Gates Industrial Corporation closed Q4 with results that met Wall Street’s expectations for both revenue and profitability, prompting a notable positive market reaction. Management credited the quarter’s performance to robust gains in its personal mobility and data center businesses, which offset ongoing softness in core industrial end markets. CEO Ivo Jurek highlighted that “personal mobility business exceeded 25% core growth in 2025, and our data center business grew 4x compared to 2024,” while acknowledging continued inventory management by distributors and a challenging backdrop for automotive original equipment. The company also emphasized disciplined cost control and the benefits of recent operational adjustments.
Is now the time to buy GTES? Find out in our full research report (it’s free for active Edge members).
Gates Industrial Corporation (GTES) Q4 CY2025 Highlights:
- Revenue: $856.2 million vs analyst estimates of $855.1 million (3.2% year-on-year growth, in line)
- Adjusted EPS: $0.38 vs analyst estimates of $0.37 (4% beat)
- Adjusted EBITDA: $187.8 million vs analyst estimates of $194.6 million (21.9% margin, 3.5% miss)
- Adjusted EPS guidance for the upcoming financial year 2026 is $1.60 at the midpoint, beating analyst estimates by 1%
- EBITDA guidance for the upcoming financial year 2026 is $805 million at the midpoint, below analyst estimates of $811.3 million
- Operating Margin: 12.6%, in line with the same quarter last year
- Organic Revenue was flat year on year (miss)
- Market Capitalization: $6.89 billion
While we enjoy listening to the management's commentary, our favorite part of earnings calls are the analyst questions. Those are unscripted and can often highlight topics that management teams would rather avoid or topics where the answer is complicated. Here is what has caught our attention.
Our Top 5 Analyst Questions From Gates Industrial Corporation’s Q4 Earnings Call
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Andy Kaplowitz (Citigroup) asked about the sustainability of order growth and the timing of aftermarket distributor restocking; CEO Ivo Jurek explained that industrial OEM order recovery is encouraging, but full aftermarket normalization may not occur until Q2.
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Julian C.H. Mitchell (Barclays) pressed on the phasing of ERP and restructuring headwinds, with CFO L. Brooks Mallard clarifying that most margin impact is front-loaded in the year, and organic growth should resume from Q2 onward.
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Tomohiko Sano (JPMorgan Chase) inquired about the durability of personal mobility growth, to which Jurek responded that the pipeline remains robust, supported by electrification and technology shifts, and projected continued high-twenties percent growth rates.
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Deane Michael Dray (RBC Capital Markets) sought detail on the scope and savings from footprint optimization, with Mallard indicating that the actions affect a single-digit number of facilities and could yield upside to the $10 million cost savings target.
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Jeffrey David Hammond (KeyBanc) asked about ERP-related revenue disruption and auto aftermarket channel trends; Mallard noted that most revenue disruption will be in Q1 and that aftermarket sales comps should normalize from Q2.
Catalysts in Upcoming Quarters
In the coming quarters, the StockStory team will be monitoring (1) the pace of recovery in industrial OEM and aftermarket demand, especially as inventory destocking subsides; (2) the realization of cost savings and operational improvements from ERP and footprint optimization projects; and (3) continued growth and order momentum in personal mobility and data center verticals. The successful execution of bolt-on acquisitions and further deleveraging will also be important milestones for Gates’ strategy.
Gates Industrial Corporation currently trades at $27.14, up from $26.51 just before the earnings. At this price, is it a buy or sell? The answer lies in our full research report (it’s free).
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