Q2 2025 CTS Corp Earnings Call Transcript
Key Points
- CTS Corp (CTS) achieved double-digit growth in diversified end markets, with diversified sales accounting for 55% of overall company revenue.
- Adjusted EBITDA expanded by 250 basis points sequentially and 130 basis points year-over-year, indicating improved profitability.
- The company reported strong cash flow generation, with $28 million in operating cash flow for the second quarter.
- Aerospace and defense sales increased by 34% year-over-year, driven by the CyQuest acquisition and a strong pipeline of opportunities.
- CTS Corp (CTS) successfully launched the next generation smart actuator for the commercial vehicle market, showcasing innovation in transportation products.
- Transportation sales declined by 6% year-over-year, impacted by China market dynamics and softness in commercial vehicle products.
- Bookings in the medical market were down 10% compared to the prior year due to softness in diagnostic bookings.
- The company faces potential headwinds in transportation revenue due to trade tariffs and geopolitical uncertainties.
- Electric vehicle penetration rates have softened in some regions, affecting the transportation market outlook.
- CTS Corp (CTS) anticipates continued softness in commercial vehicle-related revenue for the remainder of the year.
Good morning or good afternoon. Welcome to the CTS Corporation 2nd quarter 2025 Learning school. My name is Adam, and I'll be your operator for today. If you'd like to ask a question during the Q&A portion of today's call, you may do so by pressing star followed by 1 on your telephone keypad to into the queue.
Call now hand the floor to Kieran O'Sullivan, Chairman, President, and CEO to begin. So Kieran, please go ahead when you are ready.
Good morning and thank you for joining us today for our 2nd quarter 2025 results.
We delivered another quarter of double-digit growth in our diversified end markets.
Diversified sales for the quarter were 55% of overall company revenue.
In the quarter, our adjusted EBITDA expanded 250 basis points sequentially, and 130 basis points compared to the second quarter of last year. Cash flow generation was also strong in the quarter. Our teams continued to execute on our diversification strategy to
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