ATI Inc.

Q1 2026 Earnings Call — April 30, 2026

David Strauss (Wells Fargo): I wanted to ask about the aftermarket piece of your business, Kim. Maybe size that for us, how it performed in the first quarter, and if you're seeing any sort of impacts out of what's going on with the Middle East and higher fuel or how you're thinking about that business from here.

Kim (Executive): Sure. So aftermarket continues to be very strong across the aerospace, especially in jet engine where we're continuing to see both MRO shop visits, upgrade packages, driving demand. As I look at our lead times, we did talk a bit about our backlog and our lead times. Those are moving out substantially based on that demand that's coming in. Like others in the industry, we're continuing to monitor what's happening there in the Middle East, but we're not seeing any impact to our business, no changes in demand or the deferrals or any disruption to the order book. In fact, just over the last week, the conversations I've been having with customers, the first thing they say is if there is any openings that come, that they want them and they will contract and commit to them. Demand's very strong across the board. As you saw, that backlog went up to $4.1 billion, our highest level ever. And, you know, it really reflects that sustained demand.

You know, as we look forward, you know, the things that I'm looking at and thinking about are, you know, changes to possibly retirements due to fuel-driven demand, but frankly, as we go forward, those type of retirements are going to be in those legacy, less fuel-efficient engines, and the shift will accelerate towards the next-generation platforms like LEAP and GTF, where our content is roughly 2x where we are on the legacy engines. And so that will continue, I think, to sustain that MRO demand as we go forward. You know, stepping back and just looking at it all, demand's strong, the backlog's growing, and we're not seeing any near-term impacts from the conflict.

David Strauss (Wells Fargo): And quick follow-up, Rob. I guess the guidance increase, especially on the adjusted EBITDA side, what is the source of that? It sounds like you kept the margin forecast for the segments about the same place? I guess, where is the source of the uplift in the EBITDA guidance?

Rob (Executive): Yeah, we're really confident in where the guide is at. You know, we're seeing the strength, you know, primarily within the defense and jet engine business. So I didn't change the guide for the full year, right? We're still in the mid-teens for jet engine and defense, you know, low to mid-teens. But I'd say my bias is towards the upper end of that guide. So it's really the defense business and the jet engine business and the contracts that we're securing give us the confidence. Not just HPMC. We've got contracts, you know, defense for our defense business in both of our segments. That we're securing the contracts and the full year guide. Like I said, I have confidence in that higher end of the low to mid teens. The bias is towards the higher end of that defense business for both HPMC and AANS.

Richard Safran (Seaport Research Partners): Thank you. I was very interested in your comment in the slides and opening remarks about pricing and HP margins. I want to know if you could expand on that and maybe talk a bit more about pricing and why in the midst of an OE ramp where the model is typically to see a step down in price, you're actually going in the opposite direction.

Management: Yeah, so Rich, so you know when we shared over our past that we don't really see a differentiation between OE versus MRO that our parts, you know, we make a disc and we're not always have clear visibility to which use it's going to. And so, you know, really what you are seeing is that price and that mix is a material driver in the first quarter here. And we see that continuing to accelerate as we go through the year. And really where that's coming from is this is a constrained market. We're doing the most differentiated materials. Our backlogs are moving out for those differentiated materials on the engine side to a year plus. Now, in some cases, titanium PQ is almost to two years. So we're seeing that tightness in these contracts as we're reviewing them. They're getting embedded. We're getting price. It's reflecting the value of what we supply. It's not just short term based on scarcity, but it's long term and contractual and it's getting built in and it's coming through all kinds of sources. There's step ups, there's escalators, there's price resets given where markets have moved.

And, you know, alongside that, we've talked a lot about increased content on these platforms and expanded scope. You know, we're still getting calls today where there are others in the supply chain that may not be able to meet the full demand and are struggling to meet that level that our customers are looking for, and we're picking up share gains as well. And again, in those situations, we're able to capture a large portion of the value that we're creating to continue that ramp and helping them meet their commitments. And so, you know, as I look through, it's a structural shift. It is an HPMC, but it's also on the AANS side. And I just wanted to add, you know, that is a structural shift and it's been deliberate around our portfolio management. You see it in some of our other end markets and some of the reductions and not growing in those non-core markets because we're really focusing, especially in our exotic alloys, on those differentiated markets where we can capture the value that we're really providing, particularly in aerospace especially in defense and specialty energy.

So a lot of great work by the team, and you'll see that continue to accelerate, and it'll be even more pronounced in the second half.

Richard Safran (Seaport Research Partners): Now, second, no secret the Department of War has been pressing industry for additional capacity. At the same time, we're seeing a rate ramp in aerospace, which you've been talking about, I want to know if you'd be willing to discuss planned or anticipated capacity additions and then, you know, maybe comment on when they might come online.

