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ATI Inc.: From Pittsburgh Steel to Aerospace's Most Critical Supplier
The Hundred-Year Transformation of America's Materials Science Powerhouse
I. Introduction: The Irreplaceable Supplier
Picture a GE90 engine—the massive turbofan that powers Boeing's 777 widebody—spinning at 2,500 RPM with internal temperatures exceeding 2,000°F. The rotating disks, the compressor blades, the combustion chambers—all require materials that can withstand forces that would vaporize ordinary metals. Now consider that virtually every one of those critical components traces its material DNA back to a single company headquartered not in Silicon Valley or Seattle, but in the old industrial heartland of Western Pennsylvania.
ATI's key markets are aerospace and defense, particularly commercial jet engines, which account for over 50% of sales. ATI's materials and components are on virtually every commercial platform flying today.
The central question of ATI's story is this: How did a 100+ year-old Pittsburgh steel company reinvent itself as the irreplaceable materials supplier for every modern jet engine—and what does that transformation tell us about the power of strategic focus, the dangers of commodity exposure, and the value of technological moats?
At the Farnborough International Airshow in 2024, ATI celebrated its aerospace leadership by announcing $4 billion in new sales commitments through 2040. The majority of the additional revenue—approximately $2.2 billion—will be delivered in the balance of this decade.
Full year 2024 sales of $4.4 billion represents ATI's highest total since 2012. More than 70% of the company's revenues now come from aerospace and defense core markets.
The story begins over a century ago, with electric furnaces and stainless steel, moves through the conglomerate era and a transformative merger, survives a near-death experience during the oil price collapse, and culminates in a deliberate, radical pivot to become what management now calls "a materials science company." It is a story of industrial evolution—not through disruption, but through relentless refinement and strategic pruning.
II. Deep Origins: Allegheny Steel & The Birth of American Specialty Metals (1901–1939)
In 1901, in the smoky industrial valleys surrounding Pittsburgh, Pennsylvania, a company called Allegheny Steel & Iron began operations. This was the heart of American industrial might—a region where coal met iron, where rivers carried raw materials and finished products, and where the building blocks of modern infrastructure were forged in the heat of massive furnaces.
ATI owes its leadership in specialty and stainless steels largely to Allegheny Ludlum, a pioneering innovator in steel alloys and processes. Incorporated in 1901 as Allegheny Steel & Iron, it was the first company to use the electric furnace in manufacturing alloys. The company also commercialized stainless steel in the United States, winning its first patent in 1924.
The adoption of electric furnace technology was not merely an operational upgrade—it was a paradigm shift. Traditional blast furnaces were excellent for producing vast quantities of standard steel, but electric furnaces allowed for precise control over temperature and chemistry, enabling the creation of alloys with specific properties. This technical foundation would define the company's strategic identity for more than a century: not the cheapest producer, but the most capable.
Stainless from Allegheny Steel was used in New York's iconic Chrysler Building, in trim for the Ford Model A, and other industry firsts.
When the Chrysler Building rose over Manhattan in 1930, its distinctive crown—that gleaming Art Deco spire that remains one of the world's most recognizable architectural features—showcased Allegheny's stainless steel to the world. The material had to be corrosion-resistant, formable into complex shapes, and aesthetically brilliant. Standard steel simply wouldn't do. The Ford Model A's brightwork, similarly, demonstrated that specialty metals could find mass-market applications at premium prices.
In 1939, the merger of Allegheny Steel of Pittsburgh and Ludlum Steel of Watervliet, New York created Allegheny Ludlum Corporation; prior to the merger, the companies had manufactured steel for the Chrysler Building and Empire State Building in New York City.
The 1939 merger brought together two specialty steel pioneers with complementary capabilities. Allegheny Steel Company of Brackenridge, Pennsylvania, and Ludlum Steel Company of Watervliet, New York were both manufacturers of specialty steel, and each desired facilities the other possessed; for example, Allegheny wanted to enter the bar business, and Ludlum wished to get into the flat business.
W. F. Detwiler, a former night-shift apprentice for Allegheny Steel Company, became the corporation's first chairman of the board. At the completion of the company's first full year of operation in 1940, the demand for specialty steel had shown a steady increase for the past decade. The company reported more than $37 million in sales for the year, 58 percent of which were made in the final quarter.
The timing of the merger proved fortunate. As World War II loomed, the newly combined Allegheny Ludlum Steel Corporation was perfectly positioned to serve the exploding demand for specialty metals.
III. The Allegheny Ludlum Era: Specialty Steel Dominance & Diversification (1939–1996)
World War II transformed Allegheny Ludlum from a regional specialty steel producer into a critical supplier for America's war machine. The United States' entry into World War II took the steady increase of the market to unprecedented heights. As the demand for jet airplanes and armaments spiraled upward, research engineers at Allegheny Ludlum intensified their search for metal materials that would answer the growing demand. The company developed heat-resisting alloys for use in the construction of aircraft turbine engines. By 1944 the number of employees had ballooned to 17,000, almost three times the number at the outbreak of the war.
