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What changed in HEXCEL CORP /DE/'s 10-K — 2024 vs 2025

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Paragraph-level year-over-year comparison of HEXCEL CORP /DE/'s 2024 and 2025 10-K annual filings, covering the Business, Risk Factors, Legal Proceedings, Cybersecurity, MD&A and Market Risk sections. Every new, removed and edited paragraph is highlighted side-by-side so you can see exactly what management changed in the 2025 report.

+165 added−155 removedSource: 10-K (2026-02-11) vs 10-K (2025-02-05)

Top changes in HEXCEL CORP /DE/'s 2025 10-K

165 paragraphs added · 155 removed · 126 edited across 7 sections

Item 1. Business

Business — how the company describes what it does

59 edited+10 added−17 removed76 unchanged
Biggest changeThe following tables identify the key customers and the major manufacturing facilities of the Composite Materials segment: COMPOSITE MATERIALS KEY CUSTOMERS Aernnova Dassault Northrop Grumman Airbus Embraer Pratt & Whitney (2) Bell (1) FACC Safran The Boeing Company General Electric Sikorsky (4) Bombardier GKN Syensqo CFAN Gulfstream (3) Spirit Aerosystems Collins Aerospace (2) Leonardo Toray CTRM Aero Composites Lockheed Martin RTX Daher Nordam (1) A Textron Company (2) A RTX Company (3) A General Dynamics Company (4) A Lockheed Martin Company 5 MANUFACTURING FACILITIES Casa Grande, Arizona Neumarkt, Austria Dagneux, France Parla, Spain Decatur, Alabama Roussillon, France Duxford, England Salt Lake City, Utah Illescas, Spain Seguin, Texas Leicester, England Stade, Germany Les Avenières, France Vert-le-Petit, France Net sales for the Composite Materials segment to third-party customers were $1.531.0 million in 2024, $1,474.2 million in 2023, and $1,279.7 million in 2022, which represented about 80% of our net sales each year.
Biggest changeThe following tables identify the key customers and the major manufacturing facilities of the Composite Materials segment: COMPOSITE MATERIALS KEY CUSTOMERS Aernnova Daher Lockheed Martin Airbus Dassault Nordam Albany International Embraer Northrop Grumman Blue Origin FACC RTX The Boeing Company General Dynamics Safran Bombardier General Electric Syensqo CFAN GKN Toray CTRM Aero Composites Leonardo 5 MANUFACTURING FACILITIES Casa Grande, Arizona Parla, Spain Dagneux, France Roussillon, France Decatur, Alabama Salt Lake City, Utah Duxford, England Seguin, Texas Illescas, Spain Stade, Germany Leicester, England Vert-le-Petit, France Les Avenières, France During the third quarter of 2025, the Company completed the divestiture of its operations in Austria.
Our broad product range includes carbon fiber, specialty reinforcements, prepregs and other fiber-reinforced matrix materials, honeycomb, resins, engineered core and composite structures for use in commercial aerospace, space and defense, and industrial applications. We are a manufacturer of products within a single industry: Advanced Composites. We have two reportable segments: Composite Materials and Engineered Products.
Our broad product range includes carbon fiber, specialty reinforcements, prepregs and other fiber-reinforced matrix materials, honeycomb, resins, engineered core and composite structures for use in commercial aerospace, defense and space, and industrial applications. We are a manufacturer of products within a single industry: Advanced Composites. We have two reportable segments: Composite Materials and Engineered Products.
The aggregate demand by Space & Defense customers is primarily a function of procurement of military aircraft, rotorcraft and space craft that utilize advanced composites, including the United States, a number of Western European countries, as well as a select number of other countries globally.
The aggregate demand by Defense, Space & Other customers is primarily a function of procurement of military aircraft, rotorcraft and space craft that utilize advanced composites, including the United States, a number of Western European countries, as well as a select number of other countries globally.
Furthermore, failure to comply may result in the imposition of fines and penalties, including contractual damages, civil penalties, criminal penalties, administrative sanctions, suspension or debarment from contracting with the U.S. government or termination of any applicable facility security clearance, which in turn would preclude us from being awarded classified contracts or, under certain circumstances, performing on our existing classified contracts.
Furthermore, failure to comply may result in the imposition of fines and penalties, including contractual damages, civil penalties, criminal penalties, administrative sanctions, suspension or debarment from contracting with the U.S. or foreign government or termination of any applicable facility security clearance, which in turn would preclude us from being awarded classified contracts or, under certain circumstances, performing on our existing classified contracts.
These forward-looking statements are identified by their use of terms and phrases such as “anticipate,” “believe,” “continue,” “could,” “estimate,” “expect,” “intend,” “may,” “plan,” “potential,” “predict,” “project,” “should,” “seek,” “target,” “would,” “will” and similar terms and phrases, including references to assumptions. Such statements are based on current expectations, are inherently uncertain and are subject to changing assumptions.
These forward-looking statements are identified by their use of terms and phrases such as “anticipate,” “believe,” “continue,” “could,” “estimate,” “expect,” 12 “intend,” “may,” “plan,” “potential,” “predict,” “project,” “should,” “seek,” “target,” “would,” “will” and similar terms and phrases, including references to assumptions. Such statements are based on current expectations, are inherently uncertain and are subject to changing assumptions.
Depending upon the material and markets, relevant competitive factors include technology, product performance, historical database of usage, on-time delivery, service, price, customer preference for sole sourcing and the ease-of-use of our material to support customer-preferred processes. We believe that new competitors face significant barriers to entry into many of our markets.
Depending upon the material and markets, relevant competitive factors include technology, product performance, historical database of usage, on-time delivery, service, price, customer preference for sole sourcing and the ease-of-use of our material to support customer-preferred processes. 11 We believe that new competitors face significant barriers to entry into many of our markets.
Any reference to our website in this Annual Report on 12 Form 10-K is intended to be an inactive textual reference only. We make available, free of charge through our website, our Form 10-Ks, 10-Qs and 8-Ks, and any amendments to these forms, as soon as reasonably practicable after filing with, or furnishing to, the SEC.
Any reference to our website in this Annual Report on Form 10-K is intended to be an inactive textual reference only. We make available, free of charge through our website, our Form 10-Ks, 10-Qs and 8-Ks, and any amendments to these forms, as soon as reasonably practicable after filing with, or furnishing to, the SEC.
The economic benefits to airlines from weight savings in both fuel economy and aircraft range, combined with the design enhancement that comes from the advantages of advanced composites over traditional materials, have resulted in the aerospace industry becoming the leader in the adoption and use of these materials.
The economic benefits to airlines from weight savings in both fuel economy and aircraft range, combined with the aerodynamic design enhancement that comes from the advantages of advanced composites over traditional materials, have resulted in the aerospace industry becoming the leader in the adoption and use of these materials.
This will be dependent both upon the financial health of the airline operators, as well as the overall availability of financing in the marketplace. Each new generation of commercial aircraft has used increasing quantities of advanced composites, replacing metals and other materials.
This will be dependent both upon the financial health of the airline operators, as well as the overall availability of financing in the marketplace. 7 Each new generation of commercial aircraft has used increasing quantities of advanced composites, replacing metals and other materials.
Changes in environmental and climate change laws or regulations, including laws relating to greenhouse gas emissions, could lead to new or additional investment in manufacturing processes or product designs and could increase environmental compliance expenditures, including increased energy, controls and raw materials costs.
Changes in environmental and climate change laws or regulations, including laws relating to greenhouse gas emissions, could lead to new or additional investment in manufacturing processes or product designs and could increase environmental compliance expenditures, including 10 increased energy, controls and raw materials costs.
As a company with significant international operations, we are also subject to numerous laws and regulations, including export controls and sanctions laws, customs regulations, international treaties and local trade rules around the world.
As a company with significant international operations, we are also subject to numerous laws and regulations, including export controls and sanctions laws, customs regulations, tariffs, international treaties and local trade rules around the world.
Historically, wind energy comprised the largest submarket within industrial as we purchase third-party glass fiber and add value with our weaving expertise and resin formulations.
Historically, wind energy comprised the largest submarket within industrial as we would purchase third-party glass fiber and add value with our weaving expertise and resin formulations.
All of the PAN we produce is for internal carbon fiber production. We utilized between 60% and 65% by value of the carbon fiber we produced in both 2024 and 2023 with the remainder of our output sold to third-party customers.
All of the PAN we produce is for internal carbon fiber production. We utilized between 60% and 65% by value of the carbon fiber we produced in both 2025 and 2024 with the remainder of our output sold to third-party customers.
Other Regulatory Matters As a materials supplier for U.S. prime contractors, and, in some cases, directly to the U.S. government, we are subject to certain U.S. government Federal Acquisition Regulations, the Department of Defense Federal Acquisition Regulations Supplement, and associated procurement regulations.
Other Regulatory Matters As a materials supplier for U.S. prime contractors, and, in some cases, directly to the U.S. government, we are subject to certain U.S. government Federal Acquisition Regulations, the Defense Federal Acquisition Regulations Supplement, and associated procurement regulations.
The following table identifies the principal products and examples of the primary end-uses from the Engineered Products segment: SEGMENT PRODUCTS PRIMARY END-USES ENGINEERED PRODUCTS Composite Structures Aircraft structures and finished aircraft components, including wing to body fairings, wing panels, flight deck panels, door liners, rotorcraft blades, spars and tip caps Engineered Honeycomb Aircraft structural sub-components and semi-finished components used in rotorcraft blades, engine nacelles, and aircraft surfaces (flaps, wings, elevators and fairings) RF Interference Control Military and aerospace applications Net sales for the Engineered Products segment to third-party customers were $372.0 million in 2024, $314.8 million in 2023, and $298.0 million in 2022, which represented approximately 20% of our net sales each year.
The following table identifies the principal products and examples of the primary end-uses from the Engineered Products segment: SEGMENT PRODUCTS PRIMARY END-USES ENGINEERED PRODUCTS Composite Structures Aircraft structures and finished aircraft components, including wing to body fairings, wing panels, flight deck panels, door liners, rotorcraft blades, spars and tip caps Engineered Honeycomb Aircraft structural sub-components and semi-finished components used in rotorcraft blades, engine nacelles, and aircraft surfaces (flaps, wings, elevators and fairings) RF Interference Control Military and aerospace applications Net sales for the Engineered Products segment to third-party customers were $377.7 million in 2025, $372.0 million in 2024, and $314.8 million in 2023, which represented approximately 20% of our net sales each year.
While we have many multi-year contracts with our major aerospace customers and our largest Industrial customer, most of these contracts specify the proportion of the customers’ requirements that will be supplied by us and the terms under which the sales will occur, not the specific quantities to be procured or the specific dates for delivery.
While we have many multi-year contracts with our major aerospace customers, most of these contracts specify the proportion of the customers’ requirements that will be supplied by us and the terms under which the sales will occur, not the specific quantities to be procured or the specific dates for delivery.
We procure renewable power through our energy suppliers and at several sites, through power purchase agreements (PPA). We also work with our energy suppliers to provide on-site 10 renewable power including the installation of on-site solar panels at our manufacturing sites in Neumarkt, Austria, Casa Grande, Arizona, and Casablanca, Morocco.
We procure renewable power through our energy suppliers and at several sites, through power purchase agreements (PPA). We also work with our energy suppliers to provide on-site renewable power including the installation of on-site solar panels at our manufacturing sites in Casa Grande, Arizona and Casablanca, Morocco.
The Sikorsky Black Hawk wide chord blade program was the largest blade program in 2024 and 2023. Hexcel composites are being used in prototypes of new military and civilian helicopters globally. CH-53K is a future growth program, 8 including the composite helicopter blades and new helicopter programs in development which use Hexcel composites in prototypes.
