ATI Q2 Earnings Call Highlights

ATI exceeded its second-quarter outlook, with revenue up 11% year over year to $1.3 billion and adjusted EBITDA up 37% to $284 million.

Strong pricing, product mix and aerospace, defense and specialty-materials demand drove a 440-basis-point margin expansion.

The company raised its full-year guidance, projecting adjusted EBITDA of $1.135 billion to $1.185 billion, adjusted EPS of $4.90 to $5.18 and adjusted free cash flow of $550 million to $600 million.

ATI ended the quarter with a record $4.4 billion backlog, about 70% of which it expects to convert into revenue over the next 12 months.

Advanced Alloys & Solutions led segment performance, with sales up 17% and margins reaching a record 23.7%, while defense revenue rose 36% and a renewed naval nuclear agreement is expected to generate roughly $1 billion over five years.

HPMC shipments worth $30 million to $40 million shifted into the second half because of qualification timing, but management expects the deferred demand to convert later in the year.

ATI reported second-quarter results that exceeded its prior outlook, supported by higher pricing, favorable product mix and stronger demand in aerospace, defense and specialty materials.

The company raised its full-year guidance for adjusted EBITDA, adjusted earnings per share and adjusted free cash flow.

Second-quarter revenue rose 11% year over year to $1.3 billion, while adjusted EBITDA increased 37% to $284 million.

The result was $29 million above the high end of ATI's previous guidance, according to Board Chair, President and CEO Kim Fields.

Excluding a $10 million asset-sale gain, underlying performance still exceeded the high end of the company's outlook by $19 million.

Adjusted EBITDA margin expanded 440 basis points year over year to 22.6%.

Fields said the margin gain reflected commercial terms, product mix, execution and operational improvements through the company's Elevation operating system.

ATI generated adjusted free cash flow of $69 million during the quarter and $143 million in the first half, compared with a $50 million use of cash in the first half of 2025.

ATI ended the quarter with a record $4.4 billion backlog, up 18% from a year earlier and 7% sequentially.

Fields said the backlog increasingly includes long-term agreements, sole-source positions and strategic programs that provide multiyear shipment and earnings visibility.

The company expects about 70% of the backlog to convert into revenue over the next 12 months.

The company raised its full-year adjusted EBITDA guidance to $1.135 billion to $1.185 billion, with a midpoint of $1.16 billion representing 35% year-over-year growth.

ATI also increased its adjusted EPS outlook to $4.90 to $5.18 and its adjusted free cash flow forecast to $550 million to $600 million.

Senior Vice President and CFO Rob Foster said the stronger outlook is supported by contracted pricing, committed customer schedules, a higher structural earnings base in the Advanced Alloys & Solutions segment and High Performance Materials & Components shipments that shifted from the second quarter into the second half.

Third-quarter adjusted EBITDA is expected to be $305 million to $315 million.

Third-quarter adjusted EPS is projected at $1.31 to $1.37.

ATI expects fourth-quarter sales and profit to be its strongest of 2026, with midpoint guidance implying roughly $335 million in EBITDA.

The company projects low-20% consolidated adjusted EBITDA margins for the full year.