Allient Inc. Delivers Double-Digit Revenue Growth and Record 33.3% Gross Margin in Q3 2025, Driving Profitability and Balance Sheet Strength

BUFFALO, N.Y.--( BUSINESS WIRE)-- Allient Inc. (Nasdaq: ALNT) (“Allient” or the “Company”), a global designer and manufacturer of precision and specialty Motion, Controls and Power products and solutions for targeted industries and applications, today reported financial results for its third quarter ended September 30, 2025.

“Our results underscore the strong progress we are making. We delivered record gross margin of 33.3% and expanded operating margin by 350 basis points year-over-year on 11% revenue growth, while achieving robust cash generation and deleveraging year-to-date. Demand remained healthy across Industrial applications, particularly power quality solutions for data center infrastructure, and we continued to execute on key defense and medical applications,” commented Dick Warzala, Chairman and CEO. “At the same time, the macro backdrop remains fluid, including ongoing challenges in supply chains for components that use heavy rare earth materials. We have been proactive, broadening suppliers, qualifying alternative materials, managing inventory more dynamically, and working closely with customers, to mitigate these risks. With our Simplify to Accelerate NOW actions gaining traction, a balanced backlog, and focused investments in high-value Motion, Controls and Power solutions, we believe Allient is well positioned to drive resilient performance and profitability through varying market conditions.”

Third Quarter 2025 Results (Narrative compares with prior-year period unless otherwise noted)

Revenue increased 11%, or $13.5 million, to $138.7 million, reflecting strong Industrial market demand along with solid performance in the Company’s other target markets. Foreign currency provided a favorable impact of $2.3 million, resulting in 9% organic growth on a constant currency basis. See the attached table for a description of non-GAAP financial measures and reconciliation of revenue excluding foreign currency exchange rate fluctuations. Sequentially, revenue was down less than one percent, as second quarter results benefited from $3 million to $4 million in customer pull-ins, as customers accelerated purchases ahead of anticipated supply constraints related to components containing heavy rare earth materials. Sales to U.S. customers were 57% of total sales compared with 56% in the third quarter last year, with the balance of sales to customers primarily in Europe, Canada and Asia-Pacific.

Market Performance:

Gross margin expanded by 190 basis points year-over-year to 33.3%, driven primarily by a favorable product mix, increased volume, and operational efficiencies achieved through the Company’s Simplify to Accelerate NOW strategy. On a sequential basis, gross margin improved by 10 basis points.

Operating costs and expenses were 24.5% of revenue, representing a 160 basis point reduction compared with the same period last year. This year-over-year improvement reflects strong operating leverage and continued benefits from the Simplify to Accelerate NOW initiatives. Sequentially, operating costs and expenses as a percentage of revenue improved by 30 basis points.

As a result of the gross margin expansion and disciplined cost management, operating income increased 84% to $12.2 million, or 8.8% of revenue, compared with $6.6 million, or 5.3% of revenue, in the prior-year period. On a sequential basis, operating income grew 4%, with operating margin expanding by 40 basis points.

The effective income tax rate was 22.2% and 22.6% for the third quarter of 2025 and 2024, respectively. The Company expects its income tax rate for the full year 2025 to be approximately 21% to 23%.

Net income increased to $6.5 million, or $0.39 per diluted share, compared with $2.1 million, or $0.13 per diluted share, in the prior-year period. Sequentially, net income improved from $5.6 million, or $0.34 per diluted share. Adjusted net income, which excludes amortization of intangible assets related to acquisitions, acquisition and integration-related costs, restructuring and business realignment costs, and other non-recurring items, was $9.9 million, or $0.59 per diluted share. This compared with $5.1 million, or $0.31 per diluted share, in the third quarter of 2024 and $9.5 million, or $0.57 per diluted share, in the second quarter of 2025. See the attached tables for a description of non-GAAP financial measures and reconciliation table for Adjusted Net Income and Diluted Earnings per Share.

Earnings before interest, taxes, depreciation, amortization, stock-based compensation expense, acquisition and integration-related costs, restructuring and business realignment costs, and foreign currency gains/losses (“Adjusted EBITDA”) was $20.3 million, or 14.6% of revenue, compared with $14.4 million, or 11.5% of revenue, in the prior-year period. Sequentially, Adjusted EBITDA as a percentage of revenue was up 20 basis points. The Company believes that, when used in conjunction with measures prepared in accordance with U.S. generally accepted accounting principles, Adjusted EBITDA, which is a non-GAAP measure, helps in the understanding of its operating performance. See the attached table for a description of non-GAAP financial measures and reconciliation table for Adjusted EBITDA.

