OSHKOSH CORP
For the period ended Sep 30, 2025. Filed Oct 29, 2025.
View on SEC.govAbout this filing
A company's report for each of its first three quarters. The financial statements are not audited. It shows how the business has moved since the last annual report, and what management says changed.
Sep 30, 2025 · Filed Oct 29, 2025
OSK$134.36-1.7%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-Q
Period ended 2025-06-30; filed 2025-08-01.
0000950170-25-101362
ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONSCurrent report: 10-Q
Period ended 2025-09-30; filed 2025-10-29.
0001193125-25-256137
ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONSThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 108 previous paragraphs and 106 current paragraphs.
49 unchanged; 37 reworded; 19 added; 19 removed; 3 previous and 1 current paragraphs rearranged.
Tables are not compared: 10 previous and 9 current tables excluded. Dates, whitespace, punctuation and numbering changes are ignored; changes to financial figures remain significant.
A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (19)
Current report
Form 10-Q.
Current report
The Company reported earnings per share of $3.04 in the third quarter of 2025, up from earnings per share of $2.75 in the third quarter of 2024. Results in the third quarter of 2025 included a benefit related to the resolution of a multi-year federal income tax audit of $19.1 million, or $0.30 per share.
Current report
Consolidated sales in the third quarter of 2025 decreased $53 million, or 2%, to $2.69 billion compared to the third quarter of 2024. While the Company has benefited from the ramp-up of Next Generation Delivery Vehicle (NGDV) production for the USPS and continued to increase production in the Vocational segment to fulfill orders in backlog, we believe the macroeconomic environment in North America has caused customers in select markets to be cautious about ordering new equipment. Access segment sales were down $254 million, or 19%, in the third quarter of 2025 versus the third quarter of 2024.
Current report
Consolidated operating income decreased 2% to $260 million, or 9.7% of sales, in the third quarter of 2025 compared to $266 million, or 9.7% of sales, in the third quarter of 2024. Results reflect solid performance across each of the segments. Operating income margin of 9.7% reflected continued strong performance in the Vocational segment, improved operating income margins in the Transport segment and double-digit operating income margins in the Access segment. Operating income included $25 million from the one-time license of Joint Light Tactical Vehicle (JLTV)-related intellectual property to the U.S. government.
Current report
The international trade environment remains dynamic and difficult to predict. Since the Company released its most recent guidance, the Company has experienced the expansion of tariffs, including section 232 steel and aluminum derivative tariffs and medium- and heavy-duty truck chassis tariffs. This continuously changing environment contributes to economic uncertainties and the Company is seeing some customers be judicious on spending for new equipment.
Current report
The Company continues to expect Vocational segment sales in 2025 to be approximately $3.8 billion and operating income margin to be 15.0%. Operating income margin includes approximately 100 basis points of intangible asset amortization.
Current report
The Company expects Corporate and other to have an operating loss of approximately $194 million in 2025, including approximately $3 million related to amortization and $6 million related to impairment of intangible assets.
Current report
Consolidated selling, general and administrative expenses decreased due to lower spending on consultants and services ($13 million) and lower incentive compensation accruals ($12 million).
Current report
Consolidated selling, general and administrative expenses decreased primarily due to lower incentive compensation accruals ($21 million) and lower spending on consultants and services ($17 million), offset in part by incremental operating costs related to the September 2024 acquisition of AUSA ($9 million).
Current report
The effective tax rate in the third quarter of 2025 included net discrete tax benefits of $21.5 million, including $19.1 million related to the release of uncertain tax positions on the resolution of the multi-year federal income tax audit during the quarter.
Current report
The effective tax rate in the first nine months of 2025 included net discrete tax benefits of $20.1 million, including $19.1 million related to the release of uncertain tax positions on the resolution of the multi-year federal income tax audit during the third quarter of 2025. The effective tax rate in the first nine months of 2024 included net discrete tax benefits of $5.7 million.
Current report
The decrease in selling, general and administrative expenses in the Access segment was primarily due to lower spending on consultants and services ($7 million) and lower incentive compensation accruals ($6 million).
Current report
The decrease in operating income in the Access segment was primarily due to the impact of lower gross margin associated with lower sales volume ($66 million), higher sales discounts ($34 million) and higher labor and overhead costs ($23 million), offset in part by lower material costs ($19 million) and lower selling, general and administrative expenses ($15 million).
Current report
The decrease in gross margin in the Access segment was primarily due to higher sales discounts (180 basis points) and higher labor and overhead costs (180 basis points) due in part to lower absorption of fixed costs as a result of lower production, offset in part by lower material costs (70 basis points).
Current report
The decrease in selling, general and administrative expenses in the Access segment was primarily due to lower incentive compensation accruals ($9 million) and lower advertising spending ($4 million), offset in part by incremental operating costs related to the September 2024 acquisition of AUSA ($9 million).
Current report
The decrease in operating income in the Access segment was primarily due to the impact of lower gross margin associated with lower sales volume ($207 million), higher sales discounts ($85 million) and higher labor and overhead costs ($40 million), offset in part by lower material costs ($29 million), lower incentive compensation accruals ($19 million) and favorable mix ($9 million).
Current report
The increase in operating income in the Transport segment was primarily due to the one-time license of JLTV-related intellectual property ($25 million) and improved pricing ($8 million), offset in part by higher warranty expense ($13 million).
