Howmet Aerospace · Earnings release

FOR IMMEDIATE RELEASE

Investor Contact

Media Contact

Paul T. Luther

Rob Morrison

Paul.Luther@howmet.com

Rob.Morrison@howmet.com

Howmet Aerospace Reports First Quarter 2025

Results

Record Revenue Up 6% Year Over Year, Record

Profit, Strong Cash from Operations

$125 Million Deployed for Common Stock Repurchases,

Additional $100 Million in April

Range Widened, Increases to Adj. EBITDA*, Adj. EPS*, Free Cash Flow

First Quarter 2025 GAAP Financial Results

·

Revenue of $1.94 billion, up 6% year over year, driven by Commercial Aerospace,

up 9%

·

Operating Income Margin of 25.4%

·

Net Income of $344 million versus $243 million in the first quarter 2024;

·

Generated $253 million of Cash from Operations; $167 million of Cash used

for Financing Activities; and $115 million of Cash used for Investing Activities

·

Share repurchases of $125 million; $0.10 per share common stock dividend,

up 100% year over year

First Quarter 2025 Adjusted Financial Results

·

Adjusted EBITDA excluding special items of $560 million, up 28% year over

year

·

Adjusted EBITDA margin excluding special items of 28.8%, up 480 basis points

year over year

·

Adjusted Operating Income Margin excluding special items of 25.3%, up 500

basis points year over year

·

Adjusted Earnings Per Share excluding special items of $0.86, up 51% year

over year

·

Generated $134 million of free cash flow

2025 Guidance: Includes current assumptions of tariff impacts

Low

Baseline

High

Low

Baseline

High

G1G2Revenue

G3G4Adj. EBITDA*1

G5G6Adj. EBITDA Margin*1

G7G8Adj. Earnings per Share*1

G9Free Cash Flow1

* Excluding special items

1 Reconciliations of the forward-looking non-GAAP measures

to the most directly comparable GAAP measures, as well as the directly comparable GAAP measures, are not available without unreasonable

efforts due to the variability and complexity of the charges and other components excluded from the non-GAAP measures – for further

detail, see “2025 Guidance” below.

Key Announcements

·

Repurchased

$125 million of common stock in first quarter 2025 at average price of $124.24 per share

·

Repurchased

an additional $100 million of common stock in April 2025 at average price of $125.61 per share

·

Paid

a quarterly dividend of $0.10 per share on the Company’s common stock in first quarter 2025, up 100% from first quarter 2024’s

$0.05 dividend per share

·

Fitch

Ratings upgraded Howmet Aerospace’s Long-Term Issuer Default Rating from BBB to BBB+ on March 31, 2025

·

Full Year 2025 Guidance: Revenue range widened with increases to Adj. EBITDA*,

Adj. EPS*, and Free Cash Flow

PITTSBURGH, PA, May 1, 2025 – Howmet Aerospace (NYSE:

HWM) today reported first quarter 2025 results. The Company reported record first quarter 2025 revenue of $1.94 billion, up 6% year over

year, primarily driven by growth in the commercial aerospace market of 9%.

Howmet Aerospace reported Net Income of $344 million, or $0.84 per

share, in the first quarter 2025 versus $243 million, or $0.59 per share, in the first quarter 2024, and included approximately $7 million

in net charges from special items. Net Income excluding special items was $351 million, or $0.86 per share, in the first quarter 2025,

versus $238 million, or $0.57 per share, in the first quarter 2024.

First quarter 2025 Operating Income was $494 million, up 34% year over

year. Operating Income excluding special items was $491 million, up 33% year over year. Operating Income Margin was 25.4%, up approximately

520 basis points year over year. First quarter 2025 Adjusted Operating Income Margin excluding special items was 25.3%, up approximately

500 basis points year over year.

First quarter 2025 Adjusted EBITDA excluding special items was $560

million, up 28% year over year. The year-over-year increase was driven by strong growth and performance in the commercial and defense

aerospace markets, partially offset by declines in the commercial transportation market. Adjusted EBITDA margin excluding special items

was up approximately 480 basis points year over year at 28.8%.

Howmet Aerospace Executive Chairman and Chief Executive Officer John

Plant said, “The Howmet team delivered a solid start to 2025, setting quarterly records in revenue, Adjusted EBITDA*,

Adjusted EBITDA margin*, and Adjusted Earnings Per Share* while exceeding all aspects of our baseline guidance. Margin progression within

the Fastening Systems and Engineered Structures segments was particularly noteworthy. Free cash flow was healthy at $134 million, up from

$95 million in the prior year, and marked the eighth consecutive quarter of positive free cash flow generation.”

