Moog Inc. Reports Slight Increase in Net Sales but Decrease in Net Earnings for Q2 Fiscal 2025

Moog Inc. reported its financial results for the second quarter of fiscal 2025, revealing a slight increase in net sales to $934.8 million, compared to $930.3 million in the same period last year. For the first half of the fiscal year, net sales reached $1.845 billion, up from $1.787 billion in the prior year. However, net earnings for the quarter decreased to $55.8 million, or $1.75 per diluted share, down from $60 million, or $1.86 per diluted share, in the previous year. The decline in profitability was attributed to increased costs and a one-time benefit from the Employee Retention Credit in the prior year.

The company experienced notable changes in its operational metrics, with gross profit for the quarter falling to $256 million from $266.8 million year-over-year. Research and development expenses also decreased to $24.5 million from $28.4 million, reflecting a shift in project timelines, particularly in the Industrial segment. Selling, general, and administrative expenses rose to $133.1 million, compared to $125 million in the same quarter last year, indicating increased operational costs. The company’s twelve-month backlog remained relatively flat, with increases in Space and Defense orders offset by declines in Commercial Aircraft and Industrial segments.

Strategically, Moog completed the acquisition of Data Collection Limited (DCL) in October 2023 for $6 million, enhancing its capabilities in pavement surveying equipment within the Military Aircraft segment. The company also recorded losses related to the divestiture of a motors business in the Czech Republic and a hydraulic systems business in Luxembourg, which were completed in September 2024. These divestitures were part of Moog's ongoing simplification efforts aimed at streamlining operations and focusing on core business areas.

In terms of operational performance, Moog reported a significant increase in accounts receivable, which utilized $141 million more cash compared to the previous year, primarily due to the timing of collections. The company’s cash and cash equivalents stood at $62.7 million at the end of the reporting period, with $60 million held outside the U.S. Moog's total liabilities increased to $2.484 billion, up from $2.233 billion, largely due to higher long-term debt, which rose to $1.166 billion from $874 million. The company remains committed to its dividend policy, declaring a quarterly dividend of $0.29 per share, payable on May 27, 2025.

Looking ahead, Moog anticipates continued demand in its aerospace and defense sectors, particularly in military aircraft and space markets, driven by increased defense spending amid global tensions. The company is focused on leveraging its engineering capabilities to enhance product offerings and expand market share. However, it remains cautious about potential impacts from economic conditions, tariffs, and supply chain challenges that could affect future performance.