TITAN INTERNATIONAL INC

Previous wording

Management's discussion and analysis of financial condition and results of operations (MD&A) is designed to provide a reader of the financial statements included in this quarterly report with a narrative from the perspective of the management of Titan International, Inc. (Titan or the Company) on Titan's financial condition, results of operations, liquidity, and other factors that may affect the Company's future results. The MD&A in this quarterly report should be read in conjunction with the condensed consolidated financial statements and other financial information included elsewhere in this quarterly report and the MD&A and audited consolidated financial statements and related notes in the Company's Annual Report on Form 10-K for the year ended December 31, 2024, filed with the SEC on February 27, 2025(the 2024 Form 10-K).

Current wording

Management's discussion and analysis of financial condition and results of operations (MD&A) is designed to provide a reader of the financial statements included in this quarterly report with a narrative from the perspective of the management of Titan International, Inc. (Titan, the Company or we) on our financial condition, results of operations, liquidity, and other factors that may affect our future results. The MD&A in this quarterly report should be read in conjunction with the condensed consolidated financial statements and other financial information included elsewhere in this quarterly report and the MD&A and audited consolidated financial statements and related notes in the Company's Annual Report on Form 10-K for the year ended December 31, 2024, filed with the SEC on February 27, 2025(the 2024 Form 10-K).

Previous wording

On February 29, 2024, the Company acquired 100% of the equity interests of Carlstar, whose products are also known as Titan Specialty. The results of Carlstar's operations have been included in our consolidated financial statements since February 29, 2024. Total acquisition-related costs related to the Carlstar/Titan Specialty acquisition for the three months ended March 31, 2024 were $6.2 million.

Current wording

On February 29, 2024, we acquired 100% of the equity interests of Carlstar, whose products are also known as Titan Specialty. The results of Titan Specialty's operations have been included in our consolidated financial statements since February 29, 2024. Total acquisition-related costs for the Carlstar/Titan Specialty acquisition for the three and six months ended June 30, 2024 were $0.0 million and $6.2 million, respectively.

Previous wording

This Form 10-Q contains forward-looking statements, which are covered by the safe harbor for "forward-looking statements" provided by the Private Securities Litigation Reform Act of 1995. Readers can identify these statements by the fact that they do not relate strictly to historical or current facts. Titan International, Inc. (together with its subsidiaries “Titan” or the “Company”) has tried to identify forward-looking statements in this report by using words such as “anticipates,” “estimates,” “expects,” “intends,” “plans,” and “believes,” and similar expressions or future or conditional verbs such as “will,” “should,” “would,” “may,” and “could.” These forward-looking statements include, among other items, statements relating to the following:

Current wording

This Form 10-Q contains forward-looking statements, which are covered by the safe harbor for "forward-looking statements" provided by the Private Securities Litigation Reform Act of 1995. Readers can identify these statements by the fact that they do not relate strictly to historical or current facts. Titan has tried to identify forward-looking statements in this report by using words such as “anticipates,” “estimates,” “expects,” “intends,” “plans,” and “believes,” and similar expressions or future or conditional verbs such as “will,” “should,” “would,” “may,” and “could.” These forward-looking statements include, among other items, statements relating to the following:

Previous wording

•the effect of the geopolitical instability resulting from the military conflicts between Russia and Ukraine on our Russian and global operations, and between Israel and Hamas on our global operations;

Current wording

•the effect of the geopolitical instability resulting from the military conflicts between Russia and Ukraine on our Russian and global operations, and between Israel and Hamas and the Middle East on our global operations;

Previous wording

•risks related to the termination of the standstill under that agreement following the Company’s 2025 annual meeting of stockholders, as well as the impact of any sales of the Company’s shares held by affiliates of American Industrial Partners pursuant to the Form S-3 registration statement filed with and declared effective by the Securities and Exchange Commission (the SEC) in December 2024;

Current wording

•risks related to the recent termination of the standstill provisions of the Shareholder Agreement with American Industrial Partners following the Company’s 2025 annual meeting of stockholders, as well as the impact of any sales of the Company’s shares currently held by affiliates of American Industrial Partners pursuant to the Form S-3 registration statement filed with and declared effective by the Securities and Exchange Commission (the SEC) in December 2024;

Previous wording

Any changes in these factors could lead to significantly different results. Any assumptions that are inaccurate or do not prove to be correct could have a material adverse effect on the Company’s ability to achieve the results as indicated in the forward-looking statements. Forward-looking statements speak only as of the date of this report. The Company undertakes no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events, or otherwise. In light of these risks and uncertainties, there can be no assurance that the forward-looking information and assumptions contained in this report will in fact transpire. The reader should not place undue reliance on the forward-looking statements included in this report or that may be made elsewhere from time to time by the Company, or on its behalf. All forward-looking statements attributable to Titan are expressly qualified by these cautionary statements.

