Thank you for standing by. Welcome to the Woodward Inc's third quarter fiscal year 2025 earnings call. At this time, I would like to inform you that this call is being recorded for rebroadcast and that all participants are in a listen-only mode. Following the presentation, you're invited to participate in a question-and-answer session. Joining us today for the company: Chip Blankenship, Chairman and Chief Executive Officer; Bill Lacey, Chief Financial Officer; and Dan Provaznik, Director of Investor Relations. I would now like to turn the call over to Dan Provaznik. Thank you, operator. We'd like to welcome all of you to Woodward's third quarter fiscal Year 2025 earnings call. In today's call, Chip will comment on our strategies and related markets. Bill will then discuss our financial results as outlined in our earnings release. At the end of our presentation, we will take questions. For those who have not seen today's earnings release, you can find it on our website at woodward.com. We've included some presentation materials to go along with today's call that are also accessible on our website, and a webcast of this call will be available on our website for one year. All references to years in this call are references to the company's fiscal year unless otherwise stated. I would like to highlight our cautionary statement as shown on slide two of the presentation materials. As always, elements of this presentation are forward-looking, including our guidance, and are based on our current outlook and assumptions for the global economy and our businesses more specifically. These elements can and do frequently change. Our forward-looking statements are subject to a number of risks and uncertainties surrounding those elements, including the risks we identify in our filings with the SEC. These statements are made as of today, and we do not intend to update them except as required by law. In addition, we are providing certain non-U.S. GAAP financial measures. We direct your attention to the reconciliations of non-U.S. GAAP financial measures, which are included in today's slide presentation and our earnings release. We believe this additional financial information will help in understanding our results. Now, I'll turn the call over to Chip. Thank you, Dan. Good evening, everyone, and thank you for joining us. We're pleased to report strong third-quarter results that exceeded our sales and earnings expectations. This strong performance was driven by ongoing robust demand across both our aerospace and industrial segments, along with disciplined execution by our global teams. Our members remain focused on safety, quality, delivery, and cost improvements, with safety always coming first. While our traditional safety metrics are currently world-class, we are focused on making Woodward the safest work environment through our Human and Organizational Performance program, also known as HOP, which we rolled out to seven more sites this year. The new sites are embracing the program and growing their capability to identify risks, add layers of protection, and use HOP learning teams to solve more complex problems related to workplace safety. We also play a role in the safety of our customers' products, and we are laser-focused on ensuring that we meet the product safety and quality requirements our customers are counting on from Woodward. Looking at a few highlights from our third-quarter financial results, Woodward posted record sales, up 8% year-over-year, and earnings per share came in at $1.76, up 8% year-over-year. Aerospace also had record sales, up 15%, and aero margins expanded 140 basis points to 21.1%. In industrial, our reported sales declined 3%. When China OH and the divested combustion product lines are excluded, industrial delivered double-digit growth. Our year-to-date performance reaffirms our midterm and long-term growth trajectory as we strengthen our capability to meet sustained demand across our markets. Based on our strong year-to-date performance, increased macro-environment clarity, and expected sustained growth, we are raising full-year sales and earnings guidance. Bill will take you through more details on that and other changes to our guidance. I'm also excited to share with you updates on two important milestones for Woodward. At the Paris Air Show, we held an event with Airbus to announce that we've been selected to provide spoiler control actuators for the Airbus A350. This is a major achievement for Woodward and is our first actuation LRU win for a primary flight control surface on a commercial platform. The A350 spoiler award enables us to apply our deep expertise in military hydraulic flight controls to a very important and already successful key commercial aircraft program. In addition to OEM ship set delivery, the program includes a sizable installed base with long-term service opportunities, including for our own hardware and strategic upgrades to legacy configurations. It is also significant because successful execution on this opportunity will position us to be competitive on the next single-aisle aircraft. This win with Airbus is a key component of our long-term hydraulic flight control growth strategy. To support that growth, we're investing in a new manufacturing facility for the A350 spoiler actuation production in the U.S. We'll be able to share more details on the location as agreements are finalized. What I can tell you is that we're designing a showcase facility, vertically integrated, highly automated, special processes included, and built on the lessons learned at our Rock