The Sikorsky Black Hawk wide chord blade program was the largest blade program in 2025 and 2024. Hexcel composites are being used in prototypes of new military and civilian helicopters globally. CH-53K is a growth program, including the composite helicopter blades and new helicopter programs in development which use Hexcel composites in prototypes.
Of the 15% of overall sales to Boeing and its subcontractors in 2024, 13% related to Commercial Aerospace market applications and 2% related to Space & Defense market applications. Markets Our products are sold for a broad range of end-uses where durability, strength and weight are important factors to our customers.
Of the 13% of overall sales to Boeing and its subcontractors in 2025, 11% related to Commercial Aerospace market applications and 2% related to Defense & Space market applications. Markets Our products are sold for a broad range of end-uses where durability, strength and weight are important factors to our customers.
HexFIT® film infusion material is a product that combines resin films and dry fiber reinforcements to save lay-up time in production and enables the manufacture of large contoured composite structures, such as wind turbine blades. Resins : HexFlow® polymer matrix materials are sold in liquid and film form for use in direct process manufacturing of composite parts.
HexFIT® film infusion material is a product that combines resin films and dry fiber reinforcements to save lay-up time in production and enables the manufacture of large contoured composite structures. Resins : HexFlow® polymer matrix materials are sold in liquid and film form for use in direct process manufacturing of composite parts.
Composite Materials The Composite Materials segment manufactures and markets carbon fibers, fabrics, and specialty reinforcements, prepregs and other fiber-reinforced matrix materials, structural adhesives, honeycomb, molding compounds, tooling materials, polyurethane systems and laminates that are incorporated into many applications, including commercial and military aircraft, transportation (including automotive, marine and rail), wind turbine blades, recreational products, and other industrial applications. 3 The following table identifies the principal products and examples of the primary end-uses from the Composite Materials segment: SEGMENT PRODUCTS PRIMARY END-USES COMPOSITE MATERIALS Carbon Fibers Raw materials for prepregs, fabrics and specialty reinforcements Filament winding for various aerospace, defense and industrial applications Fabrics, Multi-axials and Specialty Reinforcements Raw materials for prepregs Composites and components used in aerospace, defense, automotive, wind energy, recreation, marine and other industrial applications Prepregs, Other Fiber-Reinforced Matrix Materials and Resins Epoxy resin systems Composite structures Commercial and military aircraft Aero-engines Rotorcraft Satellites and launchers Automotive, marine and rail Wind Turbine blades Skis, snowboards, bicycles and hockey sticks Structural Adhesives Bonding of metals, honeycomb and composite materials Honeycomb Composite structures and interiors Impact and shock absorption systems Rotorcraft blades Acousti-Cap® Pultruded Profiles Tubes, rods, robotics and medical applications Carbon Fibers: HexTow® carbon fibers are used in certain reinforcements and composite materials.
Composite Materials The Composite Materials segment manufactures and markets carbon fibers, fabrics, and specialty reinforcements, prepregs and other fiber-reinforced matrix materials, structural adhesives, honeycomb, molding compounds, tooling materials, polyurethane systems and laminates that are incorporated into many applications, including commercial and military aircraft, transportation (primarily automotive), recreational products, and other industrial applications. 3 The following table identifies the principal products and examples of the primary end-uses from the Composite Materials segment: SEGMENT PRODUCTS PRIMARY END-USES COMPOSITE MATERIALS Carbon Fibers Raw materials for prepregs, fabrics and specialty reinforcements Filament winding for various aerospace, defense and industrial applications Fabrics, Multi-axials and Specialty Reinforcements Raw materials for prepregs Composites and components used in aerospace, defense, automotive and other industrial applications Prepregs, Other Fiber-Reinforced Matrix Materials and Resins Epoxy resin systems Composite structures Commercial and military aircraft Aero-engines Rotorcraft Unmanned aerial vehicles Satellites and launchers Automotive Bicycles and hockey sticks Structural Adhesives Bonding of metals, honeycomb and composite materials Honeycomb Composite structures and interiors Impact and shock absorption systems Rotorcraft blades Acousti-Cap® Pultruded Profiles Tubes, rods, robotics and medical applications Carbon Fibers: HexTow® carbon fibers are used in certain reinforcements and composite materials.
These applications also exhibit increasing utilization of composite materials with each new generation of aircraft. Space & Defense The Space & Defense market represented 30% of our 2024 net sales. The Space & Defense market has historically been an innovator in the use of, and source of significant demand for, advanced composites.
These applications also exhibit increasing utilization of composite materials with each new generation of aircraft. Defense, Space & Other The Defense, Space & Other market represented 39% of our 2025 net sales. The Defense, Space & Other market has historically been an innovator in the use of, and source of significant demand for, advanced composites.
The total number of full-time employees and contract workers as of December 31, 2023 and 2022 was 5,590 and 5,328, respectively. Other Information Our internet website is www.hexcel.com.
The total number of full-time employees and contract workers as of December 31, 2024 and 2023 was 5,894 and 5,590, respectively. Other Information Our internet website is www.hexcel.com.
Employee levels are managed to align with business demand and, while we have experienced and continue to expect tight labor markets, management believes it currently has sufficient human capital to operate our business successfully. As of December 31, 2024, we employed 5,894 full-time employees and contract workers: 3,120 in the United States and 2,774 in other countries.
Employee levels are managed to align with business demand and, while we have experienced and continue to expect tight labor markets, management believes it currently has sufficient human capital to operate our business successfully. As of December 31, 2025, we employed 5,563 full-time employees and contract workers: 3,050 in the United States and 2,513 in other countries.
These reinforcements are used in the production of prepregs and other matrix materials for aerospace and select industrial markets including automotive components, wind energy blades, oil exploration and production equipment, boats, surfboards, skis and other sporting goods equipment. Prepregs: HexPly® prepregs are used in manufacturing composite laminates and monolithic structures.
These reinforcements are used in the production of prepregs and other matrix materials for aerospace and select industrial markets including automotive components, oil exploration and production equipment, and select sporting goods equipment. Prepregs: HexPly® prepregs are used in manufacturing composite laminates and monolithic structures.
Our recruitment efforts include targeted university recruitment and attendance at conferences promoting racial and gender diversity in engineering, which have historically been a major source of candidates for our summer internship program and Early Career Program for new hires.
Our recruitment efforts include targeted university recruitment and attendance at conferences, which have historically been a major source of candidates for our summer internship program and Early Career Program for new hires.
In addition, we operate various sales representation offices globally. 11 Competition In the production and sale of advanced composites, we compete with a number of U.S. and international companies on a worldwide basis. The broad markets for composites are highly competitive, and we have focused on both specific sub-markets and specialty products within markets.
Competition In the production and sale of advanced composites, we compete with a number of U.S. and international companies on a worldwide basis. The broad markets for composites are highly competitive, and we have focused on both specific sub-markets and specialty products within markets.
Sales and Marketing A staff of salaried marketing managers, product managers and sales personnel sell and market our products directly to customers worldwide. We also use independent authorized distributors for certain products, markets, and regions.
Sales and Marketing A staff of salaried marketing managers, product managers and sales personnel sell and market our products directly to customers worldwide. We also use independent authorized distributors for certain products, markets, and regions. In addition, we operate various sales representation offices globally.
For aircraft that are in the development or ramp-up stage we will have sales as much as several years in advance of the aircraft entry-into-service. Airbus and Boeing combined backlog at December 31, 2024 was 14,903 aircraft, or a 1.0% increase compared to December 31, 2023.
For aircraft that are in the development or ramp-up stage we will have sales as much as several years in advance of the aircraft entry-into-service. Airbus and Boeing combined backlog at December 31, 2025 was 15,474 aircraft, or a 3.8% increase compared to December 31, 2024.
Inclusion of information in this Annual Report on Form 10-K is not an indication that the subject or information is material to our business or operating results Such forward-looking statements include, but are not limited to: (a) the estimates and expectations based on aircraft production rates provided by Airbus, Boeing and others and the revenues we may generate from an aircraft model or program; (b) expectations with regard to the impact of regulatory activity related to the Boeing 737 MAX on our revenues; (c) expectations with regard to raw material cost and availability; (d) expectations of composite content on new commercial aircraft programs and our share of those requirements; (e) expectations regarding revenues from space and defense applications, including whether certain programs might be curtailed or discontinued; (f) expectations regarding sales for industrial applications; (g) expectations regarding cash generation, working capital trends, and inventory levels; (h) expectations as to the level of capital expenditures, capacity, including the timing of completion of capacity expansions, and qualification of new products; (i) expectations regarding our ability to improve or maintain margins; (j) expectations regarding our ability to attract, motivate, and retain the workforce necessary to execute our business strategy; (k) projections regarding our tax rate; (l) expectations with regard to the continued impact of macroeconomic factors or geopolitical issues or conflicts; (m) expectations regarding our strategic initiatives, including our sustainability goals; (n) expectations with regard to the effectiveness of cybersecurity measures; (o) expectations regarding the outcome of legal matters or the impact of changes in laws or regulations; and (p) our expectations of financial results for 2025 and beyond.
Such forward-looking statements include, but are not limited to: (a) the estimates and expectations based on aircraft production rates provided by Airbus, Boeing and others and the revenues we may generate from an aircraft model or program; (b) expectations with regard to the impact of regulatory activity related to the Boeing 737 MAX on our revenues; (c) expectations with regard to raw material cost and availability, including any impact associated with quotas, duties, tariffs, taxes or other similar restrictions upon the import or export of materials; (d) expectations of composite content on new commercial aircraft programs and our share of those requirements; (e) expectations regarding revenues from defense and space applications, including whether certain programs might be curtailed or discontinued, and government funding opportunities; (f) expectations regarding sales for industrial applications; (g) expectations regarding cash generation, working capital trends, and inventory levels; (h) expectations as to the level of research and technology investment, capital expenditures, capacity, including the timing of completion of capacity expansions, and qualification of new products; (i) expectations regarding our ability to improve or maintain margins; (j) expectations regarding our ability to attract, motivate, and retain the workforce necessary to execute our business strategy; (k) projections regarding our tax rate; (l) expectations with regard to the continued impact of macroeconomic factors or geopolitical issues or conflicts; (m) expectations regarding our strategic initiatives, including our sustainability goals; (n) expectations with regard to the effectiveness of cybersecurity measures; (o) expectations regarding the outcome of legal matters or the impact of changes in laws or regulations; (p) expectations relating to our accelerated share repurchase program and other share repurchases; and (q) our expectations of financial results for 2026 and beyond.
