Materion Corporation Reports Strong Third Quarter 2025 Financial Results and Affirms Full Year Outlook

Materion Corporation (NYSE:MTRN) today reported third-quarter 2025 financial results and affirmed full year outlook.

Financial Summary

• Net sales were $444.8 million; value-added sales¹ were $263.9 million
• Net income of $25.4 million, or $1.22 per share, diluted, versus net income of $22.3 million, or $1.07 per share, in the prior year quarter; adjusted earnings of $1.41 per share versus $1.41 in the prior year quarter
• Operating profit of $34.9 million versus operating profit of $31.3 million in the prior year quarter; adjusted EBITDA² of $55.5 million, versus $56.7 million in the prior year quarter

Business Highlights

• Delivered record EBITDA margins of 27.1% in Electronic Materials, up 700 basis points year on year
• Precision Optics transformation led to significant step up in sales with approximately 1000 basis points of margin expansion year on year
• Order rates up double-digit sequentially with increases across all three businesses, driven by organic initiatives and strong macroeconomic trends
• Announced supply agreement with Commonwealth Fusion Systems, the leading and largest commercial fusion energy company, to provide materials for groundbreaking fusion technologies
• Board of Directors authorized a new $50 million stock repurchase program, replacing existing stock repurchase program

"I am incredibly proud of our team's performance in the third quarter, with both Electronic Materials and Precision Optics achieving significant milestones. The record margin performance in Electronic Materials underscores the substantial improvements we've made in that business, as our semiconductor sales start to rebound on a much-improved cost structure. In addition, the Precision Optics transformation is delivering ahead of our expectations with a significant step up in sales in the quarter, and a return to double digit EBITDA margins," said Jugal Vijayvargiya, President & CEO of Materion.

"As we look ahead, we are encouraged by the increasing order rates in each of our business segments, specifically in markets impacted by strong macro trends, including semiconductor, energy, space and defense. Our deep customer partnerships and broad portfolio of critical advanced materials position us well to close out a strong 2025 and seed the pipeline for future growth."

THIRD QUARTER 2025 RESULTS

Net sales for the quarter were $444.8 million, compared to $436.7 million in the prior year period. Value-added sales were $263.9 million for the quarter, up 1% organic³ from the prior year quarter due to strength in non-China semiconductor and space, partially offset by equipment downtime at a Performance Materials facility impacting sales output.

Operating profit for the quarter was $34.9 million and net income was $25.4 million, or $1.22 per diluted share, compared to operating profit of $31.3 million and net income of $22.3 million, or $1.07 per share, in the prior year period.

Adjusted EBITDA was $55.5 million, or 21.0% of value-added sales, compared to $56.7 million or 21.5% of value-added sales in the prior year period. This decrease was driven primarily by equipment downtime within Performance Materials, partially offset by strong price/mix and operational performance in Electronic Materials as well as the improved performance in Precision Optics.

Adjusted net income was $29.4 million excluding acquisition amortization, or $1.41 per diluted share, compared to $1.41 per share in the prior year period.

OUTLOOK

With one quarter remaining in the full year, we expect to deliver a strong fourth quarter and finish 2025 on a high note. With that, we are affirming our prior guide of $5.30 to $5.70 adjusted earnings per share for the full year.

ADJUSTED EARNINGS GUIDANCE

It is not possible for the Company to identify the amount or significance of future adjustments associated with potential insurance and litigation claims, legacy environmental costs, acquisition and integration costs, certain income tax items, or other non-routine costs that the Company adjusts in the presentation of adjusted earnings guidance. These items are dependent on future events that are not reasonably estimable at this time. Accordingly, the Company is unable to reconcile without unreasonable effort the forecasted range of adjusted earnings guidance for the full year to a comparable GAAP range. However, items excluded from the Company's adjusted earnings guidance include the historical adjustments noted in Attachments 4 through 8 to this press release.

CONFERENCE CALL

Materion Corporation will host an investor conference call with analysts at 10:00 a.m. Eastern Time, October 29, 2025. The conference call will be available via webcast through the Company's website at www.materion.com. By phone, please dial (888) 506-0062. Calls outside the U.S. can dial (973) 528-0011; please reference participant access code of 496425. A replay of the call will be available until November 12, 2025 by dialing (877) 481-4010 or (919) 882-2331 if international; please reference replay ID number 51695. The call will also be archived on the Company's website.

FOOTNOTES

¹ Value-added sales deducts the impact of pass-through metals from net sales

² EBITDA represents earnings before interest, taxes, depreciation, depletion and amortization; adjusted EBITDA represents EBITDA excluding special items, the details of which can be found in Attachments 4 through 8

³ Excludes value-added sales from the divested Albuquerque, New Mexico large area targets business sold in 2024

ABOUT MATERION

Materion Corporation is a global leader in advanced materials solutions for high-performance industries including semiconductor, industrial, aerospace & defense, energy and automotive. With nearly 100 years of expertise in specialty engineered alloy systems, inorganic chemicals and powders, precious and non-precious metals, beryllium and beryllium composites, and precision filters and optical coatings, Materion partners with customers to enable breakthrough solutions that move the world forward. Headquartered in Mayfield Heights, Ohio, the Company employs more than 3,000 talented people worldwide, serving customers in more than 60 countries.

FORWARD-LOOKING STATEMENTS

Portions of the narrative set forth in this document that are not statements of historical or current facts are forward-looking statements. Our actual future performance may materially differ from that contemplated by the forward-looking statements as a result of a variety of factors. These factors include, in addition to those mentioned elsewhere herein: the global economy, including inflationary pressures, potential future recessionary conditions and the impact of tariffs and trade agreements; the impact of any U.S. Federal Government shutdowns or sequestrations; the condition of the markets which we serve, whether defined geographically or by segment; changes in product mix and the financial condition of customers; our success in developing and introducing new products and new product ramp-up rates; our success in passing through the costs of raw materials to customers or otherwise mitigating fluctuating prices for those materials, including the impact of fluctuating prices on inventory values; our success in identifying acquisition candidates and in acquiring and integrating such businesses; the impact of the results of acquisitions on our ability to fully achieve the strategic and financial objectives related to these acquisitions; our success in implementing our strategic plans and the timely and successful start-up and completion of any capital projects; other financial and economic factors, including the cost and availability of raw materials (both base and precious metals), physical inventory valuations, metal consignment fees, tax rates, exchange rates, interest rates, pension costs and required cash contributions and other employee benefit costs, energy costs, regulatory compliance costs, the cost and availability of insurance, credit availability, and the impact of the Company's stock price on the cost of incentive compensation plans; the uncertainties related to the impact of war, terrorist activities, and acts of God; changes in government regulatory requirements and the enactment of new legislation that impacts our obligations and operations, including changes in tax regulations or guidance promulgated pursuant to the new legislation implemented in the One Big Beautiful Bill Act; the conclusion of pending litigation matters in accordance with our expectation that there will be no material adverse effects; the disruptions in operations from, and other effects of, catastrophic and other extraordinary events including outbreaks of infectious diseases and the conflict between Russia and Ukraine; realization of expected financial benefits expected from the Inflation Reduction Act of 2022; the amount and timing of any repurchases of our shares; and the risk factors set forth in Part 1, Item 1A of the Company's 2024 Annual Report on Form 10-K.