Ducommun (DCO) Q4 2025 earnings summary

Executive summary

• Achieved record Q4 2025 revenue of $216 million, up 9.4% year-over-year, and record full-year revenue of $825 million, driven by double-digit defense growth and commercial aerospace returning to growth.

• Gross margin reached 27.7% in Q4 and 26.9% for the full year, both at record levels, with adjusted EBITDA margin at 17.5% in Q4 and 16.4% for the year.

• Book-to-bill ratio was 1.3x in Q4, with record remaining performance obligations (RPO) of $1.1 billion.

• Military and space segment led growth, with commercial aerospace showing signs of recovery after destocking headwinds.

• One-time litigation settlement and related costs impacted GAAP net income, resulting in Q4 net income of $7.4 million and a full-year net loss of $34 million.

Financial highlights

• Q4 gross profit was $59.8 million (27.7% margin), up from $46.4 million (23.5%) last year.

• Q4 adjusted operating income was $24.6 million (11.4% margin), up from $16.1 million (8.2%) year-over-year.

• Q4 adjusted net income was $16.2 million ($1.05/share), up 43% year-over-year.

• Q4 adjusted EBITDA was $37.9 million (17.5% margin), up $10.6 million year-over-year; full-year adjusted EBITDA margin was 16.4%.

• Q4 net cash used in operations was $74.7 million, primarily due to litigation settlement; adjusted cash from operations was $26.5 million.

Outlook and guidance

• Expect mid-to-high single-digit revenue growth in 2026, with acceleration in the second half as destocking subsides and defense momentum continues.

• On track to achieve Vision 2027 targets: $950M–$1,000M revenue and 18% adjusted EBITDA margin.

• September 2026 investor conference to update Vision 2027 and introduce Vision 2032.

• Tariffs and elevated interest rates not expected to materially impact results.