Such factors include, but are not limited to, the following: the extent of the impact of macroeconomic factors or geopolitical issues or conflicts; reductions in sales to any significant customers, particularly Airbus or Boeing, including related to regulatory activity or public scrutiny impacting the Boeing 737 MAX; our ability to effectively adjust production and inventory levels to align with customer demand; our ability to effectively motivate, retain and hire the necessary workforce; the availability and cost of raw materials, including the impact of supply disruptions and inflation; our ability to successfully implement or realize our strategic initiatives, including our sustainability goals and any restructuring or alignment activities in which we may engage; changes in sales mix; changes in current pricing due to cost levels; changes in aerospace delivery rates; changes in government defense procurement budgets; timely new product development or introduction; our ability to install, staff and qualify necessary capacity or complete capacity expansions to meet customer demand; cybersecurity-related risks, including the potential impact of breaches or intrusions; currency exchange rate fluctuations; changes in political, social and economic conditions, including the effect of change in global trade policies, tariff rates, economic sanctions and embargoes; work stoppages or other labor disruptions; our ability to successfully complete any strategic acquisitions, investments or dispositions; compliance with environmental, health, safety and other related laws and regulations, including those related to climate change; the effects of natural disasters or other severe weather events, which may be worsened by the impact of climate change, and other severe catastrophic events, including any public health crisis; and the unexpected outcome of legal matters or impact of changes in laws or regulations .
Such factors include, but are not limited to, the following: the extent of the impact of macroeconomic factors or geopolitical issues or conflicts, including U.S. trade policy and retaliatory actions taken in response; reductions in sales to any significant customers, particularly Airbus or Boeing, including related to regulatory activity or public scrutiny impacting the Boeing 737 MAX; our ability to effectively adjust production and inventory levels to align with customer demand; our ability to effectively motivate, retain and hire the necessary workforce; the availability and cost of raw materials, including the impact of supply disruptions, inflation, and tariffs; our ability to successfully implement or realize our strategic initiatives, including our sustainability goals and any restructuring or alignment activities in which we may engage; changes in sales mix; changes in current pricing due to cost levels; changes in aerospace build or delivery rates; any impact from a shutdown of the U.S. federal government; changes in government defense procurement or investment budgets; timely new product development or introduction; our ability to install, staff and qualify necessary capacity or complete capacity expansions to meet customer demand; the market prices of our common stock during the term and after the completion of the accelerated share repurchase period; uncertainty regarding our ability to complete share repurchases within the proposed timing or at all; uncertainty regarding the amount and timing of future share repurchases or dividends and the source of funds used for such repurchases or dividends; cybersecurity-related risks, including the potential impact of breaches or intrusions; currency exchange rate fluctuations; uncertainty related to governmental actions and changes in political, social and economic conditions, including the effect of change in global trade policies, tariff rates, economic sanctions and embargoes; work stoppages or other labor disruptions; our ability to successfully complete any strategic acquisitions, investments or dispositions; compliance with environmental, health, safety and other related laws and regulations, including those related to climate change; the effects of natural disasters or other severe weather events, which may be worsened by the impact of climate change, and other severe catastrophic events, including any public health crisis; and the unexpected outcome of legal matters or impact of changes in laws or regulations.
The following table identifies the key customers and the major manufacturing facilities of the Engineered Products segment: 6 ENGINEERED PRODUCTS KEY CUSTOMERS MANUFACTURING FACILITIES The Boeing Company Amesbury, Massachusetts Bell (1) Burlington, Washington CTRM Aero Composites Casablanca, Morocco General Dynamics Kent, Washington General Electric Pottsville, Pennsylvania GKN South Windsor, Connecticut Lockheed Martin Welkenraedt, Belgium Sikorsky (2) Spirit Aerosystems RTX (1) A Textron Company (2) A Lockheed Martin Company Significant Customers Approximately 40%, 39% and 38% of our 2024, 2023 and 2022 net sales, respectively, were to Airbus and its subcontractors.
The following table identifies the key customers and the major manufacturing facilities of the Engineered Products segment: 6 ENGINEERED PRODUCTS KEY CUSTOMERS MANUFACTURING FACILITIES The Boeing Company Amesbury, Massachusetts CTRM Aero Composites Burlington, Washington General Dynamics Casablanca, Morocco General Electric Kent, Washington GKN Pottsville, Pennsylvania Lockheed Martin RTX Textron Significant Customers Approximately 39%, 40% and 39% of our 2025, 2024 and 2023 net sales, respectively, were to Airbus and its subcontractors.
Of the 40% of overall sales to Airbus and its subcontractors in 2024, 37% related to Commercial Aerospace market applications and 3% related to Space & Defense market applications. Approximately 15%, 15% and 14% of our 2024, 2023 and 2022 net sales, respectively, were to Boeing and its subcontractors.
Of the 39% of overall sales to Airbus and its subcontractors in 2025, 35% related to Commercial Aerospace market applications and 4% related to Defense & Space market applications. Approximately 13%, 15% and 15% of our 2025, 2024 and 2023 net sales, respectively, were to Boeing and its subcontractors.
We are committed to efforts to foster an inclusive work environment that supports our global workforce through recruiting efforts, equitable compensation policies, and educational workshops to promote a positive and collaborative culture.
We operate globally under policies and programs that provide competitive wages, benefits, and terms of employment. We are committed to efforts to foster an inclusive work environment that supports our global workforce through recruiting efforts, equitable compensation policies, and educational workshops to promote a positive and collaborative culture.
We also have leading indicators in place to prevent safety events, and rigorous reviews of root causation and systemic corrective actions when safety incidents do occur. Hexcel achieved corporate umbrella certification for both ISO14001:2015 and ISO 45001:2018 in 2019.
We also have leading indicators in place to prevent safety events, and rigorous reviews of root causation and systemic corrective actions when safety incidents do occur. Hexcel achieved corporate umbrella certification for both ISO14001:2015 and ISO 45001:2018 in 2019. Achieving both certifications to these globally recognized management system standards underscores Hexcel’s commitment to excellence in environmental, health, and safety performance.
We do not believe that our business would be materially affected by the expiration of any single patent or series of related patents, or by the termination of any single license agreement or series of related license agreements.
We believe that the patents and know-how rights currently owned or licensed by Hexcel are adequate for the conduct of our business. We do not believe that our business would be materially affected by the expiration of any single patent or series of related patents, or by the termination of any single license agreement or series of related license agreements.
The blades include Composite Materials products such as carbon fiber, prepregs, and honeycomb core to improve blade performance. In addition, our Engineered Products segment provides specialty value added services such as machining, sub-assembly, and even full blade manufacturing for rotorcraft. Industrial The Industrial market represented 7% of our 2024 net sales.
The blades include Composite Materials products such as carbon fiber, prepregs, and honeycomb core to improve blade performance. In addition, 8 our Engineered Products segment provides specialty value added services such as machining, sub-assembly, and even full blade manufacturing for rotorcraft. The revenue from industrial-type markets includes automotive, a variety of recreational products, and other industrial applications.
In complying with these laws and regulations, we may be required to make additional capital expenditures and incur other costs.
We must follow similar requirements when doing business with foreign governments. In complying with these laws and regulations, we may be required to make additional capital expenditures and incur other costs.
Our Industrial customers, in particular, have always desired to order their requirements on as short a lead-time as possible. As a result, twelve-month order backlog is not a meaningful trend indicator for us. Raw Materials and Production Activities Our manufacturing operations are in many cases vertically integrated.
As a result, twelve-month order backlog is not a meaningful trend indicator for us. Raw Materials and Production Activities Our manufacturing operations are in many cases vertically integrated.
We continually focus on innovation that will help our customers reduce their cycle time and increase their production through-put, including lower curing temperatures, faster curing times, and enhancing the flow characteristics of the resin formulations, particularly for out-of-autoclave infusion and resin transfer molding manufacturing processes.
We continually focus on innovation that will help our customers reduce their cycle time and increase their production through-put, including lower curing temperatures, faster curing times, and enhancing the flow characteristics of the resin formulations, particularly for out-of-autoclave infusion and resin transfer molding manufacturing processes. 9 We purchase glass yarn for our aerospace and industrial markets from a number of suppliers in the United States, Europe and Asia as we only produce aerospace-grade carbon fiber.
No assurance can be given that any commitment, plan, initiative, projection, goal, expectation, or prospect set forth in this Annual Report on Form 10-K can or will be achieved.
No assurance can be given that any commitment, plan, initiative, projection, goal, expectation, or prospect set forth in this Annual Report on Form 10-K can or will be achieved. Inclusion of information in this Annual Report on Form 10-K is not an indication that the subject or information is material to our business or operating results.
The Industrial market also includes sales to major end user sub-markets, in order of size based on our 2024 sales: general industrial applications (including those sold through distributors), transportation (e.g., automobiles, mass transit and high-speed rail, and marine applications) and consumer electronics, wind energy, and recreational equipment (e.g., skis and snowboards, bicycles and hockey sticks).
Automotive is the largest submarket with sales to high-end performance vehicles. Sales to major end user sub-markets, in order of size based on our 2025 sales: general industrial applications (including those sold through distributors), transportation (e.g., automobiles) and consumer electronics, and recreational equipment (e.g., bicycles and hockey sticks).
Research and Technology: Patents and Know-How We maintain seven Research and Technology (“R&T”) Centers of Excellence to support our businesses worldwide, including in the U.S., France and the United Kingdom.
The lack of availability of these materials could under certain circumstances have a material adverse effect on our consolidated results of operations. Research and Technology: Patents and Know-How We maintain seven Research and Technology (“R&T”) Centers of Excellence to support our businesses worldwide, including in the U.S., France and the United Kingdom.
We do not undertake any obligation to update our forward-looking statements or risk factors to reflect future events or circumstances, except as otherwise required by law.
We caution you not to place undue reliance upon these forward-looking statements, which speak only as of the date they are made. We do not undertake any obligation to update our forward-looking statements or risk factors to reflect future events or circumstances, except as otherwise required by law.
We sell to three different markets: Commercial Aerospace, Space & Defense and Industrial. Commercial Aerospace The Commercial Aerospace industry is our largest user of advanced composites. Commercial Aerospace represented 63% of our 2024 net sales. Approximately 80% of these revenues can be identified as sales to Airbus, Boeing, and their subcontractors for the production of commercial aircraft.
Commercial Aerospace The Commercial Aerospace industry is our largest user of advanced composites. Commercial Aerospace represented 61% of our 2025 net sales. Approximately 77% of these revenues can be identified as sales to Airbus, Boeing, and their subcontractors for the production of commercial aircraft. Approximately 23% of these revenues were for business jets and regional and other commercial aircraft.
Additionally, the International Civil Aviation Organization (ICAO) Carbon Offsetting and Reduction Scheme for International Aviation (CORSIA) emission reduction mandates for international aviation becomes mandatory on January 1, 2027, which may influence fleet renewal.
Additionally, the International Civil Aviation Organization (ICAO) Carbon Offsetting and Reduction Scheme for International Aviation (CORSIA) emission reduction mandates for international aviation becomes mandatory on January 1, 2027, which may influence fleet renewal. When aircraft are retired from commercial airline fleets, they may be converted to cargo freight aircraft, used for parts, or scrapped.
With the increasing demand for carbon fiber, particularly in aerospace applications, in recent years we increased our PAN and carbon fiber capacity to serve the growing needs of our customers and our own downstream products. In early 2023, we announced that we resumed construction of a new carbon fiber line in Decatur, AL.
With the increasing demand for carbon fiber, particularly in aerospace applications, in recent years we increased our PAN and carbon fiber capacity to serve the growing needs of our customers and our own downstream products. We formulate a variety of resin systems that are tailored to specific applications and support the process for manufacturing composite parts.
