Ducommun Incorporated Reports Third Quarter 2025 Results

Core Insights - Ducommun Incorporated reported a record net revenue of $212.6 million for Q3 2025, a 6% increase from $201.4 million in Q3 2024, driven primarily by growth in the defense sector despite challenges in commercial aerospace [2][5][9] - The company achieved a gross margin of 26.6%, reflecting a year-over-year increase of 40 basis points, and an Adjusted EBITDA margin of 16.2%, also up 40 basis points from the previous year [3][11] - Ducommun's net loss for Q3 2025 was $(64.4) million, or $(4.30) per share, compared to a net income of $10.1 million, or $0.67 per diluted share, in Q3 2024, largely due to increased litigation settlement costs [6][9] Financial Performance - Net revenue for Q3 2025 was $212.6 million, up from $201.4 million in Q3 2024, with significant contributions from military and space markets [5][10] - Gross profit increased to $56.5 million, or 26.6% of revenue, compared to $52.7 million, or 26.2% of revenue, in the same quarter last year [7][9] - Adjusted EBITDA for Q3 2025 was $34.4 million, representing an 8% increase year-over-year, with a margin of 16.2% [11][31] Business Segments - The Electronic Systems segment reported net revenue of $123.1 million, up from $115.4 million in Q3 2024, driven by higher manufacturing volume [13][14] - The Structural Systems segment saw net revenue rise to $89.5 million from $86.0 million, with operating income increasing to $11.9 million, or 13.3% of revenue [15][32] - The company’s military and space end-use markets contributed significantly to revenue growth, while commercial aerospace faced declines [10][18] Operational Insights - The Book to Bill ratio was strong at 1.6 times, indicating a healthy order intake relative to revenue [2] - The company is focused on mitigating raw material tariff exposures and expects no material impact from the evolving tariff environment [4] - Ducommun's cash provided by operations increased to $18.1 million in Q3 2025, compared to $13.9 million in Q3 2024, reflecting improved operational efficiency [12]