The development of jet engine alloys during World War II established a strategic direction that would eventually dominate the company's identity. Jet engines operate at temperatures and stresses that push the limits of metallurgy—temperatures hot enough to melt many conventional alloys. The ability to create materials that could survive these conditions required deep scientific expertise, specialized manufacturing equipment, and extensive qualification processes.
In the postwar decades, Allegheny Ludlum continued to innovate in specialty steels while also pursuing a diversification strategy common to American industrial companies of the era. The conglomerate model—acquiring businesses in unrelated industries to create scale and diversify risk—was in vogue among corporate strategists.
Through the 1970s, Allegheny Ludlum periodically cooperated with Ford to build several one-off promotional cars with stainless steel bodies—demonstrations of the material's durability and aesthetic appeal. But the company's diversification moves went far beyond automotive showcases.
In 1978, the company acquired Wilkinson Sword and Scripto—moves that would have seemed logical at the time but would eventually be recognized as strategic distractions. What does a specialty steel company know about razor blades and pens? The answer, as shareholders would eventually discover, was "not enough."
The 1980s brought reckoning. In 1986, the company suffered a $198 million operating loss, and chairman Robert Buckley stepped down amid accusations of mismanagement. The diversification experiment had produced neither synergies nor focus—just complexity and losses.
The turnaround began in 1987 when Allegheny Ludlum became a public company via an initial public offering under chief executive Dick Simmons. The divestiture of non-core assets followed: in 1987, Wilkinson Sword was sold to Swedish Match for $230 million—the beginning of a strategic focus that would define the next three decades.
In 1993, the company acquired Jessop Steel, strengthening its position in specialty stainless products. The message was clear: Allegheny Ludlum would be a specialty steel company, not a conglomerate. But the full realization of this focus would require a transformative merger that brought together complementary expertise—and a partner with its own remarkable corporate history.
IV. The Teledyne Story: Henry Singleton's Conglomerate & Advanced Materials
While Allegheny Ludlum was refocusing on specialty steel in the East, a company with very different origins was building an aerospace materials empire on the West Coast. Teledyne Technologies is an American industrial conglomerate. It was founded in 1960 as Teledyne, Inc. by Henry Singleton and George Kozmetsky.
Henry Earl Singleton was an American electrical engineer, business executive, and rancher/land owner. Singleton made significant contributions to aircraft inertial guidance and was elected to the National Academy of Engineering. He co-founded Teledyne, Inc., one of America's most successful conglomerates, and was its chief executive officer for three decades.
Singleton was a remarkable figure in American business history—a man whose capital allocation skills earned comparisons to Warren Buffett. Warren Buffett, one of the wealthiest men in the world, is quoted as saying that "Henry Singleton of Teledyne has the best operating and capital deployment record in American business."
A world-class mathematician who enjoyed playing chess blindfolded, he had programmed MIT's first computer while earning a doctorate in electrical engineering. During World War II, he developed a "degaussing" technology that allowed Allied ships to avoid radar detection, and in the 1950s, he created an inertial guidance system that is still in use in most military and commercial aircraft. All that before he founded a conglomerate, Teledyne, in the early 1960s and became one of history's great CEOs.
In June 1960, Singleton and George M. Kozmetsky, a colleague from Litton, formed Instrument Systems, located in Beverly Hills, California. Arthur Rock, one of America's first and most successful venture capitalists, financed the startup with a $450,000 investment and remained a board director for 33 years.
Singleton's strategy evolved through three distinct phases. His tenure at Teledyne was mainly marked by a three-phase strategy: rapid expansion through acquisitions, aggressive share buybacks, and eventually spinning out subsidiaries. Between 1960 and 1969, Singleton acquired 130 companies in a range of industries, employing a disciplined approach that focused on acquiring profitable, growing companies at no more than 12 times their earnings.
When the P/E multiple on conglomerate stocks fell, Singleton's strategy shifted dramatically. Over 12 years, he bought back a staggering 90% of Teledyne's shares, boosting the company's earnings per share 40-fold, solidifying his reputation as a pioneer in using buybacks as a strategic financial tool.
Among Teledyne's many acquisitions were materials companies that would prove critical to ATI's future. In July 1966, Vanadium-Alloy Steel Company (Vasco), including its subsidiary Allvac, was merged into Teledyne. This expanded the company into the Eastern U.S. and started the formation of material technologies as a major business activity of Teledyne.
Twenty-one acquired companies were in the metals business including manufacturing company Wah Chang and Cast Products. Wah Chang contributed expertise in refractory metals, while Allvac Metals Company was a pioneer in vacuum melting of nickel and other alloys for jet engines.