Balance Sheet and Cash Flow Review

Cash and cash equivalents were up 9% to $39.5 million compared with $36.1 million at year-end 2024. Year-to-date cash provided by operating activities increased 46% to $43.1 million from $29.5 million in the prior-year period, driven by higher net income and improved working capital.

Capital expenditures totaled $5.1 million for the first nine months, primarily supporting new customer projects. This compared with $6.9 million of capital expenditures in the same period last year. The Company expects 2025 capital expenditures to range between $6.5 million to $8.5 million.

Total debt declined to $190.3 million, a reduction of $12.0 million from the second quarter and $33.9 million since year-end 2024. Debt, net of cash, decreased to $150.8 million, representing a net debt to capitalization ratio of 33.9%.

The Company’s leverage ratio, calculated as total net debt divided by trailing twelve months of Adjusted EBITDA, improved to 2.10x from 3.01x at December 31, 2024. The bank leverage ratio, as defined in the Company’s credit agreement and which excludes foreign cash among other adjustments, was 2.59x at quarter-end, well within covenant compliance. See the attached table for a description of non-GAAP financial measures and reconciliation table for Total Net Debt and Leverage Ratio.

Orders and Backlog Summary ($ in thousands)

Q3 2025

Q2 2025

Q1 2025

Q4 2024

Q3 2024

Orders

133,119

135,032

137,622

117,900

102,631

Backlog

230,984

236,586

237,323

230,788

238,492

Third quarter orders represented a book-to-bill ratio of 0.96, reflecting steady demand across Industrial market applications, and ongoing strength in Aerospace & Defense, despite the cancellation of the M10 Booker Tank program by the U.S. Army, which had a direct impact on Allient. Foreign currency translation favorably impacted orders by $2.5 million compared with the prior-year period.

The majority of the backlog is expected to convert to revenue within three to nine months, consistent with the Company’s historical conversion patterns.

Conference Call and Webcast

The Company will host a conference call and webcast on Thursday, November 6, 2025, at 10:00 am ET.

During the conference call, management will review the financial and operating results and discuss Allient’s corporate strategy and outlook. A question-and-answer session will follow.

To listen to the live call, dial (412) 634-6879. In addition, the webcast and slide presentation may be found at: www.allient.com/investors.

A telephonic replay will be available from 2:00 pm ET on the day of the call through Thursday, November 20, 2025.

To listen to the archived call, dial (412) 317-6671 and enter replay pin number 10202880 or access the webcast replay via the Company’s website. A transcript will also be posted to the website once available.

About Allient Inc.

Allient (Nasdaq: ALNT) is a global engineering and manufacturing enterprise that develops solutions to drive the future of market-moving industries, including medical, life sciences, aerospace and defense, industrial automation, robotics, semi-conductor, transportation, agriculture, construction and facility infrastructure. A family of globally responsible companies, Allient takes a One-Team approach to “Connect What Matters” and provides the most robust, reliable, and high-value products and systems by utilizing its core Motion, Controls, and Power technologies and platforms.

Headquartered in Buffalo, N.Y., Allient employs more than 2,500 team members around the world. To learn more, visit www.allient.com.