Current wording

Any changes in these factors could lead to significantly different results than those currently expected by Titan. Any assumptions that are inaccurate or do not prove to be correct could have a material adverse effect on the Company’s ability to achieve the results as indicated in the forward-looking statements. Forward-looking statements speak only as of the date of this report. The Company undertakes no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events, or otherwise. In light of these risks and uncertainties, there can be no assurance that the forward-looking information and assumptions contained in this report will in fact transpire. The reader should not place undue reliance on the forward-looking statements included in this report or that may be made elsewhere from time to time by the Company, or on its behalf. All forward-looking statements attributable to Titan are expressly qualified by these cautionary statements.

Previous wording

Earthmoving/Construction Segment: The Company manufactures wheels, tires, and undercarriage systems and components for various types of OTR earthmoving, mining, military, construction, and forestry equipment, including skid steers, aerial lifts, cranes, graders and levelers, scrapers, self-propelled shovel loaders, articulated dump trucks, load transporters, haul trucks, backhoe loaders, crawler tractors, lattice cranes, shovels, and hydraulic excavators. The Company provides OEM and aftermarket customers with a broad range of earthmoving/construction wheels ranging in diameter from 15 to 63 inches and in weight from 125 pounds to 7,000 pounds. The 63-inch diameter wheel is the largest manufactured for the global earthmoving/construction market. Titan’s earthmoving/construction tires are offered in the Titan brand and range from approximately three feet to approximately 13 feet in outside diameter and in weight from 50 pounds to 12,500 pounds. Earthmoving/construction tires offered by Titan serve virtually every off-road application in the industry with some of the highest load requirements in the most severe applications. The Company also offers the added value of wheel and tire assembly for certain applications in the earthmoving/construction segment.

Current wording

Earthmoving/Construction Segment: The Company manufactures wheels, tires, and undercarriage systems and components for various types of Off-The-Road (or OTR) earthmoving, mining, military, construction, and forestry equipment, including skid steers, aerial lifts, cranes, graders and levelers, scrapers, self-propelled shovel loaders, articulated dump trucks, load transporters, haul trucks, backhoe loaders, crawler tractors, lattice cranes, shovels, and hydraulic excavators. The Company provides OEM and aftermarket customers with a broad range of earthmoving/construction wheels ranging in diameter from 15 to 63 inches and in weight from 125 pounds to 7,000 pounds. The 63-inch diameter wheel is the largest manufactured for the global earthmoving/construction market. Titan’s earthmoving/construction tires are offered in the Titan brand and range from approximately three feet to approximately 13 feet in outside diameter and in weight from 50 pounds to 12,500 pounds. Earthmoving/construction tires offered by Titan serve virtually every off-road application in the industry with some of the highest load requirements in the most severe applications. The Company also offers the added value of wheel and tire assembly for certain applications in the earthmoving/construction segment.

Previous wording

Consumer Segment: In February 2024, Titan acquired Carlstar, also known as Titan Specialty, which is a global manufacturer and distributor of wheels and tires for a variety of end-market verticals including outdoor power equipment, power sports, and high speed trailers. Titan Specialty is primarily concentrated in the consumer segment, but also manufactures and sells small to midsize agricultural tires. Products are offered in Carlstar, ITP, Black Rock, and Unique brands with portfolios commensurate to supporting these markets. The Company also offers the added value of wheel and tire assemblies for many of these products to select OEM customers.

Current wording

Consumer Segment: In February 2024, Titan acquired Carlstar, also now known as Titan Specialty, which is a global manufacturer and distributor of wheels and tires for a variety of end-market verticals including outdoor power equipment, power sports, and high speed trailers. Titan Specialty is primarily concentrated in the consumer segment, but also manufactures and sells small to midsize agricultural tires. Products are offered in Carlstar, ITP, Black Rock, and Unique brands with portfolios commensurate to supporting these markets. The Company also offers the added value of wheel and tire assemblies for many of these products to select OEM customers.

Previous wording

Titan manufactures bias truck tires in Latin America and light truck tires in Russia. Titan also offers select products for ATVs, side-by-sides, rock climbers, and turf, and has recently expanded its offering into the lawn and garden segment with a major OE customer. This segment also includes sales that do not readily fall into the Company's other segments, such as custom rubber stock mixing sales to a variety of OEMs in tangential industries.

