Financial Data and Key Metrics Changes - Total sales for Q4 2025 were $373.2 million, a year-over-year increase of 7.9% as reported and 7.1% in constant currency [5] - For the full year, sales were $1.375 billion, representing year-over-year growth of 5.2% as reported and 5.1% in constant currency [5] - Adjusted earnings per share for Q4 were $1.43, growing 6.7%, while full-year adjusted EPS was $4.59, growing 10.1% [5][21] - GAAP net income for Q4 was $16.7 million, down from $33.8 million in Q4 2024, with GAAP earnings per diluted share at $0.54 compared to $1.08 a year ago [19] Business Line Data and Key Metrics Changes - Orthopedic sales increased 12.1% in Q4 and 5.5% for the full year on a constant currency basis [5] - General surgery sales increased 3.8% in Q4 and 4.7% for the full year in constant currency [5] - U.S. orthopedic sales grew 6.6% in Q4, while international orthopedic sales increased 15.7% [16] - U.S. general surgery sales declined 0.4%, while international general surgery sales increased 14.8% [16] Market Data and Key Metrics Changes - International sales grew 15.4% in Q4, while U.S. sales increased 1.4% [15] - The decline in U.S. general surgery was attributed to a focus on non-core areas and strategic portfolio management [16] Company Strategy and Development Direction - The company plans to exit its gastroenterology product lines to focus on high-growth, high-margin markets such as robotic and laparoscopic surgery [6][7] - The strategy includes stabilizing and scaling operations to build a high-performance supply chain [8] - The company aims to deliver sustained above-market growth in its orthopedic portfolio over time [8] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's ability to return to above-market growth by focusing on core strengths and investing in high-growth platforms [13] - The company is optimistic about the long-term growth potential of its AirSeal and BioBrace products, with expectations of high single-digit to low double-digit growth rates [10][12] Other Important Information - The company suspended its dividend and approved a $150 million share repurchase authorization [12] - The leverage ratio at the end of the year was 2.9 times, providing flexibility for innovation and growth [12] Q&A Session Summary Question: Can you talk about the cadence for the rest of the year and any selling day differences? - Management indicated no selling day differences and expected normal seasonality for the med tech calendar [30] Question: What is the status of the CFO search? - The company is actively searching for a new CFO who will focus on shareholder value and be a strong teammate to the leadership team [32] Question: Can you clarify the organic revenue numbers presented at the healthcare conference versus today? - The difference was due to final numbers rolling out, with the current guidance being more precise [35] Question: What drove the upside in orthopedic sales and the downside in general surgery? - The orthopedic sales beat was attributed to committed sales professionals, improving supply chain, and new product approvals, while general surgery faced challenges due to portfolio management [37][40] Question: How will the GI business be reported going forward? - The GI business will be reported separately as the company moves forward [54]

Financial Data and Key Metrics Changes - Net revenue for Q2 2026 was $369.3 million, up 23.5% sequentially and 36.4% year-over-year, exceeding guidance of $360-$370 million [4] - Operating margin for Q2 was 19.3%, above the guidance range of 17.3%-18.5%, and increased by 360 basis points quarter-over-quarter and 440 basis points year-over-year [4] - EPS was $0.22, above the guidance range of $0.18-$0.20, and increased by $0.07 sequentially and $0.09 year-over-year [5] Business Segment Data and Key Metrics Changes - NSE revenue for Q2 was $291.5 million, up 45.8% year-over-year, driven by acquisitions and strong demand in the data center ecosystem [5][6] - OSP revenue for Q2 was $77.8 million, up 9.7% year-over-year, primarily due to strength in anti-counterfeiting products [6][7] - NSE gross margin was 64.7%, slightly down year-over-year, while OSP gross margin was 50.8%, up 20 basis points year-over-year [6][7] Market Data and Key Metrics Changes - Strong demand was noted in the data center ecosystem, particularly for lab and production products, driven by AI data center build-outs [15] - Aerospace and defense business saw significant growth, with continued high demand for positioning, navigation, and timing products [15][16] - Service provider business remained stable, with some opportunistic demand from cable operators transitioning to new architectures [16] Company Strategy and Development Direction - The company approved a restructuring plan affecting approximately 5% of the global workforce, expecting to incur about $32 million in charges but aiming for annual savings of $30 million [10][11] - The focus will be on reinvesting savings into higher growth areas, particularly in data center and aerospace and defense sectors [11][30] - The company anticipates continued revenue momentum in the data center ecosystem through 2026, supported by robust bookings [15][17] Management Comments on Operating Environment and Future Outlook - Management expressed confidence in the ongoing strength of the data center ecosystem and aerospace and defense markets, expecting these trends to continue [15][17] - The company noted improved visibility on demand, with multi-quarter commitments from major customers [26] - Management highlighted the importance of operational efficiency and resource allocation to support growth in strategic areas [30] Other Important Information - Total cash and short-term investments at the end of Q2 were $772.1 million, up from $549.1 million in Q1 [8] - The company did not repurchase any shares during the quarter, prioritizing debt management [10] - The fully diluted share count increased to 233.4 million shares from 224.8 million shares year-over-year [10] Q&A Session Summary Question: Update on NSE business mix across data center, aerospace and defense, and telco - Management indicated a shift towards 45% data center, 40% service provider, and 15% aerospace and defense, reflecting strong growth in data center demand [21][22] Question: Visibility on demand and order backlog - Management confirmed improved visibility on demand, with commitments extending up to three quarters ahead [26] Question: Impact of restructuring on specific product areas - The restructuring is aimed at improving efficiency across multiple functions, not targeting specific areas [29] Question: Exciting defense and aerospace programs - Management highlighted resilient PNT (position, navigation, timing) as a key driver, particularly for drones and autonomous systems [36] Question: Growth in optical domain and data center demand - Management noted strong growth across all segments, particularly driven by advancements in optical technology and increased demand for fiber monitoring [41][45] Question: Breakdown of data center business across lab, production, and field - Management stated that while they do not break down these categories, production is expected to be a significant growth driver linked to volume demands [56][58]

