Manitowoc’s first quarter saw a positive market reaction despite revenue and adjusted EPS falling short of Wall Street expectations. Management attributed the quarter’s performance to higher orders in the Americas and a sharp uptick in European tower crane demand, with CEO Aaron Ravenscroft highlighting non-new machine sales growth and “strong customer feedback” at the Bauma trade show. The company also pointed to successful integration of AI into its operational processes, yielding measurable savings, and reported progress in aftermarket initiatives driven by expanded service capabilities. Challenges such as lower overall sales and margin compression were acknowledged, but management focused on the resilience of the aftermarket business and improving order trends.
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Manitowoc (MTW) Q1 CY2025 Highlights:
- Revenue: $470.9 million vs analyst estimates of $482 million (4.9% year-on-year decline, 2.3% miss)
- Adjusted EPS: -$0.16 vs analyst expectations of -$0.09 (71% miss)
- Adjusted EBITDA: $21.7 million vs analyst estimates of $16.14 million (4.6% margin, 34.4% beat)
- Operating Margin: 1.3%, down from 3.1% in the same quarter last year
- Backlog: $793.7 million at quarter end, down 18.3% year on year
- Market Capitalization: $433.8 million
While we enjoy listening to the management's commentary, our favorite part of earnings calls are the analyst questions. Those are unscripted and can often highlight topics that management teams would rather avoid or topics where the answer is complicated. Here is what has caught our attention.
Our Top 5 Analyst Questions Manitowoc’s Q1 Earnings Call
- Jerry Revich (Goldman Sachs) asked how tariff mitigation splits between pricing, sourcing, and vendor negotiations. CEO Aaron Ravenscroft explained mitigation involves surcharges, alternative suppliers, and partial cost-sharing with vendors, but emphasized the situation is fluid due to currency and market factors.
- Revich (Goldman Sachs) inquired about the relative impact of Chinese tariffs and underlying assumptions. Ravenscroft declined to break down the exact China portion, noting tariffs affect both Chinese components and steel/aluminum imports, with mitigation strategies dynamically adjusted as tariffs evolve.
- Revich (Goldman Sachs) sought detail on the drivers behind accelerating European tower crane orders. Ravenscroft described recovery as broad-based, attributing it to historically low dealer inventories and modest improvements in customer sentiment, but clarified that the market remains far from prior cycle peaks.
- Steven Fisher (UBS) pressed for clarity on the impact of steel and aluminum tariffs on U.S. production costs. Ravenscroft confirmed these are included in the $45 million estimate for Shady Grove manufacturing, reflecting higher input costs for domestically produced cranes.
- Fisher (UBS) questioned the ability to reprice backlog orders and sustain non-new machine sales growth. Ravenscroft responded that surcharges are intended to offset tariffs on backlog units, and non-new machine sales growth is “broad-based” across geographies and product types, supported by ongoing expansion of service technicians and locations.
Catalysts in Upcoming Quarters
Looking ahead, the StockStory team will be watching (1) the company’s ability to sustain aftermarket and non-new machine sales momentum, (2) the effectiveness of tariff mitigation efforts as global trade policy evolves, and (3) continued signs of recovery in European tower crane orders. Execution on service expansion, successful pricing strategies, and progress in key infrastructure projects will also be important markers to track.
Manitowoc currently trades at $12.24, up from $8.30 just before the earnings. Is there an opportunity in the stock?Find out in our full research report (it’s free).
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