Singleton left behind an extraordinary record, dwarfing both his peers and the market. From 1963 to 1990, Singleton delivered a remarkable 20.4% compound annual return to his shareholders, compared to an 8.0% return for the S&P 500 over the same period. A dollar invested with Henry Singleton in 1963 would have been worth $180.94 by 1990.
By the mid-1990s, however, Teledyne faced pressures. In late 1994, Teledyne was subjected to a hostile takeover attempt by WHX Corporation. This was successfully challenged, but the Teledyne pension fund had a surplus of $928 million and this was of wide interest. To forestall further hostile takeovers, Allegheny Ludlum, a steel and specialty metal firm, offered to serve as a white knight friendly acquirer.
The strategic logic was compelling: Allegheny Ludlum's deep expertise in specialty steels combined with Teledyne's aerospace materials capabilities could create a uniquely positioned materials science company.
V. The 1996 Mega-Merger: Birth of Allegheny Technologies
On August 15, 1996, an agreement was reached to merge Teledyne with Allegheny Ludlum, forming Allegheny Teledyne, Inc. (ATI), with headquarters in Pittsburgh, Pennsylvania.
Prior to the 1996 merger, Allegheny Ludlum reported annual revenues of approximately $1.8 billion. Teledyne's revenues were around $2.6 billion, showcasing the scale of the combined entities. The merger united Allegheny Ludlum's deep expertise in specialty metals with Teledyne's advanced capabilities in electronics and aerospace.
The merger created a sprawling enterprise with three business segments: Aerospace and Electronics, Specialty Metals, and Consumer Products. After some reorganization, ATI operated with three segments. The former Teledyne high-technology companies were mainly in the A&E Segment, led by Robert Mehrabian.
But the combined company faced an immediate challenge: what to do with Teledyne's sprawling non-core businesses? At various times, Teledyne, Inc. had more than 150 companies with interests as varied as insurance, dental appliances, specialty metals, and aerospace electronics.
The answer came three years later. In 1996, it merged with Teledyne to form Allegheny Technologies. The company then spun off several subsidiaries as independent public companies such as Teledyne Technologies and Water Pik Technologies in 1999, to concentrate on its core business of metal and alloy production.
ATI eventually decided to spin off the segments into independent entities, and on November 29, 1999, Teledyne Technologies Incorporated, Allegheny Technologies Incorporated, and Water Pik Technologies, Inc., were formed.
Allegheny Technologies retained several companies of the former Teledyne, Inc. that fit with Allegheny's core business of steel and exotic metals production.
This strategic decision—keeping the materials businesses while spinning off electronics and consumer products—proved prescient. The retained materials businesses included capabilities in titanium, nickel superalloys, and refractory metals that would become the foundation of ATI's aerospace dominance.
Beginning around 1999 and continuing through subsequent divestitures and acquisitions, the deliberate shift away from diversified and consumer products towards high-margin, high-performance materials, particularly for aerospace, defense, and medical markets, fundamentally reshaped the company's identity and profitability profile.
VI. Building the Aerospace Powerhouse (1998–2012)
With strategic clarity established, ATI began building its aerospace capabilities through targeted acquisitions and capital investments.
In 1998, the company acquired certain assets of Lukens Washington Steel when it was sold to Bethlehem Steel. In 1998, ATI bought Teledyne Wah Chang Albany, as well as Oregon Metallurgical Corporation (Oremet).
The Oremet facility proved particularly significant—it made high-quality titanium for use in Boeing aircraft, positioning ATI as a critical supplier to the emerging Boeing 787 Dreamliner program. The 787, with its composite fuselage and next-generation engines, demanded materials that could withstand extreme conditions while minimizing weight.
In May 2008, the company invested $260 million in a new plant located in Monroe. In 2010, the company acquired Ladish for $778 million.
The Ladish acquisition was transformative. The consolidation highlighted the two groups' involvement in supplying materials and components to aerospace and energy markets. ATI's chairman and CEO L. Patrick Hassey pointed to Ladish's expertise with technologically advanced forging, investment casting, and machining, indicating the combination would create "a more integrated, stable, and sustainable supply chain for the aerospace, defense, and industrial markets."
Acquiring Ladish was a game-changer. It wasn't just an acquisition; it was a strategic leap deeper into the aerospace supply chain, adding critical forging and manufacturing capabilities for next-generation aircraft engines and structures.
For over one hundred years Ladish Company has engaged in the age-old practice of forging metal into a variety of finished products. Innovative application of such technology made the company one of the foremost forge shops in the country, and modernization of the basic process made Ladish a key supplier of aerospace parts.
"ATI Ladish adds to our capability to produce highly engineered and technically complex parts," stated Richard J. Harshman, the new chairman of Allegheny Technologies. "We offer customers, particularly in the aerospace market, an integrated, stable, and sustainable supply chain, which now includes advanced forging, casting, and machining assets for titanium alloys, nickel-based superalloys and specialty alloys."