Management: Sure. So, you know, defense has been very strong in the first quarter. And, you know, I know we've guided to, you know, low to mid-teens, but it's as Rob just shared, our bias is to the upside on that. And so to your point, we're seeing very strong demand across our whole portfolio. And as we look at the capacity to meet that, especially in missiles, that's been an area that's really upticked from inquiries, order placements, even in advance of that funding by the Department of War. But as we look at capacity, we've announced previously our titanium investment. Our nickel investment is in progress. Both of those two are both on track and on schedule to come online. Nickel remelt will be this year, and then the primary VIM melting will be online next year. And titanium, we're already in qualifications for premium quality engines. So both of those are on track, and we're in good position. I think, you know, as we think about some of the missile, some of the nuclear naval applications, we've got capacity in place to support that ramp as we go forward.

Now, that said, as we go and think about some of our other exotic alloys or our isothermal forgings, which has consistently been over two years worth of backlog, that's an area that we'll continue to have conversations with our customers and make sure that we're aligned with them. We're not at a stage to announce any new significant projects today, but we are talking with those customers. We have very strong, close relationships with regard to capacity planning, how they're seeing that landscape change. And I do believe, though, as you look forward, defense is going to be an important growth market for us for 2026 and beyond.

Scott Deutchley (Deutsche Bank): Hey, good morning. Rob, did AAMS see any benefit from this new Cameco contract in the first quarter? And if not, when should we start to see that benefit flow through the P&L?

Rob (Executive): Yeah, thanks, Scott. There wasn't much benefit accrued into the Q1. That's really going to be a prospective benefit. And as Kim mentioned, that's going to be, you know, some of those exotics, zirconium and hafnium. And, you know, we're really making structural changes in that business. And what you're going to see is, you know, I'll call it more arrow-like margins starting to come through. So that's going to go into the AANF segment and benefit that segment here for the foreseeable future.

Scott Deutchley (Deutsche Bank): Okay. And then are you seeing firm purchase orders today that support the second half ramp and airframe sales? Or are those purchase orders expected to come a little bit closer to the second half?

Management: Now, as you think about our airframe story, you know, as I shared, you know, we're looking at it as a story of really two halves. The first half of the year, which, as I shared at the last call, is going to be flattish as that inventory normalization continues to align more closely with production orders. And we are expecting to see that acceleration and ramp in the second half. Based on our, these are all contract driven and our orders are typically placed around 12 to 18 months. And so, you know, most of those orders and certainly all the forecasts have been shared with us and we are aligned to those. And even in the last week, I've had conversations and reconfirmed. And as many, I won't speak for our customers, but they've come out and reaffirmed that they're sticking to those targets and build rates. And so we have strong visibility based on these relationships and contracts to those backlogs and shipments. So we feel confident where we are today. It is not short cycle buying. Most of this long-term agreements allow us that visibility and alignment.

And we've been talking... you know, in some cases since last September around what they were going to be looking for as we went into the air and we have frequent updates with them. So most, again, we're nine months, nine to 12 months ahead of the production schedule. So most of those forecasts are all in and most of those orders are already booked and in our books. And, you know, our contracts, just to remind everyone, have, you know, most of them have minimum quantities and frozen order windows where changes can be made. And we're rapidly approaching where the rest of the year, the back half of the year will be frozen.

Andre Madrid (BTIG): Yep. Thanks for taking my question. Good morning, everyone. Looking, you know, you made a comment, backlog is, you know, the highest it's ever been, over $4 billion right now. I mean, could you give us a split as to how that looks across all the different end markets you plan?

Management: Yeah. So, yes. The backlog is at the highest level ever, just almost a year's worth of business. And as I've shared in the past, it really needs to be taken in conjunction with our lead times, which as I just mentioned earlier, they are moving out substantially based on demand coming in. And so we're at a year plus and from forgings and PQ bill at Titanium PQ, it's close to two years. So you need to look at both of those together. We are seeing those extend. As I look at the distribution, I would say about three-quarters of that is in our HPMC segment, given the strong demand in jet engine.

Andre Madrid (BTIG): Got it. And then, you know, looking at jet engines, pretty impressive, you know, rose to about 41% of total company sales in the quarter. I guess, you know, should we expect this to grow any higher as a percent of sales and kind of in a similar vein to, you know, with the rebound of airframe in the second half? I mean, how should we expect, I guess, the percent of titanium sales to shift going forward?

Management: Yeah, so jet engine, as you said, it's about 40% of our market today. This is where some of our most differentiated capabilities are, both for nickel alloys as well as our isothermal forgings. As we look at jet engine, I mean, that could, you know, jet engine and aerospace, let's just say aerospace in total, that could go up another point or two. A&D, you know, is around 69%, 70%. Those are going to continue to grow, and that's going to be intentional. We're prioritizing, as I said, that valuable capacity to those highest value opportunities where we're able to get long-term contracts and margins are the strongest. So, you know, as I look at that, you know, A&D mix is going to continue to go higher, which will help us continue to drive higher margins along with stronger value creation. So I would expect that we're going to be above 70 and it could trend up.

Jet engine may be up a couple points as well as far as titanium sales, I think, is, as I said, with airframe sales, the first half is going to be somewhat flat and it'll start accelerating through the second half, so you will, we will start to see some of that titanium sq that typically goes into the airframe start to increase. But what I would anticipate, you'd see more substantial increases for airframe in 27, and certainly as the wide bodies start to gain in their ramp and build rates. The one area that we are seeing quite a bit of demand, though, for titanium is in defense. It does go into structural applications that are used for high temperature and performance. And so that we are seeing now, and it's starting to come into our mix. And so you may see that uptick here through the year as well. So there's a couple of key markets drawing on that, but I would say you'd probably see much stronger titanium sales growth in 27.

