Curtiss-Wright Lifts Full-Year Outlook on 10% Q3 Sales Growth

By Grace Kim

Curtiss-Wright (NYSE:CW) raised its full-year outlook after posting third-quarter sales of $953 million, up 10% year over year, and diluted earnings per share of $3.94 — a 16% increase. The defense and industrial supplier now expects adjusted diluted EPS of $15.40 to $15.50 for the year, representing 16% to 18% growth.

The quarter beat the company's own expectations. Chair and CEO Lynn Bamford said on the earnings call: "Momentum continues to accelerate at Curtiss-Wright as strong execution drove third quarter results that exceeded our expectations."

What did the numbers show?

The quarter stacked up cleanly across the board:

• Operating margin expanded 30 basis points (a basis point is one-hundredth of a percentage point) to 19.9%.
• Free cash flow came in at nearly $160 million.
• New orders rose 15%, producing a book-to-bill ratio of 1.1 — meaning orders outpaced sales.
• Backlog climbed 12% year to date to roughly $4.6 billion, a record, according to Bamford.

How much did guidance move?

Management now projects full-year sales growth of 8% to 10% and operating margin of 19.2% to 19.4%, up 60 to 80 basis points from last year. The company also lifted its free cash flow forecast by $10 million to a range of $595 million to $615 million, while keeping its cash conversion expectation above 105%. Bamford said Curtiss-Wright is on pace to repurchase approximately $460 million of shares during 2026.

Segment-level targets moved higher too. Aerospace defense sales growth guidance rose to 14% to 16%, naval defense to 9% to 11%, and general industrial to 3% to 5%, the last driven by improving market conditions and growth in industrial vehicle orders.

Where is demand strongest?

Defense Electronics orders jumped 27% in the quarter, following record bookings in the second quarter. Bamford cited demand tied to fighter jets, helicopters, modernization programs, next-generation aircraft, tactical communications equipment and mission computers. Segment sales rose 2%, helped by tactical communications revenue that shifted from the fourth quarter into the third. The segment's operating margin was 27%, down from a year earlier as unfavorable product mix outweighed the benefit of higher revenue.

Interim CFO Gary Ogilby said the company expects sequential fourth-quarter growth in both aerospace and ground defense within the segment. He also said Curtiss-Wright acted after detecting early signs of component shortages and does not expect supply-chain issues to hit fourth-quarter revenue or margins.

Incoming CEO Kevin Rayment said the company has been buying components in advance and pursuing additional supply sources. He acknowledged pressure from rising memory prices but said Curtiss-Wright is managing it with suppliers and customers.

Elsewhere, Aerospace and Industrial sales rose 14% on commercial aerospace and general industrial products. Naval & Power sales increased 12%, supported by submarine production, aircraft carrier aftermarket work and commercial nuclear revenue — and that segment's operating margin expanded 200 basis points.

What's next for nuclear and leadership?

Bamford said Curtiss-Wright still expects a 2026 order for reactor coolant pumps supporting Westinghouse AP1000 nuclear plants, identifying Poland as the expected leader, though she noted the remaining time in the year is shortening. If the order lands in the fourth quarter, Ogilby said associated revenue would arrive in 2027, with the amount depending partly on timing. Bamford added that Westinghouse is pursuing supply-chain readiness for a potential global pipeline of 91 reactors.

The company recently announced a $30 million expansion of its Round Rock, Texas facility to support demand for nuclear sensors, following an $80 million expansion at its Cheswick, Pennsylvania site announced in July. It also signed a contract and design services framework agreement with Rolls-Royce SMR covering specialized nuclear valves; Bamford estimated Curtiss-Wright's current content on a Rolls-Royce small modular reactor plant at more than $100 million in revenue.

Rayment, currently executive vice president and chief operating officer, becomes CEO on Jan. 1, with Bamford moving to executive chair. Ogilby serves as interim CFO after Chris Farkas stepped down and announced plans to retire at year-end. Rayment said acquisitions remain the top capital deployment priority — but management will walk away from deals that don't fit strategically or financially. He'll detail his priorities on the fourth-quarter call and at an investor day in May 2027.

Orders, backlog and margin are all pointing the same direction — and the raised guidance confirms it.