管理層發言
Welcome to ITT's 2026 Second Quarter Conference Call. Today is Thursday, August 6, 2026. Today's call is being recorded and will be available for replay beginning at 12:00 p.m. Eastern Time. It is now my pleasure to turn the floor over to Carleen Salvage, Vice President, Investor Relations and FP&A. You may begin.
Thank you, Liz, and good morning. Joining me in Stamford today are Luca Savi, ITT's Chief Executive Officer and President; and Mike Savinelli, Interim Chief Financial Officer. Today's call will cover ITT's financial results for the 3-month period ended July 4, 2026, which we announced this morning. Please refer to Slide 2 of the presentation available on our website, where we note that today's comments will include forward-looking statements that are based on our current expectations. Actual results may differ materially due to several risks and uncertainties, including those described in our 2025 annual report on Form 10-K and other recent SEC filings. Except where otherwise noted, the second quarter results we present this morning will be compared to the second quarter of 2025 and include certain non-GAAP financial measures. The reconciliation of such measures to the most comparable GAAP figures are detailed in our press release and in the appendix of our presentation, both of which are available on our website. Today's earnings call includes year-over-year commentary on the performance of SPX FLOW that reflects financial information before the acquisition date of March 2, 2026. With that, it is now my pleasure to turn the call over to Luca, who will begin on Slide 3.
Thank you, Carleen, and good morning. Before I begin, I would like to welcome our new Aerospace Contacts colleagues to the ITT family. I look forward to working with you to grow CCT more and faster. We would also like to recognize our ITTers all around the world for an outstanding performance in Q2 once again. And a particular thank you to our employees in Flow Technologies for their hard work that has enabled us to make significant progress on the integration of SPX FLOW whilst continuing to deliver strong operational and financial performance. In the second quarter, we accelerated the Q1 momentum. Our ITT has delivered strong performance across the portfolio through flawless execution and the realization of benefits from our acquisitions, building a solid foundation for the remainder of 2026 and beyond. Now to the momentum. We grew orders 53%, 13% organically. We grew revenue 51%, 13% organically, reflecting a book-to-bill of 1.1 for the quarter. We expanded operating margin 40 basis points. We delivered adjusted EPS of $2.08, up 18% year-over-year, and we generated $176 million of free cash flow year-to-date, a truly record quarter. Let's dive now into the details. On orders, CCT was the highlight of our Q2 performance, growing 59% organically. CCT's growth was fueled by large defense orders in our kSARIA business, which posted significant multiyear bookings across mission-critical platforms such as advanced night vision applications and fighter jet programs. kSARIA grew orders 168%, and it didn't end there. We continue to see strength in early Q3 with record order bookings in July. The Connectors business also posted record orders, increasing 38%, fueled by growth in North America, Europe and Asia. Motion Technologies continue to win new platform and conquer new awards in friction, feeding future market share gains. KONI orders were also strong with 9% growth, thanks mainly to China Rail and Defense. And lastly, in Flow Technologies, we delivered 91% orders growth. Organic orders declined 3% year-over-year due to the impact of deferred orders in the Middle East and the strong prior year performance that included very large oil and gas orders. SPX FLOW grew orders 9% in Q2 versus their prior year numbers, 23% growth in mixers across North America and China, 10% growth in Waukesha Cherry-Burrell and 8% growth in Nutrition & Health, supported by strong systems orders in Europe. On revenue, this quarter's performance was fueled by organic growth across all our segments. CCT grew 17% organically, driven by strength across the portfolio. Commercial Aerospace grew 14% from increased volume, coupled with pricing benefits. Defense grew 16%, driven by strong performance in kSARIA, which grew 28% versus the prior year. We also grew industrial connectors 24%, led mainly by Europe and Asia. Motion Technologies revenue increased 6%, 2% organic, led by friction aftermarket and outperformance of global vehicle production by more than 300 basis points, led by Europe and China, in addition to strength in China Rail. And finally, Flow Technologies revenue was up 21% organically or 123% in total. The team continues to deliver higher pump project sales, up 45%, driven by shipments in marine energy transition and oil and gas markets. And we also continue to grow our valves business, up 19% as we keep on winning in biopharma. Well done, Kasturi, and the Lancaster team. SPX FLOW revenue grew 5% in Q2 and 9% year-to-date, in line with our full year guidance of high single-digit growth. On operating margin, CCT's margin expanded 100 basis