The Composite Materials segment is comprised of our carbon fiber, specialty reinforcements, resin systems, prepregs and other fiber-reinforced matrix materials, and honeycomb core product lines and pultruded profiles.
The Composite Materials segment is comprised of our carbon fiber, specialty reinforcements, resin systems, prepregs and other fiber-reinforced matrix materials, and honeycomb core product lines and pultruded profiles. The Engineered Products segment is comprised of lightweight high strength composite structures, radio frequency/electromagnetic interference (“RF/EMI”) and microwave absorbing materials, engineered core and specialty machined honeycomb products with added functionality.
When aircraft are retired from commercial airline fleets, they may be converted to cargo freight aircraft, used for parts, or scrapped. 7 An additional factor that may cause airlines to defer or cancel orders is their ability to obtain financing, including leasing, for new aircraft orders.
An additional factor that may cause airlines to defer or cancel orders is their ability to obtain financing, including leasing, for new aircraft orders.
When entering into multi-year contracts with aerospace customers, we attempt to get back-to-back commitments from key raw material suppliers. While we are not dependent on any one supplier for the majority of our raw materials, we are highly dependent on our suppliers in order to meet commitments to our customers.
While we are not dependent on any one supplier for the majority of our raw materials, we are highly dependent on our suppliers in order to meet commitments to our customers. We continue to work closely with our key suppliers to ensure that we are able to meet our customer commitments.
However, many of the key raw materials we consume are available from relatively few sources, and in many cases the cost of product qualification makes it impractical to develop multiple sources of supply. The lack of availability of these materials could under certain circumstances have a material adverse effect on our consolidated results of operations.
We coordinate closely with key suppliers in an effort to avoid raw material shortages and excess inventories. However, many of the key raw materials we consume are available from relatively few sources, and in many cases the cost of product qualification makes it impractical to develop multiple sources of supply.
We believe that our policies, practices, and procedures are properly designed to prevent unreasonable risk of environmental damage and associated financial liability. To date, environmental control regulations have not had a significant adverse effect on our overall operations and approximately 91% of our sites as of December 31, 2024 are ISO14001:2015 certified under a Corporate umbrella certification.
To date, environmental control regulations have not had a significant adverse effect on our overall operations and all Hexcel operating sites have been assessed for ISO 14001 readiness and 100% of our sites as of December 31, 2025, are ISO14001:2015 certified under a Corporate umbrella certification.
We purchase glass yarn for our aerospace and industrial markets from a number of suppliers in the United States, Europe and Asia. We also purchase aramid and high strength fibers which are produced by only a few companies, and during periods of high demand, can be in short supply.
We also purchase aramid and high strength fibers which are produced by only a few companies, and during periods of high demand, can be in short supply. In addition, epoxy and other specialty resins, aramid paper and aluminum specialty foils are used in the manufacture of composite products.
Our products rely primarily on our expertise in materials science, textiles, process engineering and polymer chemistry. Consistent with market demand, we have been placing more emphasis on higher performing products and cost-effective production processes while seeking continually to improve the consistency of our products and our capital efficiency.
Consistent with market demand, we have been placing more emphasis on higher performing products and cost-effective production processes while seeking continually to improve the consistency of our products and our capital efficiency. Towards this end, we have entered into formal and informal alliances, as well as licensing and teaming arrangements, with several customers, suppliers, external agencies, universities and laboratories.
The following summaries describe the ongoing activities related to the Composite Materials and Engineered Products segments as of December 31, 2024.
We serve international markets through manufacturing facilities, sales offices and representatives located in the Americas, Europe, Asia Pacific, India, and Africa. The following summaries describe the ongoing activities related to the Composite Materials and Engineered Products segments as of December 31, 2025.
Towards this end, we have entered into formal and informal alliances, as well as licensing and teaming arrangements, with several customers, suppliers, external agencies, universities and laboratories. We believe that we possess unique capabilities to design, develop, manufacture, and qualify composite materials and structures, including trade secrets and extensive internal knowledge gained from decades of experience.
We believe that we possess unique capabilities to design, develop, manufacture, and qualify composite materials and structures, including trade secrets and extensive internal knowledge gained from decades of experience. It is our policy to actively enforce our proprietary rights.
In addition, epoxy and other specialty resins, aramid paper and aluminum specialty foils are used in the manufacture of composite products. A number of these products have only one or two sources qualified for use, so an interruption in their supply could disrupt our ability to meet our customer requirements.
A number of these products have only one or two sources qualified for use, so an interruption in their supply could disrupt our ability to meet our customer requirements. When entering into multi-year contracts with aerospace customers, we attempt to get back-to-back commitments from key raw material suppliers.
The revenue from this market includes automotive, a wide variety of recreational products, consumer electronics, marine, wind turbine blades and other industrial applications. Some of these applications represent emerging opportunities for our products. In developing new applications, we seek those opportunities where advanced composites technology offers significant benefits to the end user, often applications that demand highly engineered performance.
In developing new applications, we seek those opportunities where advanced composites technology offers significant benefits to the end user, often applications that demand highly engineered performance. This includes primarily carbon fiber and resin formulations that we produce, although we will procure some glass fiber from third parties that we then combine with our resin formulations and weaving expertise.
While we have not experienced materially significant issues in the purchase of key raw materials, we continue to monitor the availability (including transportation) and price of raw materials on a regular basis, as well as any potential impact on our operations.
We continue to monitor the availability (including transportation) and price (including impacts of tariffs and inflation) of raw materials on a regular basis, as well as any potential impact on our operations. Our manufacturing activities are primarily based on “make-to-order”, or “demand pull” based on customer schedules, and to a lesser extent, “make-to-forecast” production requirements.
Removed
The Engineered Products segment is comprised of lightweight high strength composite structures, radio frequency/electromagnetic interference (“RF/EMI”) and microwave absorbing materials, engineered core and specialty machined honeycomb products with added functionality and thermoplastic additive manufacturing. We serve international markets through manufacturing facilities, sales offices and representatives located in the Americas, Europe, Asia Pacific, India, and Africa.
Added
The Company had previously announced in late 2024 that it was exploring strategic options for its operations in Austria and undergoing a process to find a suitable successor. The plant in Neumarkt, Austria only served industrial markets with industrial-grade fibers procured from third parties.
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We continue to monitor developments in ongoing geopolitical issues and conflicts globally.
Added
Net sales for the Composite Materials segment to third-party customers were $1,516.2 million in 2025, $1,531.0 million in 2024, and $1,474.2 million in 2023, which represented about 80% of our net sales each year.
Removed
Although we are not experiencing direct material adverse effects upon our business, the global implications of geopolitical issues and conflicts which include increased inflation, volatile energy costs, constrained raw material availability and transportation, and thus increasing costs, as well as aircraft flight restrictions are impacting the global economy and the aerospace industry in particular.
Added
In early 2025, the Company divested its Hartford, Connecticut additive printing business and in June 2025, the Company closed its Welkenraedt, Belgium engineered products facility. The divestiture and closure were part of a strategy to streamline operations and focus on the company’s core competencies in carbon fiber composites.
Removed
The Engineered Products segment, prior to 2024, had included a 50% ownership interest in a Malaysian joint venture, Aerospace Composites Malaysia Sdn. Bhd. (“ACM”) with Boeing Worldwide Operations Limited. Hexcel historically purchased certain semi-finished composite components from the joint venture and performed inspection and additional assembly work prior to direct delivery to Boeing production lines.
Added
Beginning with the first quarter of 2025, sales are now being reported for two markets, Commercial Aerospace, unchanged from past practice, and a new sales category titled Defense, Space & Other, which combines the previous Space & Defense market and the Industrial market. Prior period sales amounts have been reclassified for comparative purposes.
Removed
As part of Boeing's supply chain optimization, this assembly work was transferred overseas in stages in 2020 and 2021 to other parts of the Boeing supply chain, including ACM. Under the ACM joint venture structure, 50% of ACM net income accrued to Hexcel. In December 2023, Hexcel sold its 50% interest in ACM to Boeing.
Added
As previously discussed, in 2025, we divested our Neumarkt, Austria industrial composites business and closed our Welkenraedt, Belgium facility. The divestiture and closure were part of a strategy to streamline operations and focus on our core competencies in carbon fiber and resulted in an exit from prepreg for wind-energy and marine.
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Approximately 20% of these revenues were for business jets and regional and other commercial aircraft.
Added
We will continue to serve select industrial markets that demand the performance of our aerospace-grade composites from our existing aerospace-focused plants, with aerospace-oriented manufacturing assets.
Removed
This includes carbon fiber and resin formulations that we produce as well as glass fiber we purchase from third parties that we then combine with our resin formulations and weaving expertise. Within the Industrial market, automotive is the largest submarket with sales to high-end performance vehicles.
Added
While we did not experience materially significant issues in the purchase of key raw materials, we have experienced cost increases in both materials and transportation, some of which we have been unable to recover or offset, as well as transportation and performance delays.
Removed
We continue to produce material for wind blades at our European facility under existing contracts for a number of legacy turbines. Our participation in Industrial applications complements our commercial and military aerospace businesses, and in many instances, technology or products now used in aerospace were started in Industrial.
Added
During the latter part of 2025, we determined that our R&T function will be renamed to Research and Development ("R&D") which will be reflected in our reporting beginning in 2026. Our products rely primarily on our expertise in materials science, textiles, process engineering and polymer chemistry.
Removed
In response to changing market dynamics, we are committed to pursuing the utilization of advanced structural material technology and introducing new innovations to support our customers where it can generate significant value and we can maintain a sustainable competitive advantage.
Added
We believe that our policies, practices, and procedures are properly designed to prevent unreasonable risk of environmental damage and associated financial liability.
Removed
We had previously paused construction on this line in early 2020. This carbon fiber line is expected to be qualified to produce carbon fiber for aerospace markets in 2028. After a new production line starts operating, it can take up to a year to be certified for aerospace applications.
Added
This milestone reflects the dedication of our senior leadership to driving continuous improvement by reducing workplace injuries and illnesses, minimizing the environmental impact of our operations, ensuring adherence to rigorous compliance obligations, and reinforcing our position as a sustainable and trusted supplier. An engaged, innovative, skilled, and collaborative workforce is critical to our continued leadership in the advanced composites industry.
Removed
Additionally in 2023, we completed the expansion of our Engineered Products facility in Casablanca, Morocco as we doubled the size of the facility to meet growing aerospace demand. 9 We formulate a variety of resin systems that are tailored to specific applications and support the process for manufacturing composite parts.