Canadian Pacific Kansas City (NYSE:CP) Q4 2025 Earnings call January 28, 2026 04:30 PM ET Speaker12Good afternoon. My name is Angela, and I will be your conference operator today. At this time, I would like to welcome everyone to CPKC's fourth quarter and full year 2025 conference call. The slides accompanying today's call are available at investor.cp kc.com. All lines have been placed on mute to prevent any background noise. After the speaker's remarks, there will be a question and answer session. If you w ...

Financial Data and Key Metrics Changes - Core EPS for Q4 2025 was $0.43 per share, exceeding consensus estimates, with a net interest margin (NIM) of 3.98% and a core return on assets (ROA) of 1.45% [4] - Average deposits grew by 2.8% and total loans increased by 1.2% in Q4, while net interest income rose by $47.2 million year-over-year to $427.5 million [4][8] - The provision for credit losses decreased by $4.3 million to $7 million, with non-performing loans (NPLs) increasing by four basis points to 94 basis points [6][8] Business Line Data and Key Metrics Changes - Fee income remained flat at 18% of total revenue, with gains in SBA offset by declines in wealth and mortgage services [6] - Core non-interest income for Q4 was $24.3 million, down $200,000 from the previous quarter, with an increase in SBA gain on sale income [15] - Core non-interest expense rose by $1.7 million to $74.3 million, primarily due to increased salaries and benefits [16] Market Data and Key Metrics Changes - Average deposit growth for the year was 6.1%, with significant contributions from money market accounts and CDs [9] - The company reported a total of $98 million in non-performing loans, including $39.2 million in total SBA loans [7] Company Strategy and Development Direction - The company aims to grow fee income through its regional banking model and maintain a focus on low-cost deposit growth [10][96] - A portfolio of approximately $225 million in commercial loans was designated as held for sale, with plans to reinvest proceeds into lower-yielding securities [12][14] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in maintaining loan growth in 2026, despite elevated payoffs in the previous year [28] - The company anticipates a near-term dip in NIM due to rate cuts, followed by gradual improvement, projecting an end-of-year NIM of around 4% for 2026 [12][61] Other Important Information - The company repurchased $23.1 million of its stock in Q4 2025, totaling 2.1 million shares for the year [7] - Management highlighted the retirement of Jane Grebenc, a key figure in the company's strategic transformations [10] Q&A Session Summary Question: Credit side impact and net charge-offs for 2026 - Management provided guidance of 25-30 basis points for charge-offs, with $1.5 million left to resolve on the dealer floor plan loan [20][21] Question: Loan growth expectations for 2026 - Management expects loan growth to continue at around 5-7%, with a strong pipeline in business banking and mortgage [28][29] Question: Buyback strategy and stock price sensitivity - The company will continue to repurchase shares using excess capital, with a sensitivity to stock price affecting the pace of buybacks [30][31] Question: NIM sustainability and deposit costs - Management indicated that NIM is projected to hover around 4% in 2026, with potential for further reductions in deposit costs [54][61]

