Astronics Corporation Reports 12% Sales Growth for First Quarter 2026

• First quarter sales increased 12.0% to $230.6 million
• Achieved first quarter net income of $25.5 million, or $0.67 per diluted share; adjusted EBITDA¹ was $37.9 million, or 16.4% of sales
• Aerospace operating margin expanded to 16.5%; adjusted Aerospace operating margin¹ was 17.4%
• Record quarterly bookings of $290.4 million for book-to-bill of 1.26 and record backlog of $734.3 million
• Generated $10.6 million in cash from operations
• Increasing 2026 revenue guidance to a range of $970 million to $1 billion

Astronics Corporation (NASDAQ:ATRO) ("Astronics" or the "Company"), a leading supplier of advanced technologies and products to the global aerospace, defense, and other mission critical industries, today reported financial results for the three months ended April 4, 2026. Financial results include the acquisition of Bühler Motor Aviation ("BMA") on October 13, 2025.

Peter J. Gundermann, Chairman, President and Chief Executive Officer, commented, "We are off to a strong start in 2026 with strong growth, expanded margins and record bookings and backlog. Our team's focus on operational execution combined with higher volume delivered adjusted EBITDA¹ margin of 16.4%. Demand across markets for our products remains robust, as evidenced by record bookings that were driven by strength in both Aerospace and Test. Our activity level is expected to pick up noticeably in the coming quarters and we believe we are well-positioned to capitalize on the opportunities ahead."

First Quarter Results

First Quarter 2026 Results (compared with the prior-year period, unless noted otherwise)

Growth in sales was driven by the Aerospace segment's continued strength in demand primarily from the Commercial Transport market. Aerospace sales increased $22.4 million, or 11.7%, while Test Systems sales grew $2.2 million, or 15.4%.

Gross profit increased $14.3 million to $75.1 million, or 32.6% of sales, an improvement over gross margin of 29.5% in the comparator quarter. Gross profit growth and margin expansion were primarily attributable to higher volume, improved productivity, and a $2.8 million catch-up of profit on the MV-75 program based on revised program estimates. This was partially offset by a $1.7 million increase in tariff expenses. In the prior year, first quarter consolidated sales and gross profit was negatively impacted by a $1.9 million revision of estimated costs to complete a long-term mass transit contract in the Test Systems segment.

Selling, general and administrative expenses ("SG&A") decreased $0.8 million. Litigation-related expenses were down $1.2 million, and the prior-year period included a $6.2 million reserve adjustment to the damage award relating to the patent infringement dispute in the UK. Appeals to the UK damage award are scheduled to be heard in July 2026. These decreases were mostly offset by higher wages and benefits, higher incentive-based compensation expenses driven by increased profitability, and incremental expenses related to the acquired BMA business. R&D was up $1.0 million reflecting the timing of projects.

Operating margin expanded 540 basis points and adjusted operating margin² expanded 180 basis points as a result of higher volume and improved productivity in the Aerospace segment, coupled with savings from the recent Test Systems cost rationalization activities.

Interest expense was down $0.8 million, or 25.8%, on lower rates following the September 2025 refinancing activities. Tax benefit in the quarter of $0.8 million was related to a $2.7 million discrete adjustment for the expected benefit of a stock-based compensation deduction, a valuation allowance reversal, and research and development costs expected to be expensed. Tax expense in the prior year period was partially offset by a $1.1 million discrete adjustment to reverse certain federal and state deferred tax liabilities.

Consolidated net income of $0.67 per diluted share improved from $0.26 per diluted share in the prior-year period from stronger operating profit, lower interest expense and lower tax. Adjusted EBITDA² increased 23.3% to $37.9 million, and adjusted EBITDA margin² expanded 150 basis points to 16.4% of consolidated sales.

Record bookings of $290.4 million in the quarter resulted in a book-to-bill ratio of 1.26:1. For the trailing twelve months, bookings totaled $935.1 million and the book-to-bill ratio was 1.05:1. Backlog at the end of the quarter was $734.3 million, the highest in the Company's history.