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Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

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Biggest changeSuch provisions include, among other things, those that: • prohibit stockholders from taking action by written consent and do not permit stockholders to call a special meeting; • authorize the board of directors, without further action by the stockholders, to issue shares of preferred stock in one or more series, and with respect to each series, to fix the number of shares constituting that series, and establish the rights and terms of that series; • establish advance notice procedures for stockholders to submit proposals and nominations of candidates for election to the board of directors to be brought before a stockholders meeting; • allow our directors to establish the size of the board of directors (so long as the board of directors consists of at least three and no more than fifteen directors) and fill vacancies on the board of directors created by an increase in the number of directors (subject to the rights of the holders of any series of preferred stock to elect additional directors under specified circumstances); • do not provide stockholders cumulative voting rights with respect to director elections; • provide that the bylaws may be amended by the board of directors without stockholder approval, to the extent permitted by law; and • do not opt out of Section 203 of the DGCL, which generally prohibits a Delaware corporation from engaging in a “business combination” with any interested stockholder (generally speaking, a stockholder who holds 15% or more of our voting stock) for three years from the date such stockholder becomes an interested stockholder, unless certain conditions are met.
Biggest changeSuch provisions include, among other things, those that: • prohibit stockholders from taking action by written consent and do not permit stockholders to call a special meeting; • authorize the board of directors, without further action by the stockholders, to issue shares of preferred stock in one or more series, and with respect to each series, to fix the number of shares constituting that series, and establish the rights and terms of that series; • establish advance notice procedures for stockholders to submit proposals and nominations of candidates for election to the board of directors to be brought before a stockholders meeting; • allow our directors to establish the size of the board of directors (so long as the board of directors consists of at least three and no more than fifteen directors) and fill vacancies on the board of directors created by an increase in the number of directors (subject to the rights of the holders of any series of preferred stock to elect additional directors under specified circumstances); • do not provide stockholders cumulative voting rights with respect to director elections; • provide that the bylaws may be amended by the board of directors without stockholder approval, to the extent permitted by law; and • do not opt out of Section 203 of the DGCL, which generally prohibits a Delaware corporation from engaging in a “business combination” with any interested stockholder (generally speaking, a stockholder who holds 15% or more of our voting stock) for three years from the date such stockholder becomes an interested stockholder, unless certain conditions are met. 22 These provisions may delay or discourage transactions involving an actual or potential change in the Company’s control or change in the board of directors or management, including transactions in which stockholders might otherwise receive a premium for their shares of common stock or transactions that our stockholders might otherwise deem to be in their best interests.
While we believe we have identified and 13 discussed below the material risks affecting our business, there may be additional risks and uncertainties that we do not presently know or that we do not currently believe to be material that may adversely affect our business, financial condition, results of operations or cash flows in the future, and may require significant management time and attention.
While we believe we have identified and discussed below the material risks affecting our business, there may be additional risks and uncertainties that we do not presently 13 know or that we do not currently believe to be material that may adversely affect our business, financial condition, results of operations or cash flows in the future, and may require significant management time and attention.
Our business and results of operations are subject to numerous risks of doing business internationally including: (a) general economic, political, legal, social and health conditions unfavorable to our growth strategy, including the impact of rising inflation and other global economic conditions on labor and supply costs and availability, changes in currency exchange rates, geopolitical conditions and global conflicts; (b) longer payment cycles of foreign customers or challenges in enforcing agreements and collecting receivables through certain foreign legal systems; (c) the cost of compliance with international trade laws of all of the countries in which we do business, including export control laws, relating to sales and purchases of goods and equipment and transfers of technology; (d) government actions having a direct or indirect adverse impact on our international business and market opportunities, including, but not limited to, tariffs and other trade restrictions imposed by the United States, China and other jurisdictions; (e) adverse tax consequences, such as fluctuating tax rates, withholding requirements on foreign earnings or limitations on repatriations of earnings; and (f) the potential difficulty in enforcing our intellectual property rights in certain foreign countries, and the potential for the intellectual property rights of others to affect our ability to sell products in certain markets.
Our business and results of operations are subject to numerous risks of doing business internationally including: (a) general economic, political, legal, social and health conditions unfavorable to our growth strategy, including the impact of rising inflation and other global economic conditions on labor and supply costs and availability, changes in currency exchange rates, geopolitical conditions and global conflicts; (b) longer payment cycles of foreign customers or challenges in enforcing agreements and collecting receivables through certain foreign legal systems; (c) the cost of compliance with international trade laws of all of the countries in which we do business, including export control laws, relating to sales and purchases of goods and equipment and transfers of technology; (d) government actions having a direct or indirect adverse impact on our international business and market opportunities, including, but not limited to, tariffs and other trade restrictions imposed by the United States, China and other jurisdictions; (e) adverse tax consequences, such as fluctuating tax rates, withholding requirements on foreign earnings or limitations on repatriations of 17 earnings; and (f) the potential difficulty in enforcing our intellectual property rights in certain foreign countries, and the potential for the intellectual property rights of others to affect our ability to sell products in certain markets.
Our ability to meet our interest expense and debt service obligations will depend on our future performance, including the cash we generate from operating activities, which could be affected by financial, business, economic and other factors, including potential 20 changes in laws or regulations, industry conditions, industry supply and demand, customer preferences and pressure from competitors.
Our ability to meet our interest expense and debt service obligations will depend on our future performance, including the cash we generate from operating activities, which could be affected by financial, business, economic and other factors, including potential changes in laws or regulations, industry conditions, industry supply and demand, customer preferences and pressure from competitors.
The loss or retirement of employees presents particular challenges to the extent they involve the departure of knowledgeable and experienced employees and the resulting need to identify and train existing or new candidates to perform necessary functions, and ineffective succession planning could result in unexpected costs, reduced productivity, and/or difficulties with respect to internal processes and controls.
The loss or retirement of employees presents particular challenges to the extent they involve the departure of knowledgeable and experienced employees and the resulting need to identify and train existing or new candidates to perform necessary functions, and ineffective succession planning could result in unexpected costs, reduced productivity, and/or difficulties 16 with respect to internal processes and controls.
If we are unable to attract and retain a qualified and inclusive workforce, we may be unable to maintain our competitive position and our future success could be materially adversely affected. We have engaged in restructuring and alignment activities from time to time and there can be no assurance that our efforts will have the intended effects.
If we are unable to attract and retain a qualified workforce, we may be unable to maintain our competitive position and our future success could be materially adversely affected. We have engaged in restructuring and alignment activities from time to time and there can be no assurance that our efforts will have the intended effects.
While Company personnel have been tasked to detect and investigate any security incidents, we cannot guarantee that such measures will be effective or sufficient to prevent a cyberattack, and future cyberattacks could still occur and could go undetected and persist for an extended period of time.
While Company personnel have been tasked to detect and investigate any security incidents, we cannot guarantee that such measures will be effective or sufficient to prevent a 19 cyberattack, and future cyberattacks could still occur and could go undetected and persist for an extended period of time.
Due to necessary cost reduction measures or changes in the industry and markets in which we compete, we may decide to implement additional restructuring or alignment activities in the future, such as closing plants, idling certain equipment or operations, or making additions, reductions or other changes to our management or workforce.
Due to necessary cost reduction measures or changes in the industry and markets in which we compete, we may decide to implement additional restructuring or alignment activities in the future, such as closing plants, selling or idling certain equipment or operations, or making additions, reductions or other changes to our management or workforce.
Given the nature of our business and our contracts (many of which are fixed price and of long duration), we have been, and in the future may be unable to recover some of these increased costs or to offset such costs with greater than expected efficiencies.
Given the nature of our business and our contracts (many of which are fixed price and of long duration), we have been and may, in the future, continue to be unable to recover some of these increased costs or to offset such costs with greater than expected efficiencies.
As a result, the local currency margins of goods manufactured with costs denominated in local currency, yet sold in U.S. dollars, will vary with fluctuations in currency exchange rates, reducing when the U.S. dollar weakens against the Euro and British 17 pound sterling.
As a result, the local currency margins of goods manufactured with costs denominated in local currency, yet sold in U.S. dollars, will vary with fluctuations in currency exchange rates, reducing when the U.S. dollar weakens against the Euro and British pound sterling.
Restructuring and/or alignment activities can also create unanticipated consequences, such as instability or distraction among our workforce, and we cannot provide any assurance that any restructuring or alignment efforts that we undertake 16 will result in the intended benefits.
Restructuring and/or alignment activities can also create unanticipated consequences, such as instability or distraction among our workforce, and we cannot provide any assurance that any restructuring or alignment efforts that we undertake will result in the intended benefits.
However, supply chain challenges in the Commercial Aerospace industry, as well as labor disruptions and regulatory issues experienced by certain participants in the industry, continue to delay planned production and negatively impact aircraft build rates.
However, supply chain challenges in the Commercial Aerospace industry, as well as labor disruptions and regulatory issues experienced by certain participants in the industry, continue to delay planned production and negatively impact aircraft build rates in 2025.
As our business expands to meet customer and market demands, and community growth impacts local ambient air and water limits, additional controls are anticipated to be required.
As our business 18 expands to meet customer and market demands, and community growth impacts local ambient air and water limits, additional controls are anticipated to be required.
Ongoing pressures on build rates, or reductions in demand, for commercial aircraft or a delay in deliveries could result from many factors, including delays in the startup or ramp-up of new programs, suspension or discontinuation of current commercial aircraft programs, changes in the propensity for the general public to travel by air (including as a result of terrorist events and any subsequent military response, a public health crisis or a global conflict), a significant change in the cost of aviation fuel, a change in technology resulting in the use of alternative materials, environmental concerns (including climate change), consolidation and liquidation of airlines, availability of funding for new aircraft purchases or leases, inventory corrections or disruptions throughout the supply chain, labor disruptions and work stoppages and slower macroeconomic growth.
Ongoing pressures on build rates, or reductions in demand, for commercial aircraft or a delay in deliveries could result from many factors, including delays in the startup or ramp-up of new programs, suspension or discontinuation of current commercial aircraft programs, changes in the propensity for the general public to travel by air (including as a result of terrorist events and any subsequent military response, a public health crisis or a global conflict), a significant change in the cost of aviation fuel, a change in technology resulting in the use of alternative materials, environmental concerns (including climate change), consolidation and liquidation of airlines, availability of funding for new aircraft purchases or leases, inventory corrections or disruptions throughout the supply chain, quality issues or product defects, labor disruptions and work stoppages and slower macroeconomic growth.
The occurrence of material operational problems or interruptions, including, but not limited to, as a result of the failure of key equipment, a quality or financial failure of a sole source or major supplier, the effects of natural disasters or climate change-related events, the impact of any public health crises, ongoing supply chain disruptions and supply shortages, energy disruption caused by ongoing global conflict, the inability to install, staff and/or qualify necessary capacity, political or social unrest, the failure to achieve planned manufacturing improvements or other causes, or any other inability to meet customer requirements, may have a material adverse effect on the productivity and profitability of a particular manufacturing facility, and could have a material effect on the Company as a whole.
The occurrence of material operational problems or interruptions, including, but not limited to, as a result of the failure of key equipment, a quality or financial failure of a sole source or major supplier, the effects of natural disasters or climate change-related events, the impact of any public health crises, ongoing supply chain disruptions and supply shortages, the impact of tariffs and other trade barriers and restrictions, energy disruption caused by ongoing global conflict, the inability to install, staff and/or qualify necessary capacity, political or social unrest, the failure to achieve planned manufacturing improvements or other causes, or any other inability to meet customer requirements, may have a material adverse effect on the productivity and profitability of a particular manufacturing facility, and could have a material effect on the Company as a whole.
In addition to compliance obligations related to climate change, growing customer environmental and sustainability requirements, including procurement policies that include social and emissions reduction or other environmental standards and requirements that suppliers are required comply with, as well as sustainability goals and targets that we have adopted, could cause us to alter our manufacturing, operations or equipment processes, and incur substantial expense to meet these requirements.
In addition to compliance obligations related to climate change, customer environmental and sustainability requirements, including procurement policies that include social and emissions reduction or other environmental standards and requirements that suppliers are required comply with, as well as sustainability goals and targets that we have adopted, could cause us to alter our manufacturing, operations, equipment processes, or product offerings, and incur substantial expense to meet these requirements.