Allegheny Technologies debuted its ATI 425 Titanium Alloy on June 14, 2010, at the land and air-land defense and security exhibition Eurosatory in Paris, France.
In 2012, ATI made another major bet on titanium. In total, ATI was said in 2012 to have capacity for 40 million pounds per annum, with the investment of $325 million in Rowley, Utah. The Rowley plant would have an annual capacity of 24 million pounds. The plant was located adjacent to a US Magnesium plant, for easy interchange of by-products. The Rowley plant uses the Kroll process.
The titanium sponge investment was designed to ensure domestic supply of a strategic material increasingly critical to aerospace. But as ATI would soon discover, the commodity nature of titanium sponge—versus the highly differentiated nature of finished titanium alloys—carried very different risk profiles.
VII. INFLECTION POINT #1: The Commodity Trap & Near-Death Experience (2014–2016)
The stunning drop in oil prices, from a peak of $115 per barrel in June 2014 to under $35 at the end of February 2016, has been one of the most important global macroeconomic developments of the past 20 months.
Oil prices fell from over US$100 per barrel in July 2014 to less than half that by January 2015. After a brief recovery to about US$60 in June 2015, prices halved again to just over $30 by February 2016.
For ATI, which had significant exposure to both oil & gas markets and commodity stainless steel, the oil price collapse proved devastating. The company's strategic bet on titanium sponge at Rowley turned from asset to liability as global overcapacity crushed prices.
As of August 2016, the firm employed roughly 1,500 people in its Albany region plants. In August 2016, the firm announced it would idle its plants in Albany and Rowley. The latter plant was idled because other global suppliers, who had entered the market recently, could undercut the Rowley titanium sponge. The Albany plant, which produced mainly for Boeing, was shuttered because of poor demand. In September 2016, the company said it would shut down its Frackville plant, which produced titanium bar and hair-thin wire in a 55,000-square-foot facility.
The $325 million Rowley investment, completed just a few years earlier, was essentially written off. This was the cruel lesson of commodity businesses: when demand falls and supply remains abundant, there is no moat to protect margins.
The stock price collapse told the story of market confidence: shares fell from approximately $40 in 2014 to under $10 in 2016—a decline of more than 75%. For a company with deep roots in American industrial history, the question became existential: could ATI survive, and if so, what kind of company would it become?
The answer required new leadership and a radical strategic pivot.
VIII. INFLECTION POINT #2: The Strategic Pivot to Aerospace & Defense (2017–2020)
Bob Wetherbee first joined ATI in 2010 to run the Tungsten Materials business, which under his leadership, achieved record financial performance results prior to its divestiture by ATI in 2013. Bob Wetherbee has been ATI's Executive Vice President, Flat Rolled Products Group since 2014. He was recruited in 2014 to transform ATI's Flat Rolled Products (FRP) business, then heavily reliant on commodity stainless steel and strip, into a producer of high-value differentiated flat rolled products.
ATI announced that its Board of Directors appointed Robert S. Wetherbee to become ATI's President and Chief Executive Officer effective January 1, 2019. Mr. Wetherbee was identified through a robust, Board-driven leadership development and succession planning process to succeed Richard J. Harshman as ATI's President and Chief Executive Officer.
Wetherbee's mandate was clear: complete the transformation away from commodity exposure toward high-value aerospace and defense materials. The strategy was simple in concept but difficult in execution: exit businesses where ATI had no competitive advantage, invest in businesses where ATI's materials science expertise created genuine differentiation, and secure long-term agreements with aerospace OEMs that provided visibility and pricing power.
In 2019, the company sold its ATI Cast Products plant in Albany, Oregon, to a Cleveland company—another step in shedding non-core operations.
Then came COVID-19.
The pandemic's impact on commercial aerospace was catastrophic. Airlines grounded fleets, deferred deliveries, and canceled orders. Boeing's production rates collapsed. For a company betting its future on aerospace, the timing could not have been worse.
But Wetherbee and his team saw the crisis as an opportunity to accelerate transformation. In December 2020, Allegheny Technologies Incorporated announced that it is exiting standard stainless sheet products, streamlining its production footprint, and investing in enhanced capabilities to accelerate the execution of its high-value strategy, primarily in aerospace and defense. "We are taking decisive action to become a more profitable company by further sharpening our focus on the highest-value opportunities for our business," said Robert S. Wetherbee, ATI President and Chief Executive Officer. "By shedding a low-margin product line and optimizing our footprint, we are redeploying resources to an aerospace and defense-centered portfolio, expanding margins and driving returns to generate significant value for our shareholders."
The Company exited standard stainless sheet products by mid-year 2021. In 2019, this product line represented $445 million of revenue with margins of less than one percent. As a result of these actions, ATI expected to achieve EBITDA margins of 15% or more within the Advanced Alloys and Solutions segment with recovery of the commercial aerospace end market.