Current wording

Titan manufactures bias truck tires in Latin America and light truck tires in Russia. Titan also offers select products for ATVs, side-by-sides, rock climbers, and turf, and has recently expanded its offering into the lawn and garden segment with a major OEM customer. This segment also includes sales that do not readily fall into the Company's other segments, such as custom rubber stock mixing sales to a variety of OEMs in tangential industries.

Previous wording

The Company’s top customers, including global leaders in agricultural and construction equipment manufacturing, have been purchasing products from Titan or its predecessors for numerous years. Customers including AGCO Corporation, Caterpillar Inc., CNH Global N.V., Deere & Company, Hitachi, Ltd., Kubota Corporation, Liebherr, and Volvo have helped sustain Titan’s market leading position in wheel, tire, assembly, and undercarriage products.

Current wording

The Company’s top customers, including global leaders in agricultural and construction equipment manufacturing, have been purchasing products from Titan or its predecessors for numerous years. Customers including AGCO Corporation, Caterpillar

Previous wording

During recent months, agriculture-related commodity prices and farmer income have been on the rise, however, prices remain lower than historical highs. The agricultural markets in North America and Europe are currently experiencing a significant slowdown in customer demand and this is further exacerbated by the implementation of tariffs by the United States and other countries throughout the world, and responses thereto, which has created uncertainty in the global markets including impact on farmer sentiments. The agricultural markets in South America are, however, seeing early signs of a market recovery as customer demand appears to be growing. Amid the evolving global tariffs situation, Titan is in a uniquely advantaged position among its competitors, having manufacturing capabilities that are strategically located in the key markets we serve. In addition, the mid to long term global market trends point to population growth, a shift in consumer preference toward higher protein diets, and the pressures to replace an aging large equipment fleet in favor of newer and higher productivity technology, as providing encouragement that market conditions may improve to support renewed and continued demand for the Company's products in the mid to long term time horizon. The Company is hopeful that the underlying market trends mentioned above will provide future support for the mid to long term demand for the Company's products. Many more variables, including weather, volatility in the price of commodities, grain prices, the demand for used equipment, export markets, foreign currency exchange rates, interest rates, government policies, subsidies, uncertainty surrounding tariffs implemented by the United States and reciprocated by other countries, can greatly affect the Company's performance in the agricultural market in a given period.

Current wording

The agricultural market is affected by related commodity prices and farmer income, among other variables. While current commodity price levels are lower than historical highs, net farmer income is forecasted to increase, supported by an expected rise in domestic government subsidies to farmers. The agricultural markets in North America and Europe are currently experiencing a significant slowdown in customer demand and this is further exacerbated by the imposition of tariffs by the United States and other countries throughout the world, and responses thereto, which has created uncertainty in the global markets including impact on farmer sentiment. The agricultural markets in South America are, however, currently showing early signs of a market recovery as customer demand appears to be growing. Amid the evolving global tariff situation, Titan is in a uniquely advantaged position among its competitors, having manufacturing capabilities that are strategically located in the key markets we serve. In addition, the mid to long term global market trends point to population growth, a shift in consumer preference toward higher protein diets, and the pressures to replace an aging large equipment fleet in favor of newer and higher productivity technology, underlying Titan's belief that market conditions may improve to support renewed and continued demand for the Company's products in the mid to long term time horizon. The Company is hopeful that the underlying market trends mentioned above will provide future support for the mid to long-term demand for the Company's products. However, many variables, including weather, volatility in the price of commodities, grain prices, the demand for used equipment, export markets, foreign currency exchange rates, interest rates, government policies, subsidies, uncertainty surrounding tariffs imposed by the United States and reciprocated by other countries, can greatly affect the Company's performance in the agricultural market in a given period.

Previous wording

The earthmoving/construction segment is affected by many variables, including commodity prices, uncertainty surrounding the imposition of tariffs as mentioned above, road construction, infrastructure, government appropriations, housing starts, and other macroeconomic drivers. The construction market is primarily driven by country-specific GDP and the need for infrastructure developments. The earthmoving/construction markets are currently experiencing a slowdown in OEM demand, but we expect the market to stabilize over the mid to long term given the level of mining capital budgets and forecasted GDP growth. The mining industry has experienced growth given the increased demand in natural resources industries. Mineral commodity prices are at relatively high levels, which also supports the forecasted mid- to long-term growth.

