anything else to add?
Speaker #3: anything else to add.
Speaker #5: Yeah,
John Wyskiel: Yeah, I'd say from what we see from order intake, I would say, business as usual. Mike?
Mark Benfield: Yeah, I'd say from what we see from order intake, I would say, business as usual. Mike?
Speaker #5: I'd say from what we see from order intake, I would say business as usual. Mike. models or things like that that might
Speaker #1: Okay. Outstanding. I'll pass it along. Thank you.
Chris Pierce: Okay, outstanding. I'll pass it along. Thank you.
Mike Shlisky: Okay, outstanding. I'll pass it along. Thank you.
John Wyskiel: Thanks, Mike.
John Wyskiel: Thanks, Mike.
Speaker #3: Mike.
Operator: Thank you. Our next question comes from the line of Chris Pierce with Needham. Chris, your line is now open.
Operator: Thank you. Our next question comes from the line of Chris Pierce with Needham. Chris, your line is now open.
Speaker #1: question comes from the line of Chris Pierce with Needham. Chris, your line is now Thanks, open.
Speaker #6: Hey, just one question for me. I guess I know that it's tariff pass-throughs
Chris Pierce: Hey, just one question for me. I guess, I know that it's tariff pass-throughs on pricing, but I guess I'm just curious about what you're hearing from distributors, the industry. I mean, when you talk about that $9,000 per bus, is there any sort of pushback out there from buyers or, you know, kind of what are buyers saying to you? And then what role does pricing play as far as long-term margin guidance as well?
Chris Pierce: Hey, just one question for me. I guess, I know that it's tariff pass-throughs on pricing, but I guess I'm just curious about what you're hearing from distributors, the industry. I mean, when you talk about that $9,000 per bus, is there any sort of pushback out there from buyers or, you know, kind of what are buyers saying to you? And then what role does pricing play as far as long-term margin guidance as well?
Speaker #6: on pricing, but I guess I'm just curious about what you're hearing from $9,000 per bus, is there any distributors, the industry. Thank you.
Speaker #6: sort of pushback out there from I mean, when you talk about that Our next buyers or kind of what are buyers saying to you?
Speaker #6: And then what role does pricing play as far as long-term margin guidance as
Speaker #6: well? Yeah, Chris, so our
Razvan Radulescu: Yeah, Chris, so our tariffs are very different between internal combustion engine buses and EVs. So our tariffs for internal combustion are now below $5,000 per bus, but the EVs are above $10,000 per bus. So I'm not sure where the $9,000 is coming from. But definitely we see tariffs as a tax imposed by the government, and we are working very hard with our supply chain partners to minimize those in a volatile environment, where different countries go on different lists from time to time. So it's a bit difficult to come up with a consistent supply and sourcing strategy geographically in this environment, but we are working to minimize those.
Razvan Radulescu: Yeah, Chris, so our tariffs are very different between internal combustion engine buses and EVs. So our tariffs for internal combustion are now below $5,000 per bus, but the EVs are above $10,000 per bus. So I'm not sure where the $9,000 is coming from. But definitely we see tariffs as a tax imposed by the government, and we are working very hard with our supply chain partners to minimize those in a volatile environment, where different countries go on different lists from time to time. So it's a bit difficult to come up with a consistent supply and sourcing strategy geographically in this environment, but we are working to minimize those.
Speaker #4: Tariffs are very engine-bus specific, and different between internal combustion and EVs. So our tariffs for internal combustion are now below $5,000 per bus, but the EVs are above $10,000 per bus.
Speaker #4: So I'm not sure where the 9,000 is. Coming from. But definitely we see tariffs as a tax imposed by the with our supply chain partners to government.
Speaker #4: minimize those in a volatile environment where different countries go on different lists from time And we are working very hard to come up with a consistent supply and sourcing strategy geographically in this those.
Razvan Radulescu: At the same time, we are working with our dealers and our customers, and providing them certainty going forward right now, all the way through June, for fixed tariff pricing, for future delivery. At this point, our target remains to be margin neutral on tariffs.