Current report
The increase in operating income in the Transport segment was largely a result of the license of intellectual property to the U.S. government ($25 million), improved pricing under recent contracts ($20 million) and lower unfavorable cumulative catch-up adjustments ($4 million), offset in part by the impact of lower gross margin associated with lower sales volume ($19 million) and higher warranty expense ($17 million).
Current report
Net operating costs for corporate and other decreased primarily due to the timing of healthcare charges between Corporate and the segments ($10 million) and lower incentive compensation accruals ($4 million).
Removed paragraphs (19)
Previous report
In July 2024, the Company moved the reporting responsibility for Pratt Miller from its Transport segment to the Chief Technology and Strategic Sourcing Officer to better utilize Pratt Miller’s expertise across the entire Oshkosh Corporation enterprise. Pratt Miller results are now reported within "Corporate and other." All historical information has been recast to reflect this change.
Previous report
In June 2025, the Company renamed the Defense segment to the Transport segment to better reflect the full scope of the segment's operations serving defense and commercial markets.
Previous report
Consolidated net sales in the second quarter of 2025 decreased $114.8 million, or 4.0%, to $2.73 billion compared to the second quarter of 2024 primarily due to lower sales volume in the Access and Transport segments, partially offset by higher Vocational segment sales volume and improved pricing. Market conditions for access equipment in North America were in line with the Company's expectations and reflected the expiration of the Company's agreement to produce Caterpillar-branded telehandlers, which ended in the fourth quarter of 2024, as well as higher discounts. The Vocational segment delivered higher sales volume and continued to benefit from higher pricing. Transport segment revenue reflected the steady ramp-up of production of Next Generation Delivery Vehicles (NGDV) for the USPS.
Previous report
Consolidated operating income increased 11.8% to $291.7 million, or 10.7% of sales, in the second quarter of 2025 compared to $260.9 million, or 9.2% of sales, in the second quarter of 2024. The increase in operating income, despite the lower sales volume, was primarily due to lower intangible asset impairments and improved sales mix. Earnings per share was $3.16 for the second quarter of 2025, compared to $2.56 in the second quarter of 2024.
Previous report
The international trade environment remains dynamic and difficult to predict. The Company's revised estimates reflect a more limited impact of tariffs compared to its previous guidance due to pauses and revisions to tariff rates and the Company's performance in the second quarter. The earnings per share guidance is in the range of the Company's January outlook as anticipated tariff impacts are expected to be offset by company-wide cost reduction actions. The Company's estimates include direct impacts of tariffs based on rates as of July 30, 2025 and do not reflect potential future indirect impacts, including weaker macroeconomic conditions, which are difficult to predict at this time.
Previous report
The Company expects Vocational segment sales and operating income margin in 2025 to be approximately $3.8 billion and 15.0%, respectively, compared to its initial expectations in January 2025 of approximately $3.8 billion and 14.0%, respectively.
Previous report
The Company expects Corporate and other, including Pratt Miller, to have an operating loss of approximately $191 million in 2025, including the Pratt Miller intangible asset impairment charge recognized in the second quarter of 2025.
Previous report
The following table presents net sales by geographic region based on product shipment destination (in millions):
Previous report
Consolidated gross margin remained flat in the second quarter of 2025 compared to the second quarter of 2024 as improved sales mix (100 basis points) and improved pricing (60 basis points) were offset by higher production costs (90 basis points) and higher warranty expense (20 basis points).
Previous report
Consolidated selling, general and administrative expenses decreased due to lower integration costs related to AeroTech ($7 million) and lower expense for credit loss reserves ($3 million), offset in part by operating costs related to the acquisition of AUSACORP S.L. (AUSA) ($4 million).
Previous report
Consolidated selling, general and administrative expenses increased primarily due to operating costs related to the acquisition of AUSA ($8 million).
Previous report
The Company recorded intangible asset impairments related to Pratt Miller of $6 million and $52 million during the six months ended June 30, 2025 and 2024, respectively.
Previous report
The decrease in gross margin in the Access segment was primarily due to higher sales discounts (190 basis points) and lower absorption as a result of lower production (100 basis points), offset in part by improved customer mix (40 basis points).
Previous report
The decrease in operating income in the Access segment was primarily due to the impact of lower gross margin associated with lower sales volume ($36 million) and higher sales discounts ($35 million), offset in part by favorable customer mix ($5 million).
Previous report
The increase in selling, general and administrative expenses was primarily due to operating costs related to the acquisition of AUSA ($8 million).
Previous report
The decrease in operating income in the Access segment was primarily due to the impact of lower gross margin associated with lower sales volume ($112 million), higher sales discounts ($50 million) and unfavorable manufacturing absorption ($18 million), offset in part by favorable customer mix ($17 million).
Previous report
The increase in operating income in the Transport segment was largely a result of improved pricing under the more recent Family of Heavy Tactical Vehicles (FHTV) contracts ($7 million), lower new product development costs ($5 million), lower unfavorable cumulative catch-up adjustments on contracts ($4 million) and improved sales mix ($3 million), offset in part by the impact of lower gross margin associated with lower sales volume ($13 million).