Current wording

The earthmoving/construction segment is affected by many variables, including commodity prices, uncertainty surrounding the imposition of tariffs as mentioned above, road construction, infrastructure, government appropriations, housing starts, and other macroeconomic drivers. The construction market is primarily driven by country-specific GDP and the need for infrastructure developments. The earthmoving/construction markets are currently experiencing a slowdown in OEM demand, but we expect the market to stabilize over the mid to long term given the level of mining capital budgets and forecasted GDP growth in many of the countries in which Titan's earthmoving/construction products are sold. The mining industry has experienced growth given the increased demand in natural resources industries. Mineral commodity prices are at relatively high levels, which also supports the forecasted mid- to long-term growth. However, as noted above, numerous variables can affect the Company's sales of earthmoving/construction products in any given period.

Previous wording

The consumer market consists of several distinct product lines within different regions. These products include specialty tires and products under several leading brands, including Carlstar, ITP and Marastar brands within powersports, outdoor power equipment and high-speed trailers. The consumer market also includes light truck tires sold into Latin America and other specialty products, including custom mixing of rubber stock, and train brakes. Some aspects of the consumer market are experiencing a slowdown, particularly in the Americas. The consumer segment pace of growth can vary from period to period and is affected by many macroeconomic variables including but not limited to inflationary impacts, consumer spending, interest rates, government policies, and uncertainty surrounding tariffs mentioned above. Titan has a manufacturing facility in China and is actively assessing the evolving retaliatory tariff situation and will make timely decisions on supply chain and production plans, which may include re-sourcing products to its factories in the United States or to other third party suppliers in countries with less tariff impacts. As previously stated, Titan’s ownership of manufacturing capabilities that are strategically located in key markets we serve, puts the company in a uniquely advantaged position.

Current wording

The consumer market consists of several distinct product lines within different regions. These products include specialty tires and products under several leading brands, including Carlstar, ITP and Marastar brands within powersports, outdoor power equipment and high-speed trailers. The consumer market also includes light truck tires sold into Latin America and other specialty products, including custom mixing of rubber stock, and train brakes. Some aspects of the consumer market are presently experiencing a slowdown, particularly in the Americas. The consumer segment pace of growth can vary from period to period and is affected by many macroeconomic variables including but not limited to inflationary impacts, consumer spending, interest rates, government policies, and uncertainty surrounding tariffs mentioned above. Titan has a manufacturing facility in China and is actively assessing the evolving retaliatory tariff situation, with a view to making timely decisions on supply chain and production plans, which may include re-sourcing products to its factories in the United States or to other third party suppliers in countries with less tariff impacts. As previously stated, we believe that our ownership of manufacturing capabilities that are strategically located in key markets we serve, puts us in a uniquely advantaged position to allow us to respond to some of the challenges presented by the current tariff situation.

Previous wording

Gross profit for the three months ended March 31, 2025 was $68.6 million, or 14.0% of net sales, compared to $77.4 million, or 16.0% of net sales, for the three months ended March 31, 2024. The changes in gross profit and gross margin were primarily due to significantly lower volume that impacted fixed cost leverage across the global production facilities, and inflationary costs impacts.

Current wording

Gross profit for the three months ended June 30, 2025 was $69.3 million, or 15.0% of net sales, compared to $80.4 million, or 15.1% of net sales, for the three months ended June 30, 2024. The change in gross profit and gross margin were primarily attributable to lower sales volumes, which reduced fixed cost absorption across the Company’s manufacturing facilities in North America and Europe.

Previous wording

Acquisition related expenses for the three months ended March 31, 2024 were $6.2 million, associated with the one-time transaction costs for Titan Specialty.

Current wording

Acquisition related expenses for the three and six months ended June 30, 2024 were $0.0 million and $6.2 million, respectively, associated with the one-time transaction costs for the acquisition of Titan Specialty.

Previous wording

Research and development (R&D) expenses for the three months ended March 31, 2025 were $4.5 million, or 0.9% of net sales, compared to $3.7 million, or 0.8% of net sales, for the comparable period in 2024. R&D spending reflects initiatives to improve product designs and an ongoing focus on innovation and quality.

Current wording

Research and development (R&D) expenses for the three months ended June 30, 2025 were $4.3 million, or 0.9% of net sales, compared to $4.2 million, or 0.8% of net sales, for the comparable period in 2024. Research and development (R&D) expenses for the six months ended June 30, 2025 were $8.9 million, or 0.9% of net sales, compared to $7.9 million, or 0.8% of net sales, for the comparable period in 2024. R&D spending reflects initiatives to improve product designs and an ongoing focus on innovation and quality.

