Flowserve (FLS) Q1 2025 earnings summary

Executive summary

• Bookings grew 18% year-over-year to $1.2 billion, with revenue up 5% and adjusted gross margin expanding 180 basis points to 33.5%.

• Adjusted EPS increased nearly 25% to $0.72, with strong aftermarket and nuclear bookings, including record aftermarket bookings of nearly $690 million and nuclear bookings exceeding $100 million for the third consecutive quarter.

• Operating income rose 17% to $132 million; adjusted operating income up 24% to $147 million year-over-year.

• The MOGAS acquisition was completed, expanding the valve portfolio and contributing to sales and margin growth.

• Full-year 2025 guidance reaffirmed, with expectations for stronger earnings in the second half despite macroeconomic uncertainty and tariff headwinds.

Financial highlights

• Sales for Q1 were $1.145 billion, up 5% year-over-year, with organic growth of 4.1% and a 3.3% benefit from the MOGAS acquisition; FX translation was a 2.2% headwind.

• Adjusted operating margin rose to 12.8%, up 190 basis points year-over-year.

• Cash from operations was negative $49.9 million, mainly due to higher working capital and timing of incentive compensation payments.

• Adjusted EPS was $0.72, up from $0.58 in Q1 2024.

• Book-to-bill ratio was 1.07.

Outlook and guidance

• Full-year 2025 guidance reaffirmed: organic growth of 3%-5%, total sales growth of 5%-7%, and adjusted EPS of $3.10-$3.30, representing 18%-25% growth over 2024.

• Q2 results expected to be similar or slightly better than Q1, with earnings weighted to the second half due to backlog and synergy realization.

• Guidance assumes current tariff rates, steady economic conditions, and reflects estimated impact of new tariffs net of mitigating actions.

• Capital expenditures projected at $80 to $90 million; adjusted tax rate approx. 21%.