Razvan Radulescu: At the same time, we are working with our dealers and our customers, and providing them certainty going forward right now, all the way through June, for fixed tariff pricing, for future delivery. At this point, our target remains to be margin neutral on tariffs.
Speaker #4: working with our dealers and our And at the same time, we are customers and providing them certainty environment. going forward. Right now, all the way through But we are working to minimize June, for fixed tariff pricing for future target remains to be margin neutral on tariffs.
Speaker #3: Yeah, and I think maybe where that 9,000, I just want to clarify, Chris, might come from at the beginning we talked about our 8,800 change in price from prior year, half is pricing action.
John Wyskiel: Yeah, and I think maybe with that $9,000, I just want to clarify, Chris, might come from, at the beginning, we talked about our $8,800 change in price from prior year, which we said roughly half is tariff, half is pricing action.
John Wyskiel: Yeah, and I think maybe with that $9,000, I just want to clarify, Chris, might come from, at the beginning, we talked about our $8,800 change in price from prior year, which we said roughly half is tariff, half is pricing action.
Speaker #6: Yeah, for sure. But in the end, the customers still have to pay that price. I was kind of curious if you're hearing anything from distributors as far as elevated pricing, which I know is because of tariffs, but I'm just kind of curious what the market is saying.
Chris Pierce: Yeah, for sure. But in the end, the customer still has to pay that price. I just was kind of curious if you're hearing anything from distributors as far as elevated pricing, which I know is because of tariffs, but I'm just kind of curious what the market is saying.
Chris Pierce: Yeah, for sure. But in the end, the customer still has to pay that price. I just was kind of curious if you're hearing anything from distributors as far as elevated pricing, which I know is because of tariffs, but I'm just kind of curious what the market is saying.
Speaker #5: Yeah, well, look, a couple of things. And I know there could be some of we were 45% up for the quarter on order intake.
John Wyskiel: Yeah. Well, look, a couple things. I know there could be some of, you know, we were 45% up for the quarter on order intake. Some of that may be catch up from the prior year. But the reality is, you know, unfortunately, there's tariffs now that they're all dealing with. But it- the, in terms of if you were to compare it to, is there any fatigue? Maybe there's-- they're not happy, but at the end of the day, they recognize all the manufacturers have them, and then I think the other side of it is they recognize they have to change the fleet out. You know, there are buses that are coming into that ten-year window right now, a heavy number, that they simply have to change, and it becomes a matter of economics.
John Wyskiel: Yeah. Well, look, a couple things. I know there could be some of, you know, we were 45% up for the quarter on order intake. Some of that may be catch up from the prior year. But the reality is, you know, unfortunately, there's tariffs now that they're all dealing with. But it- the, in terms of if you were to compare it to, is there any fatigue? Maybe there's-- they're not happy, but at the end of the day, they recognize all the manufacturers have them, and then I think the other side of it is they recognize they have to change the fleet out. You know, there are buses that are coming into that ten-year window right now, a heavy number, that they simply have to change, and it becomes a matter of economics.
Speaker #5: Some of that may be catch-up from the prior year. But the reality is, unfortunately, there's tariffs now that they're all dealing with. But in terms of, if you were to compare it to, is there any fatigue?
Speaker #5: Maybe of the day, they there's they're not happy, but at the end recognize all the manufacturers have them. And then I think the other side of it is they recognize they have to change the fleet out.
Speaker #5: There are buses that are coming, number, that they simply have to change—matter of economics. It's easier to, or more effective to replace the, and it becomes a unit, than to keep it.
Speaker #5: There are buses that are coming number, that they simply have to change matter of economics. It's easier to or more effective to replace the and it becomes a unit than to keep it into that 10-year window right now, heavy going.
John Wyskiel: It's easier to, or it's more effective to replace the unit than to keep it going.
John Wyskiel: It's easier to, or it's more effective to replace the unit than to keep it going.
Speaker #6: Okay, that makes sense. Appreciate the
Chris Pierce: Okay, that makes sense. Appreciate the detail. Thank you.
Chris Pierce: Okay, that makes sense. Appreciate the detail. Thank you.