Previous wording

The Company has trademark license agreements with The Goodyear Tire & Rubber Company to manufacture and sell certain farm, ATV and truck tires under the Goodyear brand. These agreements cover sales in North America, Latin America, Europe, the Middle East, Africa, Russia, other Commonwealth of Independent States countries, Australia, and New Zealand. The farm and ATV agreement is scheduled to expire in 2029 with annual renewal options following the initial term. The truck tires royalty agreement expires December 31, 2025. The Company intends to renew the royalty agreement prior to its expiration. The Company also has a trademark license agreement with Carlisle Companies, Inc. to manufacture and sell certain tires under the Carlisle® brand. This trademark license agreement is scheduled to expire in 2033. Royalty expenses for the three months ended March 31, 2025 were $2.4 million, or 0.5% of net sales, compared to $3.0 million, or 0.6% of net sales, for the three months ended March 31, 2024.

Current wording

The Company has trademark license agreements with The Goodyear Tire & Rubber Company to manufacture and sell certain farm, ATV and truck tires under the Goodyear brand. These agreements cover sales in North America, Latin America, Europe, the Middle East, Africa, Russia, other Commonwealth of Independent States countries, Australia, and New Zealand. The farm and ATV agreement is scheduled to expire in 2029 with annual renewal options following the initial term. The truck tires royalty agreement expires October 30, 2027. The Company also has a trademark license agreement with Carlisle Companies, Inc. to manufacture and sell certain tires under the Carlisle® brand. This trademark license agreement is scheduled to expire in 2033. Royalty expenses for the three months ended June 30, 2025 were $2.4 million, or 0.5% of net sales, compared to $2.3 million, or 0.4% of net sales, for the three months ended June 30, 2024. Royalty expenses for the six months ended June 30, 2025 were $4.9 million, or 0.5% of net sales, compared to $5.3 million, or 0.5% of net sales, for the six months ended June 30, 2024.

Previous wording

Income from operations for the three months ended March 31, 2025 was $11.8 million, compared to income from operations of $25.1 million for the three months ended March 31, 2024. The change in income from operations for the three months ended March 31, 2025 as compared to the prior year periods was primarily due to lower gross profit and the net result of the items previously discussed.

Current wording

Income from operations for the six months ended June 30, 2025 was $22.0 million, compared to income from operations of $47.4 million for the six months ended June 30, 2024. The reduction in income from operations for the six months ended June 30, 2025 as compared to the prior year period was primarily attributable to lower gross profit and the net impact of the previously discussed items.

Previous wording

Interest expense was $9.5 million and $8.4 million for the three months ended March 31, 2025 and 2024. The increase in interest expense was primarily attributable to higher borrowing associated with a new credit facility, which was used for the Titan Specialty acquisition in February 2024 and the MHR Repurchase in October 2024.

Current wording

Interest expense was $19.2 million and $18.1 million for the six months ended June 30, 2025 and 2024, respectively. The year-over-year increase was primarily driven by higher borrowing associated with a new credit facility, which was utilized to finance the Titan Specialty acquisition in February 2024 and the repurchase of shares of the Company's common stock from entities affiliated with MHR Fund Management LLC in October 2024.

Previous wording

Interest income was $2.2 million and $2.9 million for the three months ended March 31, 2025 and 2024, respectively. The decline in interest income for the three-month period was primarily due to reduced short-term financial investments in Brazil, and Argentina.

Current wording

Interest income was $4.7 million and $5.4 million for the six months ended June 30, 2025 and 2024, respectively. The year-over-year decline was primarily due to a reduction in short-term financial investments in Brazil and Argentina.

Previous wording

Foreign exchange loss was $1.4 million for the three months ended March 31, 2025, compared to a loss of $0.3 million for the three months ended March 31, 2024. The change in foreign exchange (loss) gain during the three months ended on March 31, 2025, as compared to the prior year period, was attributable to the unfavorable impact of the translation of intercompany balances at certain foreign subsidiaries, which are denominated in local currencies rather than the reporting currency, which is the United States dollar. Since these intercompany balances are expected to be settled at some point in the future, they are adjusted each reporting period to reflect the current exchange rates.

