Ducommun Reports $194.1 Million Revenue in Q1 2025, Driven by Military and Space Sector Growth

Ducommun Incorporated reported a net revenue of $194.1 million for the first quarter of 2025, reflecting a 1.3% increase from $190.8 million in the same period of 2024. The company's gross profit rose to $51.6 million, up from $46.9 million, resulting in a gross margin of 26.6%, compared to 24.6% a year earlier. Operating income also improved significantly, reaching $16.6 million, a 31.5% increase from $12.6 million in the prior year. Net income for the quarter was $10.5 million, or $0.69 per diluted share, compared to $6.8 million, or $0.46 per diluted share, in the previous year.

The increase in revenue was primarily driven by a $14.6 million rise in the military and space sector, attributed to higher rates on missile and electronic warfare platforms. However, this was partially offset by a decline of $8.2 million in the commercial aerospace sector, mainly due to reduced revenues from the Boeing 737 MAX and in-flight entertainment products. The industrial segment also saw a decrease of $3.1 million, reflecting a strategic decision to prune non-core business areas.

Ducommun's operational metrics showed a decrease in restructuring charges, which fell to $426,000 from $1.4 million in the previous year, indicating progress in the company's ongoing restructuring plan initiated in 2022. The company reported a total of $34.4 million in selling, general, and administrative expenses, up from $33.0 million, primarily due to increased compensation and professional service fees. The company’s interest expense decreased to $3.3 million from $3.9 million, reflecting lower interest rates and a reduced debt balance.

In terms of strategic developments, Ducommun continues to focus on its two primary business segments: Electronic Systems and Structural Systems. The company is actively pursuing acquisitions and capital expenditures to support long-term contracts in the aerospace and defense sectors. As of March 29, 2025, Ducommun's total debt remained stable at $243.2 million, with a weighted average interest rate of 6.18%. The company reported cash and cash equivalents of $30.7 million and an unused revolving credit facility of $191 million, indicating a solid liquidity position.

Looking ahead, Ducommun anticipates continued growth in its military and space markets, although it remains cautious about potential impacts from macroeconomic factors, including tariffs and supply chain disruptions. The company expects to spend between $23 million and $25 million on capital expenditures in 2025, primarily to support new contract awards. Overall, Ducommun's management remains optimistic about the company's ability to navigate challenges and capitalize on opportunities in the aerospace and defense sectors.