Financial Data and Key Metrics Changes - Core EPS for Q4 2025 was $0.43 per share, exceeding consensus estimates, with a net interest margin (NIM) of 3.98% and a core return on assets (ROA) of 1.45% [4] - Average deposits grew by 2.8% and total loans increased by 1.2% in Q4, with net interest income rising due to an expanded margin [4][15] - For the year 2025, core EPS was $1.53, up from the consensus estimate of $1.40, and net interest income reached $427.5 million, an increase of $47.2 million year-over-year [8][10] Business Line Data and Key Metrics Changes - Fee income constituted 18% of total revenue, with a focus on growing this through a regional banking model, although it remained flat due to seasonal declines in wealth and mortgage services [6][9] - The provision for credit losses decreased by $4.3 million to $7 million, with non-performing loans (NPLs) increasing slightly to 94 basis points [6][7] - Core non-interest income for Q4 was $24.3 million, down $200,000 from the previous quarter, with SBA gain on sale income increasing but offset by declines in other areas [15] Market Data and Key Metrics Changes - Average deposit growth for the year was 6.1%, with significant contributions from money market accounts and CDs, while non-interest-bearing deposits also increased [9] - The company reported a loan growth of 8.2% annualized for the year, with commercial banking and equipment finance leading the growth [8][9] Company Strategy and Development Direction - The company aims to maintain a focus on low-cost deposit growth and diversify its lending businesses, with a strategic exit from certain markets to concentrate resources elsewhere [10][13] - The acquisition of CenterBank was completed, contributing to overall deposit growth and positioning the company for future expansion [10][12] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in maintaining a strong NIM, projecting it to drift upward to around 4% by the end of 2026, despite anticipated short-term dips due to rate cuts [12][38] - The company is focused on managing credit costs and maintaining strong reserve levels, with expectations for stability in provisions and charge-offs [21][22] Other Important Information - The company repurchased $23.1 million of its stock in Q4, with a total of 2.1 million shares repurchased in 2025 [7][16] - Management indicated that operational expenses are expected to increase by approximately 3% year-over-year, with a focus on maintaining operating leverage [16][40] Q&A Session Summary Question: Credit side impact and loan issues - Management provided guidance on charge-offs at 25-30 basis points and noted that the dealer floor plan loan issue is nearing resolution with a remaining balance of $2.5 million [20][21] Question: Loan growth expectations - Management expects loan growth to continue at a rate of 5-7%, despite elevated payoffs in the previous year [28][29] Question: Buyback strategy - The company will be cautious with buybacks, sensitive to stock price movements, and intends to utilize its capital effectively [30][31] Question: NIM sustainability - Management discussed the potential for NIM to hover around 4% in 2027, with expectations for deposit costs to decrease further [55][56] Question: Securities yields outlook - The securities portfolio is expected to yield around 4.5% to 4.75%, with opportunities for reinvestment as the portfolio rolls over [76][79]

Financial Data and Key Metrics Changes - Core EPS for Q4 2025 was $0.43 per share, exceeding consensus estimates, with a net interest margin (NIM) of 3.98%, core ROA of 1.45%, and core efficiency ratio of 52.8% [4] - Average deposits and total loans grew by 2.8% and 1.2% respectively, while net interest income increased by $47.2 million year-over-year to $427.5 million [4][7] - The provision for credit losses decreased by $4.3 million to $7 million, with non-performing loans (NPLs) rising four basis points to 94 basis points [5][6] Business Line Data and Key Metrics Changes - Fee income remained flat at 18% of total revenue, with gains in SBA offset by declines in wealth and mortgage [5] - Core non-interest income for Q4 was $24.3 million, down $200,000 from the previous quarter, with SBA gain on sale income increasing by $800,000 [14] - Core non-interest expense increased by $1.7 million to $74.3 million, primarily due to increased salaries and benefits [15] Market Data and Key Metrics Changes - Average deposit growth for the year was 6.1%, with significant contributions from money market accounts and CDs [9] - The company reported $98 million in non-performing loans, including $39.2 million in total SBA loans [6] Company Strategy and Development Direction - The company aims to grow fee income through its regional banking model and maintain a focus on low-cost deposit growth [5][10] - A portfolio of approximately $225 million in commercial loans was designated as held for sale to improve liquidity and capital ratios [12][13] - The company plans to limit operating cost increases to approximately 3% year-over-year [15] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in maintaining loan growth despite seasonal headwinds and elevated payoffs, projecting continued growth in business banking and mortgage segments [28] - The guidance for NIM is expected to remain around 4% by the end of 2026, with a near-term dip anticipated due to rate cuts [12][40] - Management highlighted the importance of maintaining a balance between loan growth and capital generation, emphasizing disciplined capital deployment [31][32] Other Important Information - The company repurchased $23.1 million of its stock in Q4 2025, totaling 2.1 million shares for the year [6] - Jane Grebenc, Bank President and Chief Revenue Officer, will retire at the end of March 2026, marking a significant leadership transition [10] Q&A Session Summary Question: What are the expectations for net charge-offs and provisions in 2026? - Management expects charge-off guidance to be 25-30 basis points, with $1.5 million left to resolve on the dealer floor plan loan [19][20] Question: Can we expect additional loans to be moved off the balance sheet in 2026? - Management indicated that the loan sale is more of a one-off situation, focusing resources on other markets [23][24] Question: What are the expectations for loan growth in 2026? - The company anticipates loan growth to continue at a similar pace as 2025, despite elevated payoffs [28][30] Question: How should we think about the stock buyback strategy? - The buyback strategy is sensitive to stock price, with intentions to utilize the authority aggressively while maintaining capital ratios [31][57] Question: What is the outlook for NIM and deposit costs? - Management expects a dip in NIM in Q1 2026, with a gradual recovery to around 4% by year-end [60][61]

