RBC Bearings’ second quarter results received a positive market response, as the company delivered year-over-year revenue growth and exceeded Wall Street’s expectations. Management credited robust demand in the Aerospace and Defense segment, with particular strength in both commercial and defense aftermarket sales. CEO Michael J. Hartnett highlighted that the aircraft aftermarket expanded 22.6% and defense aftermarket grew 11.9%, while industrial distribution also performed well. The company’s backlog surpassed $1 billion for the first time, with Hartnett noting, “We are well positioned in our markets. We see unprecedented demand in several important areas.”
Is now the time to buy RBC? Find out in our full research report (it’s free).
RBC Bearings (RBC) Q2 CY2025 Highlights:
- Revenue: $436 million vs analyst estimates of $432.4 million (7.3% year-on-year growth, 0.8% beat)
- Adjusted EPS: $2.84 vs analyst estimates of $2.74 (3.6% beat)
- Adjusted EBITDA: $134.9 million vs analyst estimates of $135 million (30.9% margin, in line)
- Revenue Guidance for Q3 CY2025 is $450 million at the midpoint, above analyst estimates of $433.5 million
- Operating Margin: 23.2%, in line with the same quarter last year
- Market Capitalization: $12.73 billion
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 From RBC Bearings’s Q2 Earnings Call
- Kristine Liwag (Morgan Stanley) asked about the company’s five-year outlook and capacity needs. CEO Michael J. Hartnett explained that RBC plans by customer account and is focused on aligning capacity expansions with expected demand from aerospace and defense customers.
- Michael Ciarmoli (Truist Securities) sought more detail on VACCO’s revenue and margin impact. CFO Rob Sullivan said it is early in integration but expects most revenue to be reported in Aerospace and Defense, with short-term margin dilution followed by improvement.
- Steve Barger (KeyBanc Capital Markets) inquired about the sustainability of industrial demand given stimulus and GDP growth. Hartnett replied that metrics suggest strengthening demand, especially in industrial distribution, and backlog duration is “multiple years,” with potential to double within 12 months.
- Scott Deuschle (Deutsche Bank) asked about increased content opportunities on the GTF Advantage engine and supply chain constraints. Hartnett confirmed substantial content growth beginning in 2026, and that materials supply is managed through advanced planning and inventory.
- Peter Skibitski (Alembic Global) questioned whether industrial growth is sustainable and the impact of tariffs. Hartnett said growth is sector-dependent, with tariffs largely offset by price adjustments or contract terms, but the full effect of new legislation is yet to be seen.
Catalysts in Upcoming Quarters
In the coming quarters, our analysts will focus on (1) the pace and profitability of VACCO’s integration into the broader Aerospace and Defense business; (2) the ability to secure and execute new multi-year contracts—especially those aimed at increasing content on critical aerospace programs; and (3) early indicators of industrial demand response to recent U.S. tax changes. Execution on margin improvement in newly acquired businesses and navigating supply chain/tariff-related risks will also be key markers of near-term performance.
RBC Bearings currently trades at $404.80, up from $387.01 just before the earnings. In the wake of this quarter, is it a buy or sell? See for yourself in our full research report (it’s free).
High-Quality Stocks for All Market Conditions
When Trump unveiled his aggressive tariff plan in April 2025, markets tanked as investors feared a full-blown trade war. But those who panicked and sold missed the subsequent rebound that’s already erased most losses.
Don’t let fear keep you from great opportunities and take a look at Top 5 Growth Stocks for this month. This is a curated list of our High Quality stocks that have generated a market-beating return of 183% over the last five years (as of March 31st 2025).
Stocks that made our list in 2020 include now familiar names such as Nvidia (+1,545% between March 2020 and March 2025) as well as under-the-radar businesses like the once-small-cap company Exlservice (+354% five-year return). Find your next big winner with StockStory today.
StockStory is growing and hiring equity analyst and marketing roles. Are you a 0 to 1 builder passionate about the markets and AI? See the open roles here.