Cut facility during the LEAP and GTF programs. It's a significant yet manageable investment that will be spread over multiple years and is fully aligned with our organic growth strategy. The A350 spoiler facility is a perfect example of how we're investing in ourselves for the highest return. In addition, last week we completed the acquisition of Safran's North American electromechanical actuation business. This is a key inorganic play that places us at the heart of industry-leading horizontal stabilizer trim actuation technology, serving platforms including the Airbus A350, Embraer E175 and 190-E2, Gulfstream 650, 700, and 800, and Dassault Falcon 7X and 8X. Together, these two strategic moves, one organic, one inorganic, strengthen our core capabilities and commercial aircraft pedigree ahead of the next single-aisle competition. These developments, along with our automation acceleration, will require increased capital allocation to CapEx in 2026 and 2027 as we invest in future growth and productivity. Turning to what's happening in our end markets, we remain extremely optimistic about developments that matter to Woodward. In aerospace, supply chain challenges across the industry continue to impact aircraft deliveries. Air traffic is still growing globally. Airlines are optimizing load factors and fleet utilization to keep pace. Aeroservices exhibited sustained strong growth in the third quarter. The softening in services we had anticipated in our plans and guidance hasn't materialized as airline customers continue to invest in their legacy fleets to ensure they have enough capacity to meet travel demand in the face of slower deliveries of new aircraft. In fact, legacy engine LRU overhauls for both narrow body and regional aircraft grew compared to last year and show few signs of declining as yet. Wide body engine control system service demand remains steady. In addition, as I have mentioned in previous earnings reports, LEAP and GTF service activity continues to grow steeply, but it is no longer doubling in size year-over-year as the base numbers grow. The great news is that LEAP and GTF revenue is now approaching that of legacy products and is delivering a meaningful impact to our aeroservices growth profile. We expect service volumes to continue increasing through 2026 and 2027 as LEAP and GTF hours and cycles continue to drive service inputs. Commercial OEM was softer this quarter as airframers managed supply chain disruptions and all our customers managed elevated inventory buffers. Defense OEM was again a significant growth driver for aero, as expected, led by strong performance and smart defense. The defense services environment overall remained solid, though inputs to Woodward have varied quarter to quarter. In industrial, our gas turbine portfolio was a standout performer, particularly in LNG and broader oil and gas applications. Growing global electric power demand remains a key growth driver for our industrial segment. Based on conversations I've had with customers, along with what we see directly in orders, we're getting confirmation that the growth predictions are real and we're prepared to serve that growth. We're focusing our lean transformation on capacity and lead time improvements on our model gas turbine control valve production line to better serve customers. In fact, we've increased output more than 30% year-to-date. We're more than halfway through the Glatten expansion project to increase capacity to meet data center backup power demand. With construction tracking ahead of schedule, we've ordered all remaining machines in July, and we will be ready to begin moving into the new hall in November. This value stream has been completely redesigned with three key principles: that is, production, preparation, and process. We are using this expansion opportunity to create better flow, introduce higher levels of automation, and improve inventory turns. In transportation, marine demand remains exceptionally strong. Shipyards are full, and they continue to expand capacity. In the quarter, more than half of all new ship orders included alternative fuel specifications, which resulted in a strong pull for Woodward Solutions. As expected, demand for China-on-highway heavy-duty trucks declined primarily due to local economic headwinds. Overall, we see continued momentum in the macro growth drivers across both our aero and industrial segments into 2026 and beyond. A few comments on the macro environment: we remain vigilant and agile as we navigate tariffs, geopolitical matters, supply chain dynamics, and other expected and unexpected external factors. Our focus is on developing even more resilience and continuing to serve our customers regardless of the external conditions we face. Based on our consistent performance, it's clear we're on the right path to deliver on the commitments we've made to you. We will continue to create shareholder value through our value drivers of profitable growth, operational excellence, and innovation. Now I'll hand it over to Bill for more details on our third-quarter financial performance and the specifics of our updated guidance. Bill. Thank you, Chip, and good evening, everyone. As a reminder, all references to years are references to the company's fiscal year unless otherwise stated, and all comparisons are year-over-year unless otherwise stated. We delivered record net sales in the third quarter of 2025 of $915 million, an increase of 18%, reflecting the strong demand across our end markets. Earnings per share for the third quarter of 2025 were $1.76 compared to $1.63. At the segment level, Aerospace segment sales for the third quarter of 2025 were a record $596 million compared to $518 million, an increase of 15%. Defense OEM sales were strong in the quarter, up 56%, largely driven by increased demand for our smart defense programs. Commercial services sales rose 30%, exceeding expectations, driven by both pricing and increased volume tied to continued high utilization of legacy aircraft, which is extending their current service cycles. As Chip highlighted, LEAP and GTF service activity continues to increase. Commercial OEM sales were down 8% as airframers navigated supply chain disruptions and all our customers managed inventory levels. We expect these headwinds to moderate as airframers continue to increase production rates in the coming quarters. Sales for defense services were down 16%. While the market demand environment is solid, the timing and flow through of orders to Woodward can fluctuate considerably from quarter to quarter. Earnings in the third quarter for the Aerospace segments were $126 million. Margins expanded 140 basis points to 21.1% of segment sales. The increase in segment earnings was primarily driven by price realization and higher volumes, supported by ongoing operational excellence and lean initiatives that enhanced output and efficiency. These gains are partially offset by planned strategic investments in our aerospace manufacturing capabilities to meet our current and future growth. Inflation also contributed to the cost pressure. The margin rate was tempered by unfavorable mix driven by growth in our Defense OEM products, which carried lower margins relative to other parts of the portfolio. Turning to industrial, segment sales for the third quarter of 2025 were $319 million compared to $330 million, a decrease of 3%. This was primarily due to the expected decline of China-on-highway sales, which were down $36 million, or 69%. Our core industrial sales, which exclude China-on-highway, grew by 9% in the quarter. Oil and gas was up 16%, driven by price, as well as volume related to increased activity in midstream and downstream gas investments. Marine transportation was up 16%, driven by both price and volume. Power generation was flat due to the impact of the divestiture of our combustion business in the second quarter of this year. Excluding that impact, power generation sales grew double digits. For context, the combustion business averaged approximately $15 million of sales per quarter. Going forward, the best way to think about our industrial products and services portfolio is excluding China-on-highway and combustion. As Chip highlighted earlier, using this view, industrial grew double digits in the third quarter. Industrial segment earnings for the third quarter of 2025 were $48 million, or 14.9% of segment sales, compared to $60 million, or 18.1% of segment sales. The decrease was primarily due to lower China-on-highway volumes. Looking at our core industrial business, we expanded margins to 15.6% of sales, up approximately 90 basis points. This expansion was driven by our progress in operational excellence, including price realization across the portfolio and our ability to generate incremental margins from higher volumes. Given these strong results, we now expect Woodward's core industrial margin for the year to be approximately 15% of sales, the high end of our previous range. Non-segment expenses were $36 million for the third quarter of 2025, compared to $30 million. We expect adjusted non-segment expenses to finish the year close to the same rate that we have been running year-to-date. At the consolidated Woodward level, net cash provided by operating activities for the first nine months of 2025 was $238 million, compared to $297 million. Capital expenditures were $79 million for the first nine months, compared to $72 million. Free cash flow was $159 million for the first nine months of 2025, compared to $225 million. The decrease in free cash flow was primarily due to an increase in working capital. As of June 30, 2025, debt leverage was 1.5x EBITDA. During the third quarter, we returned over $62 million to stockholders, including $45 million in share repurchases and $17 million in dividends. Through the first nine months of 2025, we returned $172 million to stockholders, including $124 million in share repurchases and $48 million in dividends. We now expect to return approximately $235 million to stockholders in 2025, exceeding our initial goal of returning $250 million. This should consist of $170 million of share repurchases and $65 million in dividends. We will continue to manage this with flexibilities as conditions evolve. We remain disciplined in deploying capital across three priorities: reinvesting for growth, returning cash to shareholders, and selective returns-focused M&A. As Chip highlighted, we will be making a multi-year investment in a new state-of-the-art facility to support the Airbus A350 spoiler actuation wind and long-term organic growth. In addition, the recent acquisition strengthens our position in electromechanical actuation systems and meets our strategy-driven deal criteria. These growth investments, along with our accelerated automation initiatives, will increase capital spend over the next couple of years as we invest in growth and productivity. We will provide more details on these capital allocation plans during our fourth quarter earnings call. Now, turning to our 2025 guidance, we are raising our sales and earnings guidance, revising our adjusted effective tax rate down, and lowering our