Financial Data and Key Metrics Changes - Fiscal year 2025 marked an inflection point for the company, driven by organizational focus and strategic alignment, resulting in strong results against a dynamic economic background [25][26] - The company reported a commitment to disciplined fiscal management, which has been a cornerstone of its performance [26] Business Line Data and Key Metrics Changes - The company now operates with a focus on delivering services and comprehensive solutions in water and environmental, life sciences and advanced manufacturing, and critical infrastructure sectors, which represent long-term opportunities [26][28] - Collaboration with PA Consulting continues to drive growth and enhance the company's position as a leading provider of end-to-end lifecycle solutions [27] Market Data and Key Metrics Changes - The company is positioned to address pressing global challenges shaped by climate urgency, urbanization, geopolitical complexity, and AI-driven digital acceleration [25][26] - The end markets are characterized by a demand for multidisciplinary solutions, including clean water systems and advanced pharmaceuticals [26] Company Strategy and Development Direction - The company launched a bold client-focus strategy in 2025 to position itself at the forefront of global challenges [25] - There is a clear ambition to grow in geographies and sectors aligned with strategic opportunities, focusing on scaling AI capabilities and optimizing the relationship with PA Consulting [29] Management's Comments on Operating Environment and Future Outlook - Management emphasized the importance of resilience and opportunity through science-based, digitally-enabled solutions co-created with clients [25] - The company aims to deliver bold, future-focused solutions to complex challenges, moving forward with clarity and conviction [29] Other Important Information - The company announced its intention to acquire the remaining shares of PA Consulting, expected to conclude in Q2 of fiscal year 2026, subject to regulatory conditions [28] Q&A Session Summary Question: Were there any online questions received? - No online questions have been received during the meeting [31]

Financial Data and Key Metrics Changes - Fiscal year 2025 marked an inflection point for the company, driven by organizational focus and strategic alignment, resulting in strong results against a dynamic economic background [25][26] - The company reported a commitment to disciplined fiscal management, which has been a cornerstone of its performance [26] Business Line Data and Key Metrics Changes - The company now operates with a focus on delivering services and comprehensive solutions in the water and environmental, life sciences and advanced manufacturing, and critical infrastructure sectors, which represent long-term opportunities [26][28] - Collaboration with PA Consulting has been highlighted as a driver of growth, embedding the company earlier in the client's journey and enhancing its role in strategic advisory and innovation [27] Market Data and Key Metrics Changes - The company is positioned to address pressing global challenges such as climate urgency, urbanization, and geopolitical complexity, which are shaping client needs [25][26] - The company aims to scale its AI capabilities and optimize its relationship with PA Consulting to deliver future-focused solutions [29] Company Strategy and Development Direction - The company launched a bold client-focused strategy in 2025 to position itself at the forefront of global challenges [25] - There is a clear ambition to grow in geographies and sectors aligned with strategic opportunities, focusing on AI capabilities and innovative solutions [29] Management's Comments on Operating Environment and Future Outlook - Management emphasized the importance of resilience and opportunity through science-based, digitally-enabled solutions, co-created with clients [25] - The company is moving forward with clarity, capability, and conviction, aiming to address the world's most complex challenges [29] Other Important Information - The company announced its intention to acquire the remaining shares of PA Consulting, expected to conclude in Q2 of fiscal year 2026, subject to regulatory conditions [28] - Initiatives to strengthen talent development and employee experience were launched, including a hybrid work model and Jacobs University for skill building [29] Q&A Session Summary Question: Were there any online questions received? - No online questions have been received during the meeting [31]

