Allison Transmission Reports Record Sales and Strong Financial Performance for 2025

Allison Transmission Holdings Inc., known for its high-performance mobility solutions, announced its remarkable financial results for the fourth quarter and full year of 2025, showcasing resilience even amid challenging macroeconomic conditions. With total net sales reaching $3 billion for the year, the company displayed substantial growth in both their defense and outside North America on-highway markets.

During the year, Allison noted a consistent demand for its products, with a notable surge in sales within the Defense sector, which gained 26 percent year-over-year, contributing $267 million to overall net sales. This positive trend was supported by the execution of strategic growth initiatives and a growing focus on their high-performance mobility solutions.

In the fourth quarter alone, net sales reached $737 million, driven in part by a 6 percent growth in the Outside North America On-Highway end market. This segment alone contributed to a record $131 million in quarterly sales, bolstered by increasing demand in Europe and South America, alongside strategic price enhancements.

Financial Highlights

Allison's financial performance also showed robust metrics, with a full year net income of $623 million, translating to a diluted earnings per share (EPS) of $7.33. The adjusted EBITDA, which serves as a critical measure of operational profitability, was reported at $1.13 billion for the full year. This represents an adjusted EBITDA margin of 37.5 percent, slightly above previous year levels and highlighting the company's effective cost management and operational efficiencies.

In an exciting development for the company, Allison completed its acquisition of Dana's Off-Highway business on January 1, 2026. This strategic move is anticipated to substantially enhance Allison's position within the global mobility market while expanding its portfolio of high-performance products. CEO David S. Graziosi emphasized that this acquisition represents a pivotal moment in the company's history, marking a commitment to growth through both organic market expansion and strategic acquisitions.

As part of its continued focus on shareholder value, Allison also announced a stock repurchase program that allowed them to buy back $328 million of their common stock, representing approximately 4 percent of outstanding shares, during the year.

Looking Ahead: Guidance for 2026

In light of its successful 2025, Allison has provided optimistic guidance for 2026, projecting total consolidated net sales between $5.575 billion and $5.925 billion. Additionally, they expect net income to be in the range of $600 million to $750 million, which includes anticipated one-time restructuring costs related to the integration of the newly acquired Off-Highway segment. Furthermore, the company estimates that it will generate an adjusted free cash flow between $655 million and $805 million, reinforcing its robust financial position and strategic initiatives.

Allison Transmission will continue to discuss these results and their outlook during their upcoming conference call set for February 23, 2026, where they will elaborate on their fourth-quarter performance and future strategies. Investors and stakeholders will be keen to hear more about the implications of the Dana acquisition and how it fits into Allison's evolving market strategy.

As one of the primary leaders in high-performance mobility solutions globally, Allison Transmission's commitment to innovation and excellence has positioned them favorably even amidst the current economic uncertainties. With an extensive range of products catering to critical sectors such as infrastructure and national security, the company continues to demonstrate its status as a reliable partner in facilitating industrial mobility across more than 150 countries.

For more information about Allison Transmission and its offerings, you can visit their official website at Allison Transmission.