Previous report
The decrease in operating income in the Transport segment was largely a result of the impact of lower gross margin associated with lower sales volume ($22 million) and higher warranty expense ($4 million), offset in part by improved pricing ($13 million) and lower new product development costs ($10 million).
Previous report
The Company increased its expectations of cash from operating activities in 2025 by $100 million to a range of $650 million to $750 million, primarily as a result of lower projected tax payments following the enactment of the OBBBA.
Reworded paragraphs (37)
Previous wording
This Management’s Discussion and Analysis of Financial Condition and Results of Operations and other sections of this Quarterly Report on Form 10-Q contain statements that the Company believes to be “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. All statements other than statements of historical fact included in this Quarterly Report on Form 10-Q, including, without limitation, statements regarding the Company’s future financial position, business strategy, targets, projected sales, costs, earnings, capital expenditures, debt levels and cash flows, and plans and objectives of management for future operations, including those under the caption “Overview,” are forward-looking statements. When used in this Quarterly Report on Form 10-Q, words such as “may,” “will,” “expect,” “intend,” “estimate,” “anticipate,” “believe,” “should,” “project” or “plan” or the negative thereof or variations thereon or similar terminology are generally intended to identify forward-looking statements. These forward-looking statements are not guarantees of future performance and are subject to risks, uncertainties, assumptions and other factors, some of which are beyond the Company’s control, which could cause actual results to differ materially from those expressed or implied by such forward-looking statements. These factors include the cyclical nature of the Company’s access equipment, fire apparatus, refuse and recycling collection and air transportation equipment markets, which are particularly impacted by the strength of U.S. and European economies and construction seasons; the Company’s estimates of access equipment demand which, among other factors, is influenced by historical customer buying patterns and rental company fleet replacement strategies; the impact of orders and costs on the U.S. Postal Service contract; risks that a trade war and related tariffs could reduce the demand for or competitiveness of the Company’s products or cause inefficiencies in the Company's supply chain; the Company’s ability to increase prices to raise margins or to offset higher input costs; the Company's ability to accurately predict future input costs associated with U.S. Department of Defense contracts; the Company’s ability to attract and retain production labor in a timely manner; the Company's ability to realize the anticipated benefits associated with the AeroTech acquisition; the strength of the U.S. dollar and its impact on Company exports, translation of foreign sales and the cost of purchased materials; the impact of severe weather, war, natural disasters or pandemics that may affect the Company, its suppliers or its customers; the Company’s ability to predict the level and timing of orders for indefinite delivery/indefinite quantity contracts with the U.S. federal government; budget uncertainty for the U.S. federal government, including risks of future budget cuts, the impact of continuing resolution funding mechan…
Excerpt shortened here; the source contains the full paragraph.
Current wording
This Management’s Discussion and Analysis of Financial Condition and Results of Operations and other sections of this Quarterly Report on Form 10-Q contain statements that the Company believes to be “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. All statements other than statements of historical fact included in this Quarterly Report on Form 10-Q, including, without limitation, statements regarding the Company’s future financial position, business strategy, targets, projected sales, costs, earnings, capital expenditures, debt levels and cash flows, and plans and objectives of management for future operations, including those under the caption “Overview,” are forward-looking statements. When used in this Quarterly Report on Form 10-Q, words such as “may,” “will,” “expect,” “intend,” “estimate,” “anticipate,” “believe,” “should,” “project” or “plan” or the negative thereof or variations thereon or similar terminology are generally intended to identify forward-looking statements. These forward-looking statements are not guarantees of future performance and are subject to risks, uncertainties, assumptions and other factors, some of which are beyond the Company’s control, which could cause actual results to differ materially from those expressed or implied by such forward-looking statements. These factors include the cyclical nature of the Company’s access equipment, fire apparatus, refuse and recycling collection and air transportation equipment markets, which are particularly impacted by the strength of U.S. and European economies and construction seasons; the Company’s estimates of access equipment demand which, among other factors, is influenced by historical customer buying patterns and rental company fleet replacement strategies; the impact of orders and costs on the U.S. Postal Service contract; risks that the trade war and related tariffs could reduce the demand for or competitiveness of the Company’s products or cause inefficiencies in the Company's supply chain; the Company’s ability to increase prices to raise margins or to offset higher input costs; the Company's ability to accurately predict future input costs associated with U.S. Department of Defense contracts; the Company’s ability to attract and retain production labor in a timely manner; the Company's ability to realize the anticipated benefits associated with the AeroTech acquisition; the strength of the U.S. dollar and its impact on Company exports, translation of foreign sales and the cost of purchased materials; the impact of severe weather, war, natural disasters or pandemics that may affect the Company, its suppliers or its customers; the Company’s ability to predict the level and timing of orders for indefinite delivery/indefinite quantity contracts with the U.S. federal government; budget uncertainty for the U.S. federal government, including risks of future budget cuts, the impact of continuing resolution funding mech…
Excerpt shortened here; the source contains the full paragraph.
Previous wording
The Company continued to repurchase shares of its Common Stock throughout the quarter, repurchasing nearly 415,000 shares for $40 million, bringing share repurchases for the first six months of 2025 to nearly $70 million. Share repurchases during the previous twelve months benefited earnings per share by $0.06 compared to the second quarter of 2024.