Safe Harbor Statement

The statements in this news release that relate to future plans, events or performance are “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements include, without limitation, any statement that may predict, forecast, indicate, or imply future results, performance, or achievements. Examples of forward-looking statements include, among others, statements the Company makes regarding expected savings from restructuring and simplifying actions, the cost of implementing such actions, operating results, expectations for the level of sales, the Company’s belief that it has sufficient liquidity to fund its business operations, and expectations with respect to the conversion of backlog to sales. Forward-looking statements are neither historical facts nor assurances of future performance. Instead, they are based only on the Company’s current beliefs, expectations and assumptions regarding the future of the Company’s business, future plans and strategies, projections, anticipated events and trends, the economy and other future conditions. Because forward-looking statements relate to the future, they are subject to inherent uncertainties, risks and changes in circumstances that are difficult to predict and many of which are outside of the Company’s control. The Company’s actual results and financial condition may differ materially from those indicated in the forward-looking statements. Therefore, you should not rely on any of these forward-looking statements. Important factors that could cause our actual results and financial condition to differ materially from those indicated in the forward-looking statements include, among others, general economic and business conditions, conditions affecting the industries served by the Company and its subsidiaries, conditions affecting the Company's customers and suppliers, competitor responses to the Company's products and services, the overall market acceptance of such products and services, the pace of bookings relative to shipments, the ability to expand into new markets and geographic regions, the success in acquiring new business, the impact of changes in income tax rates or policies, commercial activity and demand across our and our customers’ businesses, global supply chains, the prices of our securities and the achievement of our strategic objectives, the ability to attract and retain qualified personnel, the ability to successfully integrate an acquired business into our business model without substantial costs, delays, or problems, and other factors disclosed in the Company's periodic reports filed with the Securities and Exchange Commission. Any forward-looking statement speaks only as of the date on which it is made. New risks and uncertainties arise over time, and it is not possible for us to predict the occurrence of those matters or the manner in which they may affect us. The Company has no obligation or intent to release publicly any revisions to any forward looking statements, whether as a result of new information, future events, or otherwise.

FINANCIAL TABLES FOLLOW

ALLIENT INC.

CONDENSED CONSOLIDATED STATEMENTS OF INCOME

(In thousands, except per share data)

(Unaudited)

For the three months ended

For the nine months ended

September 30,

2025

2024

2025

2024

Revenue

138,743

125,213

411,124

407,958

Cost of goods sold

92,562

85,949

275,835

280,641

Gross profit

46,181

39,264

135,289

127,317

Operating costs and expenses:

Selling

6,217

6,323

18,257

19,283

General and administrative

14,112

13,856

42,364

42,438

Engineering and development

9,687

9,056

29,185

30,416

Acquisition and integration-related costs

(201)

256

Restructuring and business realignment costs

836

479

3,457

1,948

Amortization of intangible assets

3,132

3,135

9,350

9,381

Total operating costs and expenses

34,001

32,648

102,653

103,722

Operating income

12,180

6,616

32,636

23,595

Other expense, net:

Interest expense

3,401

3,435

10,588

10,207

Other expense, net

457

468

1,964

405

Total other expense, net

3,858

3,903

12,552

10,612

Income before income taxes

8,322

2,713

20,084

12,983

Income tax provision

(1,845)

(612)

(4,433)

(2,830)

Net income

6,477

2,101

15,651

10,153

Basic earnings per share:

Earnings per share

0.39

0.13

0.94

0.61

Basic weighted average common shares

16,695

16,574

16,658

16,513

Diluted earnings per share:

Earnings per share

0.39

0.13

0.94

0.61

Diluted weighted average common shares

16,780

16,605

16,708

16,581

ALLIENT INC.

CONDENSED CONSOLIDATED BALANCE SHEETS

(In thousands, except per share data)

(Unaudited)

September 30,

December 31,

2025

2024

Assets

Current assets:

Cash and cash equivalents

39,476

36,102

Trade receivables, net of provision for credit losses of $1,177 and $1,628 at September 30, 2025 and December 31, 2024, respectively

91,718

78,774

Inventories

111,360

111,517

Prepaid expenses and other assets

15,502

11,187

Total current assets

258,056

237,580

Property, plant, and equipment, net

62,599

65,685

Deferred income taxes

8,277

9,116

Intangible assets, net

91,296

99,671

Goodwill

134,142

131,789

Operating lease assets

21,996

23,748

Other long-term assets

8,717

8,192

Total Assets

585,083

575,781

Liabilities and Stockholders’ Equity

Current liabilities:

Accounts payable

33,724

27,156

Accrued liabilities

39,302

30,221

Total current liabilities

73,026

57,377

Long-term debt

190,259

224,177

Deferred income taxes

3,338

3,642

Pension and post-retirement obligations

1,549

1,667

Operating lease liabilities

17,474

19,417

Other long-term liabilities

5,265

4,647

Total liabilities

290,911

310,927

Stockholders’ Equity:

Common stock, no par value, authorized 50,000 shares; 16,936 and 16,810 shares issued and outstanding at September 30, 2025 and December 31, 2024, respectively

113,325

111,024

Preferred stock, par value $1.00 per share, authorized 5,000 shares; no shares issued or outstanding