free cash flow range. We are reaffirming the other elements of our full-year guidance. This updated guidance reflects our year-to-date performance, a more stable macro environment, and strong fourth quarter outlook. For 2025, we now expect consolidated sales of $3.45 billion-$3.525 billion, which includes aerospace sales growth between 11% and 13%. A decrease in industrial sales between 5% and 7% is expected. We expect adjusted EPS between $6.50 and $6.75, with aerospace margins to be between 21% and 21.5%, and industrial margins to be approximately 14.5%. We now expect the fiscal year 2025 adjusted effective tax rate to be approximately 17%. We now expect our 2025 free cash flow to be between $315 million and $350 million. We are lowering the free cash flow range as a result of increased working capital to support higher sales during a dynamic supply chain and production environment. All other aspects of our guidance remain unchanged. This concludes our comments on the business and results for the third quarter of 2025. Operator, we are now ready to open the call for questions. Thank you. The question and answer session will begin at this time. If you're using a speakerphone, please pick up the handset before pressing any numbers. Should you have a question, please press star one on your push button phone. Should you wish to withdraw your question, press the pound key. We request that you limit yourself to one question to allow time for the other participants to ask their questions. If there is remaining time, you're welcome to re-queue with additional questions. Your question will be taken in the order it is received. Please stand by for your first question, sir. Our first question comes from David Strauss with Barclays. Please state your question. Yeah, hey, David, before you jump in, I just want to make sure I clarify something. When I noted our third quarter sales of $915 million, I may have said 18%. I just want to be clear that that is an 8% increase. Thank you. I'll turn it over to you, David. Great. Thanks. Thanks, Bill. Chip, I thought I heard you say that LEAP and GTF aftermarket volumes are now close to legacy volumes. Maybe I didn't hear that correctly, but I thought in the past you talked about getting to those kind of levels a couple of years out from now. Yeah. So, hey, thanks for the question, David. In fact, they were getting close last quarter. This quarter, they've just gotten into the same neighborhood zip code range. Still short of the legacy total volume. We forecast a crossover, which is what we said before in sort of the 2028 time period. We're still sticking with that as our outlook. The things that could make that happen faster is if the legacy fleet starts to see less hours and cycles and see less investment as Boeing and Airbus continue to pump out the Neos and MAXes to take the places of those aircraft. Right now, we're still calling 2028, but I do want the folks out there to know that LEAP and GTF volume is now having a meaningful impact on our commercial aeroservices revenue and margin, and we're very excited about that. Our next question, it comes from Scott Deuschle with Deutsche Bank. Please state your question. Hi, good evening. Hey, Scott. Hey, Scott. Bill, can you walk us through what drove the sequential margin decline in aerospace in the third quarter and then the drivers behind the implied aerospace margin improvement in the fourth quarter? Yeah, Scott, thanks. As you look at it, I think the incrementals are around 30%. Again, we typically advise that we look for incrementals between 30% and 35%. I do realize that the first half incrementals for Aero were in the 40% range. What caused those incrementals to drop was the, while we did have strong growth in aftermarket, we had very strong growth in our Defense OE. That comes with a lower profit margin, and therefore it caused the unfavorable mix of that product line, caused the decline in our incrementals. As you highlighted, as you look at our guidance and what that implies for Q4, we do expect our incrementals to get back to the ranges that we saw in the first half of the year. We will still see, we expect to see strong Defense OE still, but that should come along with our smart defense program realizing the price increases as we have moved into the newer lines. That is what will, the sustained growth in Defense OE with the move in pricing, and also we expect to have another good quarter in our commercial aftermarket business. Our next question comes from Noah Poponak with Goldman Sachs. Please state your question. Hey, good afternoon, guys. Good afternoon. A lot of discussion of some new investments or maybe a few we hadn't fully calibrated here. In the release, you also cite aerospace investments impacting the third quarter margin. Can you talk more about what that was and why it seems like only one quarter? What are you actually spending $35-$50 million on in the free cash flow reduction? Can you be more specific there? Yeah. How much and for how long are we talking about higher CapEx beyond this year and what's it for? Yeah. Thanks for those questions. First of all, on the investments that we highlighted in our manufacturing space. It was not necessarily a hit to margin rate, more of a hit to margin dollars. What those investments are, are to drive productivity. We are investing in our team leaders. We're investing in our operations supervisors, again, to work with our direct employees in order to help us to increase our productivity. We are also adding manufacturing engineers that will better allow us to