As part of the reorganization, the company closed five finishing facilities in Ohio, California, Illinois, Pennsylvania and Connecticut. Of those, two already had closed; the remaining three were shut down by the end of 2021.
The $65 to $85 million incremental investment over a three-year period was expected to be largely self-funded by working capital releases. These changes were expected to enable the AA&S business to significantly improve its margin profile by reducing costs and pursuing an improved revenue mix.
This was not trimming around the edges—it was betting the company on aerospace recovery while competitors were retrenching. ATI was walking away from $445 million in revenue, closing five facilities, and writing off approximately $1 billion in long-lived asset impairments. The December 2020 announcement was the most decisive strategic pivot in the company's modern history.
IX. INFLECTION POINT #3: Labor Strikes, Rebranding & The Move to Dallas (2021–2022)
The transformation was not without turbulence. The 2021 Allegheny Technologies strike was a labor strike involving about 1,300 workers for metals manufacturing company Allegheny Technologies Incorporated (ATI), all unionized with the United Steelworkers (USW). The strike began on March 30 and ended on July 13 with the ratification of a new labor contract. Strikers returned to work by July 19.
The United Steelworkers (USW) said that the union engaged in a strike against ATI over unfair labor practices at 7 a.m. (EDT) at nine facilities. In negotiations that started in early January 2021, the company sought major economic and contract language concessions from roughly 1,300 union members who had not had a wage increase since 2014.
The new contract has generally been seen as a win for the union, as it addresses all of the issues they had had with the company's original proposals. At the same time, the union estimates that the strike cost the company millions of dollars, with the company posting a $49.2 million loss for the second quarter of 2021.
The strike highlighted the challenges of transforming an old-line industrial company with deep union traditions. But ATI emerged from the labor dispute with a new contract and continued its strategic evolution.
In June 2022, the company was officially renamed from Allegheny Technologies Incorporated to ATI. Alongside this, the company's domain was changed from ATImetals.com to ATImaterials.com.
The rebranding was more than cosmetic. The shift from "metals" to "materials" signaled a fundamental change in self-identity—from a producer of commoditized metals to a materials science company serving demanding applications.
In 2023, the corporate headquarters relocated to Dallas, Texas. The move from Pittsburgh—where the company's roots stretched back over a century—to Dallas symbolized the transformation. ATI was no longer primarily a Pittsburgh steel company; it was a global aerospace and defense materials supplier that happened to have important operations in Pennsylvania.
X. The Modern Era: Aerospace Dominance & Record Growth (2023–2025)
As of September 2023, ATI was "a $3.8 billion company" with more than 6,000 workers in more than 30 locations in the United States and more than a dozen in Europe and Asia.
In June 2023, ATI announced a $28 million expansion of its Richland, Washington plant, located in the Horn Rapids Industrial Park. At the same time, it announced it would re-start its Albany, Oregon operations.
The Albany restart was particularly significant—the same facility that had been shuttered during the 2016 crisis was now being brought back online to meet surging aerospace demand. The turnaround in just seven years was remarkable.
The Board of Directors of ATI elected Kimberly A. Fields as President and CEO, effective July 1, 2024. Fields has served as Chief Operating Officer since 2022 and became President in July 2023. During her tenure, ATI has grown as one integrated operation, sharpening its operational advantages, increasing capacity and capability for the extraordinary materials customers value most. As CEO, Fields succeeded Robert S. Wetherbee, who became Executive Chairman. Wetherbee was named President and CEO in 2018 and became Board Chair in 2020.
Fields joined ATI in 2019 as executive vice president of ATI's Flat Rolled Products group, and in 2020 took on leadership of both business segments. Prior to joining ATI, Fields was group president for industrial and energy at IDEX Corporation, where she dramatically improved profitability and accelerated growth in the business portfolio. She's held commercial, manufacturing, and strategic leadership positions at EVRAZ and GE.
Fields earned a BS in Ceramic Engineering from the University of Illinois at Champaign-Urbana and an MBA from the Kellogg Graduate School of Management at Northwestern University.
Targeting $5 billion in revenue by 2027, Kimberly Fields took over as CEO in 2024. "Our transformation from producing standard stainless steel to highly differentiated alloys and materials has nearly tripled margins and doubled revenues," she says.
ATI's additive manufacturing strategy has also matured significantly. ATI acquired Addaero Manufacturing in 2018, a leader in metal alloy-based additive manufacturing for the aerospace and defense industries, located in New Britain, Connecticut. This strategic acquisition brings together ATI's deep knowledge and experience in commercial aerospace and industry-leading powder metal manufacturing capabilities with Addaero's technical expertise to produce aerospace quality parts using various additive manufacturing technologies.
ATI recently announced the commissioning of its new Additive Manufacturing Products facility in Margate, Florida, commemorating this event with a grand opening on February 13, 2025. The Margate, Florida, facility supports additive manufacturing of larger metal parts, serving customers across defense, space and more.
