Curtiss-Wright (NYSE:CW) Q4 2025 Earnings call February 12, 2026 10:00 AM ET Company ParticipantsJim Ryan - VP of Investor RelationsK. Christopher Farkas - EVP and CFOLynn M. Bamford - Chair and CEOConference Call ParticipantsBradley Oyster - AnalystGreg Dahlberg - AnalystKristine Liwag - Equity AnalystLouis DiPalma - AnalystMichael Ciarmoli - AnalystNathan Jones - AnalystTony Bancroft - AnalystOperatorI would now like to turn the call over to Jim Ryan, Vice President of Investor Relations. Please go ahead. ...

Naval Strategy & Development - The U S Navy is in desperate need of ships due to obsolescence [1] - A new "Golden Fleet" is being built for the U S Navy [1] - The goal is to achieve peace through strength, with the hope of never needing to use the ships [1] - The new battleships will be unlike anything built before [1] - The new ships will have 100 times the capacity/capability of existing ships [2]

Geopolitical Implications - UK and Norway form a naval alliance [1] - The alliance aims to hunt Russian submarines [1]

Financial Performance - Sales reached $869 million, a 9% increase overall, with organic growth at 6%[6] - Operating income increased by 14% to $170 million, resulting in a year-over-year margin expansion of 90 bps to 196%[6] - Diluted EPS increased by 14% to $340[6] - Free Cash Flow (FCF) increased by 8% to $176 million, with an FCF conversion rate of 137%[6] Orders and Backlog - New orders totaled $927 million, an 8% increase, resulting in a book-to-bill ratio of 11x[6] - Backlog increased by 14% year-to-date[6] Guidance - Total sales growth guidance increased to 10-11%, with organic growth now up 7-8% year-over-year[6] - Operating income growth guidance increased to 16-19%, maintaining an operating margin of 185-187%, up 100-120 bps year-over-year[6] - The company is on track to deliver 19-21% EPS growth and strong FCF generation at approximately 108% conversion[6] Segment Performance - Aerospace & Industrial sales increased by 8% to $248 million, driven by strong demand in Commercial Aerospace and higher sales in Aerospace Defense and Ground Defense[7] - Defense Electronics sales increased by 4% to $253 million, driven by higher revenues in Aerospace Defense and Naval Defense[7] - Naval & Power sales increased by 12% to $368 million, driven by higher Naval Defense revenues and solid organic growth in Commercial Nuclear[7]

Military & Geopolitics - The world's largest aircraft carrier, USS Gerald Ford, will take at least a week or more to travel from Europe to the Caribbean [1] - The report assesses potential events upon its arrival in the Caribbean [1]

U.S. Submarine Industrial Base Challenges - The U.S submarine industrial base is facing a massive issue, causing concern among U.S officials [1] - Next-generation submarine programs are facing delays, including the Columbia Class submarines delayed by 12-17 months and Virginia Class attack submarines delayed by 24-36 months [2] - The U.S may not be able to produce enough submarines to replace aging fleets, and the Navy has not met its goal of building one Columbia Class and two Virginia Class submarines per year [3] - Shipyards are facing attrition rates as high as 30% for some skilled trades, with not enough new people to replace them [4] - The Navy needs to hire 140,000 workers over the next decade to meet the growing need for submarine construction and repair [5] China's Submarine Capabilities - China is rapidly building its undersea fleet at a rate of 4-6 nuclear-powered submarines per year [6] - China is projected to have 80 submarines by 2035, raising concerns in Washington about China's investment in R&D and shipyards [6] Revitalization Efforts - A 100,000 square foot training facility in Virginia is part of efforts to boost development and hiring [7] - The training program lasts 16 weeks and aims to address the skilled labor shortage by training individuals for jobs in the submarine industrial base [7]

Industry Outlook - Britain's naval dockyards are preparing for a building boom [1]

Navy Challenges - U.S Navy struggles to maintain its fleet [1] - Death of a young submariner highlights the maintenance issues [1]

Geopolitical Risk - The report focuses on the Israel-Iran conflict and Washington's surprise attack against Iranian nuclear sites [1] Industry Focus - The report is likely to discuss the impact of the conflict on various sectors, including energy, defense, and financial markets [1] Source - CNBC's Morgan Brennan is reporting on the latest developments [1]