implement our automation and allow us to get to the productivity benefits that we're looking for. Finally, we're adding in supplier engineers to continue to work with our supply base to make sure we can improve that or improve on those areas. The second part of your question is around free cash flow and us lowering our range there. The simple answer is we are investing more in working capital, specifically inventory. As we look at the need to meet the demands of our customer in the mix that they're looking for and get it there on time and understanding the capabilities of our process, we made the decision to invest a bit more in inventory to allow us to do that. We continue to work that area. We are investing in resources and in processes and in systems so that going forward we don't need to invest in those levels, and we expect that you will see that benefit as we get to 2026. Okay. Bill, you have a few years in a row now where the full-year aerospace margin lands higher than the prior year's fourth quarter. The fourth quarter proves to be an exit rate that you build off of. The guidance implies the last quarter of this year will be in the mid-2022s. Do we use that as the jumping-off point off which you expand next year? No, not necessarily. Again, I think we are expecting to have a very strong Q4 in Aero. There are a few reasons for that. As we get into 2026, we'll talk a little bit more about the rate that you can expect for Aero for the total year, but we're very pleased with the implied 4Q exit of Aero. Our next question comes from Scott Mikus with Melius Research. Please state your question. Morning, Chip, Bill. Nice to be in there. You displaced an incumbent supplier on the A350 spoiler actuation system. That makes you a tier-one supplier to Airbus now. Do you see other opportunities to displace incumbents on current platforms, or is this more of a one-off opportunity? For future aircraft engine plans programs, do you plan to pursue more work packages as a tier-one supplier, or is the intention to primarily stay a tier-2 supplier except where you have a differentiated offering? Yes, Scott, thanks for the question. As you probably know and most people in the industry know, displacements in the middle of really successful aircraft programs are somewhat rare. We would not view that as a wave of opportunities in front of us. The combination of that opportunity and acquiring Safran's North American electromechanical actuation business allows us to get into the Airbus tier-one supplier structure, which we think is a great place to be as we look toward the next single-aisle aircraft opportunity. As far as tier-one and tier-two for us, we are kind of a little bit of a humble company. I mean, we are willing to do work at tier-one levels. We are willing and able to do systems, subsystems, or components. Where we can add value to customers and to products, we are willing to serve if we can make it a profitable, high-return business for our shareholders. Okay. And then one quick one for Bill. Do you happen to have the pricing in the quarter, and can you perhaps parse that out by aero and industrial? Yeah. So at the total business, we saw about 7% price. I would say that Aero contributed a little more than industrial, but both did a great job. We have said in the past that price for the year would be close to 5%. Based on where we are, it will be closer to delivering 7% at the Woodward level for price for 2025. Our next question comes from Christopher Glynn with Oppenheimer. Please state your question. Thanks. Good afternoon. Good afternoon, Chris. I just want to ask about the—hey, so the marine's doing better than you've talked about the long-term profile given industry capacity. Kind of at that level. Just curious, what's driving the upside this year? Maybe it's simply price, but also curious if you're taking share in some respect or building out the naval profile alongside commercial and merchant. Chris, I think the easiest way to think about how marine is going for Woodward is that our customers are taking share as well as the capacity increases and orders from the shipyards and the services business. It is those three things. It is price. It is the platforms that we are on. They are winning positions on the ships. The service opportunity from the utilization is quite strong. Okay, great. Did the third quarter see any of the new lots pricing and the smart weapons? Chris. It will start in the fourth quarter. Tax rates come down a good bit a couple separate times during the year. Just wondering what's driving that and if we should be thinking of a new baseline beyond the current year other than the kind of 20% anchor. Yeah. With the level of stock options we have to support our members. Historically, with the record stock prices that we've had, we've seen a lot of those stock options that came in, which provides us with a tax benefit. That's what really drove that rate down. As we continue to increase our net earnings, that's going to put pressure on our tax rate. I would expect a bit more pressure. Right now, with the stock price at the levels they've been at, that's causing us to get this benefit, which results in these lower tax rates. Hence, our upgrading, adjusting the guidance on that effective tax rate for 2025. Our next question comes from Gavin Parsons with UBS. Please state your question. Hey, thanks. Good afternoon. Hello, Gavin. Hey, Gavin. I wanted to just parse out the working cap investment this year and the CapEx investment next two years. How much of that is for, say, existing programs versus