Hexcel (HXL) Q3 2025 Earnings Transcript

Motley Fool Transcribing, The Motley Fool

Wed, April 22, 2026 astatine 11:03 AM CDT 47 min read

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Oct. 23, 2025 astatine 9:00 a.m. ET

• Chief Executive Officer — Thomas Gentile

• Chief Financial Officer — Patrick Winterlich

Thomas Gentile: Thanks, Kurt. Hello, everyone, and convey you for joining america contiguous for Hexcel's Third Quarter 2025 Earnings Call. Our assurance successful the maturation outlook successful the aerospace and defence markets and Hexcel's unsocial presumption wrong the manufacture remains strong. With Hexcel's wide portfolio of precocious innovative lightweight materials, we are good positioned to conscionable the needs of our customers arsenic they summation commercialized and subject craft and rotorcraft accumulation rates. We are besides moving with customers connected processing innovative precocious worldly solutions for next-generation commercialized and subject platforms. As we look astatine the opportunities successful beforehand of us, the outlook for Hexcel is compelling.

At our September Board meeting, which centered connected strategy, we reinforced our strategical absorption of precocious worldly subject with an accent connected the aerospace and defence market. This is our North Star arsenic we navigate a dynamic near-term situation and look to instrumentality vantage of the medium- and longer-term opportunities successful the aerospace and defence industry. The aerospace betterment from the pandemic has been frustratingly dilatory with galore commencement stops for archetypal instrumentality suppliers similar Hexcel. However, we person increasing assurance that we are seeing the beginnings of a much sustained ramp-up successful accumulation based connected our lawsuit discussions and actions arsenic good arsenic what we spot successful the aerospace proviso chain. The request for fuel-efficient lightweight craft is clear.

Air postulation has much than recovered to 2019 levels. The backlog for commercialized craft has grown from 13,000 units earlier the pandemic to much than 15,000 today. Even with constricted availability of near-term accumulation slots, airlines astir the satellite proceed to spot orders with Airbus and Boeing. As we look astatine the macro situation for the commercialized aerospace industry, we are intelligibly seeing increasing momentum arsenic past proviso concatenation constraints subside. While we whitethorn acquisition immoderate lingering destocking successful the 4th fourth of 2025, we expect to exit 2025 afloat aligned with the commercialized craft physique rates of our customers and positioned for maturation successful 2026 and beyond.

Positive quality developments successful the past fewer weeks further enactment the complaint ramps for each of our cardinal platforms. Beginning with the A350, our largest program, wherever we supply the full lightweight worldly system, anticipated accumulation complaint increases by Airbus volition beryllium impactful for Hexcel successful presumption of driving capableness utilization. Airbus is targeting 12 craft per period by 2028 connected the A350 program. Rising physique rates volition thrust operating leverage for Hexcel and the EU support past week that allows for the Spirit AeroSystems merger to determination guardant is different affirmative information constituent arsenic those operations go streamlined into Airbus and Boeing.