Aerospace Segment Review (compared with the prior-year period, unless noted otherwise)

Aerospace segment sales of $213.8 million increased $22.4 million, or 11.7%. Sales in the Commercial Transport market increased $18.9 million, or 13.7%. Growth was primarily related to increased demand for seat motion and lighting and safety products. General Aviation sales increased $6.2 million, or 40.7%, to $21.4 million due to higher inflight entertainment & connectivity ("IFEC") product sales to the VVIP market. Military Aircraft sales remained consistent with the prior-year period. Other sales decreased $2.9 million as the Company has wound down its non-core contract manufacturing arrangements.

Aerospace segment operating profit of $35.3 million, or 16.5% of sales, improved over the prior-year period reflecting the leverage gained on higher volume, improving production efficiencies, the cumulative catch-up of profit on the MV-75 program based on revised program estimates, and a $7.0 million decrease in litigation-related expenses and legal reserve adjustments related to the UK patent dispute previously discussed. Adjusted Aerospace operating profit² increased 20.0% to $37.2 million, or 17.4% of sales, a 120-basis point expansion over the comparator quarter.

Aerospace bookings were $264.4 million for a book-to-bill ratio of 1.24:1. Record backlog for the Aerospace segment was $651.4 million at quarter end.

Mr. Gundermann commented, "Our Aerospace business had a solid first quarter with our second-highest quarterly sales total, trailing only the preceding fourth quarter. Strong sales led to a 16.5% operating margin. Market demand for our products remains strong and we are well positioned to set new records in the coming periods."

Test Systems Segment Review (compared with the prior-year period, unless noted otherwise)

Test Systems segment sales of $16.8 million were up $2.2 million from the comparator quarter in 2025. Segment sales in the prior-year period were negatively impacted by a $1.9 million revision of estimated costs to complete a certain long-term mass transit Test contract reducing revenue recognized in the period.

Test Systems segment operating profit was $0.4 million, compared with an operating loss of $2.2 million in the first quarter of 2025. Test Systems profitability, while improving, continues to be negatively affected by mix and under absorption of fixed costs at current volume levels.

Bookings for the Test Systems segment in the quarter were $26.1 million. The book-to-bill ratio for the quarter was 1.55:1. Backlog for the Test Systems segment was $83.0 million at quarter end.

Mr. Gundermann commented, "Results in our Test business continue to confirm that our significant cost-cutting and efficiency actions have been effective, and we expect results to improve significantly as the radio test program for the U.S. Army begins. We understand that a production award is on track to be issued in the coming weeks, with the production phase of the program accelerating in the second half of the year."

Balance Sheet and Liquidity

Cash provided by operations in the first quarter of 2026 was $10.6 million, reflecting higher cash earnings offset by higher working capital requirements, including higher inventory levels to support anticipated revenue growth in the coming quarters. Capital expenditures in the quarter were $11.2 million. Elevated capital expenditures reflect necessary catch-up investments on previously deferred spending as well as the consolidation of operations and capacity improvement in a new Seattle facility. The Company expects to be free cash flow positive for the remainder of the year.

Long-term debt was relatively unchanged at quarter-end at $334.9 million. The Company had available liquidity of $231.8 million at quarter-end, including $19.1 million in available cash.

2026 Outlook

Astronics expects 2026 revenue for the year to be in the range of $970 million to $1 billion, which would surpass the record level sales of 2025. The midpoint of the revised range would be a 14% increase over 2025 sales.

Record backlog at the end of the first quarter was $734.3 million, of which approximately 81% is expected to drive revenue over the next twelve months. Mr. Gundermann concluded, "We expect second quarter sales of $245 million to $250 million, which will be a new record for the Company, and we expect our revenue rate in the second half to rise further from there. Demand remains strong for our products and capabilities, and all indications point to a very strong 2026 for our Company."