new wins like the A350 or maybe investing in the growth rate of the Safran business? Yeah. Yeah, but it's safe to say that all the inventory increase is with current programs. It's really a—a lot of people talk about it in the industry—it's a factor of fluctuation in our own production system, fluctuation in demand from customers that have supply chain issues that maybe aren't ours, and they're holding a number of our parts in inventory, and then how our suppliers perform. Our desire is not to make sudden movements with suppliers and lose that capacity that we've worked so hard to gain since COVID. A lot of things going on, a lot of management decisions, a lot of strategic thinking around how do we make sure we can serve customers and meet this demand. As we look into FY 2026, we feel like we do have expertise deployed to work that down and improve the overall process as things tend to stabilize a bit more in terms of what we see from our customers and what their desires are to have more of a stable supply chain altogether. That's work in process, but we're just seeing the effects of that in the third and fourth quarter, probably. As far as the investments go, we're looking at the facility for A350 spoiler production. These types of facilities tend to run a couple hundred million dollars that can be spread across a couple, three years. That's what we're looking at. We've got a lot of experience with this from building Rock Cut for LEAP and GTF programs. You can build a building for a lot less than that, but to build the capacity and capability to have a highly automated, vertically integrated production system in a factory like that, that's kind of what the price tag looks like. It's also with our acquisition of Safran's electromechanical business. We'll be moving product to existing facilities and really working through making that an optimum supply chain and production system to serve Airbus and the other airframers. Okay. That's great. I mean, just to put a finer point on the working capital, is that more to enable an acceleration in your growth or de-risk your own supply chain visibility? It really does both. Thanks for that. Our next question comes from Louis Raffetto with Wolfe Research. Please state your question. Yeah, thank you. Bill, you'd ballparked the quarterly sales rate for the Greenville divestiture. Could you speak to the impact of the Safran deal on results and then also what the cash usage was for this quarter? Yeah. For Safran. I think when it got announced. They sized the business. We're focused on taking it, growing it, and improving it. The key matter about this acquisition was a strategic one to allow us to continue to grow our capability in the space. That's what we're focused on. Louis, I think the second part of your question. Just how much you spent on that deal. It'll be in the K, I guess. You close it just after the quarter. Yeah. Yeah. It's a great deal for us. We're happy with that. We have it. It's not something that we're covering right now. Yeah. I think the reason we sized the Greenville for you is to help you going forward on what the industrial and power gen compares look like. There's really no macro impact on aero for that deal. So we're really not going to disclose that level of information on that small of an impact. Okay. And then maybe just latest on the China on-highway expectations for the rest of the year, I think you'd gone from $40 million to $50 million. Are we at $70 million now, I guess? Say a top-down estimate. Not right. And we're not—yeah. And for Ford, we're around 60. And in 4Q. It'll be somewhere around $10 million. Our next question comes from Michael Ciarmoli with Truist Securities. Please state your question. Hey, good evening, guys. Thanks for taking the question. Maybe, Chip, can you give a little bit more color on this A350 spoiler win? I mean, in terms of what the expected ship set content will be, I guess my understanding you've got to develop your own IP when maybe those first sales are going to occur. And any kind of expected margin profile you could talk to. It sounded like maybe the existing incumbent on this walked away just given their return profile. I guess a couple hundred million of investment sounds significant for just that one platform. Is this a broader play to position yourself for future kind of actuation spoiler wins on that next-gen narrowbody? Yeah. Thanks for the question. The spoiler actuator business is quite substantial. The A350 program, if you look at Airbus's forecast for rate increases and where that aircraft is going and what the demand is for that, it's a wonderful program to be a part of. When I look at the ship set content, so there are 14 actuators, 7 per wing, and we have 12 of those. So it's a lot of hardware per ship set. It's going to take a bit of factory space because we're going to be vertically integrated. It is a substantial investment, but it's a manageable one. We have a number of things we're looking at to add into that facility as we go forward. As of now, we like the investment and our forecasted return on that for the A350 program. We'll pile on that, and we'll add things as we can and as we win them going forward. Will this be margin-dilutive as it ramps up out of the gate? Quite often on programs, they can be margin-dilutive. A lot of that sometimes has to do with fits and starts and where is the program and where is the plane going to be when it enters production. We're not burdened with some of that in this case on a displacement. We know exactly what rate we have to catch when. Your