points over the prior year and 240 basis points sequentially to 21.7%, primarily from higher volume and pricing. Motion Technologies margin of 21.1% grew 90 basis points as a result of net productivity. And Flow Technologies, excluding SPX FLOW, expanded margins 70 basis points, fueled by market share gains and pricing. Total Flow margin of 21.4% was diluted by the full quarter contribution of SPX FLOW. Nevertheless, cost synergies from the integration, together with other productivity actions in the second half of the year, are expected to expand margin throughout the remainder of 2026. As a result of our outstanding operational execution, we delivered adjusted EPS of $2.08, up 18% versus the prior year. Turning now to capital allocation. As previously shared, we're prioritizing debt repayment. And in Q2, we paid down $124 million, bringing our leverage ratio to 2.5x, 6 months ahead of our original commitment. In July, we also deployed capital to acquire Aerospace Contacts. Though small, this acquisition is highly strategic to enhance our supply chain resilience, secure supply of critical high-precision contacts and in doing so, support continued growth with our connectors defense and aerospace customers. As you see, our legacy businesses are firing on all cylinders and now are also taking advantage of some market tailwinds. And as we shared during our Capital Markets Day, we are compounding and creating more value with our recent acquisitions. Let's turn to Slide 4 to discuss these contributions. During the last few years, we worked hard to cultivate and execute the right acquisitions. We focus on high-quality companies with strong management teams and solid fundamentals. These acquisitions do more than add scale. They strengthen ITT's portfolio by increasing our exposure to higher growth, higher-margin businesses where we can drive additional value through differentiation in execution and innovation. This is exactly the playbook with Svanehøj. We entered the marine energy transition market, a market that has a lot of growth potential today with LNG and in the future with ammonia. Svanehøj's products and team are leaders in their market, and the results speak for themselves. Since acquisition through the end of 2026, Svanehøj is expected to grow revenue 32% on average each year with a book-to-bill of 1.2. Our projected backlog at the end of 2026 will be up 40% since the acquisition. As a result, the acquisition multiple of 13 is projected to be just 6 at the end of 2026. Thank you, Søren, Morten and Johnny for this excellent performance. And the marine energy transition end market expected to remain strong. Svanehøj is well positioned for future profitable growth. kSARIA, another bolt-on acquisition, is also a success story. The defense market, which represents roughly 80% of kSARIA provides a powerful market tailwind. kSARIA's leadership and flawless execution enable us to win larger portions of the prime programs we participate in. By the end of 2026, we are projecting to grow backlog 180% since the acquisition and orders 60% on average each year. This positions us incredibly well for the future. kSARIA's acquisition multiple of 13 is expected to be 11 by the end of 2026. And we still have plenty of opportunities to expand margins with pricing actions and productivity initiatives. Thanks, DiPoto, and team for the quarter of results. On SPX, we are in the early innings, but we are encouraged by how we started, the progress we have made and the future potential. On the start, we are ahead of our plan, and the team is working hard to accelerate. We have a path to our high single-digit growth commitment with orders in the first half of the year growing 7% and revenue growing 9% year-to-date, resulting in a book-to-bill of 1.05. We are progressing well and cost synergies are ahead of plan, whilst we are working hard to build a strong foundation for future revenue synergies. On future potential, we have plenty of growth prospects in each business, be it Nutrition & Health, Waukesha Cherry-Burrell, mixers or pumps, and the funnel of opportunities keeps on growing. I'm encouraged by what I experienced at Seital, a small factory and business in Italy that is part of Nutrition & Health. I was fortunate to spend time with the local management, learn from their deep knowledge of the commercial and engineering teams, and observed the 5S of the well-run plant. This is a team that is ready to win and conquer more. Another site with great potential is our Xidu factory in China. We spent time with Bruce Wang and the local team exploring how we can grow faster and more profitably in APAC and China by adopting a more entrepreneurial mindset and a continuous improvement approach and continuing to invest in innovation. As you can see, our acquisition playbook is indeed working. In summary, our legacy businesses will keep delivering value through above-market growth and continuous margin expansion, whilst the acquisitions will compound value by doing exactly the same. With that, let me now turn the call over to Mike Savinelli, who is joining us for his first earnings call to discuss Q2 results in detail on Slide 5.
