Howmet Aerospace makes the parts that hold jet engines together and keep commercial trucks rolling. It earns money every time an airline builder, defense contractor, or truck manufacturer places an order for a component. The four product lines tell the story: Engine Products makes turbine blades and rings from nickel and titanium alloys for aircraft engines and power generation turbines. Fastening Systems makes the bolts and rivets that hold aircraft frames together. Engineered Structures makes titanium forgings and machined airframe parts. Forged Wheels makes lightweight aluminum wheels, sold under the Alcoa Wheels brand, for heavy trucks and buses. Aerospace is the engine of the whole business, accounting for roughly 70% of revenue in 2025, with commercial transportation adding another 15% and gas turbines contributing 11%. Because Howmet gets paid per order rather than on a subscription or licence, its revenue rises and falls with how many planes and trucks customers are building at any given time. The diagram below traces where the money goes.
How Howmet Aerospace Makes Money
flowchart TD
A["Aerospace Customers
Commercial & Defense"] -->|"$5.7B (70% of revenue)"| B["Engine Products,
Fastening Systems,
Engineered Structures"]
C["Transportation Customers
Trucks & Buses"] -->|"$1.2B (15% revenue)"| D["Forged Wheels
Alcoa Wheels brand"]
E["Gas Turbine Customers
Electricity, Data Centers"] -->|"$0.9B (11% revenue)"| B
B --> F["Advanced Engineered
Components & Solutions"]
D --> F
F -->|"Total Revenue
$8.3B"| G["Operating Income
$2.1B, 24.8% margin"]
G --> H["Operating Cash Flow
$1.9B"]
H --> I["R&D & Plant Investment
Titanium, Castings,
Fastener Technology"]
I --> B
I --> D
H --> J["Debt Service &
Strategic Acquisitions
CAM, Brunner"]
J --> B
B -->|"Patent Portfolio
1,020 granted patents"| F
D -->|"Trademark Portfolio
Alcoa, Huck, Dura-Bright"| F
Five years of numbers tell a clear story about where this business has been heading. Revenue has climbed every single year, from $5.0 billion in 2021 to $8.3 billion in 2025. That is not a blip. It is consistent double-digit growth driven almost entirely by aerospace demand recovering after the disruption of the early 2020s, combined with Howmet's ability to raise prices faster than its material and labour costs are rising.
Howmet Revenue 2021 to 2025 ($ billions)
Revenue has grown each year for five straight years, reaching $8.3 billion in 2025.
Cash generation is even more striking than the revenue line. Free cash flow (the money left after paying for operations and capital spending) went from $0.2 billion in 2021 to $1.4 billion in 2025. Operating cash flow reached $1.9 billion in 2025. At the same time, the company has been paying down debt steadily. Net debt fell from $3.5 billion in 2021 to $2.3 billion in 2025. The balance sheet is getting lighter every year while cash generation accelerates.
$1.4B
Free cash flow in 2025, up from $0.2B in 2021
Inside the business, the Engine Products segment is carrying the most weight. It generated $4.3 billion in revenue in 2025 and a profit margin of 33.3%, up from 27.2% in 2023. Fastening Systems has also improved sharply, with its margin rising from 20.6% in 2023 to 30.4% in 2025. Engineered Structures went from 12.9% margin to 21.2% over the same period. These are not small moves. The one segment pulling in the opposite direction is Forged Wheels. Truck demand has been soft, and wheel sales dropped slightly in 2024 and 2025 compared to 2023. Management expects commercial transportation to stay weak into at least the first half of 2026.
2025
milestone
Howmet Moves to Expand Fastening Systems
In late 2025 and early 2026, Howmet made two moves to grow its Fastening Systems business. It agreed to acquire Consolidated Aerospace Manufacturing (CAM) from Stanley Black and Decker for approximately $1.8 billion, a deal still awaiting regulatory approval as of early 2026. It also completed the smaller acquisition of Brunner Manufacturing, a fastener maker, in February 2026. Together these deals would significantly increase Howmet's share of the aerospace fastener market.
The risks here are concrete and well-documented. Boeing is a major customer, and Boeing has had serious problems. A labour strike at Boeing in late 2024 cut production of the 737 MAX and other jets, which directly reduced orders for Howmet parts. The filing states plainly that this has had a material impact on financial performance and will continue to do so. Because Howmet earns money per component delivered, any slowdown in Boeing's production line flows straight into Howmet's revenue.
Why Raw Material Prices Matter So Much Here
Howmet makes parts from titanium, nickel, cobalt, and aluminium. These materials are expensive and their prices move around based on global supply and demand. Titanium in particular has been volatile because Russia, which supplies a large share of global titanium, is involved in the conflict in Ukraine. When raw material prices spike faster than Howmet can pass costs on to customers, profit margins get squeezed.
Raw material costs are the second major risk. Howmet relies on a small number of suppliers for titanium sponge and specialised alloys. The Russia-Ukraine conflict has kept titanium prices volatile. New US tariffs starting in 2025 and 2026 add another layer of cost uncertainty. The company can often pass costs on to customers, but not always and not immediately. The third documented risk is the pending CAM acquisition itself. The deal requires regulatory approval and financing, and if it does not close as expected, or if the expected benefits do not materialise, the company's financial condition could be harmed.
$1.8B
Cash price agreed for the CAM acquisition, pending regulatory approval
What 'Cyclical Demand' Means for a Parts Maker
When airlines are confident about the future, they order more planes. When they are nervous, they cancel or delay. Aircraft programmes take years to ramp up, so parts suppliers like Howmet can go from too little work to too much work very quickly. This cyclicality means revenue can reverse sharply in a downturn even if the underlying business is well run.
RTX Corporation and GE Aerospace each represented approximately 11% of Howmet's total third-party sales in 2025. Losing either would be a serious blow. The company acknowledges this directly in its filing. Combined with the Boeing dependency, a large portion of Howmet's revenue traces back to a small number of aerospace giants whose own fortunes depend on airline demand and defence budgets.
~22%
Share of total sales tied to just two customers: RTX Corporation and GE Aerospace (each approximately 11%)
Howmet's stock price rose 1,453% from the April 2020 separation to December 31, 2025, compared to 177% for the S&P 500 over the same period. The filing states this figure directly. Whether that gap persists depends entirely on what comes next for commercial aerospace.
The Bet
Aerospace production rates keep climbing for long enough, and at a fast enough pace, that Howmet's factories can run at high utilisation and margins keep expanding. The entire revenue trajectory assumes that Boeing resolves its production problems, that airlines continue ordering new fuel-efficient jets, and that defence spending remains elevated. If aircraft build rates stall or reverse, whether because of Boeing's ongoing quality issues, a sharp drop in air travel demand, or tighter defence budgets, Howmet's per-order revenue model means the income statement turns down fast. The CAM acquisition also has to deliver the benefits management expects, at the price agreed, without the kind of integration friction that erases the rationale for paying $1.8 billion.
Open question
Howmet has generated five straight years of revenue growth, rapidly improving cash flow, and steadily falling debt. The aerospace market is recovering and the company is expanding its fastener business through acquisition. But 70% of revenue depends on commercial and defence aerospace orders, Boeing is its single largest customer and Boeing is still working through serious manufacturing problems, titanium prices are volatile, and the company is about to take on $1.8 billion of acquisition debt. Can Howmet's aerospace growth cycle run long enough and strongly enough to absorb the Boeing risk, the raw material volatility, and the CAM integration all at the same time, or is the business more exposed to a single cycle turn than the five-year revenue chart suggests?
Compiled · 10-K · FY2025
