Donaldson Q3 2025 Earnings Report
Key Takeaways
Donaldson delivered solid third quarter results with record sales and adjusted earnings, supported by strong aftermarket and Aerospace & Defense performance, even as GAAP earnings were impacted by non-recurring impairment charges.
GAAP net income dropped to $57.8 million due to $62 million in impairment charges.
Adjusted EPS reached $0.99, a record high for the company.
Aftermarket and Aerospace & Defense segments showed strong sales growth.
Gross margin decreased due to higher manufacturing costs but adjusted operating margin improved YoY.
Donaldson
Donaldson
Donaldson Revenue by Segment
Donaldson Revenue by Geographic Location
Forward Guidance
Donaldson raised its full-year adjusted EPS guidance slightly and expects continued growth across all segments with improved margins and stable impact from tariffs.
Positive Outlook
- Raised midpoint of adjusted EPS guidance to $3.67
- Expecting record full-year sales and earnings
- Improved adjusted operating margin forecast (15.6%–16.0%)
- Aftermarket demand expected to remain strong
- Life Sciences segment projected to grow high-single digits
Challenges Ahead
- On-Road sales expected to decline high teens due to product exits and lower truck production
- Ongoing weakness in agriculture markets impacting Off-Road
- Higher interest expense forecast at $23 million
- Lower capital spending range reduced to $75M–$90M
- Full-year cash conversion forecast reduced to 80%–90%
Revenue & Expenses
Visualization of income flow from segment revenue to net income