Thank you, Luca, and good morning. As Luca highlighted, we delivered a very strong quarter. In Q2, we achieved outstanding growth across the business in revenue, adjusted margin, EPS and cash. Our teams delivered a record $1.5 billion in revenue, growing 51% or 13% organically. CCT grew 17% organically, fueled by industrial connectors and aerospace and defense strength. CCT ended the quarter with a robust book-to-bill of 1.4. Motion Technologies grew 2% organically, a significant achievement in a down market, driven by friction aftermarket and OE outperformance together with KONI growth. And finally, Flow Technologies grew 21% organically, driven by strong project shipments and from strength in short cycle, which was up 10% year-over-year. Our strong top line performance contributed to operating income growth of 55% and margin expansion of 40 basis points, supported further by the full quarter of SPX FLOW as well as strong execution across our legacy businesses. CCT delivered 23% operating income growth to a margin of 21.7%, a 100 basis point expansion, driven by increased volume, realization of pricing actions and productivity, partially offset by material inflation. Flow Technologies delivered a margin of 21.4%, a decline of 160 basis points, driven by the full quarter impact of SPX FLOW. We expect to expand margin sequentially throughout the year from cost synergy realization and other productivity initiatives. And MT's operating margin grew 90 basis points to 21.1% as the team drove net productivity of 110 basis points over the prior year. As a result of our top line performance and margin expansion, EPS reached $2.08 for the quarter, increasing 18% versus the prior year. Lastly, year-to-date free cash flow of $176 million was impacted by $71 million of onetime acquisition-related expenses, which we highlighted in Q1. Excluding these impacts, free cash flow was up 15% year-over-year, and looking purely at Q2, our free cash flow margin was 11% for the quarter. Let's now turn to the Q2 EPS bridge on Slide 6. The 18% EPS growth was primarily driven by strong operational performance delivered by all legacy businesses, compounded by our acquisitions. Our legacy businesses contributed $0.36 of growth, of which Svanehøj and kSARIA contributed $0.12 of that from market share gains, pricing and productivity actions. The full quarter of SPX FLOW contributed $0.68 of growth with the impacts of the incremental interest, share count and tax rate, mostly offsetting this contribution. We are maintaining SPX FLOW's EPS accretion expectation of $0.10 to $0.14 for the year. I want to also stress that the net impacts of the tariff refunds were immaterial to the quarter at just $0.5 million. Now let's move on to Slide 7 to discuss our updated 2026 outlook. We are raising our full year organic revenue guidance range to 5% to 8% growth, driven by increased bookings in our CCT business, strength in both Flow Technologies projects and short cycle and continued friction OE outperformance, coupled with operational performance above our original expectations. On adjusted operating margin, we expect to deliver over 100 basis points of margin expansion to approximately 20.5% at the midpoint, fueled by top line growth, favorable price-to-cost ratio and productivity gains. As a result of the momentum we generated in the first half of the year, we are raising our adjusted EPS outlook for 2026 to $8.22 at the midpoint. This represents a $0.37 increase and 14% growth at the midpoint, fueled by volume growth, pricing actions and productivity initiatives. The low end of our new range now exceeds the high end of our previous guidance range. This revised guidance does not consider any additional net benefits from tariff refunds above the $0.5 million from Q2. Finally, on cash and capital structure, we are raising the midpoint of our free cash flow guidance to $565 million, resulting in a free cash flow margin between 10% and 11%. We made good progress lowering our leverage ratio. We are ahead of target and are driving towards approximately 2.3x by year-end. Now let me turn the call back over to Luca to wrap up on Slide 8.
Thanks, Mike. Before we move to Q&A, let me reinforce a few points. What you see in Q2, as you saw in Q1, is ITT's strategy in action. Our entrepreneurial spirit is accelerating growth in our legacy businesses. Our relentless execution is accelerating margin expansion. Our acquisitions are compounding organic value creation more and more. And in Q2, the momentum towards our long-term targets is accelerating. As always, I appreciate your time and continued interest in ITT. Liz, please open the line for Q&A.
分析師問答
Our first question comes from Scott Davis with Melius Research.
Congrats on these numbers. There's really not much to pick on here at all. I'd like to talk a little bit about SPX FLOW because that's the newest asset that we need to learn more about. Can you give us a sense, Luca, where SPX FLOW is in their lean and operational excellence journey, how you would compare them to your legacy ITT businesses and where the upside is there?
Sure. So I would say when we look at the plants, if it's Xidu, if it's our plant in Poland, if it is even the factory that I visited in Italy, those are well-run plants, I would say, and good 5S, Scott, and some good talent. I think though that the area for improvement that we have in SPX FLOW and in the lean is really to ensure that the lean is entrenched in the DNA in the cell. So today, I would say it's probably more linked to what were corporate initiatives, the A3 that you see stuck on the board, but not necessarily in improving the productivity in the cell or sometimes the material flow in the factory. So there is work to be done, but there is a good level of talent and the plants tend to be in general with a good 5S.
