Allison Transmission Holdings, Inc. · NYSE:ALSN
Allison Transmission — Q4 2025 Earnings Presentation
54 slides from Allison Transmission's earnings presentation, Feb 23, 2026
Slide 1: Investor Relations Presentation Q4 2025
Investor Relations Presentation Q4 2025 Published March 2, 2026 © 2026 Allison Transmission, Inc. All Rights Reserved.
Slide 2: Safe Harbor Statement
Safe Harbor Statement The following information contains forward-looking statements. The words “believe,” “expect,” “anticipate,” “intend,” “estimate” and other expressions that are predictions of or indicate future events and trends and that do not relate to historical matters identify forward-look
Slide 3: Table of Contents
Table of Contents 1 Allison Off-Highway Acquisition Overview 2 Allison Transmission Business Overview 3 Allison Off-Highway Business Overview 4 Allison Transmission Financial Overview © 2026 Allison Transmission, Inc. All Rights Reserved. 3
Slide 4: Allison Off-Highway Acquisition Overview
Allison Off-Highway Acquisition Overview © 2026 Allison Transmission, Inc. All Rights Reserved. 4
Slide 5: Allison Off-Highway Acquisition – Transaction Highlights
Allison Off-Highway Acquisition – Transaction Highlights ▪ Acquisition completed on January 1, 2026 with purchase price of approximately $2.7B ▪ Represents 6.8x Adjusted EBITDA (LTM 12/31/24) of ~$400M(1) and 5.2x including estimated run-rate synergies of ~$120M Purchase Price ▪ Purchased using a co
Slide 6: Allison Off-Highway - Global Growth Platform
Allison Off-Highway - Global Growth Platform Off-Highway acquisition accelerates combined businesses’ current growth objectives while multiplying future global growth opportunities Key Growth Drivers for Allison as a Premier Industrial Company Summary Growth Opportunities Engineering & Vertical • Se
Slide 7: Step-Up in Scale; Preserves Industry-Leading EBITDA Margin
Step-Up in Scale; Preserves Industry-Leading EBITDA Margin Expected to achieve $5.7B in net sales and increase Adjusted EBITDA by ~40% while maintaining an industry-leading Adjusted EBITDA margin profile Financial Profile (LTM 6/30/25) EBITDA Margin (2025)(3) 40% 37.5% Allison Combined(1) 35% Net Sa
Slide 8: Allison Transmission Business Overview
Allison Transmission Business Overview © 2026 Allison Transmission, Inc. All Rights Reserved. 8
Slide 9: Allison Transmission at a Glance
Allison Transmission at a Glance Leading designer and Premier brand, offering Well-positioned for Strong cash flow manufacturer of superior performance, revenue and generation and well- propulsion solutions frequently specified by earnings growth defined capital for commercial and end users allocati
Slide 10: Allison Transmission at a Glance
Allison Transmission at a Glance 2025 Net Sales by End Market Parts, Support Equipment and Other 21% Global Off-Highway 2% North America 51% On-Highway Outside North America On-Highway 17% Defense 9% 2025 Net Sales: $3.0 billion © 2026 Allison Transmission, Inc. All Rights Reserved. 10
Slide 11: North America On-Highway End Market
North America On-Highway End Market Underserved Core Addressable Market Underserved Class 8 Tractor Class 1-3 Class 8 Tractor Sleeper Class 4-5 Motor Home School Bus Class 6-7 Class 8 Straight (Linehaul) Day Cab Vehicles Weight <14 lbs 14-19 lbs 16-33 lbs 16-33 lbs 19-33 lbs 33 lbs+ 33 lbs+ 33 lbs+
Slide 12: Strategic Priorities
Strategic Priorities ® ® 1000/2000 Series 3000 Series 4000 Series FracTran eGen Force eGen Flex Continued focus on Expand global Emerging markets new technologies Deliver strong market penetration and product financial results leadership development – Capitalize on improving – Automaticity, fuel eff
Slide 13: Allison Transmission Elite EBITDA Margin
Allison Transmission Elite EBITDA Margin 2025 EBITDA Margin(1) 40% 37.5% 35% 30% 25% 20% 15% 10% 5% Graco Parker Hannifin Gentex Eaton Rockwell Sensata Donaldson Cummins (1) Fiscal year 2025 peer EBITDA provided by S&P Capital IQ Pro. EBITDA included above may not be consistent with such entity’s re
Slide 14: Leading Technology and Innovation
Leading Technology and Innovation 1 Next Generation of Commercial Propulsion 2 Allison eGen Flex® Electric Hybrid Propulsion 3 Allison eGen Force Electrified Transmission © 2026 Allison Transmission, Inc. All Rights Reserved. 14
Slide 15: Next Generation of Commercial Propulsion
