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The Eastern Company (EML) investor relations material
The Eastern Company Q3 2025 earnings summary
Complete event summary combining all related documents: earnings call transcript, report, and slide presentation.Executive summary
Q3 2025 revenue from continuing operations was $55.3 million, down 22% year-over-year, with EBITDA at $3.5 million and EPS at $0.10; nine-month sales were $191.4 million, down 7% year-over-year.
Net income from continuing operations was $0.6 million ($0.10 per diluted share), down from $4.7 million ($0.75 per share) last year; adjusted net income was $0.8 million ($0.13 per share).
Performance was impacted by significant declines in Class 8 truck and automotive markets, with OE truck production down 36% and fewer new EV model launches.
Proactive restructuring, including workforce optimization, SG&A reduction, operational footprint reorganization, and divestiture of an underperforming unit, resulted in $1.8 million in cost savings and $2.2 million in charges year-to-date.
Product innovation, customer diversification, and a new $100 million revolving credit facility are key pillars for long-term growth.
Financial highlights
Net sales decreased 22% to $55.3 million from $71.3 million in Q3 2024, mainly due to lower sales in returnable transport packaging and truck mirror assemblies.
Gross margin fell to 22.3% from 25.5% year-over-year, impacted by higher raw material costs and lower volumes.
Adjusted EBITDA from continuing operations was $3.5 million for Q3 2025 (down from $8.7 million in Q3 2024) and $15.2 million for the nine months (down from $21.3 million year-over-year).
Operating profit margin fell to 3.1% in Q3 2025 from 9.5% in Q3 2024; operating profit was $1.7 million, down from $6.8 million.
Backlog as of September 27, 2025, was $74.3 million, down 24% year-over-year.
Outlook and guidance
Marginal improvements in Q4 volumes are being observed, but a soft first half of 2026 is expected, with incremental improvements later in the year.
Gross margins are expected to improve as volumes recover, returning toward historical norms.
Management anticipates capitalizing on market recovery, focusing on product innovation, customer diversification, and operational efficiency.
Ongoing investment in product development and expansion into new end markets are key pillars of the growth strategy.
Management expects cash, operating cash flow, and available credit to be sufficient for foreseeable working capital needs.
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