Astronics (ATRO) TD Cowen 47th Annual Aerospace & Defense Conference summary

Business overview and market positioning

• Focuses 90% on aerospace, with 70% in commercial transport, 10% military, 10% business jet, and 10% test segments.

• Expects top-line revenue near $1 billion, with 10%-15% growth and improved income in 2026.

• Half of business comes from in-flight entertainment and connectivity, serving over 200 airlines and all major OEMs.

• Major product lines include aircraft lighting and flight critical electrical power for small aircraft, military, and drones.

• Test segment contributes $70-$80 million, with a significant U.S. Army radio test contract expected to add $40-$50 million annually starting first half of 2026.

Financial performance and growth drivers

• Q4 was a record quarter, continuing a trend of strong growth since the pandemic low of $445 million in 2021.

• Average growth of 18% up to 2025, with 8% in 2025 as margins improved.

• Q4 revenue reached $230-$240 million, establishing a new base for 2026.

• 75% of revenue ships within a year, with a mix of book-and-ship business.

• Backlog remains at record levels, supported by improved supply chain, especially electronics from Asia.

Product and technology trends

• Retrofit business is strong, driven by airlines' need to upgrade in-flight entertainment and power systems every 5-7 years.

• Wide-body aircraft have higher penetration of seat-back displays; narrow-body offers significant aftermarket opportunity.

• Constant technology churn in connectivity, with adaptability to LEO, KU, and KA satellite systems.

• Anticipates wireless charging as the next evolution in cabin power solutions.

• Acts as a liaison between consumer electronics and airlines to anticipate and integrate new technologies.