To the extent artificial intelligence capabilities improve and are increasingly adopted, they may be used to identify vulnerabilities and craft increasingly sophisticated cybersecurity attacks, and vulnerabilities may be introduced from the use of artificial intelligence by us, our customers, suppliers and other business partners and third-party providers.
Further, as artificial intelligence capabilities improve and are increasingly adopted, they may be used to identify vulnerabilities and craft increasingly sophisticated cybersecurity attacks, and vulnerabilities may be introduced from the use of artificial intelligence by us, our customers, suppliers and other business partners and third-party providers.
These regulations and other requirements regularly evolve, and new laws, regulations or procurement requirements or changes to current ones (including, for example, regulations related to cybersecurity, privacy, information classification and protection, greenhouse gas emissions and climate risk, cost accounting, recovery of employee compensation costs, counterfeit parts, pensions, anti-human trafficking, specialty metals, conflict minerals and use of certain non-U.S. equipment and materials) could significantly increase our costs and risks and reduce our profitability.
These regulations and other requirements regularly evolve, and new laws, regulations or procurement requirements or changes to current ones (including, for example, regulations related to cybersecurity, privacy, information classification and protection, cost accounting, recovery of employee compensation costs, counterfeit parts, pensions, anti-human trafficking, specialty metals, conflict minerals and use of certain non-U.S. equipment and materials) could significantly increase our costs and risks and reduce our profitability.
Ongoing or additional deferrals, cancellations, or reductions in demand that result in decreased aircraft build rates would, if significant, have a negative impact on sales for our Commercial Aerospace products and as a result reduce our operating income. Approximately 63% of our sales for 2024 were derived from sales to the Commercial Aerospace industry.
Ongoing or additional deferrals, cancellations, or reductions in demand that result in decreased aircraft build rates would, if significant, have a negative impact on sales for our Commercial Aerospace products and as a result reduce our operating income. Approximately 61% of our sales for 2025 were derived from sales to the Commercial Aerospace industry.
At the same time, there also exists anti-environmental, social and governance sentiment among certain stakeholders and government institutions, and we may face scrutiny, reputational risk, lawsuits or market access restrictions from these parties regarding any such initiatives we have adopted.
At the same time, there also exists anti-sustainability sentiment among certain stakeholders and government institutions, and we may face scrutiny, reputational risk, lawsuits or market access restrictions from these parties regarding any such initiatives we have adopted.
For the years ended December 31, 2024 and December 31, 2023, approximately 40% and 39% of our total consolidated sales, respectively, were to Airbus, and its related subcontractors and approximately 15% and 15% of our total consolidated sales, respectively, were to Boeing and its related subcontractors.
For the years ended December 31, 2025 and December 31, 2024, approximately 39% and 40% of our total consolidated sales, respectively, were to Airbus, and its related subcontractors and approximately 13% and 15% of our total consolidated sales, respectively, were to Boeing and its related subcontractors.
Our ability to attract, retain and motivate key employees is vital to our success. Our success, competitiveness and ability to execute on our global strategies and maintain a culture of innovation depend in large part on our ability to attract, retain and motivate qualified employees and leaders with expertise and capabilities, representing diverse backgrounds and experiences.
Our ability to attract, retain and motivate key employees is vital to our success. Our success, competitiveness and ability to execute on our global strategies and maintain a culture of innovation depend in large part on our ability to attract, retain and motivate qualified employees and leaders with expertise and capabilities.
If we fail to comply with these laws and regulations or if a government audit, review, or investigation uncovers improper or illegal activities, we may be subject to civil penalties, criminal penalties, or administrative sanctions or suspension or debarment from contracting with the U.S. government.
If we fail to comply with these laws and regulations or if a government audit, review, or investigation uncovers improper or illegal activities, we may be subject to civil penalties, criminal penalties, or administrative sanctions or suspension or debarment from contracting with the U.S. government and the foreign governments with whom we do business.
The level of purchases and product mix demanded by our customers is often affected by events beyond their control, including general economic conditions, demand for their products, conditions in the airline industry, regulatory scrutiny and/or suspension or discontinuation of aircraft, disruptions in deliveries, business disruptions, strikes and other factors, which could have a material adverse effect on our business, financial condition, results of operations, and cash flows.
The level of purchases and product mix demanded by our customers is often affected by events beyond their control, including general economic conditions, demand for their products, conditions in the airline industry, regulatory scrutiny and/or suspension or discontinuation of aircraft, disruptions in deliveries, business disruptions, strikes and other factors, which could have a material adverse effect on our business, financial condition, results of operations, and cash flows. 14 Reductions in defense and space spending could result in a decline in our sales.
We have substantial international operations subject to uncertainties that could affect our operating results. We believe that revenue from sales outside the U.S. will continue to account for a material portion of our total revenue for the foreseeable future. In 2024, 50% of our production and 59% of our customer sales occurred outside of the United States.
We have substantial international operations subject to uncertainties that could affect our operating results. We believe that revenue from sales outside the U.S. will continue to account for a material portion of our total revenue for the foreseeable future. In 2025, 47% of our production and 57% of our customer sales occurred outside of the United States.
During recent years, as a result of the challenges created by global supply and transportation constraints, ongoing global conflict and market volatility, we experienced supply disruptions and cost increases and anticipate that the risk of supply disruptions and material shortages, as well as cost increases, may continue.
During recent years, as a result of the challenges created by global supply and transportation constraints, the impact of tariffs and other trade barriers and restrictions, ongoing global conflict and market volatility, we experienced supply disruptions and cost increases and anticipate that the risk of supply disruptions and material shortages, as well as cost increases, may continue.
In addition, concerns about the relationship between greenhouse gases and global climate change, and an increased focus on carbon neutrality, has resulted, and may continue to result, in additional regulations at the national and international level to monitor, regulate, control and tax emissions of carbon dioxide and other greenhouse gases.
In addition, concerns about the relationship between greenhouse gases and global climate change, and an increased focus on carbon neutrality, have resulted, and may continue to result, in additional regulations at the national and international level to address topics of concern such as carbon neutrality and to monitor, regulate, control and tax emissions of carbon dioxide and other greenhouse gases.
Department of Defense budgets could be negatively impacted by several factors, including, but not limited to, a change in defense spending policy as a result of the current political environment or otherwise, military aid to countries experiencing global conflict, the U.S. government’s budget deficits or breach of the debt ceiling, other spending priorities, increased defense regulatory requirements resulting in additional expenses, the cost of sustaining the U.S. military presence internationally, potential political pressure to reduce military spending and future potential government shutdowns, each of which could cause the U.S.
The level of U.S. and foreign defense spending is hard to predict, and defense budgets could be negatively impacted by several factors, including, but not limited to, a change in defense spending policy as a result of the political environment or otherwise, military aid to countries experiencing global conflict, the government’s budget deficits or the breach of debt ceilings, other spending priorities, increased defense regulatory requirements resulting in additional expenses, the cost of sustaining the U.S. military presence internationally, potential political pressure to reduce military spending and future potential government shutdowns, each of which could cause U.S. and foreign defense budgets to remain unchanged or to decline.
We must comply with laws and regulations relating to the formation, administration, and performance of U.S. government contracts, including government security requirements and additional government export control laws and regulations, as well as certain cybersecurity certifications and other cybersecurity requirements.
We must comply with laws and regulations relating to the formation, administration, and performance of U.S. government contracts, including government security requirements and additional government export control laws and regulations, as well as certain cybersecurity certifications and other cybersecurity requirements. We must follow similar requirements when doing business with foreign governments.
We (including our suppliers and other partners) have and may continue to experience inflationary pressures, supply chain disruption and labor, material and transportation cost increases at a rate higher than anticipated.
We (including our suppliers and other partners) have and may continue to experience inflationary pressures, supply chain disruption, including as a result of tariffs, trade restrictions and other barriers, and labor, material and transportation cost increases at a rate higher than anticipated.
Department of Defense budget to remain unchanged or to decline. If we fail to comply with government procurement laws and regulations, including those related to information security, we could lose business and be liable for various penalties or sanctions.
If we fail to comply with government procurement laws and regulations, including those related to information security, we could lose business and be liable for various penalties or sanctions.
In addition to normal business risks, our indirect supply of products to the U.S. government is subject to unique risks largely beyond our control. The level of U.S. defense spending is hard to predict, and U.S.
In addition to normal business risks, our indirect supply of products to the U.S. and foreign government is subject to unique risks largely beyond our control.
In addition, some investors use sustainability criteria to guide their investment strategies, and may not invest in us, or divest their holdings of us, if they believe our policies relating to environmental, social and governance matters are inadequate or, on the other hand, have a negative response to such policies as a result of anti-environmental, social and governance sentiment.
In addition, some investors and customers may use sustainability criteria to guide their investment and buying strategies, and may not invest in or do business with us, or continue to do so, if they believe our policies relating to sustainability matters are inadequate or, on the other hand, have a negative response to such policies as a result of anti-sustainability sentiment.
Reductions in space and defense spending could result in a decline in our sales. Space and defense production that has occurred in recent years may not be sustained, individual programs important to Hexcel may be cancelled, production may not continue to grow or may decrease and the increased demand for composite-intensive programs 14 may not continue.
Defense and space production that has occurred in recent years may not be sustained, individual programs important to Hexcel may be cancelled, production may not continue to grow or may decrease and the increased demand for composite-intensive programs may not continue.
Our customers may require us to implement sustainability or other environmental, social and governance responsibility procedures or standards before they continue to do business with us.
For instance, our customers may require us to implement sustainability or other corporate social responsibility procedures or standards before they continue to do business with us.
In addition, the production of military aircraft depends upon defense budgets and the related demand for defense and related equipment. Approximately 30% of our 2024 sales were to the Space & Defense market, of which approximately 79% were related to military programs in the United States and other countries.
In addition, the production of military aircraft, unmanned aerial vehicles and missiles depends upon defense budgets and the related demand for defense and related equipment. Approximately 39% of our 2025 sales were to the Defense, Space & Other market, of which approximately 88% were related to military programs in the United States and other countries.
The process of integrating acquired businesses into our existing operations may result in unforeseen operating difficulties and may require additional financial resources and attention from management that would otherwise be available for the ongoing development or expansion of our existing operations.
Further, we cannot provide any assurance that we will realize the intended benefits from any such transactions. The process of integrating acquired businesses into our existing operations may result in unforeseen operating difficulties and may require additional financial resources and attention from management that would otherwise be available for the ongoing development or expansion of our existing operations.
While we have not experienced materially significant issues in the purchase of key raw materials, we continue to monitor the availability (including transportation) and price of raw materials on a regular basis, as well as any potential impact on our operations.
While we have not experienced materially significant disruptions in sourcing key raw materials, we continue to proactively mitigate any risks to the extent possible while monitoring the availability (including transportation) and price of raw materials on a regular basis, as well as any potential impact on our operations.
Risks Related to Our Operations The global macroeconomic environment could negatively impact our business and our financial position, results of operations and/or cash flows could be materially adversely affected . 15 Our business, financial position, results of operations and cash flows have been and may continue to be adversely impacted by the global macroeconomic environment, which has experienced, and continues to experience, extraordinary challenges, including high rates of inflation; increasing interest rates; widespread disruptions in supply chains; workforce challenges, including labor shortages; and market volatility.
Our business, financial position, results of operations and cash flows have been and may continue to be adversely impacted by the global macroeconomic environment, which has experienced, and continues to experience, extraordinary challenges, including high rates of inflation and interest rates; volatile energy costs; widespread disruptions in supply chains, including constrained raw material availability; workforce challenges, including labor shortages; political and social unrest; and market volatility.
Even if successfully integrated, the acquired business may not achieve the results we expect or produce expected benefits in the time frame planned. In addition, we may not be able to successfully complete any strategic divestures in a timely manner, or at all.
Even if successfully integrated, the acquired business may not achieve the results we expect or produce expected benefits in the time frame planned. 15 Divestitures involve risks and uncertainties, such as the ability to successfully complete any strategic divestures in a timely manner, or at all, and to realize the expected benefits of such transactions.
Certain provisions of our certificate of incorporation, bylaws, and the DGCL have anti-takeover effects and could delay, discourage, defer or prevent a tender offer or takeover attempt that a stockholder might consider to be in the stockholders’ best interests . 21 Certain provisions of our certificate of incorporation and bylaws and the DGCL may have the effect of delaying or preventing changes in control if our board of directors determines that such changes in control are not in the best interests of the Company and its stockholders.
Certain provisions of our certificate of incorporation, bylaws, and the DGCL have anti-takeover effects and could delay, discourage, defer or prevent a tender offer or takeover attempt that a stockholder might consider to be in the stockholders’ best interests .
The 2018 share repurchase plan was fully utilized as of June 30, 2024. Our amended and restated bylaws (the “bylaws”) provide that the Court of Chancery of the State of Delaware will be the exclusive forum for certain legal actions between us and our stockholders, which could discourage lawsuits against the Company and our directors and officers .
