Allison Transmission Holdings, Inc. · NYSE:ALSN
Allison Transmission — Q2 2026 Earnings Presentation
58 slides from Allison Transmission's earnings presentation, Aug 10, 2026
Slide 1: Q2 2026 Investor Relations Presentation
Q2 2026 Investor Relations Presentation Published August 10, 2026 © 2026 Allison Transmission, Inc. All Rights Reserved 1
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 Allison Off-Highway 1 Acquisition Overview Allison Transmission 2 Business Unit Overview Allison Off-Highway 3 Business Unit Overview Allison 4 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 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 combi
Slide 6: Allison Off-Highway Acquisition – Synergy Capture
Allison Off-Highway Acquisition – Synergy Capture Source of Savings and % of Expected $120M Annual Run-Rate Synergy Realization Progress & Timing Procurement & Logistics 2027 40% Captured ▪ Strategic sourcing for purchased components ▪ Increased vertical integration / insourcing opportunities 60% 20
Slide 7: Allison Off-Highway Acquisition – Global Growth Platform
Allison Off-Highway Acquisition – 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 & V
Slide 8: 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 9: Allison Transmission Business Unit Overview
Allison Transmission Business Unit Overview © 2026 Allison Transmission, Inc. All Rights Reserved 9
Slide 10: Allison Transmission at a Glance
Allison Transmission at a Glance Leading designer and Premier brand, offering Strong cash flow manufacturer of Well-positioned for superior performance, generation and well- propulsion solutions for revenue and earnings frequently specified by defined capital allocation commercial and defense growth
Slide 11: Allison Transmission Revenue by End Market
Allison Transmission Revenue by End Market LTM(1) Net Sales by End Market LTM Net Sales: $3.0 billion Parts, Support Equipment and Other 22% Global Off-Highway 2% North America 49% On-Highway Outside North America On-Highway 16% Defense 11% (1) LTM 6/30/26 © 2026 Allison Transmission, Inc. All Right
Slide 12: Q2 2026 Net Sales Performance – Allison Transmission
Q2 2026 Net Sales Performance – Allison Transmission ($ in millions, variance % from Q2 2025) End Markets Q2 2026 Variance Commentary Market is showing signs of improvement although uncertainty persists around geopolitical impacts, including tariffs, and emissions regulations. Class 8 vocational Nor
Slide 13: 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 14: Allison Transmission Strategic Priorities
Allison Transmission Strategic Priorities ® ® 1000/2000 Series 3000 Series 4000 Series FracTran eGen Force eGen Flex Continued focus on new Expand global market Emerging markets Deliver strong financial technologies and product leadership penetration results development Capitalize on improving A
Slide 15: 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 16: Leading Technology and Innovation
Leading Technology and Innovation 1 Next Generation of Commercial Propulsion 2 Allison Transmission eGen Flex® Electric Hybrid Propulsion 3 Allison Transmission eGen Force Electrified Transmission © 2026 Allison Transmission, Inc. All Rights Reserved 16
Slide 17: 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 18: Portfolio of Electric Products
Portfolio of Electric Products ® ® Fully-integrated zero-emission electric axles for Next generation zero-emission capable electric hybrid New electric hybrid propulsion system for tracked medium- and heavy-duty commercial trucks propulsion system combat vehicles Content per vehicle opportun
Slide 19: 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 20: 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 future Will enable electric hybrid propulsion, electric-only silent
Slide 21: 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 21
Slide 22: 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 23: 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 24: 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 25: 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 26: 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 26
Slide 27: 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 28: $300M of Incremental Annual Revenue Opportunities
$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 hydraulic fracturing
Slide 29: 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 30: 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®, purpose-built to meet the – Commodity prices support further expansion cyclical rec
Slide 31: North America On-Highway Growth Strategy
North America On-Highway Growth Strategy Market is showing signs of improvement although uncertainty persists around North America Production in Allison’s Core Addressable Market geopolitical impacts, including tariffs, and emissions regulations. Class 8 (units in 000s)(1) vocational truck demand
Slide 32: 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 33: 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 34: Allison Off-Highway Business Unit Overview
Allison Off-Highway Business Unit Overview © 2026 Allison Transmission, Inc. All Rights Reserved 34
Slide 35: Allison Off-Highway Revenue by End Market
Allison Off-Highway Revenue by End Market 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: $2.4 billion © 2026 Allison Transmission, Inc. All Rights Reserved 35
Slide 36: Q2 2026 Net Sales Performance – Allison Off-Highway
