REGAL REXNORD REPORTS STRONG THIRD QUARTER 2025 FINANCIAL RESULTS

Core Insights - Regal Rexnord Corporation reported strong momentum in the third quarter of 2025, with significant orders in the data center segment totaling $135 million, plus an additional $60 million in October [2] - The company is focusing on growth investments in the data center market, which are yielding positive results and positioning Regal Rexnord as an emerging scale player with a bid pipeline exceeding $1 billion [2] - The company has narrowed its annual guidance for GAAP diluted earnings per share to a range of $4.26 to $4.56, primarily due to unfavorable impacts from tariffs and trade policies related to rare earth magnets [3] Financial Performance - Regal Rexnord achieved diluted EPS of $1.20, up 10.1% year-over-year, and adjusted diluted EPS of $2.51, up 0.8% year-over-year [9] - Total sales for the quarter were $1,497 million, reflecting a 1.3% increase compared to the previous year, with organic sales growth of 0.7% [9] - The company reported GAAP net income of $80 million, an increase of $7 million from the previous year, and adjusted EBITDA of $339.4 million, up $2.4 million year-over-year [9] Segment Performance - Automation & Motion Control net sales were $402 million, a slight increase of 0.1%, with a decrease of 1.0% on an organic basis, primarily due to project timing and challenges in the medical market [10] - Industrial Powertrain Solutions net sales reached $662.3 million, an increase of 2.8%, with a 1.6% organic growth driven by strength in energy and metals & mining [10] - Power Efficiency Solutions net sales were $432.7 million, up 0.3%, with organic growth of 0.8%, reflecting growth in pool and commercial HVAC markets [10] Strategic Initiatives - The company is investing in a new 100,000 square foot assembly facility in Texas to support the growing demand in the data center market [9] - Regal Rexnord is diversifying its growth strategy by expanding into new secular markets, as evidenced by recent wins in air filtration solutions for semiconductor clean rooms [2] - The company aims to achieve a net leverage ratio of approximately 3x by the end of 2025, having paid down $74.5 million of gross debt during the quarter [2][9]