Planned capital expenditures in 2026 are expected to be in the range of $40 million to $45 million driven largely by costs associated with the Seattle operation consolidation, which will conclude in the second quarter. In addition, the Company is in the early phases of implementing a new global resource planning system. Astronics expects to spend approximately $15 million to $17 million on this project in 2026, excluding reallocated internal operating costs. Approximately $2 million to $3 million of the investment will be incremental operating expense with the remainder to be capitalized and reported as a cash outflow from operations. The total cost of the project over five years, excluding reallocated internal operating expenses, is expected to be approximately $35 million to $40 million of which $25 million is expected to be capitalized.

First Quarter 2026 Webcast and Conference Call

The Company will host a teleconference today at 4:45 p.m. ET. During the teleconference, management will review the financial and operating results for the period and discuss Astronics' corporate strategy and outlook. A question-and-answer session will follow.

The Astronics conference call can be accessed by calling (201) 493-6784. The listen-only audio webcast can be monitored at investors.astronics.com. To listen to the archived call, dial (412) 317-6671 and enter replay pin number 13759858. The telephonic replay will be available from 8:00 p.m. on the day of the call through Tuesday, May 26, 2026. The webcast replay can be accessed via the investor relations section of the Company's website where a transcript will also be posted once available.

About Astronics Corporation

Astronics Corporation (NASDAQ:ATRO) serves the world's aerospace, defense, and other mission-critical industries with proven innovative technology solutions. Astronics works side-by-side with customers, integrating its array of power, connectivity, lighting, structures, interiors, and test technologies to solve complex challenges. For over 50 years, Astronics has delivered creative, customer-focused solutions with exceptional responsiveness. Today, global airframe manufacturers, airlines, military branches, completion centers, and Fortune 500 companies rely on the collaborative spirit and innovation of Astronics. The Company's strategy is to increase its value by developing technologies and capabilities that provide innovative solutions to its targeted markets.

Safe Harbor Statement

This news release contains forward-looking statements as defined by the Securities Exchange Act of 1934. One can identify these forward-looking statements by the use of the words "expect," "anticipate," "plan," "may," "will," "estimate," "feeling" or other similar expressions and include all statements with regard to the Company's 2026 outlook including the level of activity in coming quarters, the expectation of setting new records in coming periods, the timing of the receipt of production orders for U.S. Army radio test set program, the level of profitability contribution from the Test segment with its onset, and the rate of revenue growth in the second half of 2026. The forward-looking statements also include all statements related to achieving any revenue or profitability expectations, expectations of continued growth, the level of liquidity, the level of cash generation and free cash flow, the level of demand by customers and markets and the amount of expected capital expenditures, the amount of investment in an ERP system, the amount of backlog to be recognized as revenue over the next twelve months, and statements regarding the amount of opportunities available to be executed. Because such statements apply to future events, they are subject to risks and uncertainties that could cause actual results to differ materially from those contemplated by the statements. Important factors that could cause actual results to differ materially from what may be stated here include the trend in growth with passenger power and connectivity on airplanes, the state of the aerospace and defense industries, the market acceptance of newly developed products, internal production capabilities, the timing of orders received, the status of customer certification processes and delivery schedules, the demand for and market acceptance of new or existing aircraft which contain the Company's products, the impact of regulatory activity and public scrutiny on production rates of a major U.S. aircraft manufacturer, the need for new and advanced test equipment, customer preferences and relationships, the effectiveness of the Company's supply chain and execution on opportunities, and other factors which are described in filings by Astronics with the Securities and Exchange Commission. Except as required by applicable law, the Company assumes no obligation to update forward-looking information in this news release whether to reflect changed assumptions, the occurrence of unanticipated events or changes in future operating results, financial conditions or prospects, or otherwise.

Use of Non-GAAP Financial Metrics and Additional Financial Information

In addition to reporting financial results in accordance with generally accepted accounting principles, or GAAP, Astronics provides Adjusted Non-GAAP information as additional information for its operating results. References to Adjusted Non-GAAP information are to non-GAAP financial measures. These measures are not required by, in accordance with, or an alternative for, GAAP and may be different from non-GAAP financial measures used by other companies. Astronics management uses these measures for reviewing the financial results of Astronics for budget planning purposes and for making operational and financial decisions. Management believes that providing these non-GAAP financial measures to investors, as a supplement to GAAP financial measures, help investors evaluate Astronics core operating and financial performance and business trends consistent with how management evaluates such performance and trends.