Current wording
The Company continued to repurchase shares of its Common Stock throughout the quarter, repurchasing 666,359 shares for nearly $91 million, bringing share repurchases for the first nine months of 2025 to nearly $160 million. Share repurchases during the previous twelve months benefited earnings per share by $0.05 in the third quarter of 2025 compared to the third quarter of 2024.
Previous wording
The Company expects its 2025 diluted earnings per share to be approximately $10.25. The earnings per share estimate includes after-tax charges of $0.68 per share related to amortization of purchased intangibles and $0.07 per share related to intangible asset impairments. Excluding these items, the Company's 2025 adjusted earnings per share estimate is approximately $11.00.
Current wording
The Company now expects its 2025 diluted earnings per share to be between $9.75 and $10.25 on sales between $10.3 billion and $10.4 billion, compared to the Company's most recent estimates of diluted earnings per share of approximately $10.25 on sales of approximately $10.6 billion. The updated earnings per share guidance primarily reflects the impact of lower projected sales volume offset in part by a lower effective income tax rate. The earnings per share estimate includes after-tax charges of $0.68 per share related to amortization of purchased intangibles and $0.07 per share related to intangible asset impairments. Excluding these items, the Company's 2025 adjusted earnings per share estimate is between $10.50 and $11.00.
Previous wording
The Company expects Access segment sales and operating income margin in 2025 to be approximately $4.4 billion and 11.5%, respectively, compared to its initial expectations in January 2025 of approximately $4.4 billion and 12.5%, respectively.
Current wording
The Company expects Access segment sales and operating income margin in 2025 to be approximately $4.3 billion and 11.0%, respectively, compared to the Company's most recent estimates of $4.4 billion and 11.5%, respectively, reflecting weaker market conditions for access equipment in North America. Operating income margin includes approximately 50 basis points of intangible asset amortization.
Previous wording
The Company expects Transport segment sales and operating income margin in 2025 to be approximately $2.3 billion and 4.5%, respectively, compared to its initial expectations in January 2025 of approximately $2.3 billion and 4.0%, respectively.
Current wording
The Company expects Transport segment sales and operating income margin in 2025 to be approximately $2.1 billion and 4.0%, respectively, compared to the Company's most recent estimates of $2.3 billion and 4.5%, respectively. The revised expectations reflect the Company's latest expectations for NGDV production as well as higher warranty costs.
Previous wording
Consolidated net sales decreased primarily due to lower sales volume in the Access ($121 million) and Transport ($102 million) segments, offset in part by higher sales volume in the Vocational segment ($81 million) and improved pricing ($21 million).
Current wording
Consolidated net sales decreased primarily due to lower sales volume in the Access ($225 million) segment, offset in part by higher sales volume in the Vocational ($107 million) and Transport ($41 million) segments. Improved pricing ($21 million) also benefited sales in the third quarter of 2025.
Previous wording
The decrease in consolidated gross margin was primarily due to higher production costs (110 basis points), higher engineering costs (30 basis points) and higher warranty expense (20 basis points), offset in part by improved pricing (70 basis points) and improved sales mix (70 basis points).
Current wording
The decrease in consolidated gross margin was primarily due to higher labor and overhead costs (140 basis points) and higher warranty expense (70 basis points), offset in part by improved pricing (60 basis points) and lower material costs (50 basis points).
Previous wording
The decrease in consolidated operating income was primarily due to the impact of lower gross margin associated with lower sales volume ($103 million) and higher production costs ($44 million), offset in part by improved pricing ($50 million) and lower intangible asset impairments ($46 million).
Current wording
The decrease in consolidated operating income was primarily due to higher labor and overhead costs ($36 million), the impact of lower gross margin associated with lower sales volume ($21 million) and higher warranty expense ($20 million), offset in part by lower selling, general and administrative expenses ($30 million), improved pricing ($21 million) and lower material costs ($14 million).
Previous wording
Consolidated net sales decreased primarily due to lower sales volume in the Access ($382 million) and Transport ($156 million) segments, offset in part by higher sales volume ($138 million) in the Vocational segment and improved pricing ($50 million).
Current wording
Consolidated net sales decreased primarily due to lower organic sales volume in the Access ($698 million) and Transport ($117 million) segments, offset in part by higher sales volume in the Vocational segment ($235 million) and sales related to the September 2024 acquisition of AUSACORP S.L. (AUSA) ($91 million). Improved pricing ($76 million) also benefited sales in the first nine months of 2025.
Previous wording
The increase in consolidated operating income was primarily due to lower intangible asset impairments ($46 million), favorable sales mix ($23 million) and improved pricing ($21 million), offset in part by the impact of lower gross margin associated with lower sales volume ($36 million) and higher production costs ($23 million).
Current wording
The decrease in consolidated operating income was primarily due to the impact of lower gross margin associated with lower sales volume ($127 million), higher labor and overhead costs ($79 million) and higher warranty expense ($28 million), offset in part by improved pricing ($76 million), lower intangible asset impairments ($46 million), favorable sales mix ($25 million), lower selling, general and administrative expenses ($23 million) and lower material costs ($12 million).
Previous wording
In July 2025, the One Big Beautiful Bill Act (OBBBA) was enacted in the United States. The OBBBA includes provisions to expense previously deferred domestic research and development costs, increase bonus depreciation and modify the international tax framework. The Company expects the OBBBA to reduce the Company's tax payments in 2025 by approximately $100 million as a result of the acceleration of deductions.