The share repurchase program, even if fully implemented, may not enhance long-term stockholder value. Our amended and restated bylaws (the “bylaws”) provide that the Court of Chancery of the State of Delaware will be the exclusive forum for certain legal actions between us and our stockholders, which could discourage lawsuits against the Company and our directors and officers .
In the Commercial Aerospace market, approximately 80%, and in the Space & Defense market, approximately 19%, of our 2024 sales were made to Airbus and Boeing and their related subcontractors.
We have concentrated customers in the Commercial Aerospace and the Defense, Space & Other markets. In the Commercial Aerospace market, approximately 77%, and in the Defense, Space & Other market, approximately 16%, of our 2025 sales were made to Airbus and Boeing and their related subcontractors.
In addition, we could be criticized for the scope of such initiatives, targets or goals or perceived as not acting responsibly in connection with these matters. Any such matters could have a material adverse effect on our business. We may not be able to service our debt obligations or satisfy covenants included in our outstanding debt.
In addition, we could be criticized for the scope of such initiatives, targets or goals or perceived as not acting responsibly in connection with these matters. Any such matters could have a material adverse effect on our business. We are exposed to risks related to the use of artificial intelligence tools by us and others.
We periodically need to renegotiate our collective bargaining and works council agreements, and any failure to negotiate new agreements or extensions in a timely manner could result in work stoppages or slowdowns.
As of December 31, 2025, approximately 26% of employees in the United States were unionized and the majority in Europe were represented by a works council. We periodically need to renegotiate our collective bargaining and works council agreements, and any failure to negotiate new agreements or extensions in a timely manner could result in work stoppages or slowdowns.
Future delays, or production cuts arising from the impact of macroeconomic events, geopolitical conditions, global conflict or supply chain and labor disruptions, in these or other major new customer programs could similarly impact our results. In addition, our customers emphasize the need for cost reduction or other improvements in contract terms throughout the supply chain.
In the past, such matters have delayed our expected growth, or our effective utilization of capacity installed for such growth. Future delays, or production cuts arising from the impact of macroeconomic events, geopolitical conditions, global conflict or supply chain and labor disruptions, in these or other major new customer programs could similarly impact our results.
Over the past several years, we have completed strategic acquisitions of complementary manufacturing companies, as well as strategic investments in companies and divestitures of certain interests. We expect to continue to explore complementary mergers, acquisitions, investments and joint ventures and may also pursue additional divestures or closures of business lines or investments that do not fit with our core strategy.
We expect to continue to explore complementary mergers, acquisitions, investments and joint ventures and may also pursue additional divestures or closures of business lines or investments that do not fit with our core strategy. We may also engage in further vertical integration and business restructuring.
In addition, failure to comply with applicable regulations could result in fines or government investigations or actions, which could affect our business, financial 18 condition, results of operations and cash flows.
In addition, failure to comply with applicable regulations could result in fines or government investigations or actions, which could affect our business, financial condition, results of operations and cash flows. We could also face increased costs related to defending and resolving legal claims and other litigation related to climate change and the alleged impact of our operations on climate change.
If such parties fail to deter, detect or report cyber incidents in a timely manner, we may suffer from financial and other harm, including to our information, operations, financial results, performance, employees and reputation. 19 An intrusion may also result in fines, penalties, litigation or governmental investigations and proceedings, increased mitigation and remediation expenses, diminished competitive advantages through reputational damages and increased operational costs.
If such parties fail to deter, detect or report cyber incidents in a timely manner, we may suffer from financial and other harm, including to our information, operations, financial results, performance, employees and reputation.
In response to these pressures, we may be required to accept increased risk or face the prospects of margin compression on some products in the future. Where possible, we seek to offset or mitigate the impact of such pressures through productivity and performance improvements, cost index contractual provisions, hedging and other actions, which may not be successful.
Where possible, we seek to offset or mitigate the impact of such pressures through productivity and performance improvements, cost index contractual provisions, hedging and other actions, which may not be successful. A significant decline in business with Airbus, Boeing, or other significant customers could materially impact our business, operating results, prospects, and financial condition.
While we continue to work proactively to mitigate these challenges, if we are unable to do so successfully, our financial position, results of operations and/or cash flows could be materially adversely affected. Our results of operations would be adversely affected by a shortage of trained personnel or work stoppages and may be adversely affected by increasing labor costs.
We cannot predict how long these challenges will persist or how they will change over time, or how the macroeconomic environment will evolve and continue to impact us. While we continue to work proactively to mitigate these challenges, if we are unable to do so successfully, our financial position, results of operations and/or cash flows could be materially adversely affected.
We may also engage in further vertical integration and business restructuring. We may face competition for attractive targets and may not be able to acquire potential targets on terms or at prices acceptable to us, if at all.
With respect to potential mergers or acquisitions, we may face competition for attractive targets and may not be able to acquire potential targets on terms or at prices acceptable to us, if at all. In addition, these types of transactions may require significant liquidity, which may not be available on terms favorable to us, or at all.
Additionally, we may face reputational challenges in the event that our sustainability and other environmental, social and governance policies, practices and metrics do not meet the standards set by certain constituencies, which are often inconsistent in approach. In addition, from time to time, we communicate certain initiatives, targets or goals regarding sustainability/ESG matters.
If our sustainability and social policies and practices fail to meet regulatory requirements or stakeholders’ evolving expectations and standards for responsible corporate 20 citizenship, our reputation and employee retention may be negatively impacted, and we may face reputational challenges in the event that our sustainability and social policies, practices and metrics do not meet the standards set by certain constituencies, which are often inconsistent in approach.
For instance, both Boeing and Airbus have, in recent years, experienced difficulties meeting production goals due to supply chain delays, and, in fall 2024, Boeing experienced delays in 737 MAX and other aircraft production due to a strike by factory workers. In the past, these have delayed our expected growth, or our effective utilization of capacity installed for such growth.
For instance, both Boeing and Airbus have, in recent years, experienced difficulties meeting production goals due to supply chain delays and disruptions, including quality issues, and, during recent years, Boeing experienced delays in production due to strikes by factory workers, impacting both 737 MAX and other commercial aircraft production and military aircraft and defense systems.
While we review cybersecurity capabilities with our top-tier suppliers and have implemented cybersecurity requirements in our standard supplier contract terms,” we do not control such third parties and our ability to monitor their cybersecurity is limited, we cannot ensure the cybersecurity measures they take will be sufficient to protect any information we share with them or prevent any disruption arising from a technology failure, cyberattack or other information or security breach.
As such, we cannot ensure the cybersecurity measures they take will be sufficient to protect any information we share with them or prevent any disruption arising from a technology failure, cyberattack or other information or security breach. We depend on such parties to implement adequate controls and safeguards to protect against and report cyber incidents.
While some aspects of the macroeconomic environment appear to be improving, and we have been able to mitigate some of the challenges, other challenges persist. We cannot predict how long these challenges will persist or how they will change over time, or how the macroeconomic environment will evolve and continue to impact us.
While some aspects of the macroeconomic environment appear to be improving, and we have been able to mitigate some of the challenges, including seeking exemptions and alternative sourcing, where available, engaging in industry advocacy and implementing price increases, where feasible, other challenges persist.
Our business has historically been dependent on a highly trained workforce because of the complex nature of our products. As of December 31, 2024, approximately 26% of employees in the United States were unionized and the majority in Europe were represented by a works council.
Our results of operations would be adversely affected by a shortage of trained personnel or work stoppages and may be adversely affected by increasing labor costs. Our business has historically been dependent on a highly trained workforce because of the complex nature of our products.
From time to time, we have responded to changes in our industry and the markets we serve, or other changes in our business, by restructuring or aligning our operations, including the closure of our Tianjin, China wind energy prepreg production facility in 2022, the movement of our Research and Technology Center from Dublin, California to Salt Lake City, Utah, and the sale of our 50% interest in a Malaysian joint venture.
From time to time, we have responded to changes in our industry and the markets we serve, or other changes in our business, by restructuring or aligning our operations, including the divestiture of our operations in Austria in 2025 and the divestiture of our Hartford, Connecticut business and closure of the Welkenraedt, Belgium plant during 2025 as part of our strategy to streamline operations and focus on core competencies.
Removed
A significant decline in business with Airbus, Boeing, or other significant customers could materially impact our business, operating results, prospects, and financial condition. We have concentrated customers in the Commercial Aerospace and the Space & Defense markets.
Added
In addition, our customers emphasize the need for cost reduction or other improvements in contract terms throughout the supply chain. In response to these pressures, we may be required to accept increased risk or face the prospects of margin compression on some products in the future.
Removed
In addition, these types of transactions may require significant liquidity, which may not be available on terms favorable to us, or at all. We cannot provide any assurance that we will realize the intended benefits from any such transactions.
Added
In recent years, as part of our strategy to streamline operations and focus on our core competencies, we have engaged in strategic activities, including business restructuring and divestitures or closures of certain facilities and investments.
Removed
With respect to tariffs, implementation of new tariff schemes by various governments, such as those implemented by the United States and China in recent years, could potentially increase the costs of our materials, increase our cost of production, and ultimately increase the landed cost of our products sold from one country into another country.
Added
Divestitures of businesses also involve a number of other risks, including significant costs and expenses, loss of customer relationships, and decrease in revenues and earnings associated with the divested business. Risks Related to Our Operations The global macroeconomic environment could negatively impact our business and our financial position, results of operations and/or cash flows could be materially adversely affected .
Removed
We could also face increased costs related to defending and resolving legal claims and other litigation related to climate change and the alleged impact of our operations on climate change.
Added
In addition, our business has been negatively impacted as a result of the tariffs, sanctions, and other restrictions on goods imposed by the U.S. government and similar measures imposed by governments outside the United States, and we expect to continue to experience impacts to our business in the future.
Removed
We depend on such parties to implement adequate controls and safeguards to protect against and report cyber incidents.
Added
In particular, tariffs have increased the cost of materials used to manufacture our products and may in the future reduce our ability to sell products globally and/or increase costs of domestic goods, energy, freight and other related costs.
Removed
Our business could be negatively impacted by sustainability/environmental, social and governance (“ESG”) matters and/or our reporting of such matters . There is an increasing focus from certain investors, customers, employees, and other stakeholders concerning sustainability matters, and an increasing number of stakeholders are requiring companies to disclose sustainability and related policies, practices and metrics.
Added
For instance, as a result of the tariffs, sanctions, and other restrictions imposed on goods imported into the U.S. during 2025, and similar measures imposed by governments outside the U.S., we are experiencing, and expect to continue to experience, impacts to our business, including increases in the cost of materials used to manufacture our product.
Removed
There can be no assurance that we will repurchase stock at favorable prices.
Added
Such measures may in the future reduce our ability to sell products globally and/or increase costs of domestic goods, energy, freight and other related costs.
Removed
On February 19, 2024, our Board of Directors approved a $300 million share repurchase plan, which was in addition to the amount that remained available for repurchase under the existing 2018 share repurchase plan, however, the repurchase program may be suspended or terminated at any time and, even if fully implemented, may not enhance long-term stockholder value.
Added
While we have taken actions to mitigate these risks, such as seeking exemptions and alternative sourcing, where available, engaging in industry advocacy and implementing price increases, where feasible, there can be no assurance that these actions will be effective, and we could continue to be adversely impacted by such tariffs and other restrictions.
Removed
These provisions may delay or discourage transactions involving an actual or potential change in the Company’s control or change in the board of directors or management, including transactions in which stockholders might otherwise receive a premium for their shares of common stock or transactions that our stockholders might otherwise deem to be in their best interests.
Added
In addition, as we increase our use of artificial intelligence tools into our operations, the risk of unauthorized access to our data and of making errors or erroneous decisions based on our reliance on such tools will increase.
Added
While we impose cybersecurity requirements on with our top-tier suppliers and have implemented cybersecurity requirements in our standard supplier contract terms as well as our Supplier Code of Conduct, we do not control such third parties and our ability to monitor their cybersecurity is limited.
Added
An intrusion may also result in fines, penalties, litigation or governmental investigations and proceedings, increased mitigation and remediation expenses, diminished competitive advantages through reputational damages and increased operational costs.
Added
Our business could be negatively impacted by sustainability matters and/or our reporting of such matters . The legislative environment and stakeholders’ views relating to sustainability and related policies, practices and metrics could result in additional costs, and could adversely impact our reputation, consumer perception, employee retention, and willingness of third parties to do business with us.
Added
Inconsistency of legislation and regulations among jurisdictions, including anti-sustainability or legislation, and expected additional regulations may also affect the costs of compliance with such laws and regulations. In addition, from time to time, we communicate certain initiatives, targets or goals regarding sustainability matters.