Next Generation of Commercial Propulsion Incremental growth opportunities for an established and experienced propulsion supplier such as Allison Expertise in commercial propulsion, vehicle controls and vocational duty-cycles Deep experience in systems integration, battery management and power di
Slide 16: Portfolio of Electric Products
Portfolio of Electric Products ® ® – Fully-integrated zero-emission electric axles for – Next generation zero-emission capable electric – New electric hybrid propulsion system for tracked medium- and heavy-duty commercial trucks hybrid propulsion system combat vehicles – Content per vehicle opportun
Slide 17: Electric Hybrid Propulsion
Electric Hybrid Propulsion ® Over $1.6 billion in sales since 2003 launch Allison’s electric hybrid propulsion system for transit buses is among the most dependable and efficient electric hybrid systems in the world Demonstrated ability to operate in full engine-off mode for more than 50% of i
Slide 18: Next-Generation Electrified Transmission
Next-Generation Electrified Transmission Newest product in Allison’s extensive tracked vehicle portfolio Designed to meet requirements across a broad spectrum of applications, including the heavy Infantry Fighting Vehicle and Will enable electric hybrid propulsion, electric-only silent future
Slide 19: Premier Industrial Company
Premier Industrial Company 1 Global Market Leader and Premier Brand 2 End User Value Proposition 3 Leader in Commercial Propulsion 4 Diverse End Markets 5 Growth Opportunities 6 Capital Allocation and Free Cash Flow Utilization © 2026 Allison Transmission, Inc. All Rights Reserved. 19
Slide 20: A Recognized Leader and Respected Brand
A Recognized Leader and Respected Brand End users frequently Over 110-year history of Proprietary and request Allison providing high-quality patented technology Transmission innovative products and developed over many products by name demonstrated value to decades and over eight and pay a premium en
Slide 21: End User Value Proposition
End User Value Proposition Advantages of a fully automatic Allison transmission Productivity Fuel Agnostic and Fuel Maintenance Savings Driver Skillset / (acceleration) Efficiency / Reduced (life cycle costs) Wages Emissions Training Shift Quality Safety Residual Value (time, cost) Payback period fo
Slide 22: Leader in Commercial Propulsion
Leader in Commercial Propulsion Allison Transmission’s addressable market encompasses a broad range of vocations with complex and diverse duty-cycles On-Highway Off-Highway Defense • Fire and Emergency • Hydraulic Fracturing • Light / Medium / Heavy Wheeled • Pick-up, Delivery and Distribution • Oil
Slide 23: Very Diverse End Markets
Very Diverse End Markets Distribution Emergency Motorhome Rugged Duty School/Shuttle Bus Transit On-Highway British Airport Authority File:Prevost Logo.svg Global Off-Highway Defense Light / Medium / Heavy Wheeled and Tracked Aftermarket Parts, Support Equipment & Other © 2026 Allison Transmission,
Slide 24: Over OEMs Rely on Allison Transmission
Over 350 OEMs Rely on Allison Transmission On-Highway North America Transit Bus Off-Highway On-Highway Outside North America Off-Highway Light / Medium Defense / Heavy Wheeled and Tracked © 2026 Allison Transmission, Inc. All Rights Reserved. 24
Slide 25: Allison Transmission Growth Opportunities
Allison Transmission Growth Opportunities 1 $300M of Incremental Annual Revenue Opportunities 2 Outside North America On-Highway Growth Strategy 3 Global Off-Highway Growth Strategy 4 North America On-Highway Growth Strategy 5 Global Defense Growth Strategy 6 Value Added On-Highway Variants & Enhanc
Slide 26: Growth Strategy – $300M of Incremental Annual Revenue Opportunities
Growth Strategy – $300M of Incremental Annual Revenue Opportunities Wide Body Mining Dump FracTran® • Penetration of new market for Allison’s 4000 Series and 6000 Series On- • Next-generation, designed-from-the-ground-up Oil Field Series (OFS) Highway transmissions transmission, purpose-built for hy
Slide 27: Outside North America On-Highway Growth Strategy
Outside North America On-Highway Growth Strategy Global market leadership expansion and Focus on high value vocational Demand drivers vary by region emerging markets penetration vehicles – Substantial investments in the expansion of global sales – Increasing vehicle sophistication – Transit, refuse,
Slide 28: Allison Transmission Global Off-Highway Growth Strategy
Allison Transmission Global Off-Highway Growth Strategy High Horsepower Hydraulic Energy Sectors Mining and Construction Fracturing Transmissions – Equipment is being utilized with aging fleets, – Launched FracTran® in 2021, purpose-built to – Commodity prices support further expansion cyclical reco