The 132,000-square-foot building houses nine metal 3D printers, including small- and medium-format LPBF machines from EOS, one Arcam electron beam melting (EBM) printer, plus two eight-laser Velo3D XC printers and a 12-laser SLM Solutions NXG 600E capable of building parts up to 1.5 meters tall.
Financial Performance and Capital Returns
Adjusted EBITDA for 2024 was $729 million and projections for 2025 detail a guidance of between $800 million – $840 million. Free-cash-flow is projected to be $240 million – $360 million.
Aerospace and Defense dominates company revenues (62% in 2024, up from 59% in 2023), with products for commercial jet engines accounting for 33% of total company sales (up from 32%).
The specialty materials manufacturer reported adjusted earnings per share of $0.85 in Q3 2025, exceeding analyst expectations and representing a 42% year-over-year increase. Total sales reached $1.1 billion, up 7% compared to the same period last year, with A&D now accounting for a record 70% of the company's business.
ATI's airframe revenue has increased approximately 70% in Q3 2025 TTM compared to 2022, and new long-term agreements extend and expand the company's presence through 2030. The defense segment has shown particularly strong growth, with Q3 revenue up 51% year-over-year, marking three consecutive years of double-digit growth.
ATI announced that the Board of Directors has elected Kimberly A. Fields to become Board Chair of ATI, in addition to her roles as Chief Executive Officer and President. This appointment becomes effective May 14, 2026, at ATI's Annual Meeting of Shareholders. At that time, Robert S. Wetherbee will retire as Executive Chair and as a member of ATI's Board.
XI. The OEM Partnerships: Boeing, Airbus & The Engine Makers
ATI's strategic position is anchored by long-term agreements with the world's leading aerospace manufacturers.
ATI announced the extension and expansion of its long-term titanium products agreement with The Boeing Company, reinforcing ATI's position as a top supplier of high-performance titanium materials for aerospace. The agreement supports Boeing's full suite of commercial airplane programs—both narrowbody and widebody—with opportunity to grow. ATI is also positioned to serve Boeing's third-party subsidiaries under terms of the agreement.
"We're proud to expand our decades-long partnership with Boeing," said Kimberly Fields, ATI President and CEO. "This agreement reaffirms ATI's leadership in titanium at a time of accelerating aerospace production and growing demand for differentiated materials. It also deepens our position in high-strength titanium alloys and sheet products—strategic focus areas for ATI and our customers."
Under the terms of the agreement, ATI will supply a comprehensive portfolio of high-performance titanium materials, including long products—such as ingots, billets, rectangles, and bars—and flat-rolled products, including plate, sheet, and coil. It includes titanium alloy sheet from ATI's new Pageland, South Carolina, facility and draws on the strengths of both Specialty Materials and Specialty Rolled Products businesses.
"We are honored to partner with Airbus on this guaranteed share contract, which more than doubles ATI's prior support of Airbus," said ATI President and CEO Kimberly A. Fields. "Our investments in titanium capacity give us the ability to respond to our customer's increased need for high purity melt and exceptional titanium products as they grow their production."
ATI opened a new manufacturing operation in Chesterfield County, South Carolina that will employ nearly 70 people at full capacity. The facility, located at 340 Industrial Park Lane in Pageland, produces titanium alloy sheet—a technically challenging material critical to airframe manufacturers for its strength and durability in aerostructure components and assemblies.
"With our Pageland facility fully online and in production, ATI now offers a full complement of titanium materials, producing quality titanium sheets wider and longer than anyone in the industry."
The engine manufacturers are equally important customers. The new sales commitments announced at Farnborough represent an estimated $500 million of revenue in 2025 and $550 million in 2027. Approximately 20% of these revenues are incremental to ATI's previously announced financial targets.
The $4 billion in new sales commitments from the Farnborough International Airshow are predominantly for nickel alloys and include $550 million in revenues for 2027. This further demonstrates that ATI remains on track to exceed both $5 billion in revenue and $1 billion in adjusted EBITDA by 2027.
XII. Business Model Deep Dive: How ATI Makes Money
The company organizes its products into two segments: High Performance Materials & Components, which includes titanium-based alloys, nickel-based alloys and superalloys, zirconium and hafnium. Advanced Alloys & Solutions, which includes zirconium-, hafnium-, and niobium-based alloys, titanium and titanium alloys, nickel-based alloys, specialty alloys, duplex alloys in sheet, strip, and plate form, grain-oriented electrical steel.
ATI Inc. operates by transforming raw materials into high-performance specialty materials and complex components, primarily serving demanding end markets like aerospace and defense. The company leverages advanced melting, forging, rolling, and machining capabilities to produce mission-critical products. ATI's value creation hinges on its integrated manufacturing processes. It starts with sourcing raw materials and scrap, followed by sophisticated melting techniques like Vacuum Induction Melting (VIM) and Vacuum Arc Remelting (VAR) to achieve precise alloy chemistries. Subsequent steps involve forging, hot and cold rolling, and advanced finishing processes tailored to customer specifications.