Okay. Good answer. Just a quick follow-up. Where are we on price versus cost in your three different segments?
Yes. When you look at the price-cost dynamic, it's pretty much the same overall. You have a price-cost positive situation when it comes to Flow Technologies and in CCT because obviously, we have more price power in those areas. Different dynamics in Motion Technologies, where we are recovering some of the cost inflation, but not fully. So there are pressures there. But at the ITT level, we expect to be price-to-cost positive, probably neutral from a margin perspective for the full year.
Our next question comes from Jeff Hammond with KeyBanc Capital Markets.
Great start here with SPX FLOW. Just wondering if you could maybe speak to the underlying demand momentum in SPX FLOW. I guess that's what's driving the order growth and any early wins you're seeing around maybe backing off 80/20 or synergies? And then maybe expand on the funnel comment in SPX FLOW, which I think you said was expanding.
Yes. So when you look at the funnel and the orders, it's a great performance. If you think about up 9% in Q2, year-to-date our orders are up 7%. Also, our book-to-bill is above 1. Our book-to-bill in Q2 for SPX FLOW is 1.13. So good performance there. What we see is really a good recovery in chemicals. If you think about the mixers dynamic, we had a very good performance on orders for mixers. Good performance on Waukesha as well, 10% orders growth. And in Nutrition & Health, to give you more color, I participated in some very important bid reviews for large projects in Europe. So good orders, book-to-bill above 1, building backlog, and the funnel of opportunities in SPX FLOW is growing. This is geographically across the board, both in North America as well as in Europe.
Okay. That's good to hear. And then just on the CCT orders — they were pretty eye-popping, and I think you mentioned record July. Can you just kind of split out underlying demand versus lumpiness?
Sure. CCT was simply outstanding in terms of orders. Everything was up, so it's not just CCT up 58%. Controls were up 22%. Connectors were up 38%. kSARIA is true — some lumpiness is present. You may remember that in Q1 we postponed some orders from Q1 to Q2. But if you look at kSARIA today, orders up 46%. There is a market tailwind, as I said in the prepared remarks, but there are also significant market share gains. We are participating in some programs and we know we've re-won those programs and more. Some of this has long-term visibility into 2028 and beyond. The backlog we have visible for Q3, Q4 and Q1 of next year compared to last year at the same time is considerably higher. So great growth for the midterm as well as long term.
Our next question comes from Mike Halloran with Baird.
A couple of questions. First, can you help with the back half of the year cadence as you think about earnings, revenue and any of those metrics? And then maybe put in context how your orders are tracking in terms of timeline, how much visibility it's giving you. It feels with the strength in the orders you're getting longer-dated, longer-cycle orders coming through. How should we think about that order-to-revenue conversion?
I just want to mention that we had a significant step-up in performance in Q2. For the balance of the year, for the second half, we expect to remain at that elevated level of performance. Looking at each value center: for Motion Technologies, we expect some seasonality in the second half, expecting stable margins. For CCT, we're expecting consistent revenue and margin similar to Q2. And Flow Technologies' margin expansion, we expect to expand from synergies.
Talking about the orders: different picture across businesses. For CCT, as I said, incredible performance. There are some long-term programs that give us fantastic visibility in the future, and our backlog for the next few quarters is incredibly up, so very good short-term visibility. For Flow Technologies, orders were up 91% in total. Svanehøj's book-to-bill is 1.3. If you have a business growing 39% in Q2 on top of that with book-to-bill of 1.3 and building backlog, that gives short- and medium-term visibility. SPX FLOW revenue is up 5% and book-to-bill is 1.13, so we are building backlog for the medium term. Motion Technologies are winning more awards that will feed market share gains. KONI orders were up 9%, thanks to rail and defense. So great visibility for the long term, and also in the short and medium term.
That makes sense. Appreciate that. And then maybe just state of the union on the legacy Flow assets: what you're seeing on a regional basis, with emphasis on directional dynamics in the Middle East, and what you're seeing in terms of project outlays?