earlier question was about when we would see revenue. We and Airbus are targeting 2028 entry into service for our hardware. Our next question comes from Sheila Kahyaoglu with Jefferies. Please state your question. Thank you, guys. Maybe just following up on the new facility. How do we think about the few hundred million? Is it 2026 and 2027? So $300 million over two years. And I know I'm making up numbers here. How do we think about the payback on that. In terms of the commercial areas? Yeah. So we look at this to be about a couple of hundred million dollar investment, Sheila. Yes, it'll be spread out over 2026, 2027. Some of it could leak into 2028, but most of it will happen between those two years. Again, we love this program. We think it's— It will have good returns for us. It's a great portfolio of opportunity here with Airbus. We think it's going to be a really good program. Okay. On the defense continued at performance, are there any comments you could make on how long it lasts? How do we think about the JDAM contract in particular and its impact on profitability? Yeah. First, smart defense, I want to make sure to say that all the products in our smart defense portfolio are performing well. Obviously, JDAM gets a lot of coverage, as it should. These programs are tough, but we think through at least the first half of 2026, we feel good about seeing the demand. We like the demand. It gets a little dangerous to take that view too much further than that, Sheila. I will say we feel good about this demand through the first half of 2026. Our next question comes from Gautam Khanna with TD Cowen. Please state your question. Hey, good afternoon, guys. Afternoon, Gautam. I had a couple of questions. Perhaps I dropped. I'm just curious. Did you address China natural gas and what demand signals you're seeing from those customers? Yeah. We briefly said that Q4 will be around $10 million. The overall economy continues to dampen the demand and the order rate in that business. Okay. Any preliminary view on 2026, given fiscal 2025 has been an unnaturally low year? Yeah. No. Yeah. No. What is normal? No. We are going to continue to focus on our core industrial business. That will be our focus. As we said, it is a dynamic, volatile business. We will highlight our view when we get to the end of the fourth quarter. Okay. Big picture, have you seen any demand erosion from U.S. trade policy and all the changes we've had with U.S. trade policy since April? Anywhere in the portfolio? I wouldn't say we've seen demand drop off. I think we've seen some maybe unnatural volatility and some delays and then spikes. We had some delayed China service orders earlier in the year. And then we've had some piling on of orders, maybe at 1.5 to 2x the normal amount in third quarter and fourth quarter. I think we've seen some unnatural volatility, but maybe not—I wouldn't characterize it as a drop-off in demand or a long-term demand increase either way. Our next question comes from David Strauss with Barclays. Please state your question. Thanks for taking the fall off. Previously, you had this free cash flow target out through 2026 of $1.2 billion cumulative. Is that now off the table given the reduction in the free cash flow forecast for this year and what you're talking about, it sounds like, for CapEx next year? Yeah. David, I think. For our underlying business and our plan, we still are. We still see being able to deliver the $1.2 billion. You did highlight a point, and that is that we are still figuring out what exactly the CapEx spend will be in 2026, and that may have an impact on it. We'll just come back to you at the end of the year with more clarity on exactly how that's looking. Okay. Do you guys have any impact from or any benefit from Section 174 amortization going away as part of the Big, Beautiful Bill? Some of these elements on that bill around what we can do around some of the R&D expenses, around what we can do as we're billing the facilities and can accelerate that depreciation, a lot of those things will help. There's still a lot of—we got high-level views of what that is, but exactly how it rolls out, we're going to have to spend a little more time, and we can give you a better understanding of the impact as we get to given 2026 guidance. Our next question comes from Scott Deuschle with Deutsche Bank. Please state your question. Chip, just to clarify an earlier comment you made, were you saying that LEAP and GTF aftermarket revenue is approaching legacy narrowbody aftermarket, or was the comment that total revenue from LEAP and GTF, including OE, is approaching legacy aftermarket? Just wanted to clarify that. Good clarification question. The point I was making was that in the aftermarket, in the service business, which is comprised of spare end items, repair and overhaul, as well as spare parts, in those categories, that LEAP and GTF are gaining and getting into the same zip code as the legacy, which is very exciting for us. Okay. Chip, when we think about growth in power generation over the coming years, should we be looking at the growth at GE Vernova and Rolls-Royce? When we think about your growth, or are there any specific nuances with respect to Woodward's position that would drive a meaningful divergence between what those OEMs are looking at and what you might look at? Thank you. I think broadly speaking, we see the same kind of growth they do, but it can get a little bit nuanced in terms of which platform wins which application. Because if a certain gas turbine wins, it starts to win more, or a certain recip