ParkerHannifin (0KFZ.L) Q2 2025 Earnings Report

ParkerHannifin reported QQ2 2025 revenue of $4.7426 billion, down 1.63% year over year and 3.29% quarter over quarter. Despite near-term top-line pressure, the company delivered margin stability and strong cash generation. Gross margin remained robust at approximately 36.5%, supporting an operating margin of roughly 19.8% and a net margin near 20.0%, underscoring effective cost controls and mix resilience within its two-segment portfolio (Diversified Industrial and Aerospace Systems). Net income of $948.5 million and diluted EPS of $7.25–$7.37 for the period reflect leverage from operating performance and tax effects, with substantial free cash flow generation of about $813.6 million and operating cash flow of $934.8 million. Free cash flow per share stood at $6.32, while cash conversion from reported net income remained healthy, aided by working-capital management and disciplined capital allocation.

The balance sheet shows total assets of ~$28.27 billion against liabilities of ~$15.14 billion and equity of ~$13.12 billion. Net debt stood at approximately $8.65 billion, with interest coverage around 9.6x, signaling a comfortable cushion to service debt even if rates or volumes move unfavorably. The company returned capital to shareholders via dividends (~$210 million) and repurchased shares (~$98.5 million) while continuing to fund investments and acquisitions as part of a growth strategy. Management commentary—where available—emphasizes ongoing focus on higher-margin product mix, aftermarket opportunities, and selective bolt-on acquisitions to augment scale and technology breadth. Investors should monitor demand cycles in aerospace and heavy-drawn industrials, pricing discipline, and the pace of deleveraging given the sizable leverage profile.