Financial Data and Key Metrics Changes - Revenue grew 4% year over year, exceeding $1,140,000,000 [5][17] - Adjusted EBITDA reached approximately $208,000,000, a 14% increase year over year [17] - Adjusted earnings per share came in at $0.74, above projected range [5] - Adjusted EBITDA margin reached 18.2%, a long-standing performance target [5] - Adjusted free cash flow was $93,000,000, a 94% increase year over year [6] Business Line Data and Key Metrics Changes - High Performance Materials and Components (HPMC) segment delivered margins of 23.7%, a 350 basis point improvement from Q2 2024 [5] - Commercial jet engine sales grew 27% in Q2 and 31% year to date [10] - Defense remains a reliable growth driver with expectations of double-digit growth [12] - Aerospace and Defense (A&D) continues to drive margin expansion due to contractually secured customer base [20] Market Data and Key Metrics Changes - Jet engine market expected to grow more than 20% for the full year [25] - Airframe estimates held flat from 2024 levels due to customer inventory destocking [26] - Non-A&D markets expected to decline by 5% to 7% from 2024 levels [26] Company Strategy and Development Direction - Company signed long-term agreements with Boeing and Airbus, expanding product offerings and securing customer share [7][8] - Focus on achieving consistent profitable growth through innovation, performance, and partnerships [15] - Investments in capacity and technology to support future growth and reliability [6][15] Management Comments on Operating Environment and Future Outlook - Management expressed confidence in the ability to deliver with reliability and scale as the aerospace recovery accelerates [4] - Anticipated near-term volatility in airframe markets but confident in long-term growth [9] - Management remains mindful of near-term uncertainties but believes long-term fundamentals are compelling [31] Other Important Information - Company executed $250,000,000 in share repurchases during the quarter, totaling over $800,000,000 since 2022 [6] - Cash generation improvements in the first half strengthen the balance sheet and increase optionality looking forward [22] Q&A Session Summary Question: Airframe outlook and inventory levels - Management noted that customer destocking is impacting revenues but anticipates demand returning in the back half of the year as Boeing ramps up production [34][35] Question: Capacity utilization and volume increase for 2026 - Company is in good shape to meet 2027 targets with discrete investments in melting, forging, and finishing [41][42] Question: Industrial end markets and guidance for the second half - Industrial markets showed flat overall performance with some positive growth in conventional oil and gas, but declines in construction and mining [51][53] Question: HPMC margins and future targets - HPMC margins expected to remain above 24% with incremental margins projected in the 40% range [63] Question: Aftermarket trends and production ramp - MRO demand remains strong, with expectations for sustained high demand through the rest of the decade [68][70] Question: Contract extensions and terms - New contracts include share gains, beneficial changes to mix pricing, and terms that allow for inflation and cost pass-through [72][75] Question: Nickel melt capacity increase - Investments in new melting equipment will increase nickel capacity by 8% to 10% [84][85] Question: Titanium revenue contribution from new furnaces - Titanium melt capacity expected to increase by 80%, with significant revenue contributions anticipated [92][95] Question: Direct tariff impacts on cost structure - Company is well-positioned to recover costs incurred due to tariffs through structured contracts [117][121] Question: Exotics business and nuclear demand - Demand for nuclear products is up 24% year over year, with strong growth anticipated in the back half of the year [124][126]