Segment Performance
The High Performance Materials & Components (HPMC) segment is the higher-margin, aerospace-focused business. HPMC second quarter 2025 segment EBITDA was $144.0 million, or 23.7% of sales. Overall aerospace & defense sales represented 92% of total HPMC sales in the first quarter 2025.
The Advanced Alloys & Solutions (AA&S) segment serves a broader range of end markets. Overall aerospace & defense sales were 39% of total AA&S sales in the first quarter of 2025. First quarter 2025 sales increased $47.3 million, or 9%, compared to the prior year quarter. The higher year-over-year sales were primarily driven by increased demand for aerospace & defense and conventional energy. AA&S first quarter 2025 segment EBITDA was $83.4 million, or 14.9% of sales.
Long-Term Agreement Economics
The long-term agreement (LTA) structure is critical to ATI's business model. LTAs provide revenue visibility, enable capacity planning, and create switching costs for customers who have qualified ATI materials for their programs. Aerospace qualification processes are lengthy and expensive—customers cannot simply switch suppliers for certified materials.
ATI maintains long-term supply contracts with Boeing, Lockheed Martin, and Pratt & Whitney, representing 68% of their total aerospace revenue in 2023.
XIII. Competitive Analysis & Strategic Moats
Porter's Five Forces Analysis
1. Threat of New Entrants: LOW
ATI Inc. reported capital expenditures of $135 million in 2023, creating substantial entry barriers for potential competitors. The specialized metallurgical manufacturing equipment requires an initial investment ranging from $50 million to $250 million. ATI holds 127 active patents in advanced metallurgy and manufacturing processes. Aerospace-grade titanium alloy production requires minimum 15 years of specialized engineering experience. Advanced metallurgical certifications cost approximately $2.5 million per qualification. Aerospace certification processes demand rigorous compliance, with average certification costs reaching $3.7 million and taking 24-36 months to complete.
2. Bargaining Power of Suppliers: MODERATE
ATI sources titanium sponge, nickel, cobalt, and various alloying elements from global commodity markets. While raw material price volatility affects costs, ATI's integrated operations—from melting to finished components—allow some absorption of input price fluctuations.
3. Bargaining Power of Buyers: MODERATE TO LOW
The aerospace OEMs (Boeing, Airbus, GE, Pratt & Whitney, Rolls-Royce) are large, sophisticated customers with significant purchasing power. However, qualification barriers, long-term agreements, and the mission-critical nature of ATI's materials limit customer negotiating leverage. Customers cannot easily switch suppliers for certified aerospace materials.
4. Threat of Substitutes: LOW TO MODERATE
In 2023, the global advanced composites market reached $84.6 billion, with a projected CAGR of 6.7% through 2028. ATI faces direct competition from composite materials in aerospace and industrial sectors. 3D printing technologies reduced material costs by 37% in aerospace manufacturing between 2020-2023.
While composites have displaced metals in some airframe applications, jet engines continue to require metal alloys that can withstand extreme temperatures. The hot section of a turbofan engine—where temperatures exceed the melting point of many metals—demands nickel superalloys that composites cannot replicate.
5. Competitive Rivalry: MODERATE
ATI's primary competitors include Precision Castparts, Arconic, Carpenter Technology and others.
ATI is a global manufacturer of specialty materials, including titanium, nickel-based alloys, and stainless steel. The company serves various industries, such as aerospace, defense, oil and gas, and medical. With a strong focus on innovation and product development, ATI poses significant competition to Carpenter Technology.
Hamilton Helmer's 7 Powers Framework
Process Power: ATI's advanced melting techniques (VIM, VAR) and decades of metallurgical expertise create process advantages that competitors cannot easily replicate. The ability to produce materials with precise chemistries and properties is a core competency.
Scale Economies: The capital-intensive nature of specialty metals production favors larger players. ATI's integrated operations—from raw materials through finished components—create scale advantages in purchasing, manufacturing, and qualification.
Switching Costs: Aerospace qualification processes create enormous switching costs. Once ATI materials are qualified for a specific aircraft or engine program, customers face years of requalification effort and expense to switch suppliers.
Network Effects: Limited in this industry.
Counter-Positioning: ATI's December 2020 decision to exit standard stainless steel represented counter-positioning—walking away from revenue that competitors might value, to focus on differentiated materials where ATI has advantages.
Branding: ATI's "Proven to Perform" positioning reflects decades of supplying mission-critical materials. The brand carries weight with aerospace OEMs who cannot risk supply chain failures.
Cornered Resource: ATI's metallurgical expertise, qualification databases, and customer relationships represent accumulated knowledge that new entrants cannot easily acquire.
