Financial Performance - Sales reached $1.17 billion in 2Q 2025, a decrease of 0.8% compared to the previous year[9, 29] - Adjusted EBITDA margin was 17.7%, down from 19.5% in the prior-year period, primarily due to lower production volume, incremental tariff costs, and unfavorable FX[9, 30] - Adjusted EPS stood at $1.42, compared to $1.63 in the prior-year period, representing a 13% decrease[11, 40] - Free cash flow generated was $78 million[11] Segment Performance - Engineered Bearings segment sales were $777 million, down 0.8% year-over-year[42, 45] with adjusted EBITDA of $153 million, or 19.7% of sales[44, 46] - Industrial Motion segment sales were $396 million, down 0.7% year-over-year[50, 55] with adjusted EBITDA of $73 million, or 18.3% of sales[52, 53] - Organic sales decreased by 2.5%[12, 36] Outlook - The company expects organic sales to decline by 2.0% in 2025 at the midpoint[15] - The adjusted EPS outlook for 2025 is $5.10 to $5.40, compared to $5.79 in 2024[16] - Free cash flow for 2025 is projected to be approximately $375 million, exceeding the 2024 level[16] - The company anticipates a net unfavorable impact from tariffs of approximately $10 million for the full year[16]

Core Insights - Timken reported revenue of $1.17 billion for the quarter ended June 2025, reflecting a year-over-year decline of 0.8% [1] - The EPS for the same period was $1.42, down from $1.63 a year ago, but exceeded the consensus estimate of $1.34 by 5.97% [1] - The revenue surpassed the Zacks Consensus Estimate of $1.15 billion by 1.72% [1] Financial Performance Metrics - Net Sales in Industrial Motion were $396 million, slightly below the average estimate of $397.62 million, representing a year-over-year decline of 0.7% [4] - Net Sales in Engineered Bearings reached $777.4 million, exceeding the average estimate of $759.27 million, with a year-over-year decline of 0.8% [4] - Adjusted EBITDA for Industrial Motion was $72.6 million, slightly above the average estimate of $72.21 million [4] - Adjusted EBITDA for Engineered Bearings was $153.4 million, surpassing the average estimate of $144.54 million [4] Stock Performance - Timken's shares have returned +7.3% over the past month, outperforming the Zacks S&P 500 composite's +3.4% change [3] - The stock currently holds a Zacks Rank 3 (Hold), indicating potential performance in line with the broader market in the near term [3]

Company Performance - Timken reported quarterly earnings of $1.42 per share, exceeding the Zacks Consensus Estimate of $1.34 per share, but down from $1.63 per share a year ago, representing an earnings surprise of +5.97% [1] - The company posted revenues of $1.17 billion for the quarter ended June 2025, surpassing the Zacks Consensus Estimate by 1.72%, although this is a slight decrease from year-ago revenues of $1.18 billion [2] - Over the last four quarters, Timken has surpassed consensus EPS estimates two times and topped consensus revenue estimates four times [2] Stock Outlook - Timken shares have increased approximately 13.5% since the beginning of the year, outperforming the S&P 500's gain of 8.3% [3] - The company's earnings outlook, including current consensus earnings expectations for upcoming quarters, will be crucial for assessing future stock performance [4] - The current consensus EPS estimate for the coming quarter is $1.33 on revenues of $1.12 billion, and for the current fiscal year, it is $5.36 on revenues of $4.5 billion [7] Industry Context - The Electronics - Miscellaneous Products industry, to which Timken belongs, is currently in the top 33% of over 250 Zacks industries, indicating a favorable outlook [8] - Empirical research shows a strong correlation between near-term stock movements and trends in earnings estimate revisions, which can impact Timken's stock performance [5][6]

Timken Reports Second-Quarter 2025 Results | | 2Q-25 | 2Q-24 | % Change | | --- | --- | --- | --- | | Net Sales (mils.) | $1,173.4 | $1,182.3 | (0.8)% | | Net Income Margin | 6.7% | 8.1% | (140 bps) | | Adjusted EBITDA Margin | 17.7% | 19.5% | (180 bps) | | Diluted EPS | $1.12 | $1.36 | (17.6)% | | Adjusted EPS | $1.42 | $1.63 | (12.9)% | Excluding special items (detailed in the attached tables), adjusted net income in the second quarter was $99.3 million or $1.42 per diluted share. This compares to adjuste ...

Core Insights - The Timken Company reported second-quarter 2025 net sales of $1.17 billion, a decrease of 0.8% compared to the same period in 2024, primarily due to lower end-market demand, although partially offset by revenue from the CGI acquisition and favorable pricing [1][12] - The company's net income for the quarter was $78.5 million, or $1.12 per diluted share, down from $96.2 million, or $1.36 per diluted share, in the same quarter last year [2][12] - Adjusted EBITDA for the quarter was $208.2 million, representing 17.7% of sales, compared to $230.2 million, or 19.5% of sales, in the prior year [3][12] Financial Performance - Net income margin decreased to 6.7% from 8.1% year-over-year, while adjusted EPS fell to $1.42 from $1.63, reflecting a 12.9% decline [2][3] - The company generated $111.3 million in net cash from operations and reported free cash flow of $78.2 million [4][12] - Timken returned $47.0 million to shareholders through dividends and share repurchases during the quarter, with a 3% increase in quarterly dividends [4][12] Segment Performance - Engineered Bearings segment sales were $777.4 million, down 0.8% year-over-year, with higher renewable energy demand offset by lower demand in other sectors [5][12] - Industrial Motion segment sales decreased by 0.7% to $396.0 million, with lower demand across most platforms despite contributions from the CGI acquisition [7][12] - Adjusted EBITDA margins for Engineered Bearings and Industrial Motion were 19.7% and 18.3%, respectively, both showing declines from the previous year [6][8] Outlook - The company has revised its full-year 2025 earnings per diluted share forecast to a range of $3.90 to $4.20, with adjusted earnings per diluted share expected to be between $5.10 and $5.40 [9][12] - Timken anticipates a challenging operating environment in the second half of 2025, driven by trade situations and macroeconomic factors [10][12] - Despite current challenges, the company expresses optimism for 2026, planning to position itself for potential industrial market expansion [10][12]

