Q3 2025 Flowserve Corp Earnings Call Transcript
Key Points
- Flowserve Corp (FLS) delivered exceptional results in Q3 2025, with bookings of $1.2 billion and revenue growth of 4%.
- The company raised its adjusted EPS guidance range for the second time this year to $3.40 to $3.50, representing a 31% increase from last year.
- Adjusted gross margins increased by 240 basis points to 34.8%, and adjusted operating margins were 14.8%, driven by incremental margins of 115%.
- Flowserve Corp (FLS) returned $173 million of cash to shareholders in the quarter, including $145 million of share repurchases.
- The company announced a divestment of its legacy asbestos liabilities, which will enhance capital allocation optionality and improve annual cash flow by $15 million to $20 million.
- Flowserve Corp (FLS) continues to see slowness in project timing for larger engineered projects, primarily in the energy end market.
- The company's bookings in the energy sector were down 19% due to a difficult comparison with the previous year, which included large projects in the Middle East.
- Despite strong performance, the chemical end market remains the lowest growth area for Flowserve Corp (FLS).
- The company faces competitive dynamics in project pricing, particularly for larger projects, which could impact margins.
- Flowserve Corp (FLS) acknowledges that its work on improving working capital is not yet complete, indicating room for further improvement.
Good day and welcome to the quarter three 2025 earnings call. Please note that this conference is being recorded.
At this time, I'd like to turn the conference over to Brian Ezzell, Vice President, Investor Relations, Treasurer and Corporate Finance. Please go ahead.
Thank you, and good morning, everyone. Welcome to Flowserve's third quarter 2025 business update. I'm joined by Scott Rowe, Flowserve's President and Chief Executive Officer; and Flowserve's Chief Financial Officer, Amy Schwetz. Following Scott Name's prepared remarks, we'll open the call for questions.
Turning to slide 2. Our discussion will contain forward-looking statements that are based upon information available as of today. Actual results may differ due to risks and uncertainties, refer to additional information, including our note on non-GAAP measures in our press release, earnings presentation and SEC filings, which are available on our website.
With that, I'll
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