Current wording
On July 4, 2025, the One Big Beautiful Bill Act (OBBBA) was enacted in the United States. The OBBBA includes provisions to expense previously deferred domestic research and development costs, increase bonus depreciation and modify the international tax framework. The Company's annual effective tax rate increased approximately 40 basis points as a result of the enactment of the OBBBA.
Previous wording
Miscellaneous, net primarily related to gains and losses on investments, foreign currency transaction gains and losses and non-service costs of the Company’s pension plans. Results for the first six months of 2025 included a $4 million gain on investments, partially offset by foreign currency transaction losses of $1 million. Results for the first six months of 2024 included foreign currency transaction losses of $4 million.
Current wording
Miscellaneous, net primarily related to gains and losses on investments, foreign currency transaction gains and losses and non-service costs of the Company’s pension plans. Results for the first nine months of 2025 included gains related to investments of $7 million and income related to the non-service portion of the Company's pension plans of $5 million.
Previous wording
Losses of unconsolidated affiliates included an impairment of an equity method investment of $7 million in the first six months of 2024.
Current wording
Losses of unconsolidated affiliates included an impairment of an equity method investment of $7 million in the first nine months of 2024.
Previous wording
Access segment net sales decreased primarily due to the expiration of the agreement to produce Caterpillar-branded telehandlers, lower sales volumes in Europe, Africa and the Middle East and higher sales discounts ($35 million), offset in part by sales related to the acquisition of AUSA ($38 million).
Current wording
Access segment net sales decreased primarily due to lower sales volumes in North America ($198 million) due to the expiration of the agreement to produce Caterpillar-branded telehandlers and softer market conditions. Higher sales discounts ($34 million) also contributed to the decline in sales in the quarter.
Previous wording
The decrease in gross margin in the Access segment was primarily due to higher sales discounts (160 basis points), lower absorption as a result of lower production (140 basis points), and higher engineering costs (60 basis points), offset in part by favorable sales mix (50 basis points).
Current wording
The decrease in gross margin in the Access segment was primarily due to higher labor and overhead costs (270 basis points) due in part to lower absorption of fixed costs as a result of lower production, higher sales discounts (220 basis points) and adverse sales mix (50 basis points), offset in part by lower material costs (150 basis points).
Previous wording
Access segment net sales decreased primarily as a result of lower organic sales volume ($457 million) as a result of softer market conditions and the expiration of the agreement to produce Caterpillar-branded telehandlers, as well as higher sales discounts ($50 million), offset in part by sales related to the acquisition of AUSA ($75 million).
Current wording
Access segment net sales decreased primarily as a result of lower organic sales volume ($698 million) as a result of softer market conditions and the expiration of the agreement to produce Caterpillar-branded telehandlers, as well as higher sales discounts ($85 million), offset in part by incremental sales in 2025 related to the September 2024 acquisition of AUSA ($91 million).
Previous wording
Vocational segment net sales increased due to higher sales volume ($81 million) as a result of increased production rates and improved pricing in response to higher input costs ($49 million).
Current wording
Vocational segment net sales increased due to higher sales volume ($107 million), largely as a result of increased production rates, and improved pricing ($47 million).
Previous wording
The increase in gross margin in the Vocational segment was primarily attributable to improved pricing (340 basis points), offset in part by higher material costs (60 basis points), increased warranty expense (30 basis points) and higher engineering costs (20 basis points).
Current wording
The increase in gross margin in the Vocational segment was primarily attributable to improved pricing (350 basis points), offset in part by higher labor and overhead costs (130 basis points), higher material costs (60 basis points) and higher warranty expense (40 basis points).
Previous wording
The increase in operating income in the Vocational segment was largely a result of improved pricing ($86 million) and the impact of higher gross margin associated with higher sales volume ($39 million), offset in part by higher production costs ($16 million), higher material costs ($8 million), higher engineering costs ($8 million), higher warranty expense ($7 million) and costs to start-up a plant in Tennessee ($5 million).
Current wording
The increase in operating income in the Vocational segment was largely a result of improved pricing ($47 million) and the impact of higher gross margin associated with higher sales volume ($31 million), offset in part by higher labor and overhead costs ($19 million), higher material costs ($6 million), higher warranty costs ($5 million) and unfavorable sales mix ($4 million).
Previous wording
Vocational segment net sales increased due to higher sales volume ($138 million) as a result of increased production rates and improved pricing in response to higher input costs ($86 million).
Current wording
Vocational segment net sales increased due to higher sales volume ($235 million), largely as a result of increased production rates, and improved pricing ($140 million).
Previous wording
The increase in gross margin in the Vocational segment was primarily attributable to improved pricing (360 basis points), offset in part by higher production costs (150 basis points), higher material costs (70 basis points) and increased litigation expense (30 basis points).
Current wording
The increase in gross margin in the Vocational segment was primarily attributable to improved pricing (360 basis points), offset in part by higher material costs (80 basis points), higher labor and overhead costs (70 basis points) and higher warranty expense (30 basis points).
Previous wording
The increase in operating income in the Vocational segment was largely a result of improved pricing ($49 million) and the impact of higher gross margin associated with higher sales volume ($24 million), offset in part by higher production costs ($13 million), higher material costs ($8 million), higher warranty expense ($3 million), higher litigation expense ($3 million) and higher engineering costs ($3 million).