Let me address the Middle East first, then other regions. Regarding the Middle East, our business there has been growing very well for the first six months because of all the orders we won in the last couple of years that we are delivering — we had a huge backlog and are delivering it, so huge revenue growth in Q1 and Q2. However, orders in the Middle East have been delayed and this will probably impact regional growth in Saudi Arabia and the Middle East in the next few quarters. We have seen some orders now being given to EPCs, so we're starting to see some movement, which is good. I also want to highlight Habonim's performance: despite being in the middle of this environment, Habonim had orders up 18% in the quarter, revenue up 19%. Year-to-date, both orders and revenue are up double-digit and book-to-bill is above 1, so great over there. Regarding the funnel, it is increasing year-over-year: the funnel is up 34% year-over-year and 6% sequentially. Regionally, North America, Latin America and interestingly the Middle East are up. The Middle East funnel is up mainly because orders got delayed, but North America and Latin America being up highlights the strength of those regions because revenue is growing, book-to-bill above 1, so orders are growing even more. Europe and Asia-Pacific funnels are down a little bit.
That was great. Appreciate it. Congrats on the quarter.
Our next question comes from Daniel DiCicco with BMO Capital Markets.
It looks like you're winning share literally everywhere. We've talked about some of the drivers, but where do you see the most opportunity still in the portfolio when we look out to the medium term?
You're spot on — we are winning share across the board. In KONI, rail opportunities are strong. In China, we are winning market share with CRRC and other OEMs. We're winning market share in Flow Technologies as well, mainly because of our project management and in connectors. I would say the biggest opportunities remain in Flow Technologies and CCT — we can grow faster there.
Great. And then some of the commercial opportunities you see within SPX FLOW and specifically some pricing opportunities on the Nutrition & Health side would be helpful.
When we look at SPX FLOW, an example is Xidu in China, a very good plant. Our approach in China could be adapted more to the market by investing more in engineering, local application engineering and local R&D so decisions are made closer to the market and the customer. This approach has generated success for our friction business in China, KONI in China and our connectors business. Decentralizing and empowering local teams would be a great opportunity. Similar opportunities exist at Seital in Italy; that team is eager to win more. We're also working on revenue synergies, particularly in Latin America for mixers. The pause in the Middle East presents an opportunity to prepare for mixers or the Bran+Luebbe pumps with localization in Saudi.
Great. Congratulations on a great quarter.
Our next question comes from Joe Giordano with TD Cowen.
Just curious what the opportunity set is. You've been talking about winning valves market share for a while with the legacy portfolio in pharma and health. What's the potential to bring in and pull in some of the SPX FLOW into those discussions from the wins you've had on the legacy side in valves?
You're right. We have good penetration in biopharma with our Lancaster plant because of proprietary technology like EnviZion. We won very well there. This is a market where we can expand with some SPX FLOW brands and mixers. Conversations are happening and sales synergies could have been underestimated during due diligence — that is fair.
And then can you talk about what's going on in the Middle East and the implications? If we have to rethink where LNG capacity goes or new pipelines and shipping routes, I'd imagine you could be a beneficiary across multiple elements of the firm — Svanehøj, infrastructure, etc. If energy flows are rerouted, how does that impact you?
There are always two sides to the coin. If our factory in Dammam is impacted in the short term, from a shipping perspective the business for Svanehøj could be positively affected. More investment in pipelines would use BB3 pumps; we completed VA/VE on the BB3 and have a very good product that helped win the Vaca Muerta project in Argentina. Further investment in different regions could also be good for Bornemann or Goulds Pumps. For example, what's happening in Venezuela could be a tailwind for Bornemann since Venezuela was a large market historically. So there are definitely opportunities across the board.
Our next question comes from Nathan Jones with Stifel.
I'll follow up to Scott's question on Lean and ask where you think SPX is on their 80/20 journey. Specifically, I'm interested in value-based pricing, which typically comes later in the cycle. They've been on an 80/20 journey since they went private. Any updates or thoughts?
I'm not particularly an 80/20 purist — it's a good tool and we use it where it makes sense, such as safety and quality. But I prefer to go after the whole picture rather than rely solely on an 80/20 rule. We're adopting a common-sense, rigorous approach. Regarding value-based pricing, the team is good at it. Commercial teams like Wendy and Rudy know their markets and customers and they know how to price opportunities appropriately. In Nutrition & Health, the bids I participated in demonstrated the commercial team's ability to push to the right price relative to value.
On revenue synergy opportunities: are there chances to pull legacy ITT products into SPX end markets or combine SPX products with legacy products to generate revenue synergies?