Mr. Plant continued, “Free cash flow was deployed with a $0.10

per share common stock dividend, up 25% from the prior quarter, $125 million of common stock repurchases in the first quarter 2025, and

an additional $100 million of repurchases in April. Howmet Aerospace’s strong balance sheet continues to be recognized by the rating

agencies, with Fitch upgrading its debt rating on the Company to BBB+, three notches into Investment Grade.”

* Excluding special items

“Turning to the outlook, the commercial aerospace market remains

poised for continued growth. Air passenger traffic continues to grow, led more recently by Europe and Asia Pacific. There has been some

recent moderation in North American traffic growth, driven by tariff-related and economic uncertainty. Nevertheless, Howmet Aerospace’s

engine and airframe OEM customers continue to demonstrate growth, with record backlogs supported by under-build of aircraft in recent

years and the desire for new, fuel-efficient aircraft. We continue to expect healthy growth in the defense aerospace market as well as

industrial and other, with demand for industrial gas turbine fueled by significant data center expansion. For commercial transportation,

a potential increase in truck builds in the second half of 2025 is less certain, given tariff-related and economic uncertainty in North

America. However, our premium products and strong market position should allow Howmet Aerospace to continue to outperform the overall

market. While the tariff situation remains fluid, we expect to pass on tariff-related costs to our customers. Taking these factors into

account including the impact of tariffs, for the full year 2025 guidance, the revenue range has been widened with increases to Adjusted

EBITDA*, Adjusted EPS*, and Free Cash Flow. The balance sheet continues to strengthen, and liquidity remains healthy.”

First Quarter 2025 Segment Performance

Engine Products

(in U.S. dollar millions)

Third-party sales

$

$

$

$

$

Inter-segment sales

$

2

$

1

$

3

$

1

$

2

Provision for depreciation and amortization

$

$

$

$

$

Segment Adjusted EBITDA

$

$

$

$

$

Segment Adjusted EBITDA Margin

%

%

%

%

%

Restructuring and other charges (credits)

$

—

$

(1

)

$

1

$

1

$

—

Capital expenditures

$

$

$

$

$

Engine Products reported first quarter 2025 revenue of $996 million,

an increase of 13% year over year, due to growth in the commercial aerospace, defense aerospace, industrial gas turbine, and oil and gas

markets. Segment Adjusted EBITDA was $325 million, up 31% year over year, driven by favorable growth in the commercial aerospace, defense

aerospace, industrial gas turbine, and oil and gas markets. The Segment absorbed approximately 500 net headcount in the quarter in support

of expected revenue increases. Segment Adjusted EBITDA margin increased approximately 450 basis points year over year to 32.6%.

Fastening Systems

(in U.S. dollar millions)

Third-party sales

$

$

$

$

$

Inter-segment sales

$

—

$

—

$

—

$

1

$

—

Provision for depreciation and amortization

$

$

$

$

$

Segment Adjusted EBITDA

$

$

$

$

$

Segment Adjusted EBITDA Margin

%

%

%

%

%

Restructuring and other charges (credits)

$

—

$

2

$

1

$

2

$

—

Capital expenditures

$

7

$

5

$

5

$

9

$

Fastening Systems reported revenue of $412 million, an increase of

6% year over year due to growth in the commercial aerospace market, partially offset by declines in the commercial transportation market.

Segment Adjusted EBITDA was $127 million, up 38% year over year, driven by growth in the commercial aerospace market as well as productivity

gains, partially offset by declines in the commercial transportation market. Segment Adjusted EBITDA margin increased approximately 710

basis points year over year to 30.8%.

Engineered Structures

(in U.S. dollar millions)

Third-party sales

$

$

$

$

$

Inter-segment sales

$

1

$

3

$

3

$

3

$

3

Provision for depreciation and amortization

$

$

$

$

$

Segment Adjusted EBITDA

$

$

$

$

$

Segment Adjusted EBITDA Margin

%

%

%

%

%

Restructuring and other charges (credits)

$

—

$

$

1

$

(3

)

$

(4

)

Capital expenditures

$

6

$

5

$

5

$

4

$

5

Engineered Structures reported revenue of $282 million, an increase

of 8% year over year due to growth in the defense aerospace market. Segment Adjusted EBITDA was $60 million, up 62% year over year, driven

by growth in the defense aerospace market as well as productivity gains. Segment Adjusted EBITDA margin increased approximately 720 basis

points year over year to 21.3%.

