AMETEK delivered strong second-quarter results highlighted by record-level sales and EBITDA, strong core margin expansion, and excellent earnings growth. We also raised our full-year sales and earnings guidance to reflect our second-quarter results and the recent acquisition of FARO Technologies. Sales were a record $1.78 billion, an increase of 2.5% from the second quarter of 2024. Organic sales were flat, acquisitions added 1.5 points, and foreign currency translation was a 1-point benefit.
Book to bill in the quarter was 1.00, and we ended the second quarter with a backlog of $3.47 billion, near record levels. Our operating performance in the quarter was excellent, leading to strong margin expansion and earnings growth. Operating income in the quarter was $462 million, a 3% increase over the second quarter of 2024. Operating margins were 26% in the quarter, up 20 basis points from the prior year.
Core margins, excluding the dilutive impact from acquisitions and the impact of foreign currency, were very strong at 26.7%, up 90 basis points versus the prior year. EBITDA in the quarter was a record $565 million, up 4% versus the prior year, with EBITDA margins an impressive 31.8%. This operating performance led to earnings of $1.78 per diluted share, up 7% versus the second quarter of 2024. EIG operating income was $344 million, and operating margins were 29.7%, with core margins a very strong 30.7%, up 40 basis points versus the prior year.
| Metric | Period | Current guidance |
|---|---|---|
| Full-year sales and earnings | FY2025 | Raised to reflect Q2 results and the FARO acquisition (Raised) |
| Aerospace & defense organic sales | FY2025 | Up high single digits (Raised) |
| Power & industrial organic sales | FY2025 | Up low single digits (Raised) |
| Process businesses organic sales | FY2025 | Flat to down low single digits (Updated) |
| Automation & engineered solutions organic growth | FY2025 | Mid single digits (Maintained) |
| Total organic growth | FY2025 | Positive low single digits (Maintained) |
| FARO EPS contribution | FY2025 | A couple of pennies (partial Q3 plus Q4) (New) |
| Effective tax rate | FY2025 | 19% to 19.5% (Updated) |
| Capital expenditures | FY2025 | Approximately $160 million (about 2% of sales) (Updated) |
| Depreciation and amortization | FY2025 | Approximately $425 million (Updated) |
| Free cash flow conversion | FY2025 | Approximately 115% of net income (Maintained) |
| Operating expense (growth investments worked through P&L) | FY2025 | $155 million (Raised) |
| Metric | YoY | Note |
|---|---|---|
| Total sales | +2.5% | Organic flat, acquisitions added 1.5 points, foreign currency translation added 1 point. |
| Electronic Instruments Group sales | +1% | Organic down 3%, acquisitions added 2 points, foreign currency added 1 point. |
| Electromechanical Group sales | +6% | Organic up 5% and foreign currency a 1-point tailwind, with notable order strength in Paragon and automation businesses. |
| EMG operating income | +17% | Strong sales and orders growth plus profitability gains from Paragon and automation as destocking ended. |
| Operating income | +3% | Strong operating performance and margin expansion. |
| EBITDA | +4% | Record sales, productivity, and strong acquisition performance. |
| Earnings per diluted share | +7% | Core margin expansion, positive price-cost, and strong operating execution. |
| Process businesses sales | Flat | Acquisition contribution offset a 4% organic decline amid project-spending hesitation. |
| Total orders | +6% | EMG up double digits, EIG up single digits; book-to-bill of 1.00. |
| Topic | Previous mention | Current period | Trend |
|---|---|---|---|
| Tariffs and trade uncertainty | Flagged $100 million headwind and $70 million at-risk China revenue with mitigation plans | Mitigation actions (pricing, supply chain, localization) delivering benefits; $100 million no longer a headwind and most of the $70 million shipped | Steady |
| M&A and acquisition pipeline | — | Two deals closed deploying ~$1 billion for ~$400 million in revenue; pipeline robust with ~$4.5-$5 billion of capacity at 2.5x leverage | Rising |
| Destocking in MedTech and automation | Ongoing destock in Paragon and automation | Destock complete in both, driving strong orders and EMG margin expansion | Rising |
| Margin expansion | — | Core margins up 90 basis points; EMG core margins up 260 basis points | Rising |
| FARO integration | — | Mid-teens cost synergies, public-company cost elimination, targeting 30% EBITDA in about three years from ~15%, likened to the Zygo playbook | Rising |
| Research/academia and semiconductor weakness | — | Both were headwinds; research is about 10% of AMETEK with U.S. funding delays expected through at least Q3 | Declining |