Absolutely. The largest opportunity is Bornemann hygienic pumps. Bornemann has strong products for hygienic applications, but we lacked the proper channels. Waukesha Cherry-Burrell has strong hygienic channels in the U.S., so allowing Waukesha Cherry-Burrell to sell Bornemann pumps in the U.S. through their channel is a great opportunity. There are also cases where SPX has strong distributors in regions where we are weaker, so utilizing each other's channels on mixers and pumps is where we see meaningful benefits.
Our next question comes from Vlad Bystricky with Citigroup.
On SPX FLOW orders and revenue momentum, can you parse how much of that is volume versus price-driven? And more broadly for ITT, how are you thinking about price contributing to organic growth this year given lingering inflation?
For SPX FLOW, the growth is mainly volume-driven with a little bit of price. For example, our legacy short-cycle orders in Flow Technologies were up 5% in the quarter; of that 5%, 4% is volume and 1% is price. We need to be more surgical on pricing, but the price/cost equation remains positive for Flow Technologies each quarter and for the full year.
Got it. Regarding CCT and specifically kSARIA: given the orders growth, some of this is longer-cycle and extends out. How are you thinking about capacity at kSARIA and your ability to ramp to deliver versus these large orders and overall supply chain ability to keep up?
Great performance on orders and revenue — kSARIA pro forma revenue was up 28% in Q2. As of today, we do not see capacity constraints at kSARIA. In fact, that is part of why we acquired Aerospace Contacts — we were concerned about feeding demand and growth on the connector side, aero and defense. By in-sourcing Aerospace Contacts, we now secure a more resilient supply chain. So no real capacity constraints at kSARIA currently.
Our next question comes from Andrew Obin with Bank of America.
Question on the margin guide raise. Q2 was very good, but the quarter came a little short on margin versus some models. You raised margins into the second half — why do you feel better about margins into the second half?
You are right — we see plenty of improvement opportunities. Motion Technologies at 21.1% margin grew 90 basis points, which is strong given the market pressures. Our goal is to consolidate and maintain that level for the full year. CCT at 21.7% margin is a record for CCT and improved sequentially more than 240 basis points; without kSARIA dilution it would be higher than 23%. The higher-than-expected dilution in Flow Technologies impacted Q2 more than we anticipated, but legacy Flow is up 70 basis points and serves as a strong benchmark. As we move forward, margins will improve because productivity ramps and acquisition cost synergies will have increasing impact.
So it's really about Flow?
Yes, the more pronounced dilution in Q2 was from Flow Technologies, so as synergies and productivity take hold we expect that dilution to abate and margins to expand.
If you back into second-half organic growth, it feels like roughly plus 6% implied. The first half was 12% organic and orders were very impressive. The second half feels conservative — any commentary?
Consider the full-year picture: we've raised the full-year growth. Sequential dynamics are affected by a tougher year-over-year compare in Q3 and Q4, Q4 has four fewer days this year versus last, and the Middle East orders delay will impact growth in upcoming quarters. Additionally, Motion Technologies has Q4 seasonality as customers often shut down earlier in December. Overall, we expect to remain at an elevated performance level for the remainder of the year and have raised Q3 and Q4 EPS guidance accordingly. The full-year outlook remains strong.
Our next question comes from Joe Ritchie at Goldman Sachs.
Luca, exceptional performance across the board. You've done a lot of M&A, delevered faster than expected, and the M&A is paying dividends. What's the pipeline look like going forward, where are the opportunities, and how are you thinking about deploying future capital?
Everything is working well and we're busy cultivating the right companies. Deleveraging faster gives some flexibility, but priorities remain: pay down debt, execute synergies, and deliver on SPX FLOW. We are cultivating bolt-on acquisitions across Flow and the connector side; small strategic bolt-ons like Aerospace Contacts are in the pipeline and may be executed, but our primary focus is paying down debt and delivering synergies.
Great. I may have missed it earlier: on kSARIA orders and the portfolio shifting toward longer-cycle business, is the mix changing to more longer-cycle than historically? How are you thinking about visibility beyond 2026?
We have both shorter-cycle and longer-cycle exposure. kSARIA wins provide visibility into 2028 on jet programs and similar platforms. When we look at backlog for the next four quarters and compare to the prior year, the backlog we have for upcoming quarters is considerably higher — sometimes 20% to 30% higher for upcoming periods — so we have great long-term visibility and much more backlog for the short term as well.
Thank you. This does conclude today's teleconference. Please disconnect your lines at this time, and have a wonderful day.
Thank you.