—

Retained earnings

191,163

177,013

Accumulated other comprehensive loss

(10,316)

(23,183)

Total stockholders’ equity

294,172

264,854

Total Liabilities and Stockholders’ Equity

585,083

575,781

ALLIENT INC.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(In thousands)

(Unaudited)

For the nine months ended

September 30,

2025

2024

Cash Flows From Operating Activities:

Net income

15,651

10,153

Adjustments to reconcile net income to net cash provided by operating activities

Depreciation and amortization

19,105

19,248

Deferred income taxes

287

(45)

Stock-based compensation expense

2,590

3,382

Debt issue cost amortization recorded in interest expense

485

379

Other

3,729

3,248

Changes in operating assets and liabilities, net of acquisitions:

Trade receivables

(10,679)

6,012

Inventories

1,863

5,500

Prepaid expenses and other assets

(3,372)

142

Accounts payable

5,583

(12,259)

Accrued liabilities

7,874

(6,302)

Net cash provided by operating activities

43,116

29,458

Cash Flows From Investing Activities:

Consideration paid for acquisitions, net of cash acquired

—

(25,231)

Purchase of property and equipment

(5,090)

(6,903)

Net cash used in investing activities

(5,090)

(32,134)

Cash Flows From Financing Activities:

Proceeds from issuance of long-term debt

—

76,898

Principal payments of long-term debt and finance lease obligations

(34,334)

(61,333)

Payment of contingent consideration

—

(2,450)

Payment of debt issuance costs

(41)

(2,329)

Dividends paid to stockholders

(1,500)

(1,505)

Tax withholdings related to net share settlements of restricted stock

(1,121)

(1,596)

Net cash (used in) provided by financing activities

(36,997)

7,685

Effect of foreign exchange rate changes on cash

2,345

208

Net increase in cash and cash equivalents

3,374

5,217

Cash and cash equivalents at beginning of period

36,102

31,901

Cash and cash equivalents at end of period

39,476

37,118

ALLIENT INC.

Reconciliation of Non-GAAP Financial Measures

(In thousands, Unaudited)

In addition to reporting revenue and net income, which are U.S. generally accepted accounting principle (“GAAP”) measures, the Company presents Revenue excluding foreign currency exchange rate impacts, Organic revenue, EBITDA and Adjusted EBITDA (earnings before interest, income taxes, depreciation and amortization, stock-based compensation expense, acquisition and integration-related costs, restructuring and business realignment costs, and foreign currency gains/losses), total net debt, and leverage ratio, which are non-GAAP measures.

The Company believes that Revenue excluding foreign currency exchange rate impacts is a useful measure in analyzing organic sales results. The Company excludes the effect of currency translation from revenue for this measure because currency translation is not fully under management’s control, is subject to volatility and can obscure underlying business trends. The portion of revenue attributable to currency translation is calculated as the difference between the current period revenue and the current period revenue after applying foreign exchange rates from the prior period. Organic revenue is reported revenues adjusted for the impact of foreign currency and the revenue contribution from acquisitions.

The Company believes EBITDA and Adjusted EBITDA are often a useful measure of a Company’s operating performance and are a significant basis used by the Company’s management to evaluate and compare the core operating performance of its business from period to period by removing the impact of the capital structure (interest), tangible and intangible asset base (depreciation and amortization), taxes, stock-based compensation expense, acquisition and integration-related costs, restructuring and business realignment costs, foreign currency gains/losses on short-term assets and liabilities, and other items that are not indicative of the Company’s core operating performance. EBITDA and Adjusted EBITDA do not represent and should not be considered as an alternative to net income, operating income, net cash provided by operating activities or any other measure for determining operating performance or liquidity that is calculated in accordance with GAAP. In addition to the performance measures identified above, we believe that total net debt and leverage ratio provide meaningful measures of liquidity and a useful basis for assessing our ability to fund our activities, including the financing of acquisitions and debt repayments. Total net debt is calculated as total debt less cash and cash equivalents. Leverage ratio is total net debt divided by adjusted EBITDA for the trailing twelve months.

