Loading...
01/09 23:56
Loading...
Access earnings results, analyst expectations, report, slides, earnings call, and transcript.
The earnings call summary and Q&A session indicate strong financial performance, robust backlog, and positive guidance across various segments. Management's strategies to offset tariff impacts and plans for increased share buybacks further bolster sentiment. While there are some uncertainties, such as tariff impacts and backlog mix, the overall outlook remains optimistic, driven by technological advancements and market demand. This suggests a positive stock price movement in the short term.
Revenue $2.7 billion, a decrease of $115 million or 4% from the same quarter last year. The decrease was primarily due to lower sales volume in the Access and Transport segments, partially offset by higher Vocational sales volume and improved pricing.
Adjusted Operating Margin 11.5%, consistent with the prior year despite lower sales. This reflects strong performance across segments, particularly in the Vocational segment and improved returns in the Transport segment.
Adjusted Earnings Per Share (EPS) $3.41, an increase of $0.07 or 2.1% over the prior year. The increase was supported by share repurchases and strong segment performance.
Free Cash Flow $49 million, significantly higher than the net use of cash of $251 million in the second quarter of 2024. The improvement was due to the timing of tax payments and better management of receivables.
Access Segment Sales $1.26 billion, a decrease of $151 million or 11% from the prior year. The decline was due to the expiration of the agreement to produce Cat-branded telehandlers, higher discounts, and lower sales volume in Europe, partially offset by sales at AUSA.
Vocational Segment Sales $970 million, a 15% increase from the prior year. This was driven by higher sales volume, improved pricing, and a 20% growth in fire apparatus deliveries.
Vocational Segment Adjusted Operating Income Margin 16.3%, a 220 basis point increase from the prior year. The improvement was due to better price-cost dynamics.
Transport Segment Sales $479 million, a decrease of $93 million from the prior year. The decline was due to lower defense vehicle volume from the wind-down of the domestic JLTV program, partially offset by higher international sales of tactical wheeled vehicles and increased revenue from delivery vehicles.
Transport Segment Adjusted Operating Income Margin 3.7%, an improvement from 2.1% in the prior year. The improvement was driven by better FHTV pricing and increased revenue from delivery vehicles.
Micro-sized scissor lift: Launched in May and began deliveries in June. Specifically designed for data center customers. High demand has led to evaluating options to expand capacity and broaden the product line.
FMTV (Family of Medium Tactical Vehicles) contract: Signed a 3-year sole-source contract with the Department of Defense, including updated pricing and an economic price adjustment mechanism. Launch of LVAD (low velocity airdrop variance) under this program.
FHTV (Family of Heavy Tactical Vehicles) contract: 5-year contract signed last year with the Department of Defense, contributing to improved returns in the Transport segment.
Adjusted operating margin: Achieved 11.5% on $2.7 billion revenue in Q2, reflecting strong performance across segments.
Vocational segment: Delivered 16.3% adjusted operating income margin on $970 million sales, with a 220 basis point increase from last year. Fire apparatus deliveries increased 7%.
Transport segment: Improved operating income margin to 3.7% from 2.1% last year, despite lower sales volume. Revenue from delivery vehicles increased to 22% of segment sales.
2028 targets: Aiming for 7%-10% compound annual revenue growth and 200-400 basis points margin expansion. Building blocks for these targets are in place.
Sustainability initiatives: Published 12th annual sustainability report in June, highlighting long-term commitments.
Market Conditions: Lower sales volume in the Access and Transport segments due to market conditions in North America and Europe, including the expiration of the Cat-branded telehandlers agreement and higher discounts.
Tariff Environment: Dynamic tariff environment impacting segment margins, though partially offset by cost actions.
Supply Chain Challenges: Potential challenges in meeting growing demand and fulfilling backlog orders in the Vocational segment.
Defense Vehicle Volume: Lower defense vehicle volume due to the wind-down of the domestic JLTV program, partially offset by international sales.
Economic Uncertainty: Uncertainty in the macroeconomic environment, which could impact the company's ability to meet its financial targets.
Revenue Dependency: Dependence on specific contracts such as the FMTV and FHTV programs with the Department of Defense, which could pose risks if not renewed or if terms change unfavorably.
Revenue Growth: The company expects a compound annual revenue growth rate of 7% to 10% by 2028.
Margin Expansion: Oshkosh targets transformative margin expansion of 200 to 400 basis points by 2028.
Free Cash Flow: The company has increased its free cash flow outlook for 2025 to a range of $400 million to $500 million, up from the previous range of $300 million to $400 million.
Adjusted EPS: The company projects adjusted EPS for 2025 to be approximately $11 per share, with a long-term target of $18 to $22 per share by 2028.
Transport Segment: The company is ramping up production of the next-generation delivery vehicle (NGDV) for the United States Postal Service and expects continued growth in this segment.
Vocational Segment: Plans to progressively expand capacity to meet growing demand and fulfill backlog orders, with a focus on fire apparatus deliveries.
Access Segment: The company is evaluating options to expand capacity for its new micro-sized scissor lift product line due to strong demand.
Defense Contracts: Signed a 3-year sole-source contract for the Family of Medium Tactical Vehicles (FMTV) program with the Department of Defense, which includes updated pricing and an economic price adjustment mechanism.
Share Repurchase: During the quarter, Oshkosh Corporation repurchased nearly 415,000 shares of its stock, amounting to approximately $40 million. This brings the year-to-date share repurchases to nearly $70 million. The share repurchases over the previous 12 months contributed $0.06 to adjusted EPS compared to the second quarter of 2024. The company also indicated plans to materially increase the pace of share buybacks across the year.
The earnings call shows mixed signals: strong free cash flow and improved margins in the transport segment are positive, but declining sales in the Access segment and weak guidance affect sentiment. Q&A highlights challenges with tariffs and production delays, while management's lack of clarity on future guidance raises concerns. Given these mixed factors, the stock is likely to see a neutral movement in the short term.
The earnings call summary and Q&A session indicate strong financial performance, robust backlog, and positive guidance across various segments. Management's strategies to offset tariff impacts and plans for increased share buybacks further bolster sentiment. While there are some uncertainties, such as tariff impacts and backlog mix, the overall outlook remains optimistic, driven by technological advancements and market demand. This suggests a positive stock price movement in the short term.
All transcripts are sourced directly from the official live webcast or the company’s official investor relations website. We use the exact words spoken during the call with no paraphrasing of the core discussion.
Full verbatim transcripts are typically published within 4–12 hours after the call ends. Same-day availability is guaranteed for all S&P 500 and most mid-cap companies.
No material content is ever changed or summarized in the “Full Transcript” section. We only correct obvious spoken typos (e.g., “um”, “ah”, repeated 10 times”, or clear misspoken ticker symbols) and add speaker names/titles for readability. Every substantive sentence remains 100% as spoken.
When audio quality is poor or multiple speakers talk over each other, we mark the section instead of guessing. This ensures complete accuracy rather than introducing potential errors.
They are generated by a specialized financial-language model trained exclusively on 15+ years of earnings transcripts. The model extracts financial figures, guidance, and tone with 97%+ accuracy and is regularly validated against human analysts. The full raw transcript always remains available for verification.
