HWM · 10-Q · 2026Q2 · Full report
Gross Margin Drivers
Howmet Aerospace Inc. · 2026-08-06 · Importance 37 · Surprise 32 · No source text
COGS declined to 62.7% of sales in the second quarter of 2026 from 66.5% in the prior-year quarter. For the six months, COGS declined to 62.9% of sales from 66.5%, implying gross-margin expansion of approximately 380 basis points. The improvement was driven by aerospace and gas turbine growth and favorable product pricing, partly offset by lower commercial transportation volumes, higher cost pass-through, increased Engine Products headcount, and acquisition-related inventory step-up amortization.
Key facts
- COGS as a percentage of Sales in Q2 2026: 62.7% compared to 66.5% in Q2 2025. source
- COGS as a percentage of Sales in six months ended June 30, 2026: 62.9% compared to 66.5% in six months ended June 30, 2025. source
Impact estimates
| metric | direction | stage | expected | basis |
|---|---|---|---|---|
| margin | positive | realized | +3.8% | COGS as a percentage of Sales in Q2 2026: 62.7% compared to 66.5% in Q2 2025. |
| margin | positive | realized | +3.6% | COGS as a percentage of Sales in six months ended June 30, 2026: 62.9% compared to 66.5% in six months ended June 30, 2025. |