Miles Walton (Wolf Research): Thanks. Good morning. Kim, last quarter you talked about the missiles as a percent of your defense exposure. Can you remind us where that is now given what seems to be a constant doubling of revenue? And then are you party to the seven-year frameworks? Are they trying to lock in your supply for a longer than normal duration?

Management: Yeah, so missiles is one of those markets that we're seeing really meaningful uptick in demand and inquiries. It is a small portion of our revenue as you reference, but the rate of acceleration is really what's notable there. We've seen that increase inquiries, order activity. As I mentioned, folks are placing orders because of the lead times that we've got. They're placing orders in advance of that total funding that's come through just based on the replenishment needs for, you know, our military and missiles and munitions. So, you know, the programs that we're on, you know, that really require the performance materials that we have are PAC-3, THAAD, Tomahawk, all substantially, you know, been advertised. You know, they're up 3, 6, 10x as they're trying to build the supply chain. And we're really working with those folks in the supply chain to increase and align our capacity to those needs. And it's really across a couple of key areas. I talked about titanium, our premium quality titanium, our exotic alloys like zirconium, hafnium, niobium, and that's continuing to drive this uptick. And yes, it grew triple digits.

I expect that'll continue to grow at that rate to become a meaningful part of the portfolio, both from a growth and margin perspective, just to remind you right now we've got we've kind of laid out their low to mid teens growth for the year, but I would say my bias is to the upside given just the recent activity here in the last month to six weeks.

Miles Walton (Wolf Research): Okay, and can you just remind us of your tariff outlook for 26 after the changes in 232 where we are positive negative?

Management: Yeah, just to jump in there. So, yeah, for tariffs, we've kept, you know, right now we're status quo. We've got pass-throughs for all of our contracts. So any tariffs that we're still experiencing, we're passing those through. Clearly, given the administration, we're still trying to work through what may be a refund policy, although I'll be honest, there has not been a lot of progress in that regard. So we're continuing as those come in. We've got alignment with our customers, and we're able to, and we are continuing recovering any tariffs that we're seeing.

Gautam Khanna (P.D. Cohen): Hey, thanks. Good morning, guys. I was wondering if you could opine on where we are on that de-bottlenecking initiative that you announced about three quarters ago, and if you could characterize kind of what percentage of your nickel alloy capacity is being utilized at this point and, you know, how that might change over the next six to 18 months. I'm just curious how close to 100 percent utilization you're at.

Management: Sure. So I think the de-bottlenecking you're talking about is in our primary nickel melting. There is some other work that's going on downstream, but I think that's what you're referring to on the nickel side. And so that's progressing very well. I shared, you know, in my prepared remarks that we've seen a 15 percent uptick in output. And maybe more importantly, we've seen a significantly improved product quality control parameters. So not only are we getting more output, but we're also making a higher percentage of material that doesn't need to be reworked or have any additional steps taken to make it ready for delivery. And so we are well ahead, I will say, walking through the plants. They are doing a phenomenal job. And quite frankly, this was in advance and in preparation for the capital investment that I shared around our remelt assets that are going to be coming online here towards the end of the year in the fourth quarter. And it'll be just in time. Like I said, we are rapidly working on how we increase productivity through our remelt operations across our system to take advantage of that increased primary melt. But there's still some work to do.

And so as I look, you know, you said, you know, how we think about that over the next six to 18 months. I do think we are already seeing upticks. You're seeing that both in output and mix in pricing as well because we really are focusing that in our highest valued products. But as I'm looking forward, you'll see the first uptick in the beginning of next year where we really are in leash, you know, call it 5% or so more volume through the operations. And then we've got the primary melt that's coming in at the end of next year, which I've talked about is kind of that 8% to 10% uptick that will continue to allow us to take advantage of all the improvements and all of the investments that we're making. So from an overall, I'd say we are being selective and deliberate in how we're directing our capacities. We're going after the hardest to make, most differentiated products. You know, I talked a lot about those six of seven alloys that in five of those cases were the only ones making those today. And so we are prioritizing that.

You're seeing it in the margin uplifts, but we're continuing to drive those bottlenecks and finding meaningful capacity through the work that the team is doing and, frankly, the learning curve improvement of our employees as we continue to move up that base and people get more experienced and learn more.

Rob (Executive): And Rob, I just wanted to get your opinion on incrementals by segment. I remember Don used to talk about 40% and 30%, respectively, HPMC, AA, and S. Is that what you think we should be penciling in over the next, you know, year and a half, two years, whatever?