Current wording

Foreign exchange loss was $3.0 million for the three months ended June 30, 2025, compared to a gain of $0.5 million for the three months ended June 30, 2024. The change in foreign exchange (loss) gain was primarily driven by unfavorable translation of intercompany balances at certain foreign subsidiaries. These balances are denominated in local currencies rather than the Company’s reporting currency, the U.S. dollar, and are remeasured each reporting period based on current exchange rates, as they are expected to be settled in the future.

Previous wording

The Company recorded income tax expense of $4.2 million and $9.7 million for the three months ended March 31, 2025 and 2024, respectively. The Company's effective income tax rate was 99.5% and 49.4% for the three months ended March 31, 2025 and 2024, respectively. For the three months ended March 31, 2025 and 2024, the income tax expense differed each period due to an overall decrease in pre-tax income.

Current wording

The Company recorded income tax expense of $4.7 million and $15.5 million for the three months ended June 30, 2025 and 2024, respectively. For the six months ended June 30, 2025 and 2024, the Company recorded income tax expense of $8.9 million and $25.2 million, respectively. The Company's effective income tax rate was 431.6% and 81.9% for the three months ended June 30, 2025 and 2024, respectively, and 167.1% and 65.3% for the six months ended June 30, 2025 and 2024, respectively. For the six months ended ended June 30, 2025 and 2024, the income tax expense differed each period due to an overall decrease in pre-tax income.

Previous wording

Net income for the three months ended March 31, 2025 was $0.0 million, compared to net income of $10.0 million in the comparable period of 2024. For the three months ended March 31, 2025 and 2024, basic (loss) earnings per share were $(0.01) and $0.14, respectively, and diluted (loss) earnings per share were $(0.01) and $0.14, respectively. The Company's net income and (loss) earnings per share changes were due to the items previously discussed.

Current wording

Net loss for the six months ended June 30, 2025 was $3.6 million, compared to net income of $13.4 million in the comparable period of 2024. For the six months ended June 30, 2025 and 2024, basic and diluted loss per share was $(0.08), compared to basic and diluted earnings per share of $0.16 in the prior-year period. The Company's net (loss) income and (loss) earnings per share changes were primarily attributable to the items previously discussed.

Previous wording

Net sales in the agricultural segment were $197.7 million for the three months ended March 31, 2025, as compared to $239.7 million for the comparable period in 2024. The net sales change was primarily attributable to a significant reduction in global demand for agricultural equipment, particularly in North America and Europe which stemmed from lower farm income, higher financing costs, and actions taken by OEM customers to reduce elevated inventory at their retail channels, among other current economic impacts. Additionally, an unfavorable foreign currency translation impact of 4.2% further contributed to the change in net sales, mainly due to the weakening Brazilian real and Turkish lira.

Current wording

Net sales in the agricultural segment were $193.2 million for the three months ended June 30, 2025, as compared to $216.3 million for the comparable period in 2024. The net sales change was primarily driven by a significant reduction in global demand for agricultural equipment, particularly in North America and Europe, due to lower farm income, higher financing costs, and inventory reduction initiatives by OEM customers. Additionally, unfavorable foreign currency translation, mainly from the weakening Brazilian real and Turkish lira, negatively impacted net sales by approximately 1.8%. These declines were partially offset by favorable price and product mix, reflecting higher raw material and input costs.

Previous wording

Income from operations in the Company's agricultural segment was $9.4 million for the three months ended March 31, 2025, as compared to income of $24.0 million for the three months ended March 31, 2024. The overall change in income from operations was primarily due to the lower gross profit resulting from the decrease in net sales.

Current wording

Income from operations in the Company's agricultural segment was $11.5 million for the three months ended June 30, 2025, as compared to income of $15.8 million for the three months ended June 30, 2024. The overall change in income from operations was primarily due to the lower gross profit.

Previous wording

The Company's earthmoving/construction segment income from operations was $1.7 million for the three months ended March 31, 2025, as compared to $8.8 million for the three months ended March 31, 2024. The change was a result of lower sales volume impacting gross margins and inflationary costs.

Current wording

The Company's earthmoving/construction segment income from operations was $3.0 million for the three months ended June 30, 2025, as compared to $7.0 million for the three months ended June 30, 2024. The change was a result of lower sales volume impacting gross profit.

Previous wording

Consumer segment net sales were $149.7 million for the three months ended March 31, 2025, as compared to $77.3 million for the three months ended March 31, 2024. This increase was mainly driven by the favorable effects of the Titan Specialty acquisition, although it was partially offset by lower sales volumes in the Americas due to challenging market conditions, particularly with OEM's from the current economic conditions, along with a 2.6% negative impact from foreign currency, primarily due to the weakening Brazilian real.