Financial Data and Key Metrics Changes - Fiscal year 2025 marked an inflection point for Jacobs, driven by organizational focus and strategic alignment, resulting in strong performance against a dynamic economic backdrop [23][24] - The company reported a commitment to disciplined fiscal management, which underpinned its strong results [24] Business Line Data and Key Metrics Changes - Jacobs operates with a focus on delivering services and comprehensive solutions in water and environmental, life sciences and advanced manufacturing, and critical infrastructure sectors, which represent long-term opportunities [24] - The collaboration with PA Consulting continues to drive growth and enhance Jacobs' position as a leading provider of end-to-end lifecycle solutions [24][25] Market Data and Key Metrics Changes - The company is positioned to address long-term market demands, including clean water systems, advanced pharmaceuticals, resilient transportation, and secure energy [24] - Jacobs has formalized its enterprise-wide approach to AI, which is central to scaling delivery and enhancing client value [25] Company Strategy and Development Direction - Jacobs launched a bold client-focused strategy in 2025 to tackle the world's pressing challenges, emphasizing integrated solutions and deep domain expertise [23][24] - The company aims to grow in geographies and sectors aligned with strategic opportunities, focusing on scaling AI capabilities and optimizing its relationship with PA Consulting [27] Management's Comments on Operating Environment and Future Outlook - Management highlighted the dynamic global environment shaped by climate urgency, urbanization, geopolitical complexity, and AI-driven digital acceleration as key factors influencing their strategy [23] - The ambition for fiscal 2026 is clear, with a focus on strong execution and disciplined focus to deliver future-focused solutions [27] Other Important Information - Jacobs University was launched as a global learning hub for skill building and leadership development, alongside the introduction of the Talent Work Marketplace for employee growth opportunities [26] - The company announced its intention to acquire the remaining shares of PA Consulting, expected to conclude in Q2 of fiscal year 2026, subject to regulatory conditions [25] Q&A Session Summary Question: Were there any online questions received? - No online questions have been received during the meeting [30]

Financial Data and Key Metrics Changes - For Q4 2025, net income was $22.9 million, or $0.85 per diluted share, compared to $18.6 million, or $0.69 per diluted share in the prior quarter [9] - Return on average assets was 1.25%, and return on average equity was 15.41%, indicating continued profitability improvement [9] - Core earnings per share increased by 24% from the prior year [4] - Net interest income rose by 1.3% from the prior quarter to $62.1 million, with net interest margin expanding 7 basis points to 3.56% [10] Business Line Data and Key Metrics Changes - Total core deposits grew by $78 million during Q4, with gains in interest-bearing demand, savings, and money market balances [6] - Total loan portfolio declined by $78 million from the prior quarter, with a full-year decline of $44 million driven by a decrease in residential mortgage, home equity, and consumer portfolios [6][7] - Commercial mortgage and construction portfolios showed strong growth, with a 10% year-over-year increase [32] Market Data and Key Metrics Changes - Hawaii's economy remains resilient despite macroeconomic uncertainty, with strong construction activity in both public and private sectors [4] - Non-interest-bearing demand deposits represented 29% of total deposits, indicating a healthy deposit base [6] Company Strategy and Development Direction - The company is focused on organic growth, diversification, and operational excellence, aiming for consistent earnings growth and enhanced shareholder returns [4] - A strategic partnership with Korea Investment & Securities was signed to expand international reach and create new deposit opportunities [5] Management's Comments on Operating Environment and Future Outlook - Management expressed cautious optimism for 2026, guiding for low single-digit growth in net loans and deposits [8] - The company plans to continue investing in technology to drive returns and efficiency while managing expenses [35] Other Important Information - The board declared a first-quarter cash dividend of $0.29 per share, an increase of 3.6% from the prior quarter [13] - A new share repurchase authorization for up to $55 million in 2026 was approved, reflecting strong earnings and capital position [14] Q&A Session Summary Question: Delay in new loan fundings - Management confirmed that delayed closings are expected to be weighted more towards the second quarter of 2026 [23] Question: Spot rate on deposit costs - The deposit spot rate at year-end was 89 basis points [24] Question: Loan growth outlook - Management indicated that loan growth is expected to be slower in the first quarter but may accelerate later in the year [43] Question: Drivers behind payoffs and paydowns - Payoffs were attributed to a smaller construction portfolio, impacting loan growth [47] Question: Competitive landscape for deposits - Core deposit growth was driven by both new clients and deepening relationships with existing clients [50]