Speaker #6: Thank Backlog remains solid. You talked about sourcing EPA more color on what you're seeing in the overall EV market?
Speaker #6: you.
Speaker #5: Thanks, Chris.
John Wyskiel: Thanks, Chris.
John Wyskiel: Thanks, Chris.
Speaker #1: Thank you. Our next question comes from the line of Craig Irwin with Roth Capital Partners. Craig, your line is now open.
Operator: Thank you. Our next question comes from the line of Craig Irwin with Roth, Roth Capital Partners. Craig, your line is now open.
Operator: Thank you. Our next question comes from the line of Craig Irwin with Roth, Roth Capital Partners. Craig, your line is now open.
Speaker #6: Hey guys, it's Andrew on for Craig. First one for detail: detail on kind of the alt-fuel buses, but it looks like within EVs, you guys kind of nudged up the midpoint of your annual guide.
[Analyst] (ROTH Capital Partners): Hey, guys, it's Andrew on for Craig. First one for me, you kind of touched a lot, provided a lot of detail on, on kind of the alt-fuel buses, but looks like within EVs, you guys kind of nudged up your, the midpoint of your annual guide, backlog remains solid. You talked about still seeing EPA funding flowing. So can you just provide a bit more color on what you're seeing in the overall EV market?
Craig Irwin: Hey, guys, it's Andrew on for Craig. First one for me, you kind of touched a lot, provided a lot of detail on, on kind of the alt-fuel buses, but looks like within EVs, you guys kind of nudged up your, the midpoint of your annual guide, backlog remains solid. You talked about still seeing EPA funding flowing. So can you just provide a bit more color on what you're seeing in the overall EV market?
Razvan Radulescu: Yeah, Andrew, thanks for the question. This is Razvan. Yeah, we see strong orders supported both by the EPA Rounds 2 and 3 and the state funding subsidies that are out there. And yes, we raised our guidance for this year to 800 units. And I would say part of the upside to our guidance to go higher on both revenues and EBITDA for the year is comes from EV. So to the extent that we can build more and deliver them, we will do that in this year, and this gives the upside to our guidance. On the other side, the downside to our guidance comes from tariffs and the cost coming from tariffs that we can't fully predict right now.
Razvan Radulescu: Yeah, Andrew, thanks for the question. This is Razvan. Yeah, we see strong orders supported both by the EPA Rounds 2 and 3 and the state funding subsidies that are out there. And yes, we raised our guidance for this year to 800 units. And I would say part of the upside to our guidance to go higher on both revenues and EBITDA for the year is comes from EV. So to the extent that we can build more and deliver them, we will do that in this year, and this gives the upside to our guidance. On the other side, the downside to our guidance comes from tariffs and the cost coming from tariffs that we can't fully predict right now.So those are the two puts and takes for the guidance, and we feel very good about the EV right now.
Speaker #4: Razvan. Yeah, we see strong Yeah, Andrew. Thanks for the question. This is orders. Supported both by the EPA rounds two and three and their state there.
Speaker #4: And yes, we raised our guidance for this year to 800 units. And I would say part of the upside to our guidance to go higher on both revenues and EBITDA for the year comes from EVs.
Speaker #4: So more and deliver them, we will do that in this year. And this gives the upside to our guidance. On the other side, the downside to our guidance comes from tariffs.
Speaker #4: And the cost coming from tariffs that we can't fully predict right now. So those are the two puts and takes for the guidance. And we feel very good about the EV right
Razvan Radulescu: So those are the two puts and takes for the guidance, and we feel very good about the EV right now.
Speaker #4: now.
Speaker #5: Yeah, maybe just a couple of other
John Wyskiel: Yeah, maybe just a couple other things. You know, of course, there's a federal side that we just talked to with Rounds One through Five. But then on the state side, I always reiterate, New York, California, Oregon, Illinois, Michigan, there's about $1.5 billion in funding there. And then a lot of these big fleets just have mandates. They want to get to certain thresholds in terms of EVs as a portion of their fleet, and that includes both big fleets as well as states. So when you roll it all together, we've continued to say EV is relevant.
