Ducommun Incorporated (DCO) Reports Record Quarterly Revenue in Q3, Reaffirms Full-Year Guidance

Core Insights - Ducommun Incorporated (NYSE:DCO) reported record quarterly revenue of $212.6 million for Q3 fiscal 2025, marking a 6% year-over-year increase, driven by strong performance in its defense business, particularly the missile franchise [2][4] - The company reaffirmed its full-year 2025 guidance and noted that 95% of its revenue is generated domestically, mitigating concerns over potential tariff impacts [6] Financial Performance - Gross margin improved to 26.6%, up 40 basis points from the previous year [3] - Adjusted EBITDA reached $34.4 million, representing 16.2% of revenue, and has exceeded $30 million for three consecutive quarters, aligning with the company's goal of achieving 18% adjusted EBITDA by 2027 [3] - Despite a reported net loss of $64.4 million due to litigation costs, adjusted net income was $15.2 million, or $0.99 per diluted share, surpassing estimates by four cents [4] Market Context - The CEO highlighted challenges in the commercial aerospace sector and ongoing destocking as significant headwinds, but welcomed the FAA's approval for an increase in Boeing's 737 production cap, which may help alleviate inventory issues [5] - The stock has performed well in 2025, gaining 43.53% year-to-date as of November 14 [6]