Rob (Executive): Yeah, so I'll break it down, but first I'll start with the consolidated look. You know, for the full year, you know, 2026, you know, modeling in something close to that kind of 40% consolidated incremental for the full year is how I'm thinking about it. And if you double click and unpack that by segment, I think what you'll see is, you know, margins on the incremental basis kind of drifting higher from the HPMC segment and maybe a bit lower from the A&S segment for the overall composite of about 40%. And that's an improvement from where we've been historically. If you think about where we would historically guide, it was in the mid 30s to maybe the upper end of 40. I think we're now, you know, pretty confident in that 40% year over year incremental margin on a consolidated basis.

Rob (Executive): Yeah, you know, I won't, you know, talk about 2027 other than, you know, from a model standpoint, you know, we have the guidance out there from 2027, and I'm very familiar with that guidance. I was part of the team working with Don and Kim that prepared that. And overall, you know, my confidence is really high in our ability to get into that guide range. And if you look at the second half run rate here, which we're thinking about, you know, you'll see if you connect the dots that that puts you, you know, well within the range. And the point I want to make is we're not going to stop growing. So, you know, I think what I would say is I have a bias towards the upper end of that 2027 guide for EBITDA dollars and the consolidated margin percentage.

Seth Safeman (JP Morgan): Thanks very much, and good morning. I wonder if you could talk a little bit about the supply side angle of things that are going on in the Middle East when we think about upward pressure on anything in your cost base, whether that's energy costs or any particular inputs availability of any inputs, anything you're monitoring, and any way maybe in particular to think about the way that you can pass through higher energy costs.

Management: Yeah, so as we, you know, coming covid supply chain monitoring I think has become one of the key strengths that we have. I'm sure every company does as well. So we are monitoring a couple things. We have not seen any upticks, so there's been no impact to date. But I will say one key input is helium that goes into our processes. So that I know several of the suppliers have started to export that from the U.S. And so we're monitoring that closely. It's a small portion of our costs, so it's not critical, and we do have alternatives that are readily available. So, that's one area that we're paying attention to, mainly from a, you know, just Middle Eastern supply and transport aspect. From an energy cost standpoint, we are seeing other impacts, you know, outside of just what's happening with the Middle East, but, you know, data centers and other things that are providing and putting more pressure on some of the electrical pricing and other things. And so we've got multiple mechanisms to deal with that. One, you know, we do pass through all of those inflationary costs through in our contracts. And so we've got protections and mechanisms to do that.

We manage natural gas hedges that we have become more conservative with as we look out 12 to 18 months. And in some cases, even longer than that, that again, allow us not to control it, but to allow us to stay aligned with those mechanisms from an inflation indexing standpoint so that we're able to stay flat and aligned to what those costs are. And then there's some other innovative ideas and things that we're pursuing, projects we're pursuing around energy and energy generation that long-term may come into play as we think about how we want to manage those costs. But to date, no impact from the Middle East and what's happening there from a cost standpoint. And we'll monitor a couple of those things, but so far it's been very stable. And then energy cost is something that even before what's happened over in the Middle East has been on our agenda and something that we've been working on.

Management: Yes, you will see that acceleration. It's going to be sequentially stepping up as we go through the year. So you'll start to see it in Q2. It's coming through, as you said, in both demand, in enhanced mix, and expanded content, as well as price. And so you'll see that coming through. We are being very deliberate around how we allocate our resources, our capacity, and so, you know, you'll probably see that those impacts more heavily weighted towards our margin and EBITDA line more so than the revenue line as we go through the year and we continue to pivot our mix and portfolio to support those high-value markets.

Pete Skibitsky (Alembic Global): Hey, good morning. Hey, Kim, going back to the start of the Q&A, you were talking to Dave about the impact of higher jet fuel prices on potentially driving the retirement of legacy aircraft. I just wanted to get the sense, if we think about commercial aftermarket for jet engines today, is your revenue at this point on the newer jet engines aftermarket, is that the same or above the aftermarket revenue for legacy jet engines, or are we not there yet? I just wanted to get a sense of where we are sort of in the cycle for you.

Kim (Executive): Yeah, I would say it's heavily weighted towards the next gen. We've got twice the content, as I've shared in the past. A lot of these next-gen engines are still in the lifecycle of an engine in the early cycle. So there's upgrade packages, durability packages, and we're seeing that demand on top of the OEM build rates and just the first round of shop visits that LEAP and others are starting to hit. And so those are all coming together. So there is more demand. Revenue and demand, you know, that is more heavily weighted. And so it is a very favorable trend for us as we accelerate into those next-gen engines. And those legacy engines, you know, for those materials, what we find is our assets are very fungible. And so they're very useful in other markets like specialty energy, which uses similar materials, similar capabilities, and are required for those, which is, you know, it's basically like an engine on the ground. And so between specialty energy and some of these defense applications we were just talking about, we're able to pivot to those high-value, very differentiated capabilities into those other markets as they start to retire some of those legacy planes.

Pete Skibitsky (Alembic Global): Okay, great. I appreciate the color. Just one last one for me. On the defense growth this year, I'm trying to – obviously, missiles are growing really fast. It's still small. I'm trying to get a better sense for the core driver for you in military? And it seems like recently the shipyards are showing a lot of improvement in throughput, hiring more people, supply chain is improving in shipyards. So is it the exotics for you within defense, the zirconium for the nuclear Navy? Is that the biggest muscle mover for the military growth or are there other factors as well?