Company Overview - The Timken Company is a global technology leader in engineered bearings and industrial motion, with a focus on designing next-generation products for diverse industries [3] - The company has been operational for over 125 years, leveraging specialized expertise to innovate and create customer-centric solutions that enhance reliability and efficiency [3] - In 2024, Timken reported sales of $4.6 billion and employs approximately 19,000 people across 45 countries [3] Upcoming Financial Results - Timken will release its 2025 second-quarter financial results on July 30, 2025, prior to the opening of the New York Stock Exchange [1] - A conference call will be held on the same day at 11:00 a.m. Eastern Time to discuss the financial performance with investors and securities analysts [2] - Conference call materials and financial results will be accessible online at the company's investor relations website [1][2]

Company Leadership Change - The Timken Company has appointed Timothy A. Graham as president of Industrial Motion, effective immediately, succeeding Christopher A. Coughlin who is retiring [1][2] - Graham has been with Timken since 2003 and has extensive experience in leading global operations, including his recent role as vice president of operations for Engineered Bearings [2] Strategic Vision - Graham expressed his commitment to driving innovation and delivering exceptional value for customers, aiming to strengthen Timken's position in the Industrial Motion sector [3] - The CEO, Richard G. Kyle, highlighted Graham's operational expertise and global experience as key factors for scaling and accelerating profitable growth in the Industrial Motion business [2] Company Overview - The Timken Company is a global technology leader in engineered bearings and industrial motion, with $4.6 billion in sales in 2024 and approximately 19,000 employees across 45 countries [4]

Company Overview - The Timken Company is a global technology leader in engineered bearings and industrial motion, with a focus on designing next-generation products for diverse industries [2] - The company has over 125 years of experience in innovation and creating customer-centric solutions that enhance reliability and efficiency [2] - In 2024, Timken reported sales of $4.6 billion and employs approximately 19,000 people across 45 countries [2] Upcoming Events - Timken will participate in the KeyBanc Industrials & Basic Materials Conference on May 28, 2025, in Boston, Massachusetts [1] - Philip D. Fracassa, executive vice president and chief financial officer, and Neil Frohnapple, vice president of investor relations, will represent the company at the conference [1] - Materials shared during the conference will be accessible online at the company's investor relations website [1]

Company Overview and Performance - The Timken Company was founded in 1899 and has been NYSE listed since 1922[9] - In 2024, the company reported revenue of $4.6 billion, adjusted EBITDA of $845 million, and adjusted EPS of $5.79[9] - The adjusted EBITDA margin for 2024 was 18.5%, and free cash flow was $306 million[9] - The company's dividend yield as of December 31, 2024, was 1.9%[9] - In Q1 2025, net sales were $1.14 billion, a decrease of 4.2% compared to Q1 2024[64, 65] - Adjusted EBITDA for Q1 2025 was $208 million, with a margin of 18.2%, down 250 bps from Q1 2024[64, 66] - Adjusted EPS for Q1 2025 was $1.40 per diluted share[64, 67] Business Segments and Strategy - The company operates through two segments: Engineered Bearings (66% of sales) and Industrial Motion (34% of sales)[15] - 56% of sales are from the Americas, 24% from Europe, Mid-East, Africa (EMEA), and 20% from Asia-Pacific in 2024[11] - The company targets organic growth of 4-5% CAGR and inorganic growth of 2-3% CAGR, aiming for a total growth CAGR of 6-8%[102] - The company aims for adjusted EPS CAGR of >10% and adjusted EBITDA margins of +200 bps versus the 2017-2021 period[102] Capital Allocation - The company targets capital expenditures of 3.5-4.0% of sales over the cycle[80] - The company has repurchased approximately 31 million shares for $1.55 billion since 2013, reducing basic shares outstanding by approximately 25%[101] - The company's long-term leverage target is 1.5-2.5x net debt-to-adjusted EBITDA[74, 102]

Core Points - The Timken Company has approved a 3 percent increase in its quarterly cash dividend, raising it to 35 cents per share, payable on May 23, 2025 [1] - The company has achieved 12 consecutive years of annual dividend increases, reflecting the board's confidence in its long-term earnings and cash flow growth [2] - Timken has maintained a dividend payment every quarter since its NYSE listing in 1922, marking 412 consecutive quarters of dividends, one of the longest streaks among NYSE-listed companies [2] Company Overview - The Timken Company is a global technology leader in engineered bearings and industrial motion, with a focus on next-generation products for diverse industries [3] - In 2024, Timken reported sales of $4.6 billion and employs approximately 19,000 people across 45 countries [3]