Q2 2026 Net Sales Performance – Allison Off-Highway ($ in millions) End Markets Q2 2026 Commentary Global construction markets seeing steadier investments, while rate-sensitive residential segments lag. Construction & Material European construction activity is showing signs of strength, althought th
Slide 37: 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 38: 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 39: 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 40: Allison Consolidated Financial Overview
Allison Consolidated Financial Overview © 2026 Allison Transmission, Inc. All Rights Reserved 40
Slide 41: 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 41
Slide 42: Significant Cash Flow Generation
Significant Cash Flow Generation Adj. Free Cash Flow (1) $ in millions (2) (1) See appendix for a reconciliation of Adjusted Free Cash Flow (2) Midpoint of Guidance range $745 million to $865 million. Includes approximately $85 million of one-time cash outlays associated with the acquisition of the
Slide 43: 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 66% of S/O 90% 181 184 183 179 Strategic acquisition opportunities 160 171 Repurchased 80% 164 Since IPO(1) 140 70% De
Slide 44: Allison Financial Highlights
Allison Financial Highlights Q2 2026 Financial Metrics(1) $ in millions, except per share data Solid operating margins — Diverse end markets Net Sales $1,566 — Premium vocational pricing model — Cost controls and productivity improvements Adj. EBITDA* $404 Low recurring (maintenance) capital exp
Slide 45: Strong Liquidity Profile
Strong Liquidity Profile Long-Term Debt Profile & Credit Statistics Cash and Available Borrowing Capacity of $1.4 billion as of June 30, 2026 (in millions) 6/30/2026 — $399 million of cash and cash equivalents Cash and cash equilvalents $399 — $995 million of available revolving credit facility co
Slide 46: Summary
Summary Allison is the global leader in Substantial growth Strong financial position the markets it serves opportunities Premier brands across Allison Elite EBITDA margin Expand global leadership Transmission and Allison Off- Highway business units Asset-light business model Penetrate emer
Slide 47: Guidance and Supplemental Financial Information
Guidance and Supplemental Financial Information © 2026 Allison Transmission, Inc. All Rights Reserved 47
Slide 48: Full Year 2026 Guidance Update
Full Year 2026 Guidance Update ($ in millions) Prior Guide Updated Guide (May 4, 2026) (August 3, 2026) Net Sales $5,575 to $5,925 $5,800 to $6,000 $5,750 Midpoint $5,900 Midpoint Net Income* $600 to $750 $600 to $700 $675 Midpoint $650 Midpoint Adjusted EBITDA** $1,365 to $1,515 $1,465 to $1,575 $1
Slide 49: Historical Financial Summary
Historical Financial Summary Financial Summary (1) In $ millions Annual YTD 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 Net Sales $2,262 $2,713 $2,698 $2,081 $2,402 $2,769 $3,035 $3,225 $3,010 $2,972 % Growth 22.9% 19.9% (0.6%) (22.9%) 15.4% 15.3% 9.6% 6.3% (6.7%) - Adj. EBITDA 868 1,128 1,083
Slide 50: Allison Quarterly Net Sales Summary
Allison Quarterly Net Sales Summary Quarterly Net Sales by End Market 2019 2020 2021 Net Sales - Allison Transmission Q1 Q2 Q3 Q4 Total Q1 Q2 Q3 Q4 Total Q1 Q2 Q3 Q4 Total NA On-Highway $377 $398 $369 $330 $1,474 $352 $164 $281 $284 $1,081 $319 $302 $275 $281 $1,177 ONA On-Highway $94 $106 $99 $91 $
Slide 51: Appendix: Non-GAAP Financial Information
Appendix Non-GAAP Financial Information © 2026 Allison Transmission, Inc. All Rights Reserved 51
Slide 52: Non-GAAP Financial Information
Non-GAAP Financial Information We use adjusted earnings before interest, taxes, depreciation, and amortization (“EBITDA”) and adjusted EBITDA as a percent of net sales (“adjusted EBITDA margin”) to measure our operating profitability. We believe that adjusted EBITDA and adjusted EBITDA margin provid
Slide 53: Non-GAAP Reconciliations (1 of 5)
Non-GAAP Reconciliations (1 of 5) Adjusted EBITDA Reconciliation Three months ended $ in millions, Unaudited For the year ended December 31, June 30, 2021 2022 2023 2024 2025 2025 2026 Net income (GAAP) $442 $531 $673 $731 $623 $195 $181 plus: Interest expense, net 116 118 107 89 92 22 54 Income tax
Slide 54: Non-GAAP Reconciliations (2 of 5)
Non-GAAP Reconciliations (2 of 5) Segment Adjusted EBITDA Reconciliation ($ in millions) Allison Transmission Allison Off-Highway Central Group Function Consolidated Three months ended Three months ended Three months ended Three months ended June 30, June 30, June 30, June 30, 2026 2026 2026 2026 20
Slide 55: Non-GAAP Reconciliations (3 of 5)
Non-GAAP Reconciliations (3 of 5) Adjusted Net Income and Earnings Per Share Reconciliation $ in millions Three months ended June 30, 2026 2025 Net income (GAAP) $ 181 $ 195 plus: Amortization expense 21 1 Depreciation of the stepped up basis in property, plant and equipment 18 - Acquisition-related
Slide 56: Non-GAAP Reconciliations (4 of 5)
Non-GAAP Reconciliations (4 of 5) Adjusted Free Cash Flow Reconciliation Three months ended $ in millions, Unaudited For the year ended December 31, June 30, 2021 2022 2023 2024 2025 2025 2026 Net cash provided by operating activities (GAAP) $635 $657 $784 $801 $836 $184 $312 (Deductions) Long-lived
Slide 57: Non-GAAP Reconciliations (5 of 5)
Non-GAAP Reconciliations (5 of 5) Guidance Reconciliation $ in millions Guidance Year Ending December 31, 2026 Low High Net income (GAAP) $ 600 $ 700 plus: Income tax expense 135 185 Depreciation of property, plant and equipment 255 245 Interest expense, net 220 210 Amortization of intangible assets
Slide 58: 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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