ATI INC (ATI)

ATI Inc. is a Delaware corporation headquartered in Dallas, Texas, that produces specialty materials differentiated by its materials science expertise and advanced process technologies. Its stated mission is to solve the world's challenges through materials science. In fiscal 2023 the company reported revenues of $4.17 billion, and it employed approximately 7,300 people, 15% of them outside the United States across 15 countries.

ATI operates two segments. High Performance Materials & Components (HPMC), 51% of 2023 revenue, makes nickel-based alloys and superalloys, titanium and titanium-based alloys, advanced metallic powder alloys, precision forgings, machined parts and 3D-printed aerospace products. It is integrated across melt, forging, finishing, testing and machining, and about 85% of its revenue comes from aerospace and defense, including nearly 60% from commercial jet engine products. Advanced Alloys & Solutions (AA&S), 49% of revenue, makes nickel-based, titanium and specialty alloys as plate, sheet and Precision Rolled Strip products. It includes the Specialty Rolled Products and Specialty Alloys & Components businesses, a 60%-owned precision stainless strip joint venture in China (STAL), and a 50% interest in the A&T Stainless joint venture. The Uniti titanium joint venture is being dissolved. The company is expanding titanium melt capacity in Albany, Oregon and Richland, Washington, building an additive manufacturing facility near Fort Lauderdale, Florida, and expanding nitinol production with a $50 million investment from Confluent Medical Technologies.

Aerospace and defense account for nearly 60% of sales, led by jet engines, and together with energy, medical and electronics they make up almost 85% of revenue. Energy covers specialty energy, oil and gas, and downstream processing, and includes nuclear, natural gas and alternative power generation. Medical applications include niobium superconducting wire for MRI devices, orthopedic implant alloys and nitinol stents. Electronics uses nickel alloys and precision strip for computers and smartphones. HPMC customers include airframe makers such as Boeing, Airbus and Embraer, and engine makers such as GE Aerospace, Rolls-Royce, Pratt & Whitney and Safran's Snecma. The company has long-term agreements with most major aerospace OEMs, and much of HPMC output is sold directly to end users under multi-year agreements. AA&S sells directly to end users and through independent service centers. International sales are about 46% of the total. Backlog of confirmed orders was approximately $3.8 billion at December 31, 2023.

Substantially all raw materials are available from more than one supplier. They include scrap, nickel, titanium sponge, zirconium, ferrochromium, molybdenum, cobalt and niobium, with some sourced from foreign producers, and the company hedges some exposure such as nickel. HPMC has precision forging and machining operations in Poland, and the China joint venture serves Asian markets. Competitors include Precision Castparts (Berkshire Hathaway), Howmet Aerospace, Carpenter Technology, VSMPO-AVISMA and Aubert & Duval in HPMC, and Haynes International and VDM Metals in AA&S. ATI spent $22.1 million on research and development in 2023 and owns hundreds of U.S. patents. It is subject to environmental, health and safety regulation.