Current wording

Consumer segment net sales were $264.9 million for the six months ended June 30, 2025, as compared to $227.6 million for the six months ended June 30, 2024. This increase was mainly driven by the two additional months of sales of the Titan Specialty acquisition when compared with prior year, along with favorable price and product mix. The increase was partially offset by lower volumes in the Americas region of the legacy Titan business due to continued market softness and a 0.9% negative impact from foreign currency translation.

Previous wording

Gross profit from the consumer segment was $29.3 million for the three months ended March 31, 2025, as compared to $13.8 million for the three months ended March 31, 2024. The increase in gross profit and margin was influenced by the Titan Specialty acquisition, particularly its aftermarket presence.

Current wording

Gross profit from the consumer segment was $52.8 million for the six months ended June 30, 2025, as compared to $40.6 million for the six months ended June 30, 2024. The increase in gross profit was largely attributable to the Titan Specialty acquisition, particularly its strong aftermarket presence, which contributed to improved margins.

Previous wording

Consumer segment income from operations was $8.8 million for the three months ended March 31, 2025, as compared to income of $5.1 million for the three months ended March 31, 2024. The increase was driven by the higher gross profit attributable to the factors mentioned above.

Current wording

Consumer segment income from operations was $12.0 million for the six months ended June 30, 2025, as compared to income of $11.6 million for the six months ended June 30, 2024. The increase was driven by the higher gross profit, as discussed above.

Previous wording

Income from operations on a segment basis did not include unallocated costs of $8.1 million for the three months ended March 31, 2025, as compared to $12.9 million for the three months ended March 31, 2024.

Current wording

Income from operations on a segment basis did not include unallocated corporate expenses of $7.5 million and $15.6 million for the three and six months ended June 30, 2025, respectively, as compared to $6.9 million and $19.8 million for the three and six months ended June 30, 2024, respectively.

Previous wording

Unallocated expenses are primarily comprised of corporate selling, general and administrative expenses. The change in corporate and unallocated expenses for the three months ended March 31, 2025 as compared to the prior year period was primarily due to transaction costs of $6.2 million related to the Titan Specialty acquisition in the first quarter of 2024.

Current wording

Unallocated expenses primarily consist of corporate-level selling, general, and administrative (SG&A) costs. The increase in unallocated expenses for the three months ended June 30, 2025, was mainly driven by higher SG&A costs, particularly increased professional service fees associated with domestic system implementation. The year-over-year decrease in unallocated expenses for the six-month period was primarily due to $6.2 million in transaction-related costs incurred in the first quarter of 2024 in connection with the Titan Specialty acquisition, which did not recur in 2025.

Previous wording

As of March 31, 2025, the Company reported $174.4 million of cash, which decreased as compared to the December 31, 2024 balance of $196.0 million, due to the net effect of the following items:

Current wording

As of June 30, 2025, the Company reported $184.7 million of cash, which decreased as compared to the December 31, 2024 balance of $196.0 million, due to the net effect of the following items:

Previous wording

During the first three months of 2025, cash flows used for operating activities was $38.6 million. This was primarily due to an increase in working capital, partially offset by non-cash adjustments for depreciation and amortization expenses totaling $15.9 million. The rise in accounts receivable was attributed to seasonality, as sales increased during the first quarter of 2025 compared to the last quarter of 2024 by $107.1 million. As a result of the increased operating activity during the first quarter, accounts payable also increased over the last quarter of 2024, as well. Inventory increased by a smaller proportion as the company continued to manage its inventory levels to support business needs.

Current wording

During the first six months of 2025, cash flows used for operating activities was $24.3 million. This was primarily due to an increase in working capital, partially offset by non-cash adjustments for depreciation and amortization expenses totaling $32.5 million. The rise in accounts receivable was attributable to seasonality, as sales increased by $77.3 million during the second quarter of 2025 compared to the last quarter of 2024. As a result of the increased operating activity during the second quarter, accounts payable also increased over the last quarter of 2024, as well. Inventory also increased as we continued to manage our inventory levels to support the increase that was due to seasonal demand.

Previous wording

Operating cash flows decreased by $40.6 million when comparing the first three months of 2025 to the comparable period in 2024. This decline was mainly due to lower net income and the impact of increased investment in working capital to support the increased operating activity from the prior quarter due to seasonality. Key factors contributing to the working capital increase was a $54.0 million increase in accounts receivable, which was partially offset by $26.0 million increase in accounts payable.

