Financial Data and Key Metrics Changes - In Q4 2025, bookings increased significantly by 42% sequentially and 35% year-over-year, indicating early signs of demand recovery [3][4] - Q4 revenues declined to $923 million, reflecting weaker shipment volumes and a significant impact from tariffs, resulting in an adjusted operating loss of $16 million [4][5] - Full year 2025 revenue decreased to $3.8 billion, with an adjusted operating profit of $16 million, which included approximately $100 million in gross tariff costs [4][5] Business Line Data and Key Metrics Changes - The Americas drove the increase in bookings, particularly in core counterbalance Class Five trucks in the 1 to 3.5 ton range [8][9] - Despite overall market challenges, North America showed meaningful sequential improvement in bookings, while EMEA and JAPIC regions experienced a contraction in demand [7][8] Market Data and Key Metrics Changes - The global lift truck market faced year-over-year declines across all regions and truck classes in Q4 2025, with North America being the exception [7][8] - Backlog at the end of 2025 totaled $1.28 billion, reflecting shipments outpacing new orders, particularly in EMEA [10] Company Strategy and Development Direction - The company is focusing on operational efficiency, disciplined cost management, and product innovation to navigate the challenging market environment [12][14] - A restructuring program targeting $40 million-$45 million in annualized savings is set to begin in 2026, alongside ongoing initiatives to optimize the manufacturing footprint [15][19] - The introduction of modular and scalable platforms aims to strengthen the company's competitive position in evolving market segments [13][14] Management's Comments on Operating Environment and Future Outlook - Management expressed cautious optimism for 2026, anticipating stronger performance as customer confidence improves and backlog builds [17][21] - The company is preparing for a potential recovery in demand, with expectations of moderate full-year operating profit and stronger revenue in the second half of 2026 [17][18] Other Important Information - Tariffs remain a significant external factor, with forecasted costs expected to remain consistent with Q4 2025 levels throughout 2026 [16][17] - Capital expenditures for 2026 are projected to range from $55 million to $75 million, focusing on product development, IT infrastructure upgrades, and manufacturing optimization [19][48] Q&A Session Summary Question: Can you expand on the pent-up demand dynamic and potential for fleet replacements? - Management noted that customers are transitioning from conserving cash to ensuring operational needs are met, with a focus on counterbalance trucks driving bookings [24][25] Question: Can you provide an update on new product launches and automation? - New products are being launched, including modular electric counterbalance trucks, with automation solutions being piloted and expected to accelerate throughout the year [30][31] Question: How are order rates trending by end market? - Recovery has been noted primarily in industrial sectors, particularly heavy manufacturing, while the warehouse side has remained stable [57] Question: What impact will automation and lithium-ion solutions have on margins? - Revenue and margins are expected to increase significantly with the introduction of lithium-ion solutions and automation, with potential revenue bumps of up to 2x per unit [60][62] Question: What is the company's strategy for penetrating the warehouse segment? - Progress has been made in the warehouse market, with new truck launches and safety systems aimed at improving market share [51]

Financial Data and Key Metrics Changes - In Q4 2025, bookings increased significantly by 42% sequentially and 35% year-over-year, indicating early signs of demand recovery [3][4] - Q4 revenues declined to $923 million due to weaker shipment volumes, while full-year revenue for 2025 was $3.8 billion, reflecting a challenging operating environment [4][5] - Adjusted operating loss for Q4 was $16 million, including $40 million in gross tariff costs, while full-year adjusted operating profit was $16 million [4][5] Business Line Data and Key Metrics Changes - The Americas drove the increase in bookings, particularly in core counterbalance Class Five trucks in the 1 to 3.5 ton range [7][8] - Despite overall market challenges, North America showed meaningful sequential improvement in bookings, contrasting with declines in EMEA and JAPIC regions [6][7] Market Data and Key Metrics Changes - The global lift truck market faced year-over-year declines across all regions and truck classes, with North America showing signs of recovery [6][9] - Backlog at the end of 2025 totaled $1.28 billion, with a sequential decline driven by lower unit volumes [9][10] Company Strategy and Development Direction - The company is focusing on operational efficiency, disciplined cost management, and product innovation to navigate the challenging market environment [11][12] - Strategic initiatives include modular product development, manufacturing footprint optimization, and enhancing customer engagement [12][14][15] - The company aims to be a first mover when demand recovers, with a focus on cash generation and long-term value creation [21][22] Management's Comments on Operating Environment and Future Outlook - Management expressed cautious optimism for 2026, anticipating stronger performance as the year progresses, driven by improving bookings and aging fleets [17][21] - The company expects moderate full-year operating profit, with a small loss in the first half followed by stronger revenue and profit improvement in the second half [17][18] Other Important Information - Capital expenditures for 2026 are expected to range from $55 million to $75 million, focusing on product development, IT infrastructure upgrades, and manufacturing optimization [19][46] - Tariff costs are anticipated to remain consistent with Q4 2025 levels throughout 2026, with mitigation efforts expected to contribute more meaningfully starting in Q2 2026 [16][17] Q&A Session Summary Question: Can you expand on the pent-up demand dynamic and potential for fleet replacements? - Management noted that customers are transitioning from conserving cash to ensuring operational needs are met, with a focus on counterbalance trucks [25][26] Question: Update on new product launches and automation? - New products are being launched, including modular and scalable platforms for electric counterbalance trucks, with automation solutions in pilot phases [30][31] Question: Summary of bookings and market trends? - Bookings increased in North America, while other regions remained stable, with a shift towards smaller, more price-competitive products [36][37] Question: CapEx guidance and spending rationale? - CapEx is directed towards product development, IT upgrades, and optimizing manufacturing capabilities [46][47] Question: Progress in penetrating the warehouse segment? - The company has made progress in the warehouse market, launching new trucks and enhancing safety systems to improve market share [49][50] Question: Impact of automation and lithium-ion on margins? - Automation and lithium-ion solutions are expected to significantly increase revenue and margins, with higher capability sensors and systems involved [57][58]