John Wyskiel: Yeah, maybe just a couple other things. You know, of course, there's a federal side that we just talked to with Rounds One through Five. But then on the state side, I always reiterate, New York, California, Oregon, Illinois, Michigan, there's about $1.5 billion in funding there. And then a lot of these big fleets just have mandates. They want to get to certain thresholds in terms of EVs as a portion of their fleet, and that includes both big fleets as well as states. So when you roll it all together, we've continued to say EV is relevant.
Speaker #5: things. The question is a federal side that we just talked to. It's rounds one through five. But then on the state side, I always reiterate, New York, California, Oregon, Illinois, Michigan, there's about a billion, five, in funding there.
Speaker #5: And then a lot of these big fleets just have mandates. They want to get to certain thresholds in terms of EVs as a portion of their fleet.
Speaker #5: And that includes both big fleet states. So when you roll it all together, we've continued to say, EV is, as well as—
Speaker #5: relevant. Great.
[Analyst] (ROTH Capital Partners): Great. Well, appreciate the color. And then, second from me, I know it's not a big driver in 2026, but I know last quarter, you provided an update on the commercial chassis, you're prototyping some models with some different body types. Can you just provide some additional color and update there, and if we can still kind of expect around 100 units towards the latter half of the year?
Craig Irwin: Great. Well, appreciate the color. And then, second from me, I know it's not a big driver in 2026, but I know last quarter, you provided an update on the commercial chassis, you're prototyping some models with some different body types. Can you just provide some additional color and update there, and if we can still kind of expect around 100 units towards the latter half of the year?
Speaker #1: Well, appreciate the caller. And then second from me, I know it's not a big driver in 26, but I know last quarter you provided an update on the commercial chassis.
Speaker #1: Your some different body prototyping some models with types can you just provide some we can still kind of expect around 100 additional color and update there?
Speaker #1: units towards the latter half of the year?
Speaker #5: Yeah, for sure. So first of all, we took our first
John Wyskiel: Yeah, for sure. So first of all, we took our first order, you know, first of 30, I guess, is the best way to say it, from one customer. This is a customer that helped us with the development and, you know, working through what they wanted to see from a field standpoint. What we're doing now is we're going through normal engineering loops, and then we're kind of rolling up our bill and doing all that, or bill materials and working that process. Our production SOP now looks like it's gonna be, you know, I would say, later Q4, which is gonna push out units into next year.
John Wyskiel: Yeah, for sure. So first of all, we took our first order, you know, first of 30, I guess, is the best way to say it, from one customer. This is a customer that helped us with the development and, you know, working through what they wanted to see from a field standpoint. What we're doing now is we're going through normal engineering loops, and then we're kind of rolling up our bill and doing all that, or bill materials and working that process. Our production SOP now looks like it's gonna be, you know, I would say, later Q4, which is gonna push out units into next year.
Speaker #5: first of 30, I guess, is the best way to say it, from one customer. And this And if is a customer that helped us with the development and working through what they wanted to see from a field standpoint.
Speaker #5: What we're doing now is we're going through normal engineering loops, and then we're kind of rolling up our bill and doing all that in our bill of materials.
Speaker #5: And working that process, our production SOP now looks like it's going to be I would say later fourth quarter, which is going to push out units into next year.
Speaker #5: But again, our focus on this whole thing is this is a new entry, so we want to make sure we got it right from quality.
John Wyskiel: But again, our focus on this whole thing, this is a new entry, so we wanna make sure we got it right from quality, from a durability perspective, from a price perspective. Getting all that right is important. It matters.
John Wyskiel: But again, our focus on this whole thing, this is a new entry, so we wanna make sure we got it right from quality, from a durability perspective, from a price perspective. Getting all that right is important. It matters.
Speaker #5: From a durability perspective, from a price perspective, getting all that right is important. It matters.
Speaker #4: And maybe just to clarify in terms of guidance, we substituted those 100 sales with buses for the total year. So we maintained the 9,500.
Razvan Radulescu: Maybe just to clarify in terms of guidance, we substituted those 100 sales with buses for the total year, so we maintained the 9,500. But due to the timing of production, these stripped chassis will start to be revenue recognized and sold for the income statement purposes in fiscal 2027 Q1.