Current wording
The increase in operating income in the Vocational segment was largely a result of improved pricing ($140 million) and the impact of higher gross margin associated with higher sales volume ($68 million), offset in part by higher labor and overhead costs ($39 million), higher material costs ($18 million), higher warranty expense ($12 million), higher engineering costs ($7 million) and higher incentive compensation accruals ($7 million).
Previous wording
Transport segment net sales decreased due to lower Joint Light Tactical Vehicles (JLTV) sales volume to the U.S. Department of Defense (DoD), offset in part by increased sales volume for the NGDV, which commenced in the second quarter of 2024, and improved international tactical wheeled vehicle sales volume.
Current wording
Transport segment net sales increased due to the ramp up of NGDV production ($114 million), higher international tactical wheeled vehicle sales volume ($67 million) and the one-time license of JLTV intellectual property to the U.S. government ($25 million), offset in part by lower JLTV sales volume to the Department of Defense (DoD) ($163 million).
Previous wording
The increase in gross margin in the Transport segment in the first six months of 2025 compared to the first six months of 2024 was primarily due to improved pricing (120 basis points), offset in part by higher warranty expense (60 basis points) and higher unfavorable cumulative catch-up adjustments on contracts (40 basis points).
Current wording
The increase in gross margin in the Transport segment was primarily due to improved sales mix (410 basis points) and improved pricing (120 basis points) on recently signed contracts, offset in part by higher warranty expense (220 basis points).
Previous wording
Transport segment net sales decreased primarily due to lower JLTV sales volume to the DoD, offset in part by sales volume for the NGDV, which commenced in the second quarter of 2024, higher international tactical wheeled vehicle sales volume and higher FHTV sales volume.
Current wording
Transport segment net sales decreased primarily due to lower JLTV sales volume to the DoD ($504 million), offset in part by the ramp up of NGDV production ($235 million), higher international tactical wheeled vehicle sales volumes ($63 million), higher Family of Heavy Tactical Vehicles sales volume and the license of JLTV-related intellectual property to the U.S. government ($25 million).
Previous wording
The increase in gross margin in the Transport segment was primarily due to improved pricing (130 basis points), improved sales mix (70 basis points) and lower unfavorable cumulative catch-up adjustments on contracts (50 basis points).
Current wording
The increase in gross margin in the Transport segment was primarily due to improved sales mix (130 basis points) and improved pricing (110 basis points), offset in part by higher warranty expense (120 basis points).
Previous wording
Net operating costs for corporate and other decreased primarily due to lower intangible asset impairments ($46 million) at the Company's Pratt Miller business unit.
Current wording
Net operating costs for corporate and other decreased primarily due to lower intangible asset impairments ($46 million) at the Company's Pratt Miller business unit, lower incentive compensation accruals ($8 million) and lower spending related to consultants ($8 million).
Previous wording
The Company generates significant capital resources from operating activities, which is the expected primary source of funding for the Company. In addition to cash generated from operations, the Company had other sources of liquidity available at June 30, 2025, including $191.7 million of cash and cash equivalents and $1.12 billion of unused available capacity under the Revolving Credit Facility (as defined in "Liquidity"). Borrowings under the Revolving Credit Facility could, as discussed below, be limited by the financial covenants contained in the Credit Agreement (as defined in “Liquidity”). The Company was in compliance as of June 30, 2025 and expects to remain in compliance with the financial covenants contained in the Credit Agreement.
Current wording
The Company generates significant capital resources from operating activities, which is the expected primary source of funding for the Company. In addition to cash generated from operations, the Company had other sources of liquidity available at September 30, 2025, including $211.8 million of cash and cash equivalents and $1.41 billion of unused available capacity under the Revolving Credit Facility (as defined in "Liquidity"). Borrowings under the Revolving Credit Facility could, as discussed below, be limited by the financial covenants contained in the Credit Agreement (as defined in “Liquidity”). The Company was in compliance as of September 30, 2025 and expects to remain in compliance with the financial covenants contained in the Credit Agreement.
Previous wording
The Company’s ratio of debt to total capitalization of 25.2% at June 30, 2025 remained within its targeted range. The increase in the debt to total capitalization ratio compared to December 31, 2024 was due to higher borrowings to fund seasonal working capital needs.
Current wording
The Company’s ratio of debt to total capitalization of 21.0% at September 30, 2025 remained within its targeted range. The increase in the debt to total capitalization ratio compared to December 31, 2024 was due to higher borrowings to fund seasonal working capital needs.
Previous wording
Consolidated days sales outstanding (defined as “Trade Receivables” at quarter end divided by “Net Sales” for the most recent quarter multiplied by 90 days) increased from 40 days at December 31, 2024 to 47 days at June 30, 2025. Days sales outstanding for segments other than the Transport segment increased from 44 days at December 31, 2024 to 52 days at June 30, 2025 primarily due to timing of cash receipts from customers in the Access segment at December 31, 2024. Consolidated inventory turns (defined as “Cost of Sales” on an annualized basis, divided by the average “Inventory” at the past five quarter end periods) decreased from 3.9 times at December 31, 2024 to 3.5 times at June 30, 2025 primarily due to increases in inventory levels in all three segments. Consolidated days payable outstanding (defined as “Accounts Payable” at quarter end divided by material costs of sales for the most recent quarter multiplied by 90 days) decreased from 65 days at December 31, 2024 to 56 days at June 30, 2025 due to timing of payments.