Current wording

Operating cash flows decreased by $97.1 million when comparing the first six months of 2025 to the comparable period in 2024. This decline was mainly due to lower net income and the impact of increased investment in working capital to support the increased operating activity. Key factors contributing to the working capital increase was a $52.5 million increase in accounts receivable, and a $47.9 million increase in inventory, which were partially offset by a $27.0 million increase in accounts payable.

Previous wording

Cash conversion cycle increased by 2 day when comparing March 31, 2025 to March 31, 2024. This increase was primarily driven by increased operating activity during the three months ended March 31, 2025, compared to the corresponding period in 2024.

Current wording

Cash conversion cycle increased by 13 days when comparing June 30, 2025 to June 30, 2024. This increase was primarily due to the decreases in net sales in a short period of time, and cost of sales for the three months ended June 30, 2025 as compared to the three months ended June 30, 2024. Inventory management is critical for the business in preparation for the future periods to supply customers efficiently, which was the driver of increased days in inventory at the end of June 30, 2025.

Previous wording

During the first three months of 2025, Titan reported a net cash outflow of $14.8 million from investing activities, as compared to the $158.8 million outflow recorded in the corresponding period of 2024. This change was primarily due to the acquisition of Titan Specialty in February 2024 for a cash consideration of $143.6 million. Additionally, Titan invested $15.0 million in capital expenditures in the first three months of 2025, slightly lower than the $16.6 million in the corresponding period of 2024. These expenditures were aimed at replacing and enhancing plant equipment, as well as acquiring new tools, dies, and molds to support new product development initiatives. The capital outlay in 2025 reflects Titan's strategic efforts to improve existing facilities, enhance manufacturing capabilities, and drive operational efficiency and labor productivity gains.

Current wording

During the first six months of 2025, Titan reported a net cash outflow of $24.8 million from investing activities, as compared to the $171.3 million outflow recorded in the corresponding period of 2024. This change was primarily due to the acquisition of Titan Specialty in February 2024 for consideration that included cash of $143.6 million. Additionally, Titan invested $25.1 million in capital expenditures in the first six months of 2025, lower than the $34.2 million in the corresponding period of 2024. These expenditures were aimed at replacing and enhancing plant equipment, as well as acquiring new tools, dies, and molds to support new product development initiatives. The capital outlay in 2025 reflected Titan's strategic efforts to improve existing facilities, enhance manufacturing capabilities, and drive operational efficiency and labor productivity gains. The lower capital expenditure in 2025 reflects actions taken to manage cash optimally, given the decreased product demand in the market.

Previous wording

During the first three months of 2025, $18.6 million of cash was provided by financing activities. This was primarily due to $26.6 million in borrowings to meet increased working capital requirements, partially offset by $8.0 million in debt repayments.

Current wording

During the first six months of 2025, $16.9 million of cash was provided by financing activities. This was primarily due to $54.9 million in borrowings to meet increased working capital requirements, partially offset by $38.0 million in debt repayments.

Previous wording

During the first three months of 2024, $145.7 million of cash was used for financing activities. This significant outflow was mainly due to the acquisition of Titan Specialty on February 29, 2024, for which Titan borrowed $147.0 million under a new domestic credit facility. This cash inflow was partially offset by $7.0 million in debt repayments and $1.4 million in repurchased common stock.

Current wording

During the first six months of 2024, $113.9 million of cash was provided by financing activities. This significant inflow was mainly due to the acquisition of Titan Specialty on February 29, 2024, for which Titan borrowed $147.0 million under a new domestic credit facility. This cash inflow was partially offset by $34.1 million in debt repayments and $7.8 million in repurchased common stock.

Previous wording

Additionally, Titan issued common stock worth $168.7 million during the first three months of 2024 in connection with the Titan Specialty acquisition. This issuance was reflected as "Non cash financing activity" in the Condensed Consolidated Statements of Cash Flows.

Current wording

Additionally, Titan issued common stock worth $168.7 million during the first six months of 2024 in connection with the Titan Specialty acquisition. This issuance was reflected as "Non cash financing activity" in the Condensed Consolidated Statements of Cash Flows.

Previous wording

The Company does not anticipate significant liquidity constraints during the foreseeable future. At March 31, 2025, the Company reported $174.4 million of cash and cash equivalents. This amount included $159.5 million held in foreign countries.

Current wording

The Company does not anticipate significant liquidity constraints during the foreseeable future. At June 30, 2025, the Company reported $184.7 million of cash and cash equivalents. This amount included $168.8 million held in foreign countries.