Management: The naval nuclear is our largest contributor when you look at our overall defense sales. As you mentioned, it's very long cycle funded programs. They're looking to expand that capability. I shared that new naval nuclear contract that we just signed, which is about 2x the revenue over the next five years than we had in the past contract. And as you said, we're seeing strong growth in that area. And that is an area that we're continuing to invest in. It is predominantly coming from those exotic alloys, zirconium, hafnium, some nickels as well. So it does translate to a little bit into our HPMC business as well, but predominantly the ANS. And you're seeing that with the margin accretion that you've seen over the last three quarters.

Samuel McKinney (KeyBank Capital Markets): Hey, good morning. Thanks for getting me in. Given the rich margins that you guys get in defense aero, can you just talk to us a little bit about how you're thinking about managing and prioritizing line time on some of these assets that can serve both the defense and commercial aero in the context of the OEM build ramp?

Management: Yes. So as we thought, as you said, we are prioritizing capacity and line time, as you called it. And, you know, what we find typically is jet engine is our highest margin business, although that's been rapidly shrinking. You know, as we think about defense and specialty energy, we're seeing both of those start to accelerate very quickly given the tightness of the market and the demand.

Q4 2025 Earnings Call — February 3, 2026

Seth Stiefman (JP Morgan): Thanks very much and good morning, everyone. Don, just want to say thanks for all the help over the years and congratulations and best of luck. Well, why don't you start off maybe with a little bit of a big picture question, and you probably can't talk about a lot of the details, but when we're thinking about expanding capacity with customer support, how do we think about how much of the new capacity is dedicated to the customer versus how much you have at your disposal to serve other customers? And then also, you know, the customer support helps to reduce the denominator and the ROI. How do we think about the impact on the numerator?

Don (Executive): Hey, Seth. Yeah. And you're right. We can't share a lot of details around what products or what projects these go to unless we've done a public press release, which we have on some of these in the past. The way to think about that and the way that these are structured, these agreements, is that it's really around security of access to highly constrained differentiated materials. And so, you know, as we are partnering to do these investments, the customers are, one, looking to ensure that that capacity is available and they have right of first refusal for, you know, whatever that negotiated amount is. Beyond that, as we are managing our mix and managing demand, we're able to flex and move that to support whatever business at the time makes the most sense for us. So, you know, it does give them, like I said, that surety that there's investment and supply coming. We work very closely. I think the other benefit for us, maybe 2 fold 1. is that alignment around customer demand when they need it.

So it's coming on exactly when that demand's coming, but also the qualification becomes much more abbreviated because of the focus around resourcing and the investment and alignment of interest there. On your question around the returns, you know, I've shared in the past our threshold for returns on our projects are all 30% plus. And obviously with this, contributed capital from our customers that helps drive those projects even more robust returns for us over the project timeline.

Seth Stiefman (JP Morgan): Excellent. Excellent. Thanks. And maybe just as a quick follow-up, if you could provide an update on, I think you talked about airframe growth being more pronounced in the second half of the year, just maybe an update on the stocking situation there and what kind of visibility that you have.

Don (Executive): Yeah, I would say, you know, airframe inventories are getting much closer to being in line. Inventory alignment has progressed meaningfully through 2025. As I shared in the past, they only had pockets where the inventory, they were working to normalize that. And so from our perspective, as we see inventories across that supply chain, it's largely will be right-sized by 2026, and that's where we are anticipating that we'll start to see some modest improvement in order rates and demand as we get into the second half. And clearly, you know, Boeing had some great news to share this week. They're on a great path. And as they continue to pull and increase their ramp build rates, you know, we anticipate that normalization, you know, moving even quicker.

Pete Skibitsky (Olympic Global): Hey, good morning, guys. Nice quarter. Hey, Kim, you've had some great history here in terms of defense sales and a nice projection, and it seems like there's still a lot of runway there with this reconciliation bill spend yet to come. I was wondering if you could parse out some of the pieces of defense revenue. I think Naval is about 50% defense for you, but maybe you could talk about missiles some more in terms of how big that could be, because we've seen some historic contracts for PAC-3 and FAD, items that you guys have content on. So we're just wondering if you could parse through some of the growth drivers in defense there. Thank you.

Kim (Executive): Yeah, sure. And yeah, I'm very excited about defense. For the full year, 25, it was up 14%. We're expecting that growth to accelerate into the mid-teens in 26. And as you said, the spending that is coming in the programs that we have content and are supported are going to just continue to accelerate that. So, you know, as you said, as we break down and I look at the defense markets, just generally, nuclear is probably a little bit less than you said, closer to, you know, 35 to 40% of that overall. And then missiles today, is around, say, 20% of that total. And as I mentioned, you know, we're continuing to win new content on both current programs as well as development in new programs. And so, you know, I mentioned in the prepared remarks specifically around PAC-3 and FAD, utilizing our very specialized C-103 material. We're one of the few U.S. suppliers and producers of that material, and that really goes into that high temperature high strength applications and then the titanium six four which goes to helping support the eb investment that we made over the last few years it's coming online very well it's right at the right time and as you said both of those missile programs I think they're up three to four acts in spending as we work to replenish our stockpiles so Defense is an area that has continued to grow. It's a very attractive market for us, and it does have a lot of improvement and opportunity as we go into 26 and beyond, frankly.