Current wording
Consolidated days sales outstanding (defined as “Trade Receivables” at quarter end divided by “Net Sales” for the most recent quarter multiplied by 90 days) increased from 40 days at December 31, 2024 to 45 days at September 30, 2025. Days sales outstanding for segments other than the Transport segment increased from 44 days at December 31, 2024 to 51 days at September 30, 2025 primarily due to timing of cash receipts from customers in the Access segment at December 31, 2024. Consolidated inventory turns (defined as “Cost of Sales” on an annualized basis, divided by the average “Inventory” at the past five quarter end periods) decreased from 3.9 times at December 31, 2024 to 3.5 times at September 30, 2025 due to increases in inventory levels in all segments. Consolidated days payable outstanding (defined as “Accounts Payable” at quarter end divided by material costs of sales for the most recent quarter multiplied by 90 days) decreased from 65 days at December 31, 2024 to 56 days at September 30, 2025 due to timing of payments.
Previous wording
Operating activities used $305.7 million of cash in the first six months of 2025 compared to $566.8 million of cash during the first six months of 2024. The decrease in cash used by operating activities was primarily due to lower tax payments, improved management of unbilled receivables and lower investments in deferred contract assets, offset in part by higher inventory levels. The first six months of 2025 included net cash tax payments of $148 million, which was down $178 million compared to the first six months of 2024 primarily due to higher taxable income in 2023 as a result of the timing of customer advances.
Current wording
Operating activities provided $183.3 million of cash in the first nine months of 2025 compared to using $240.7 million of cash during the first nine months of 2024. The increase in cash provided by operating activities was primarily due to lower tax payments, investments in the NGDV program in the first nine months of 2024 and an increase in customer advances. The first nine months of 2025 included net cash tax payments of $151.8 million, which was down $213.1 million compared to the first nine months of 2024 primarily due to higher taxable income in 2023 as a result of the timing of customer advances. The Company continues to expect cash flow from operations to be between $650 million and $750 million in 2025.
Previous wording
Investing activities used cash of $99.1 million in the first six months of 2025 compared to $149.3 million during the first six months of 2024. Through the first six months of 2025, the Company used $80.9 million for capital expenditures, a decrease of $58.7 million compared to the first six months of 2024 as the Company was investing in new facilities in South Carolina and Tennessee in 2024. The Company continues to expect that it will invest $250 million on capital expenditures in 2025 due to efforts to expand production capacity in the Vocational segment.
Current wording
Investing activities used cash of $136.3 million in the first nine months of 2025 compared to $309.6 million during the first nine months of 2024. During the first nine months of 2024, the Company used $112.9 million to fund the acquisition of AUSA. Through the first nine months of 2025, the Company used $105.6 million for capital expenditures, a decrease of $87.9 million compared to the first nine months of 2024 as the Company was investing in new facilities in South Carolina and Tennessee in 2024. The Company expects that it will invest $200 million on capital expenditures in 2025, down from $250 million previously expected as the Company continues to maintain rigorous spending controls.
Previous wording
Financing activities provided cash of $379.4 million in the first six months of 2025 compared to $732.8 million during the first six months of 2024 primarily due to lower net borrowings. In the first six months of 2025, the Company repurchased 702,307 shares of its Common Stock at an aggregate cost of $68.7 million. In the first six months of 2024, the Company repurchased 464,193 shares of its Common Stock at an aggregate cost of $54.6 million. The Company plans to accelerate share repurchases in the second half of 2025. As of June 30, 2025, the Company had approximately 9.5 million shares of Common Stock remaining under its repurchase authorization.
Current wording
Financing activities used cash of $51.6 million in the first nine months of 2025 compared to providing $585.7 million during the first nine months of 2024 primarily due to lower net borrowings. In the first nine months of 2025, the Company repurchased 1,368,666 shares of its Common Stock at an aggregate cost of $159.3 million. In the first nine months of 2024, the Company repurchased 564,405 shares of its Common Stock at an aggregate cost of $65.6 million. The Company plans to modestly increase its repurchase of shares in the fourth quarter of 2025 versus the third quarter of 2025. As of September 30, 2025, the Company had approximately 8.9 million shares of Common Stock remaining under its repurchase authorization.
Previous wording
In March 2022, the Company entered into a Third Amended and Restated Credit Agreement with various lenders (the “Credit Agreement”). The Credit Agreement, as amended, provides for an unsecured revolving credit facility (the “Revolving Credit Facility”) with a maximum aggregate availability of$1.55 billion that matures in March 2027. At June 30, 2025, borrowings under the Revolving Credit Facility of $397.0 million and specified outstanding letters of credit of $35.5 million reduced available capacity under the Revolving Credit Facility to $1.12 billion.
Current wording
In March 2022, the Company entered into a Third Amended and Restated Credit Agreement with various lenders (the “Credit Agreement”). The Credit Agreement, as amended, provides for an unsecured revolving credit facility (the “Revolving Credit Facility”) with a maximum aggregate availability of$1.55 billion that matures in March 2027. At September 30, 2025, borrowings under the Revolving Credit Facility of $105.0 million and specified outstanding letters of credit of $31.8 million reduced available capacity under the Revolving Credit Facility to $1.41 billion.