FINANCIAL TABLES FOLLOW

Beginning in the current year, the Company reorganized its product line structure to align with changes in internal reporting. Refer to the Supplemental Prior Period Tables within this release for prior-year recast of disaggregation of sales by product line to conform with the updated, current-period presentation. Please refer to the Company's Quarterly Report on Form 10-Q for the quarter ended April 4, 2026 for additional details.

Adjusted EBITDA is defined as net income before interest expense, income taxes, depreciation, amortization, and other adjustments. Adjusted EBITDA Margin is defined as Adjusted EBITDA divided by sales. Adjusted EBITDA and Adjusted EBITDA Margin are not measures determined in accordance with GAAP and may not be comparable with Adjusted EBITDA and Adjusted EBITDA Margin as used by other companies. Nevertheless, the Company believes that providing non-GAAP financial measures, such as Adjusted EBITDA and Adjusted EBITDA Margin, are important for investors and other readers of the Company's financial statements.

Adjusted Operating Income is defined as income from operations as reported, adjusted for certain items. Adjusted Operating Margin is defined as Adjusted Operating Income divided by sales. Adjusted Operating Income and Adjusted Operating Margin are not measures determined in accordance with GAAP and may not be comparable with Adjusted Operating Income and Adjusted Operating Margin as used by other companies. Nevertheless, the Company believes that providing non-GAAP financial measures, such as Adjusted Operating Income and Adjusted Operating Margin, are important for investors and other readers of the Company's financial statements and assists in understanding the comparison of the current periods' income from operations to the historical periods' income from operations and operating margin, as well as facilitates a more meaningful comparison of the Company's income from operations and operating margin to that of other companies.

Adjusted Net Income and Adjusted Diluted EPS are defined as net income and diluted EPS as reported, adjusted for certain items, including amortization of intangibles, and also adjusted for a normalized tax rate. Adjusted Net Income and Adjusted Diluted EPS are not measures determined in accordance with GAAP and may not be comparable with the measures used by other companies. Nevertheless, the Company believes that providing non-GAAP financial measures, such as Adjusted Net Income and Adjusted Diluted EPS, are important for investors and other readers of the Company's financial statements and assists in understanding the comparison of the current periods' net income and diluted EPS to the historical periods' net income and diluted EPS, as well as facilitates a more meaningful comparison of the Company's net income and diluted EPS to that of other companies. The Company believes that presenting Adjusted Diluted EPS provides a better understanding of its earnings power inclusive of adjusting for the non-cash amortization of intangible assets, reflecting the Company's strategy to grow through acquisitions as well as organically.

Adjusted Segment Operating Profit is defined as segment operating profit as reported, adjusted for certain items. Adjusted Segment Margin is defined as Adjusted Segment Operating Profit divided by segment sales. Adjusted Segment Operating Profit and Adjusted Segment Margin are not measures determined in accordance with GAAP and may not be comparable with Adjusted Segment Operating Profit and Adjusted Segment Margin as used by other companies. Nevertheless, the Company believes that providing non-GAAP financial measures, such as Adjusted Segment Operating Profit and Adjusted Segment Margin, are important for investors and other readers of the Company's financial statements and assists in understanding the comparison of the current periods' segment operating profit to the historical periods' segment operating profit and segment margin, as well as facilitates a more meaningful comparison of the Company's segment operating profit and segment margin to that of other companies.

Supplemental Prior Period Tables

The following tables provide a prior-year recast of the disaggregation of sales by product line by quarter for the years ending December 31, 2025 and 2024, to conform with the updated, current-period presentation.

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For more information, contact:

Company:

Nancy L. Hedges, Chief Financial Officer

Phone: (716) 805-1599

Email: invest@astronics.com

Investor Relations:

Deborah K. Pawlowski, Alliance Advisors LLC

Phone: (716) 843-3908

Email: dpawlowski@allianceadvisors.com