Richard Safran (Seaport Research Partners): Thanks very much. Good morning, everybody. Don, it's been great working with you. Best of luck. First question I have. I think it's the obvious one. Are you still good with your 2027 guide, you know, that you have out there? I'm kind of curious if you'd like to update it right now. I mean, you're guiding to, you know, 1 to 1.2 billion in EBITDA in 27. And as Kim, you know, you said you're guiding to 1 billion in 26 at the midpoint. And, you know, if I heard you right, you're expecting 40% incremental margins in 26. So I guess, you know, what does this all say about your 27 guide?

Rob (Executive): Yeah, hi, Rich. This is Rob. I'll jump in here. You know, when I think about the 2027 guidance, you know, I'm really confident in the guidance. You know, it's not, I guess everyone doesn't know, but I was a part of the team, you know, prior to being the president of our specialty hours and components business. you know, I was running the operational finance group. So been very closely involved with these numbers and very confident in our ability to achieve these kind of targets. At this point, you know, I'm going to spend some time in the chair and we're going to get to reviewing the outlook in longer range and normal course. And I'll be in a position to give you an update whenever we get to that point. I'm not there yet, but I will say that I do have some bias to the top end of the EBITDA margin percent, and I do feel really confident with those 2027s, but we're not in a position right now to give an update.

Richard Safran (Seaport Research Partners): Okay. Thanks. Second, Tim, I sense this is following up on some of your comments about defense possibly, but the past few years have been pretty good for share gains. VSMPO, you know, you picked up. I'm kind of curious what the opportunity set is for share gains in 2026. And I'm thinking given spending levels, you know, are most of them in defense right now? I mean, you know, that's just my take on things, but I'm very interested in what you're seeing. Thanks.

Tim (Executive): Yeah, Rich, that's an interesting perspective because, you know, as I look at 2026, I see opportunities for share gains. And in fact, we've already had a couple here early in the year across three key markets. One is defense, as you mentioned, and I talked about some of those programs in the missiles, but also in the jets and rotor hub areas as well, where I know we are winning share, taking share, winning new programs and new parts on that equipment. But the other two areas that I think we still have opportunities are one in jet engine and second in specialty energy. Both of those, I would say over just the last 30 to 60 days, we won significant new share positions. And really, those are related to where our peers maybe are challenged to meet the requirements of the ramp, are challenged to meet the requirements of the OEMs to support those rates. When that, you know, and again, I mentioned, you know, those materials on slide six that we've got the proprietary differentiated materials. Those give us the opportunity then to grow and continue to grow that content on each of those engines.

And, you know, I'm very pleased that our customers do feel like they can rely on us to deliver reliability, high quality products. And I'm seeing share gains across all three of those. And again, the tailwinds for the growth of those three markets as well and increasing demand, I think, are going to continue to open up new opportunities for us to go in and win share and win new program positions.

Scott Deutchler (Deutsche Bank): Hey, good morning. Kim, based on the $350 million revenue disclosure you offered, it looks like you'd be adding around 9,000 tons of annual nickel milk capacity with this new VIM, at least based on my napkin math. Does that sound roughly right in the right ballpark?

Kim (Executive): Hey, Scott. Generally, it's a little bit mix dependent, right? So the materials that this purpose-built capital is going in for have differences around melt rates, around production time. And so you're in the ballpark, but again, that's part of the reason we shared the revenue targets because some of these are very, very difficult and complicated to make. And so it doesn't equate to what you may see as a general purpose capacity or run rates.

Scott Deutchler (Deutsche Bank): Just as a follow-up, can you share how the melt times typically compare for one of these exotic alloys like Rene65 versus a more standard alloy like 718?

Kim (Executive): Yeah, I would say if you take kind of a 718 versus maybe one of those proprietary alloys on that slide six, it could be up to three to four times longer melt times. These are all specified controlled melts to get that quality and grain structure requirements that the OEMs are looking for.

Scott Deutchler (Deutsche Bank): That's really helpful. Thank you. And then, Rob, I was just wondering if you could walk us through the 2026 pricing outlook specifically for the exotic alloys that AANS makes, zirconium, hafnium, and niobium, obviously some big moves on hafnium market so curious what that pricing outlook looks like for 26.

Rob (Executive): Yeah so you know at a high level when I think about the walk from the 2025 EBITDA to the 2026 guidance you know the way to think about it is roughly 50 percent pricing 50 percent volume and you know yeah there has been some pretty significant movement with some of the alloys within our specialty alloys and components business, as well as some of the other businesses that we have. You know, we don't really disclose that detail. You know, we do talk about, you know, zirconium and related products. You know, thinking about that in the context, it's just under 10% of our kind of volumes in terms of revenue. But I will say that the pricing assumptions that were used in the 2026 guidance aren't too far from, you know, the current information available. So we've considered a lot of that movement into our 2026 guide.

Andre Madrid (BTIG): Yes. Good morning, everybody. And Don, thank you again for everything and best of luck in future endeavors.