Forged Wheels

(in U.S. dollar millions)

Third-party sales

$

$

$

$

$

Provision for depreciation and amortization

$

$

$

$

$

Segment Adjusted EBITDA

$

$

$

$

$

Segment Adjusted EBITDA Margin

%

%

%

%

%

Restructuring and other charges (credits)

$

—

$

—

$

1

$

—

$

—

Capital expenditures

$

$

9

$

$

$

Forged Wheels reported revenue of $252 million, a decrease of 13% year

over year due to lower volumes in the commercial transportation market, partially offset by an increase in aluminum and other inflationary

cost pass through. Segment Adjusted EBITDA was $68 million and decreased 17% year over year due to lower volumes in the commercial transportation

market. Segment Adjusted EBITDA margin decreased approximately 150 basis points year over year to 27.0%.

Repurchased $125 Million of Common Stock in First Quarter 2025,

In the first quarter 2025, Howmet Aerospace repurchased $125 million

of common stock at an average price of $124.24 per share, retiring approximately 1.0 million shares. In April 2025, the Company repurchased

an additional $100 million of common stock at an average price of $125.61 per share, retiring approximately 0.8 million shares. As of

April 30, 2025, total share repurchase authorization available was $1.972 billion.

Quarterly Common Stock Dividend of $0.10 Per Share Paid in First

On February 25, 2025, the Company paid a quarterly dividend of $0.10

per share on its common stock, up 100% from the $0.05 per share dividend paid in the first quarter 2024. The Board of Directors announced

a quarterly dividend of $0.10 per share on the Company’s common stock to be paid on May 27, 2025 to the holders of record of the

common stock at the close of business on May 9, 2025.

Fitch Upgraded Howmet Aerospace Rating to BBB+

On March 31, 2025, Fitch Ratings upgraded Howmet Aerospace’s

Long-Term Issuer Default Rating from BBB to BBB+, three notches into Investment Grade.

2025 Guidance: Includes current assumptions of tariff impacts

Low

Baseline

High

Low

Baseline

High

Revenue

Adj. EBITDA*1

Adj. EBITDA Margin*1

Adj. Earnings per Share*1

Free Cash Flow1

* Excluding Special Items

1 Reconciliations of the forward-looking non-GAAP financial

measures to the most directly comparable GAAP financial measures, as well as the directly comparable GAAP measures, are not available

without unreasonable efforts due to the variability and complexity of the charges and other components excluded from the non-GAAP measures,

such as gains or losses on sales of assets, taxes, and any future restructuring or impairment charges. In addition, there is inherent

variability already included in the GAAP measures, including, but not limited to, price/mix and volume. Howmet Aerospace believes such

reconciliations would imply a degree of precision that would be confusing or misleading to investors.

Howmet Aerospace will hold its quarterly conference call at 10:00

AM Eastern Time on Thursday, May 1, 2025. The call will be webcast via www.howmet.com. The press release and presentation materials will

be available at approximately 7:00 AM ET on May 1, via the “Investors” section of the Howmet Aerospace website.

About Howmet Aerospace

Howmet Aerospace Inc., headquartered

in Pittsburgh, Pennsylvania, is a leading global provider of advanced engineered solutions for the aerospace and transportation industries.

The Company’s primary businesses focus on jet engine components, aerospace fastening systems, and airframe structural components

necessary for mission-critical performance and efficiency in aerospace and defense applications, as well as forged aluminum wheels for

commercial transportation. With approximately 1,170 granted and pending patents, the Company’s differentiated technologies enable

lighter, more fuel-efficient aircraft and commercial trucks to operate with a lower carbon footprint. For more information, visit www.howmet.com.

Dissemination of Company Information

Howmet Aerospace intends to make future announcements regarding Company developments and financial performance through its website atwww.howmet.com.

Forward-Looking Statements

This release contains statements that relate to future events and expectations

and as such constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking

statements include those containing such words as "anticipates", "believes", "could", “envisions”, "estimates", "expects", "forecasts", "goal", "guidance", "intends", "may", "outlook", "plans", “poised”, "projects", "seeks", "sees", "should", "targets", "will", "would", or other words of similar meaning. All statements that reflect Howmet Aerospace’s

expectations, assumptions or projections about the future, other than statements of historical fact, are forward-looking statements, including,

without limitation, statements, forecasts and outlook relating to the condition of markets; future financial results or operating performance;

future strategic actions; Howmet Aerospace's strategies, outlook, and business and financial prospects; and any future dividends, debt

issuances, debt reduction and repurchases of its common stock. These statements reflect beliefs and assumptions that are based on Howmet

Aerospace’s perception of historical trends, current conditions and expected future developments, as well as other factors Howmet