The Company’s calculation of Revenue excluding foreign currency exchange impacts for the three and nine months ended September 30, 2025 is as follows:

Three months ended

Nine months ended

September 30, 2025

Revenue as reported

138,743

411,124

Foreign currency impact

(2,259)

(2,822)

Revenue excluding foreign currency exchange impacts

136,484

408,302

The Company’s calculation of organic revenue for the three and nine months ended September 30, 2025 is as follows:

Three months ended

Nine months ended

September 30, 2025

Revenue change over prior year

10.8

0.8

Less: Impact of acquisitions and foreign currency

1.8

1.0

Organic revenue

9.0

(0.2)

ALLIENT INC.

Reconciliation of Non-GAAP Financial Measures

(In thousands, Unaudited)

The Company’s calculation of Adjusted EBITDA for the three and nine months ended September 30, 2025 and 2024 is as follows:

Three months ended

Nine months ended

September 30,

2025

2024

2025

2024

Net income as reported

6,477

2,101

15,651

10,153

Interest expense

3,401

3,435

10,588

10,207

Provision for income tax

1,845

612

4,433

2,830

Depreciation and amortization

6,423

6,447

19,105

19,248

EBITDA

18,146

12,595

49,777

42,438

Stock-based compensation expense

835

1,098

2,590

3,382

Acquisition and integration-related costs (1)

(201)

256

Restructuring and business realignment costs

836

479

3457

1,948

Foreign currency loss/(gain)

465

461

1,974

380

Adjusted EBITDA

20,299

14,432

57,838

48,404

(1)

The Company’s calculation of Total Net Debt and Leverage Ratio as of September 30, 2025 and December 31, 2024 is as follows:

September 30, 2025

December 31, 2024

Total debt

190,259

224,177

Less: cash and cash equivalents

39,476

36,102

Total net debt (Non-GAAP)

150,783

188,075

TTM Adjusted EBITDA (Non-GAAP)

71,958

62,525

Leverage Ratio (Non-GAAP)

2.10

3.01

ALLIENT INC.

Reconciliation of GAAP Net Income and Diluted Earnings per Share to

Non-GAAP Adjusted Net Income and Adjusted Diluted Earnings per Share

(In thousands, except per share data)

(Unaudited)

The Company’s calculation of Adjusted net income and Adjusted diluted earnings per share for the three and nine months ended September 30, 2025 and 2024 is as follows:

For the three months ended

September 30,

Per diluted

2025

2024

Net income as reported

6,477

0.39

2,101

0.13

Non-GAAP adjustments, net of tax (1)

Amortization of intangible assets – net

2,399

0.14

2,401

0.14

Foreign currency loss – net

356

0.02

353

0.02

Acquisition and integration-related costs – net (2)

—

(154)

(0.01)

Restructuring and business realignment costs – net

640

0.04

367

0.02

Non-GAAP adjusted net income and adjusted diluted earnings per share

9,885

0.59

5,068

0.31

Weighted average diluted shares outstanding

16,780

16,605

(1)

Applies a blended federal, state, and foreign tax rate of 23% applicable to the non-GAAP adjustments.

(2)

Includes a Q3 2024 fair value measurement gross reduction of $270 due to acquisition-related contingent consideration.

For the nine months ended

September 30,

Per diluted

2025

2024

Net income as reported

15,651

0.94

10,153

0.61

Non-GAAP adjustments, net of tax (1)

Amortization of intangible assets – net

7,162

0.43

7,339

0.44

Foreign currency loss / (gain) – net

1,512

0.09

291

0.02

Acquisition and integration-related costs – net (2)

—

196

0.01

Restructuring and business realignment costs – net

2,647

0.16

1,492

0.09

Non-GAAP adjusted net income and adjusted diluted earnings per share

27,003

1.62

19,471

1.17

Weighted average diluted shares outstanding

16,708

16,581

(1)

Applies a blended federal, state, and foreign tax rate of 23% applicable to the non-GAAP adjustments.

(2)

Includes a Q3 2024 fair value measurement gross reduction of $270 due to acquisition-related contingent consideration.

Adjusted net income and diluted EPS are defined as net income as reported, adjusted for certain items, including amortization of intangible assets and unusual non-recurring items. Adjusted net income and diluted EPS are not a measure determined in accordance with GAAP in the United States, and may not be comparable to the measure as used by other companies. Nevertheless, the Company believes that providing non-GAAP information, such as adjusted net income and diluted EPS are important for investors and other readers of the Company’s financial statements and assists in understanding the comparison of the current quarter’s and current year’s net income and diluted EPS to the historical periods’ net income and diluted EPS.