Slide 29: North America On-Highway Growth Strategy
North America On-Highway Growth Strategy Although some clarity received on emissions regulations and Section 232 tariff policy, 2026 outlook cautiously optimistic. Outlook assumes continued softness in North America Production in Allison’s Core Addressable Market medium-duty trucks, driven by macr
Slide 30: Global Defense Growth Strategy
Global Defense Growth Strategy Allison is committed to investing in and pursuing further opportunities resulting from increased global defense spending in a multi-year growth cycle Poised to capture growth through continuation of long-standing partnership with United States Department of Defense
Slide 31: Value Added On-Highway Variants & Enhancements
Value Added On-Highway Variants & Enhancements FuelSense® 2.0 9-Speed Transmission • Proprietary software ideally suited for shift-dense vocations such as transit, • New design leverages the proven reliability of the Allison six-speed 2000 school bus, refuse, construction and distribution SeriesTM •
Slide 32: Allison Off-Highway Business Overview
Allison Off-Highway Business Overview © 2026 Allison Transmission, Inc. All Rights Reserved. 32
Slide 33: Allison Off-Highway at a Glance
Allison Off-Highway at a Glance 2025 Net Sales by End Market Service Parts, Specialty & Other 20% Construction & 36% Material Handling Mining 7% Industrial 15% 22% Agriculture 2025 Preliminary Net Sales: $2.4 billion © 2026 Allison Transmission, Inc. All Rights Reserved. 33
Slide 34: Allison Off-Highway – Construction & Material Handling
Allison Off-Highway – Construction & Material Handling 36% Representative Applications Leading Indicators Telehandlers, Lifts (Boom / Scissor / Fork), Excavators and Wheel Loaders • Infrastructure budgets • Housing starts • Purchasing Managers’ Index • Rental fleet utilization • Industrial productio
Slide 35: Allison Off-Highway – Agriculture
Allison Off-Highway – Agriculture 22% Representative Applications Leading Indicators Combines and Tractors • Commodity prices, particularly corn, wheat and soybean • CEMA Business Barometer • Purchasing Managers’ Index • Farmer income • Commentary from public OEM customers 2025 Sales Breakdown(1) Ma
Slide 36: Allison Off-Highway – Industrial and Mining
Allison Off-Highway – Industrial and Mining 15% 7% Industrial Mining Representative Applications Leading Indicators Roller Presser and Shredder Mining Truck and Load Haul Dumper Industrial Industrial Mining • Manufacturing PMI • Industrial output • Energy project pipelines Mining • Commodity prices,
Slide 37: Allison Transmission Financial Overview
Allison Transmission Financial Overview © 2026 Allison Transmission, Inc. All Rights Reserved. 37
Slide 38: Capital Allocation & Free Cash Flow Utilization
Capital Allocation & Free Cash Flow Utilization 1 Significant Cash Flow Generation 2 Capital Allocation Priorities 3 Free Cash Flow Utilization © 2026 Allison Transmission, Inc. All Rights Reserved. 38
Slide 39: Significant Cash Flow Generation
Significant Cash Flow Generation Historical Allison Transmission Adj. Free Cash Flow Generation (1) Note: See appendix for comments regarding the presentation of non-GAAP financial information. (1) See appendix for a reconciliation of Adjusted Free Cash Flow. © 2026 Allison Transmission, Inc. All Ri
Slide 40: Capital Allocation Priorities
Capital Allocation Priorities Organic revenue and earnings growth Share Repurchase History 200 Shares Outstanding in Millions 100% New product and technology development 180 184 183 Over 65% of S/O 90% 181 179 Strategic acquisition opportunities 160 171 Repurchased 80% 164 Since IPO(1) Debt
Slide 41: Free Cash Flow Utilization
Free Cash Flow Utilization Well-Defined Capital Allocation Policy • Realize returns from completed investments in global commercial capabilities, and new product and technology development • Prudent balance sheet management • Return capital to shareholders ‒ Increased quarterly dividend to $0.29 per
Slide 42: Allison Transmission Financial Highlights
Allison Transmission Financial Highlights 2025 Financial Metrics (% of Net Sales) Solid operating margins — End Markets diversity — Premium vocational pricing model Gross Margin 48.6% — Cost controls and productivity improvements Low recurring (maintenance) capital expenditure requirements Adj.