Aerospace believes are appropriate in the circumstances. Forward-looking statements are not guarantees of future performance and are subject

to risks, uncertainties and changes in circumstances that are difficult to predict, which could cause actual results to differ materially

from those indicated by these statements. Such risks and uncertainties include, but are not limited to: (a) deterioration in global economic

and financial market conditions generally, or unfavorable changes in the markets served by Howmet Aerospace, including due to escalating

tariff and other trade policies and the resulting impacts on Howmet Aerospace’s supply and distribution chains, as well as on market

volatility and global trade generally; (b) the impact of potential cyber attacks and information technology or data security breaches;

(c) the loss of significant customers or adverse changes in customers’ business or financial conditions; (d) manufacturing difficulties

or other issues that impact product performance, quality or safety; (e) inability of suppliers to meet obligations due to supply chain

disruptions or otherwise; (f) failure to attract and retain a qualified workforce and key personnel, labor disputes or other employee

relations issues; (g) the inability to achieve improvement in or strengthening of financial performance, operations or competitiveness

anticipated or targeted; (h) inability to meet increased demand, production targets or commitments; (i) competition from new product offerings,

disruptive technologies or other developments; (j) geopolitical, economic, and regulatory risks relating to Howmet Aerospace’s global

operations, including geopolitical and diplomatic tensions, instabilities, conflicts and wars, as well as compliance with U.S. and foreign

trade and tax laws, sanctions, embargoes and other regulations; (k) the outcome of contingencies, including legal proceedings, government

or regulatory investigations, and environmental remediation; (l) failure to comply with government contracting regulations; (m) adverse

changes in discount rates or investment returns on pension assets; and (n) the other risk factors summarized in Howmet Aerospace’s

Form 10-K for the year ended December 31, 2024 and other reports filed with the U.S. Securities and Exchange Commission. Market projections

are subject to the risks discussed above and other risks in the market. Under its share repurchase program, the Company may repurchase

shares from time to time, in amounts, at prices, and at such times as the Company deems appropriate, subject to market conditions, legal

requirements and other considerations. The Company is not obligated to repurchase any specific number of shares or to do so at any particular

time. The declaration of any future dividends is subject to the discretion and approval of the Board of Directors after the Board’s

consideration of all factors it deems relevant and subject to applicable law. The Company may modify, suspend, or cancel its share repurchase

program or its dividend policy in any manner and at any time that it may deem necessary or appropriate. Credit ratings are not a recommendation

to buy or hold any Howmet Aerospace securities, and they may be revised or revoked at any time at the sole discretion of the credit rating

organizations. The statements in this release are made as of the date of this release, even if subsequently made available by Howmet Aerospace

on its website or otherwise. Howmet Aerospace disclaims any intention or obligation to update publicly any forward-looking statements,

whether in response to new information, future events, or otherwise, except as required by applicable law.

Non-GAAP Financial Measures

Some of the information included in this release is derived from Howmet

Aerospace’s consolidated financial information but is not presented in Howmet Aerospace’s financial statements prepared in

accordance with accounting principles generally accepted in the United States of America (GAAP). Certain of these data are considered “non-GAAP financial measures” under SEC rules. These non-GAAP financial measures supplement our GAAP disclosures and should

not be considered an alternative to the GAAP measure. Reconciliations to the most directly comparable GAAP financial measures and management’s

rationale for the use of the non-GAAP financial measures can be found in the schedules to this release.

Other Information

In this press release, the acronym “FY” means “full

year”; “Q” means “quarter”; “YoY” means year over year; “Adj.” means adjusted; and

references to performance by Howmet Aerospace or its segments as “record” mean its best result since April 1, 2020 when Howmet

Aerospace Inc. (previously named Arconic Inc.) separated from Arconic Corporation.

Howmet Aerospace Inc. and subsidiaries

Statement of Consolidated Operations (unaudited)

(in U.S. dollar millions, except per-share and share amounts)

Quarter ended

Sales

$

$

$

Cost of goods sold (exclusive of expenses below)

Selling, general administrative, and other expenses

Research and development expenses

8

7

Provision for depreciation and amortization

Restructuring and other credits

(4

)

—

—

Operating income

Interest expense, net

Other expense, net

9

Income before income taxes

Provision for income taxes

Net income

$

$

$

Amounts Attributable to Howmet Aerospace Common Shareholders:

Earnings per share - basic(1):

Net income per share

$

$

$

Average number of shares(2)(3)

Earnings per share - diluted(1):

Net income per share

$

$

$

Average number of shares(2)(3)

Common stock outstanding at the end of the period

(1)

In order to calculate both basic and diluted earnings per share, preferred stock dividends declared of less than $1 for the quarters

presented need to be subtracted from Net income.