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Item 2. Properties

Properties — owned and leased real estate

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Biggest changeManufacturing Facilities Facility Location Segment Principal Products Total Square Footage United States: Amesbury, Massachusetts Engineered Products Microwave and RF Absorbing Composite Materials 202,100 Burlington, Washington Engineered Products Engineered Honeycomb Parts 252,124 Casa Grande, Arizona Composite Materials Honeycomb and Honeycomb Parts 443,123 Decatur, Alabama Composite Materials PAN Precursor (used to produce Carbon Fibers) 819,863 Kent, Washington Engineered Products Composite structures 486,400 Pottsville, Pennsylvania Engineered Products Engineered Honeycomb Parts 180,305 Salt Lake City, Utah Composite Materials Carbon Fibers; Prepregs 1,365,000 Seguin, Texas Composite Materials Fabrics; Specialty Reinforcements 228,815 South Windsor, Connecticut Engineered Products 3D printed parts 32,600 International: Casablanca, Morocco Engineered Products Engineered Honeycomb Parts 333.832 Dagneux, France Composite Materials Prepregs 213,698 Duxford, England Composite Materials Prepregs; Adhesives; Honeycomb and Honeycomb Parts 417,109 Illescas, Spain Composite Materials Carbon Fibers 58,986 Leicester, England Composite Materials Lightweight Multiaxials Fabrics 134,657 Les Avenières, France Composite Materials Fabrics; Specialty Reinforcements 490,000 Neumarkt, Austria Composite Materials Prepregs 159,791 Parla, Spain Composite Materials Prepregs 147,186 Roussillon, France Composite Materials PAN Precursor and Carbon Fibers 222,170 Stade, Germany Composite Materials Prepregs 154,268 Vert-le-Petit, France Composite Materials Pultruded profiles; Prepregs and Adhesives 70,944 Welkenraedt, Belgium Engineered Products Engineered Honeycomb Parts 235,326 We lease the land and buildings in South Windsor, Connecticut, and the land on which the Burlington, Washington and Roussillon, France facilities are located.
Biggest changeManufacturing Facilities Facility Location Segment Principal Products Total Square Footage United States: Amesbury, Massachusetts Engineered Products Microwave and RF Absorbing Composite Materials 222,425 Burlington, Washington Engineered Products Engineered Honeycomb Parts 252,124 Casa Grande, Arizona Composite Materials Honeycomb and Honeycomb Parts 443,123 Decatur, Alabama Composite Materials PAN Precursor (used to produce Carbon Fibers) 819,863 Kent, Washington Engineered Products Composite structures 486,400 Pottsville, Pennsylvania Engineered Products Engineered Honeycomb Parts 312,000 Salt Lake City, Utah Composite Materials Carbon Fibers; Prepregs 1,365,000 Seguin, Texas Composite Materials Fabrics; Specialty Reinforcements 228,815 International: Casablanca, Morocco Engineered Products Engineered Honeycomb Parts 333,832 Dagneux, France Composite Materials Prepregs 213,698 Duxford, England Composite Materials Prepregs; Adhesives; Honeycomb and Honeycomb Parts 417,109 Illescas, Spain Composite Materials Carbon Fibers 58,986 Leicester, England Composite Materials Lightweight Multiaxials Fabrics 134,657 Les Avenières, France Composite Materials Fabrics; Specialty Reinforcements 490,000 Parla, Spain Composite Materials Prepregs 147,186 Roussillon, France Composite Materials PAN Precursor and Carbon Fibers 222,170 Stade, Germany Composite Materials Prepregs 154,268 Vert-le-Petit, France Composite Materials Pultruded profiles; Prepregs and Adhesives 70,944 We lease the land on which the Burlington, Washington and Roussillon, France facilities are located.
For further information, refer to “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and to Note 7 to the accompanying Consolidated Financial Statements of this Annual Report on Form 10-K.
In addition to the facility in Amesbury, Massachusetts, we also lease land and a building at another location in Amesbury. We own all other remaining manufacturing facilities. For further information, refer to “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and to Note 7 to the accompanying Consolidated Financial Statements of this Annual Report on Form 10-K.
During the fourth quarter of 2024, the Company announced that it was exploring strategic options for its operations in Austria and is undergoing a process to find a suitable successor for the Neumarkt plant. We lease portions of the facilities located in Casa Grande, Arizona; Pottsville, Pennsylvania; Parla, Spain; and Leicester, England.
The Company still owns the Welkenraedt, Belgium facility, however, earlier in 2025, its operations were shutdown. In addition, in 2025, we divested the facility in Neumarkt, Austria and the South Windsor, Connecticut business. We also lease portions of the facilities located in Casa Grande, Arizona; Pottsville, Pennsylvania; Parla, Spain; and Leicester, England.
Removed
In addition to the facility in Amesbury, Massachusetts we purchased in 2023, we also lease land and a building at another location in Amesbury. We own all other remaining manufacturing facilities.

Item 3. Legal Proceedings

Legal Proceedings — active lawsuits and investigations

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Biggest changeITEM 3. Legal Pro ceedings The information required by Item 3 is contained within Note 16 on page 72 of this Annual Report on Form 10-K and is incorporated herein by reference. ITEM 4. Mine Saf ety Disclosure Not applicable. 24 PA RT II
Biggest changeITEM 3. Legal Pro ceedings The information required by Item 3 is contained within Note 16 of this Annual Report on Form 10-K and is incorporated herein by reference. ITEM 4. Mine Saf ety Disclosures Not applicable. 25 PA RT II

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

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Biggest changeDuring 2024, the Company repurchased 3,649,310 shares of common stock on the open market under the aforementioned Share Repurchase Plans at an average price of $68.49 per share for a total cost of $252.2 million, leaving approximately $234.9 million available for additional repurchases under the 2024 Share Repurchase Plan.
Biggest changeDuring the year ended December 31, 2025, we repurchased 5,720,616 shares of common stock, including the shares repurchased pursuant the ASR, under both repurchase plans at a cost of $454.3 million, including sales commissions and excise taxes, leaving approximately $380.6 million available for additional repurchases under the 2025 Share Repurchase Plan.
ITEM 5. Market for Registrant’s Com mon Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities Hexcel common stock is traded on the New York Stock Exchange under the symbol HXL.
ITEM 5. Market for Registrant’s Com mon Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities Hexcel common stock is traded on the New York Stock Exchange under the symbol HXL. On February 19, 2024, the Board approved a $300 million share repurchase plan (the “2024 Share Repurchase Plan”).
On January 31, 2025, there were 365 holders of record of our common stock. ITEM 6. [ Reserved]
The final settlement under the ASR Agreements is scheduled to occur in the first quarter of 2026. On January 31, 2026, there were 337 holders of record of our common stock. ITEM 6. [ Reserved]
Removed
Under the share repurchase plan adopted by the Board of Directors of the Company (the "Board") in May 2018 (the “2018 Repurchase Plan"), the Board authorized $500 million for the repurchase of the Company's common stock which was fully utilized as of June 30, 2024.
Added
As of December 31, 2025 the 2024 Share Repurchase Plan was fully utilized. The repurchases of the Company’s common stock under the 2024 Share Repurchase Plan were made in open market transactions, block transactions, privately negotiated purchase transactions or other purchase techniques at the discretion of management based upon consideration of market, business, legal, accounting, and other factors.
Removed
The repurchase of the Company’s common stock under the 2018 Repurchase Plan was all made in open market transactions. On February 19, 2024, the Board approved a $300 million share repurchase plan (the “2024 Share Repurchase Plan”) which was in addition to the amount that remained available for repurchases under the 2018 Repurchase Plan.
Added
On October 22, 2025, the Board approved an additional $600 million share repurchase plan (the "2025 Share Repurchase Plan"), and, as part of the 2025 Share Repurchase Plan, the Company entered into accelerated share repurchase agreements (the "ASR") to purchase an aggregate of $350 million of the Company's common stock.
Added
On October 24, 2025, the Company paid Bank of America, N.A. (“Bank of America”) and Goldman Sachs & Co.
Added
LLC (together with Bank of America, the “Counterparties”) an aggregate amount of $350 million and received an initial delivery of approximately 3.95 million shares of the Company's common stock, representing 80% of the shares expected to be repurchased under the ASR agreement, at a price of $70.95 per share.
Added
The final number of shares to be repurchased will be based on the average of the daily volume-weighted average prices of the Company’s common stock during the term of the ASR Agreements, less a discount and subject to adjustments pursuant to the terms and conditions of the ASR Agreements.
Added
Upon final settlement of the ASR, under certain circumstances, each of the Counterparties may be required to deliver additional shares of common stock, or the Company may be required to deliver shares of common stock or to make a cash payment, at its election, to the Counterparties.
Added
The final settlement of each transaction under the ASR Agreements is scheduled to occur in the first quarter of 2026.
Added
In connection with the ASR, on October 21, 2025, the Company provided notice to the lenders pursuant to its senior unsecured revolving credit agreement to borrow $350.0 million under the revolving credit facility to fund the initial settlement of the ASR.
Added
The acquisition of these shares was accounted for under the treasury stock method.
Added
The following is a summary of share repurchase activity during the fiscal quarter ended December 31, 2025: Period (a) Total Number of Shares Purchased (b) Average Price Paid per Share (c) Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs (d) Approximate Dollar Value (Millions) of Shares that May Yet Be Purchased Under the Plans or Programs October 1 — October 31, 2025 3,946,442 (a) $ 70.95 (a) 3,946,442 $ 380.6 Total 3,946,442 $ 70.95 3,946,442 $ 380.6 (a) Shares reflect 80% of shares expected to be received under the ASR agreement based on the closing price of Hexcel common stock on October 24, 2025.

Item 7. Management's Discussion & Analysis

Management's Discussion & Analysis (MD&A) — revenue / margin commentary

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Biggest changeITEM 7. Management’s Discu ssion and Analysis of Financial Condition and Results of Operations The information required by Item 7 is contained on pages 32 to 39 of this Annual Report on Form 10-K under “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and is incorporated herein by reference.
Biggest changeITEM 7. Management’s Discu ssion and Analysis of Financial Condition and Results of Operations The information required by Item 7 is contained on pages 34 to 40 of this Annual Report on Form 10-K under “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and is incorporated herein by reference. 26

Item 7A. Quantitative and Qualitative Disclosures About Market Risk

Market Risk — interest-rate, FX, commodity exposure

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Biggest changeITEM 7A. Quantitative and Qualit ative Disclosures about Market Risk The information required by Item 7A is contained under the heading “Market Risks” on pages 38 to 39 of this Annual Report on Form 10-K and is incorporated herein by reference.
Biggest changeITEM 7A. Quantitative and Qualit ative Disclosures about Market Risk The information required by Item 7A is contained under the heading “Market Risks” on pages 39 to 40 of this Annual Report on Form 10-K and is incorporated herein by reference.

Other HXL 10-K year-over-year comparisons