XIV. Bull Case vs. Bear Case
The Bull Case
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Aerospace Supercycle: Global air travel continues to grow at 4-5% annually, driving demand for new aircraft. The installed fleet requires MRO (maintenance, repair, and overhaul) services that consume ATI materials. Backlogs at Boeing and Airbus extend years into the future.
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Defense Tailwinds: Congress is talking about possibly increasing defense spending in the next two fiscal years. When you look at the white paper on that, it's earmarked and targeted to go to programs—over 50%, maybe 50% of that earmarked to go into programs that we participate in.
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Margin Expansion: The transformation from commodity producer to differentiated materials supplier continues to drive margin improvement. ATI achieved $225 million in adjusted EBITDA in Q3 2025, a 21% year-over-year increase, while expanding its adjusted EBITDA margin to 20%.
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Long-Term Visibility: The $4 billion in new LTAs announced at Farnborough provides revenue visibility through 2040. ATI's materials are designed into aircraft programs with 20-30 year production lives.
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Shareholder Returns: ATI has returned over $800 million to shareholders through buybacks since 2022, demonstrating confidence in free cash flow generation.
The Bear Case
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Customer Concentration: Heavy reliance on Boeing, Airbus, and the major engine OEMs creates concentration risk. Boeing's ongoing challenges (737 MAX issues, 787 production disruptions, 777X delays) directly impact ATI.
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Cyclicality: Despite the focus on aerospace, ATI remains exposed to cyclical end markets. A recession that impacts air travel would ripple through to ATI's order book.
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Geopolitical Risk: Approximately 44% of ATI's sales come from outside the United States. Trade tensions, tariffs, and supply chain disruptions pose ongoing risks.
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Competition: Precision Castparts (owned by Berkshire Hathaway), Carpenter Technology, and international competitors continue to invest in aerospace materials capabilities.
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Execution Risk: The strategic transformation is not yet complete. ATI's 2027 targets ($5 billion revenue, $1 billion EBITDA) require continued execution in a volatile macro environment.
XV. Key Performance Indicators to Watch
For investors monitoring ATI's ongoing performance, three metrics deserve particular attention:
1. Aerospace & Defense Revenue Mix
This is the single most important indicator of strategic progress. ATI's transformation thesis depends on continuing to grow A&D as a percentage of total revenue. More than 70% of the company's revenues now come from aerospace and defense core markets. Management's goal is to maintain and expand this mix toward "aero-like" applications in medical, electronics, and specialty energy.
2. HPMC Segment EBITDA Margin
The High Performance Materials & Components segment is ATI's highest-margin business. The HPMC segment posted adjusted EBITDA of $146 million (+18% YoY) in Q3 2025. The segment's adjusted EBITDA margin expanded to 24.2%, a 190 basis point improvement year-over-year. Sustained margin expansion in HPMC validates the value proposition of differentiated materials.
3. Long-Term Agreement Coverage
The percentage of revenue covered by long-term agreements provides visibility and reduces volatility. ATI does not disclose this metric precisely, but the $4 billion Farnborough announcement and ongoing Boeing/Airbus contracts suggest substantial LTA coverage. Investors should monitor new agreement announcements and contract extensions.
XVI. Conclusion: The Materials Science Company
ATI's transformation from a Pittsburgh steel company to an aerospace and defense materials leader represents one of the most dramatic strategic pivots in American industrial history. The company that once supplied stainless steel for the Chrysler Building now supplies the titanium and nickel superalloys that enable modern jet engines to operate at the edge of physical possibility.
The journey required vision, discipline, and difficult decisions. Exiting $445 million in commodity stainless revenue during a pandemic—when aerospace demand had collapsed—took conviction. Closing facilities, writing off assets, and relocating headquarters from Pittsburgh to Dallas required breaking with more than a century of tradition.
But the results speak clearly: "Our transformation from producing standard stainless steel to highly differentiated alloys and materials has nearly tripled margins and doubled revenues."
The question for investors is whether ATI's strategic positioning translates into durable competitive advantage. The evidence suggests it does: 15+ year qualification barriers, 127 patents, long-term agreements with every major aerospace OEM, and materials science expertise accumulated over more than a century create moats that new entrants cannot easily cross.
ATI is a producer of high-performance materials and solutions for the global aerospace and defense markets, and critical applications in electronics, medical and specialty energy. We're solving the world's most difficult challenges through materials science. We partner with our customers to deliver extraordinary materials that enable their greatest achievements: their products fly higher and faster, burn hotter, dive deeper, stand stronger and last longer.
For a company that traces its roots to electric furnaces in 1901, ATI's hundred-year journey offers a powerful lesson: industrial companies can reinvent themselves, but only through relentless focus on competitive advantage and the courage to walk away from businesses where they cannot win. In ATI's case, that meant embracing its identity as a materials science company—and proving, one jet engine at a time, that it is truly "Proven to Perform."
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