Don (Executive): Thank you, Andre.

Andre Madrid (BTIG): Not to nitpick, but when looking at airframe, I think you guys are now projecting mid to high single digit, but before it was just high single digit for 26. What's giving you any pause there, and what would need to happen for you guys to come in the lower side of that range?

Don (Executive): Yeah, I'd say, you know, our guidance is built on executed customer production schedules and contractual commitments and not necessarily those headline build rate targets. So, you know, as you said, you know, we're coming in at that, you know, mid to high single digit growth rates. But specifically what we base our outlook on is the OEM order rates the schedules that they've given us for both Airbus and Boeing, you know, contractual minimums. I'll just remind you that our Boeing contract has contractual minimums. There's order frameworks and timing for both of those that tie demand, material demand to those actual production plans. And I would say what's really coloring this is maybe a conservative view of the timing, particularly early in the year where we are today, rather than assuming, you know, immediate full rate execution. And so, you know, we'll continue to update that as we go through the year. But, you know, we're encouraged by that progress Boeing shared on production, but we're not assuming best case rate acceleration as we go through the year.

So, the guidance is really a measured ramp, airframe weighted toward that second half of 2026 with production rates that convert to orders and shipments. You know, as far as upside or what would have to be true, you know, these contracts, as I shared with you, expanded both our mix, our participation, our product portfolio. We won price. We won share. And so as they start to accelerate those build rates, we anticipate capturing that share and that volume as we go into the back half of the year. So together, you know, it's taking all this together supports really, you know, we're looking at steady airframe growth throughout the year, modest in the first half, accelerating in the second half, resulting in that mid to high single digit growth for 2026.

Scott Deutchler (Deutsche Bank): And if I could just squeeze one more in. I mean, looking at jet engine, it looks like, you know, this was the second quarter of MRO coming in at about half of jet engine. Do you expect similar contribution into 26? Is that what's baked into the guide?

Kim (Executive): Yes, Scott. So when I look at the frame, I would say that the jet engine growth in 2026 assumes roughly that continuation of MIX being 50% MRO, 50% OEM.

Miles Walton (Wolf Research): Thanks. Good morning. James Meeker & Kim you caught you commented on the non-seasonal nature and pickup of order activity, the start of the year, can you expand upon that directionally where that's coming from how unusual it is in any classification matter and then where did the backlog end up at Iran.

Kim (Executive): Sure, I can definitely mile talk through that so um. You know, we did see an uptick in orders and strength in order inquiries as well as order placements just in the first, you know, 30 days here of the year already. And what we're attributing and what it looks like is that it's related to supply chain readiness moves as people are moving and are taking, you know, the positive feedback and Boeing's progress to get in position for upcoming rate increases. I will say, you know, from a magnitude standpoint, it's coming in very strong, maybe stronger than we've seen in the last few years for these products and for the airframe applications. But we really don't rely on that short-term transactional buying. You know, nearly most of our exposure is governed by that airframe and long-term agreements that very closely tie to customer production plans. But, you know, we're going to continue to monitor that. It kind of goes to my earlier comments around the airframe market. And, you know, we'll monitor as they continue to make those rate increases, both Boeing and Airbus, and update that as we see opportunities.

Miles Walton (Wolf Research): And the backlog, do you provide that at your end?

Kim (Executive): Oh, sorry. Yes, yes. From a backlog standpoint, You know, our backlog today remains just under one year of revenue, you know, which is about where we'd like to see that backlog at. You know, the one thing that I would anticipate seeing, you know, when I look at lead times for those materials, as we just talked about, and those proprietary materials around PQ titanium, nickel alloys, those specialized nickel alloys, And the exotic alloys like hafnium and zirconium, all of those are extending, some up to 2x since a quarter ago. And so I, you know, we are looking and we would expect to see that backlog start to come up a little bit as we continue to implement productivity improvements and efficient improvements to produce those orders and get those shipped. I say in general, It's up about 3%, but as I said, we target around one year of backlog generally. I think the other thing I just mentioned is that the backlog is not a universal indicator. As we've talked about many times before, a lot of our customer demand is contracted. And with those contracts, what that affords our customers is a reserved place in line.

And so what I'd say is it's been the supply chains have stabilized. I've seen some really nice order patterns generally coming in. But what you don't have is you don't have customers coming in and maybe speculative buying or putting in their orders extra early because they know when we get to the lead times and frozen windows that they've got a spot and they can load those against their forecast and what we've reserved for them. So the one pop was that early in the year, watching the supply chain ready for the airframe ramp. and that might have some impact, but generally we'll stay in about the range that we're at today.

Gautam Khanna (TD Cowan): Hi. Good morning, guys. Good morning. And congrats to both Rob and Don. I had two quick ones. First, I was wondering if you could just characterize the VIM capacity add as a percentage of your capacity. So how much does it add to it? And maybe if you could give us some context on how many nickel alloy VIMs you actually have as well in the answer and have a follow up.