Previous wording
Sales to the U.S. government comprised approximately 17% of the Company’s net sales in the first six months of 2025. No other single customer accounted for more than 10% of the Company’s net sales for this period. A substantial majority of the Company’s net sales are derived from the fulfillment of customer orders that are received prior to commencing production.
Current wording
Sales to the U.S. government comprised approximately 19% of the Company’s net sales in the first nine months of 2025. No other single customer accounted for more than 10% of the Company’s net sales for this period. A substantial majority of the Company’s net sales are derived from the fulfillment of customer orders that are received prior to commencing production.
Previous wording
The Company’s backlog at June 30, 2025 decreased 7.4% to $14.23 billion compared to $15.37 billion at June 30, 2024. Access segment backlog decreased 63.6% to $1.19 billion at June 30, 2025 compared to $3.26 billion at June 30, 2024. The Company believes the decrease in backlog is primarily the result of the normalization of orders in connection with improved product availability as well as slowing demand in North America. Vocational segment backlog increased 10.4% to $6.27 billion at June 30, 2025 compared to $5.68 billion at June 30, 2024 due to strong demand for municipal fire apparatus and price increases. Unit backlog for municipal fire apparatus as of June 30, 2025 was up 4.4% compared to June 30, 2024. Unit backlog for refuse and recycling collection vehicles as of June 30, 2025 was down 26.3% compared to June 30, 2024. Transport segment backlog increased 5.1% to $6.71 billion at June 30, 2025 compared to $6.38 billion at June 30, 2024, due to the NGDV order received in the fourth quarter of 2024, offset in part by the completion of production under the Company's domestic JLTV contract.
Current wording
The Company’s backlog at September 30, 2025 decreased 4.4% to $13.7 billion compared to $14.3 billion at September 30, 2024. Access segment backlog decreased 66.2% to $721 million at September 30, 2025 compared to $2.1 billion at September 30, 2024. The Company believes the decrease in backlog is primarily the result of slowing demand in North America due to the uncertain macro environment and the normalization of orders in connection with improved product availability. Vocational segment backlog increased 8.3% to $6.4 billion at September 30, 2025 compared to $5.9 billion at September 30, 2024 due to strong demand for municipal fire apparatus and higher pricing on future deliveries. Unit backlog for municipal fire apparatus as of September 30, 2025 was up 2.9% compared to September 30, 2024. Unit backlog for refuse and recycling collection vehicles as of September 30, 2025 was down 32.5% compared to September 30, 2024 as the Company believes customers have been cautious in the uncertain macroeconomic environment. Transport segment backlog increased 4.2% to $6.5 billion at September 30, 2025 compared to $6.2 billion at September 30, 2024, due to the NGDV order received in the fourth quarter of 2024, offset in part by the completion of production under the Company's domestic JLTV contract.
Previous wording
Backlog represents the dollar amount of revenues that the Company anticipates from customer contracts that have been awarded and/or are in progress. Reported backlog includes the original contract amount and any contract modifications that have been agreed upon. Reported backlog excludes purchase options, orders for which definitive contracts have not been executed and any potential future contract modifications. Backlog is comprised of fixed and variable priced contracts that may be canceled, modified or otherwise changed in the future. As a result, backlog may not be indicative of future operating results. Backlog information and comparisons thereof as of different dates may not be accurate indicators of future sales or the ratio of the Company’s future sales. Approximately 71% of the Company’s June 30, 2025 backlog is not expected to be filled in 2025.
Current wording
Backlog represents the dollar amount of revenues that the Company anticipates from customer contracts that have been awarded and/or are in progress. Reported backlog includes the original contract amount and any contract modifications that have been agreed upon. Reported backlog excludes purchase options, orders for which definitive contracts have not been executed and any potential future contract modifications. Backlog is comprised of fixed and variable priced contracts that may be canceled, modified or otherwise changed in the future. As a result, backlog may not be indicative of future operating results. Backlog information and comparisons thereof as of different dates may not be accurate indicators of future sales or the ratio of the Company’s future sales. Approximately 84% of the Company’s September 30, 2025 backlog is not expected to be filled in 2025.
Rearranged current paragraphs (1)
Current report — wording carried from elsewhere
The decrease in consolidated gross margin was primarily due to higher labor and overhead costs (120 basis points) and higher warranty expense (40 basis points), offset in part by improved pricing (70 basis points).
Rearranged previous paragraphs (3)
Previous report — wording carried elsewhere
Miscellaneous, net primarily related to gains and losses on investments, foreign currency transaction gains and losses and non-service costs of the Company’s pension plans. Results for the second quarter of 2025 included a $6 million gain on investments, partially offset by foreign currency transaction losses of $2 million. Results for the second quarter of 2024 included foreign currency transaction losses of $1 million.
Previous report — wording carried elsewhere
Losses of unconsolidated affiliates in the second quarter of 2024 included an impairment of an equity method investment of $7 million.
Previous report — wording carried elsewhere
Net operating costs for corporate and other decreased primarily due to lower intangible asset impairments ($46 million) at the Company's Pratt Miller business unit.