Razvan Radulescu: Maybe just to clarify in terms of guidance, we substituted those 100 sales with buses for the total year, so we maintained the 9,500. But due to the timing of production, these stripped chassis will start to be revenue recognized and sold for the income statement purposes in fiscal 2027 Q1.
Speaker #4: But due to the timing of production, this strip chassis will start to be revenue recognized and sold for income statement purposes in fiscal '27.
Speaker #4: Q1.
Speaker #1: Thanks again for
Mark Benfield: Thanks again for taking the questions.
Craig Irwin: Thanks again for taking the questions.
Speaker #1: taking the questions.
Speaker #5: No worries. Thank you.
John Wyskiel: No worries. Thank you.
John Wyskiel: No worries. Thank you.
Speaker #1: Thank you. They're currently no questions registered. So as a question, please press star one on your telephone keypad. We will pause here briefly to ask questions are brief reminder, if you would like to ask a registered.
Operator: Thank you. There are currently no questions registered, so as a brief reminder, if you would like to ask a question, please press star one on your telephone keypad. We will pause here briefly as questions are registered. There are no more questions waiting at this time, so I would like to pass the conference back over to John for any closing remarks.
Operator: Thank you. There are currently no questions registered, so as a brief reminder, if you would like to ask a question, please press star one on your telephone keypad. We will pause here briefly as questions are registered. There are no more questions waiting at this time, so I would like to pass the conference back over to John for any closing remarks.
Speaker #1: There are no more questions waiting at this time, so I would like to pass the conference back over to John for any closing remarks.
Speaker #2: Yeah, thank you, William. And thanks to each of you for joining us on the call today. Blue Bird has delivered a great start to 2026 with strong results, beating expectations in a challenging environment.
John Wyskiel: Yeah, thank you, William, and thanks to each of you for joining us on the call today. Blue Bird has delivered a great start for 2026, with strong results, beating expectations and raising our guidance, and this is despite a challenging environment. With the fundamentals of the industry and the key elements of our strategy, I remain very optimistic for Blue Bird and its future, and we look forward to updating you on our progress next quarter. Should you have any follow-up questions, please don't hesitate to contact our Head of Investor Relations, Mark Benfield. Blue Bird continues to be stronger than ever and has an amazing future ahead as we approach our 100th anniversary next year. Thanks again from all of us at Blue Bird, and have a great evening.
John Wyskiel: Yeah, thank you, William, and thanks to each of you for joining us on the call today. Blue Bird has delivered a great start for 2026, with strong results, beating expectations and raising our guidance, and this is despite a challenging environment. With the fundamentals of the industry and the key elements of our strategy, I remain very optimistic for Blue Bird and its future, and we look forward to updating you on our progress next quarter. Should you have any follow-up questions, please don't hesitate to contact our Head of Investor Relations, Mark Benfield. Blue Bird continues to be stronger than ever and has an amazing future ahead as we approach our 100th anniversary next year. Thanks again from all of us at Blue Bird, and have a great evening.
Speaker #2: With the and raising our guidance. And this is despite a our strategy, I remain very optimistic for Bluebird and its future. And we look forward to updating you on our progress next quarter.
Speaker #2: Should you have any follow-up questions, please don't hesitate to contact our head of investor relations, Mark Benfield. Bluebird continues to be stronger than ever and has an amazing fundamentals of the industry and the key elements of future ahead as we approach our 100th anniversary next year.
Speaker #2: Bluebird, and have a great
Speaker #2: evening. Thank you.
Operator: Thank you. That concludes the Blue Bird fiscal 2026 Q1 earnings call. Thank you for your participation. You may now disconnect your lines.
Operator: Thank you. That concludes the Blue Bird fiscal 2026 Q1 earnings call. Thank you for your participation. You may now disconnect your lines.
Speaker #1: That
Speaker #1: concludes the Bluebird fiscal Thanks again from all of us at 2026 first quarter earnings call. Thank you for your participation. You may now disconnect your lines.