Kim (Executive): Sure. We aren't really sharing the total capacity ad. As I said, it's difficult to measure given the product portfolio and how that mix can change, you know, depending on which products that we're making. As I said, you know, we're adding this capacity. It's targeted and it's phased. It's going to focus on supporting those next-gen alloy platforms like LEAP and GTF with that different shape rotating part. alloys that are shown on slide six. So that's the $350 million run rate in 28 is a good way to think about incremental revenue as you start to model and look forward. From a VIM capacity standpoint or number of VIMs that we have, we have currently four VIMs. But what I might caution is obviously this investment allows us to upgrade with state-of-the-art equipment and technology, helping to drive the highest quality product and cost-competitive production. And so we anticipate that there will be some improvements in productivity and output from the brand-new equipment and new controls and so forth. So today we have four. This would be our fifth.

Gautam Khanna (TD Cowan): And just to put a finer point on it, I mean I know it depends on mix and the like, and therefore you're talking about revenue and not tonnage but you know. Do you have a ballpark sense of what the capacity increase is is it like 10 15% is it simple to say you go to four to five it's 25% and just ballpark i'm not asking for specifics.

Kim (Executive): Yeah, well, I'd say, you know, I shared previously the remount gives us kind of 8 to 10, and I would say this is in that ballpark.

Gautam Khanna (TD Cowan): Okay. And, you know, again, part of that revenue, yeah, I was just going to say part of that revenue uptick is really around, you know, the price and mix that we're winning with the LTAs that are supporting this asset, and we're about 80% contracted right now for that. Thanks, Kim. And I was just curious also, as we look to 27 and beyond, what's your ballpark sense of how much price we as outsiders should anticipate the company will get, you know, company-wide, if you will, pricing year over year, 26 to 27, 27 and beyond?

Kim (Executive): Well, as I look at 26, we see substantial price opportunities and mix as we're going forward. You know, these assets and, you know, the products that we're making, as I shared a couple times, proprietary hot section rotating parts, they go into both MRO and OE. Almost every shop visit is going to be looking at those compressor disks and turbine disks. And so, you know, as we're going forward, we're continuing to maintain that value-based pricing. It's protected under long-term agreements. You know, I would say, as you look at our guide for 2026, for example, you can say half of that is related to price and mix, that uptick, and the other half is volume. And I would anticipate that continuing throughout the decades as we bring on these new assets and bring these new materials to our customers.

Phil Gibbs (KeyBank Capital Markets): Hey, good morning. This one. I wanted to just ask a general question on headcount and what are your plans on staffing for 26 as you meet some of these growth aspirations?

Kim (Executive): Yeah, thanks, Phil. I'd say we're stable on headcount as I look at, and that really stabilized through 2025. And you saw the efficiency and the equipment reliability and that improvement that was then flowing through our financials as our employees moved up the learning curve and became more experienced. So, from an overall metric, we're not seeing any spikes in hiring or a lot of new hiring coming in. Now, as you mentioned for this new capacity, we are, we've got some open positions to help support that even today, but I will tell you support from our current experience workforce has been overwhelming. For example, I know they posted six positions here just in the last two weeks and they had 60 of our current employees that are excited and want to be part of this project and moving over. And so our goal is to bring in our most experienced operators that know how to make these very, very tough to produce and long qualification times. And that's really where I'm focused as we think about how do we accelerate the qualification of this new equipment that we brought in. I've given you kind of a six to nine month qualification time with the revenue run rate.

But I do anticipate, given the experience operators will be moving in and the installed base and quality systems that already support these products and obviously the alignment with our customers, that we'll be able to accelerate that. So overall, not huge hiring demands. We'll do it in a measured, disciplined way. But we've got a lot of enthusiasm, I'd say, from our current workforce that want to be part of these investments in this new project.

Phil Gibbs (KeyBank Capital Markets): And then just as a follow-up on isothermal forgings, you've got jet engine growth in the mid-teens for 2026. Is the isothermal forging piece likely to grow beyond that as you continue to gain share in content and new expanded winds with folks like Pratt? And I think you also have maybe more engine manufacturers and growing in that portfolio even beyond Pratt with capabilities to maybe talk to some of that because I know it's an important differentiator for you.

Kim (Executive): Yeah, iso forging is um it's a it's a very important part it's in high demand our lead times are out beyond 18 months at this point as you look at the engine oems we support all three Almost as close to an even mix between the three, especially as you mentioned with the GTF and the growth in the share we've had over the last two years with them. That will continue to grow. I do see continued increased demand from all three where they're looking for things between MRO, upgrade packages, modifications. So those are continuing to come in. And we're really focused on the productivity, the de-bottlenecking, I'm continuing to expand the new heat treat and ultrasonic testing capabilities that we brought online. So we do see growth there. I do think as we work through this year, but as we think about the rest of this decade, that will be an area that, you know, we'll be talking with our customers closely around making sure that we've got the right capacity in place to continue to support their needs.

Kim (Executive): So as ATI enters 2026, we're entering from a position of strength and momentum. I want to thank our customers for their continued trust, our shareholders for their support, and most importantly, our ATI team for another outstanding year of execution. We're confident in the path ahead and look forward to updating you on our progress. This concludes today's call. Thank you for joining. You may now disconnect your lines.