Slide 43: Strong Liquidity Profile
Strong Liquidity Profile Cash and Available Borrowing Capacity of $2.2 billion as of December 31, 2025 Long-Term Debt Profile & Credit Statistics (in millions) 12/31/2025 — $1,495 million of cash and cash equivalents Cash and cash equilvalents $1,495 — $745 million of available revolving credit fa
Slide 44: Summary
Summary Allison is the global Strong financial Substantial growth leader in the markets it position opportunities serves – Premier fully automatic – Elite EBITDA margin – Expand global leadership transmission brand – Asset-light business model – Penetrate emerging markets – Global leader in high-per
Slide 45: Guidance and Supplemental Financial Data
Guidance and Supplemental Financial Data © 2026 Allison Transmission, Inc. All Rights Reserved. 45
Slide 46: 2026 Guidance
2026 Guidance ($ in millions) For full year 2026, we are providing the following guidance: Business Unit Consolidated Net Cash Adjusted Provided by Capital Adjusted Free Net Sales Net Sales Net Income* EBITDA** Operating Expenditures Cash Flow** Activities $3,025 to $2,550 to $5,575 to $600 to $1,36
Slide 47: Historical Financial Summary
Historical Financial Summary Financial Summary (1) (1) In $ millions In $ millions LTM LTM 2015 2016 2015 2017 2016 2018 2017 2019 2018 2020 2019 2021 2020 2022 2021 2023 2022 2024 2023 2025 2024 2025 Net SalesNet Sales $1,986 $1,986 $1,840 $1,840 $2,262 $2,262 $2,713 $2,713 $2,698 $2,698 $2,081 $2,
Slide 48: Allison Transmission Quarterly Sales Summary
Allison Transmission Quarterly Sales Summary Quarterly Net Sales by End Market ($ in millions) 2016 2017 2018 Net Sales Q1 Q2 Q3 Q4 Total Q1 Q2 Q3 Q4 Total Q1 Q2 Q3 Q4 Total NA On-Highway $274 $280 $232 $237 $1,023 $275 $314 $301 $287 $1,177 $339 $343 $332 $303 $1,317 Defense $25 $28 $25 $37 $115 $2
Slide 49: Appendix
Appendix Non-GAAP Financial Information © 2026 Allison Transmission, Inc. All Rights Reserved. 49
Slide 50: Appendix: Non-GAAP Financial Information
Appendix: Non-GAAP Financial Information We use Adjusted EBITDA and Adjusted EBITDA as a percent of net sales to measure our operating profitability. We believe that Adjusted EBITDA and Adjusted EBITDA as a percent of net sales provide management, investors and creditors with useful measures of the
Slide 51: Non-GAAP Reconciliations (1 of 3)
Non-GAAP Reconciliations (1 of 3) Adjusted EBITDA Reconciliation $ in millions, Unaudited $ in millions, Unaudited For the year ended December For the 31,December 31, year ended 2015 2016 2015 2017 2016 2018 2017 2019 2018 2020 2019 2021 2020 2022 2021 2023 2022 2024 2023 2025 2024 2025 Net income (
Slide 52: Non-GAAP Reconciliations (2 of 3)
Non-GAAP Reconciliations (2 of 3) Adjusted Free Cash Flow Reconciliation $ in millions, $ inUnaudited millions, Unaudited For the yearFor ended December the year 31, ended December 31, 2015 2016 2015 2017 2016 2018 2017 2019 2018 2020 2019 2021 2020 2022 2021 2023 2022 2024 2023 2025 2024 2025 Net c
Slide 53: Non-GAAP Reconciliations (3 of 3)
Non-GAAP Reconciliations (3 of 3) Guidance Reconciliation $ in millions Guidance Year Ending December 31, 2026 Low High Net income (GAAP) $ 600 $ 750 plus: Income tax expense 160 220 Depreciation & Amortization 275 255 Interest expense, net 220 210 Acquisition-related expenses 50 40 Stock-based comp
Slide 54: Certain Trademarks
Certain Trademarks This presentation contains trademarks, service marks, copyrights and trade names of other companies, which are the property of their respective owners. We do not intend our use or display of other companies’ trademarks, service marks, copyrights or trade names to imply a relations
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