Donaldson Q2 2025 Earnings Report
Key Takeaways
Donaldson Company, Inc. reported Q2 FY25 revenue of $870 million, down 0.8% year-over-year, with adjusted EPS rising 2.5% to $0.83. Operating margin declined slightly due to restructuring charges, but adjusted operating margin improved. Aftermarket, Aerospace & Defense, and Life Sciences segments showed growth, while Off-Road and On-Road declined. The company reaffirmed its FY25 guidance with expectations of record EPS.
Revenue declined by 0.8% year-over-year to $870 million, impacted by currency headwinds.
Adjusted EPS increased by 2.5% to $0.83, while GAAP EPS declined to $0.79.
Operating margin declined to 14.4%, but adjusted operating margin improved to 15.2%.
Aftermarket, Aerospace & Defense, and Life Sciences segments showed strong growth.
Donaldson Revenue
Donaldson EPS
Donaldson Revenue by Segment
Donaldson Revenue by Geographic Location
Forward Guidance
Donaldson expects record EPS for FY25, with adjusted EPS between $3.60 and $3.68. Revenue growth is projected between 0% and 4%, with margin expansion and disciplined cost management.
Positive Outlook
- Full-year adjusted EPS expected between $3.60 and $3.68.
- Revenue expected to grow between 0% and 4%.
- Aftermarket sales projected to increase due to OEM demand.
- Aerospace & Defense sales expected to rise high-single digits.
- Operating margin forecasted to improve to 15.6%-16.0%.
Challenges Ahead
- Currency translation expected to create a 1% revenue headwind.
- Off-Road sales projected to decline mid-single digits.
- On-Road sales forecasted to decrease in low-double digits.
- Interest expense estimated to increase to $21 million.
- Free cash flow conversion expected between 85% and 95%, lower than historical levels.
Revenue & Expenses
Visualization of income flow from segment revenue to net income