engine that's liquid wins, then our hardware may or may not be on those OEMs. Broadly speaking, if you average the OEMs, I think you'd get something close to what we're seeing. Our SOGAV product line is on gas engines. Our DFS business, WLO in Germany, is on MTUs, reciprocating backup engine power. We have a lot of control valves on GE Vernova, Baker Hughes, and Mitsubishi gas turbines. When you look at those OEMs and how they're doing and how they're forecasting growth, you can see how we can play in that market. Our next question comes from Noah Poponak with Goldman Sachs. Please state your question. Chip. In the beginning of the year in the initial guidance, if I recall, you had contemplated aerospace aftermarket revenue growing low to mid-single digits. And year to date, it's now I have it up 24%. I think that's right. The excess 20 points of growth, how much of that is pent-up demand, extended duration of the legacy fleet versus how much of that is, it sounds like, maybe the LEAP and the GTF are coming along a bit faster than you planned at the beginning of the year? It is a combination of both of those, Noah, as well as price. We see few signs of the legacy slowing down. I think that's one of the bigger indications to us that we did not see earlier in the year. I thought that would be flattish, except for price. The shops and the airlines have found ways to send more units in for overhaul and repair and order more spare parts than we forecast or modeled. Leap and GTF has that steep curve that has continued to deliver more units into overhaul for us. We like the results. I think I said early in the year when I was questioned by a number of folks, "Are you just— Do you think that that's going to happen? What if there's more demand?" I said, "If there's more demand, we will be ready with the capacity to capitalize on that opportunity." That is kind of how it turned out. Do you have a sense from those customers of how long that now goes into the forward? Or is it just kind of hard to have that visibility in that business? I think the challenge is it's all related to revenue passenger miles and how long airlines keep flying those legacy aircraft to make up for delivery rates that are slower than they want them to be from the airframers. If you listen to Southwest and United and American and Delta talk about U.S. domestic travel, it's not such a rosy picture. If you listen to folks talk about what's going on in the rest of the world, there's some good demand in Europe and other places. Just keeping a close eye on that demand, I think, helps us understand how long the legacy fleet is going to be robustly invested in, if you will. Because once airplanes start to get parked from the legacy fleet, more used serviceable material will be available. While it could really, I think, eat into that business pretty quickly. For us, on the Woodward side, the great news about that is that there's such a multiplier effect on LEAP and GTF in terms of how that fleet is accumulating hours and cycles that we feel like our growth profile is relatively secure. I just—maybe we were a few quarters ahead of that legacy fleet tailing off. The one reminder you'll hear from a lot of folks in the OEM business is that I don't know whether it's 40% or 50% of the CFM56-5s and -7s haven't seen their first shop visit yet. Those younger parts of the fleet still have a long way to go. The older parts of the fleet may get parked out when the demand curve turns a little bit or when the OEMs start producing at the rates they want to produce. Our next question comes from the line of Gavin Parsons with UBS. Please state your question. Hey, thanks for the follow-up. On the LEAP GE, a week or two ago, said they expect a 25% shop visit CAGR through the end of the decade. Anything to keep in mind about your growth rate relative to that? Thanks. Sure thing. That's an exciting growth rate. I think that hours and cycles and utilization support that, obviously. For us, some of our LRUs are not necessarily correlated with the shop visit in terms of when we see them. Even though those, our growth rates are substantial still, and we have a steep growth rate. We do not necessarily correlate one-to-one with the shop visits in terms of removals of our different LRUs. We have kind of averaged that to talk about the service content of the LEAP and GTF being 5x what the prior legacy engine configurations were. That kind of averages out the difference in shop visit rate from a fuel pump and a BSV actuator and an air valve. Right now, we are seeing pumps and fuel metering units and fuel nozzles come in. We have not seen many of the other products yet, but over time, we will. I just do not know if 25% is a good number for us because we are not all that correlated to shop visits. We are more correlated directly to hours and cycles. That's helpful. On JDAM, I didn't see the step up in the budget. Do you guys have that contract locked in? I'm just wondering your visibility on that going forward. We have POs from our customer. And we're responding to those and fulfilling. I don't know what the locked-in you're referring to, but we have POs from our customer. Mr. Blankenship, there are no further questions at this time. I will now turn the conference back to you. I would just like to thank everyone for joining us for today's call. We'll see you next time. Ladies and gentlemen, that concludes our conference call today. A rebroadcast will be available at the company's website, www.woodward.com, for one year. We thank you for your participation in today's conference call.