(2)

For the quarters presented, the difference between the diluted average number of shares and the basic average number of shares relates

to share equivalents associated with outstanding restricted stock unit awards and employee stock options.

(3)

As average shares outstanding are used in the calculation of both basic and diluted earnings per share, the full impact of share repurchases

is not fully realized in earnings per share ("EPS") in the period of repurchase since share repurchases may occur at varying

points during a period.

Howmet Aerospace Inc. and subsidiaries

Consolidated Balance Sheet (unaudited)

(in U.S. dollar millions)

Assets

Current assets:

Cash and cash equivalents

$

$

Receivables from customers, less allowances of $— in both 2025 and 2024

Other receivables

Inventories

Prepaid expenses and other current assets

Total current assets

Properties, plants, and equipment, net

Goodwill

Deferred income taxes

Intangibles, net

Other noncurrent assets

Total assets

$

$

Liabilities

Current liabilities:

Accounts payable, trade

$

$

Accrued compensation and retirement costs

Taxes, including income taxes

Accrued interest payable

Other current liabilities

Long-term debt due within one year

7

6

Total current liabilities

Long-term debt

Accrued pension benefits

Accrued other postretirement benefits

Other noncurrent liabilities and deferred credits

Total liabilities

Equity

Howmet Aerospace shareholders’ equity:

Preferred stock

Common stock

Additional capital

Retained earnings

Accumulated other comprehensive loss

)

)

Total equity

Total liabilities and equity

$

$

Howmet Aerospace Inc. and subsidiaries

Statement of Consolidated Cash Flows (unaudited)

(in U.S. dollar millions)

First quarter ended March 31,

Operating activities

Net income

$

$

Adjustments to reconcile net income to cash provided from operations:

Depreciation and amortization

Deferred income taxes

Restructuring and other credits

(4

)

—

Net realized and unrealized losses

5

7

Net periodic pension cost

Stock-based compensation

Other

3

1

Changes in assets and liabilities, excluding effects of acquisitions, divestitures, and foreign currency translation adjustments:

Increase in receivables

)

)

Increase in inventories

)

)

Decrease in prepaid expenses and other current assets

Increase in accounts payable, trade

Decrease in accrued expenses

)

)

Increase in taxes, including income taxes

Pension contributions

—

(2

)

Increase in noncurrent assets

(1

)

(2

)

Decrease in noncurrent liabilities

)

(9

)

Cash provided from operations

Financing Activities

Repurchases and payments on debt

(1

)

—

Repurchases of common stock

)

)

Proceeds from exercise of employee stock options

1

5

Dividends paid to shareholders

)

)

Taxes paid for net share settlement of equity awards

—

)

Cash used for financing activities

)

)

Investing Activities

Capital expenditures

)

)

Proceeds from the sale of assets and businesses

5

7

Other

(1

)

—

Cash used for investing activities

)

)

Effect of exchange rate changes on cash, cash equivalents and restricted cash

1

—

Net change in cash, cash equivalents and restricted cash

)

)

Cash, cash equivalents and restricted cash at beginning of period

Cash, cash equivalents and restricted cash at end of period

$

$

Howmet Aerospace Inc. and subsidiaries

Segment Information (unaudited)

(in U.S. dollar millions)

Engine Products

Third-party sales

$

$

$

$

$

$

Inter-segment sales

$

2

$

1

$

3

$

1

$

7

$

2

Provision for depreciation and amortization

$

$

$

$

$

$

Segment Adjusted EBITDA

$

$

$

$

$

$

Segment Adjusted EBITDA Margin

%

%

%

%

%

%

Restructuring and other (credits) charges

$

—

$

(1

)

$

1

$

1

$

1

$

—

Capital expenditures

$

$

$

$

$

$

Fastening Systems

Third-party sales

$

$

$

$

$

$

Inter-segment sales

$

—

$

—

$

—

$

1

$

1

$

—

Provision for depreciation and amortization

$

$

$

$

$

$

Segment Adjusted EBITDA

$

$

$

$

$

$

Segment Adjusted EBITDA Margin

%

%

%

%

%

%

Restructuring and other charges

$

—

$

2

$

1

$

2

$

5

$

—

Capital expenditures

$

7

$

5

$

5

$

9

$

$

Engineered Structures

Third-party sales

$

$

$

$

$

$

Inter-segment sales

$

1

$

3

$

3

$

3

$

$

3

Provision for depreciation and amortization

$

$

$

$

$

$

Segment Adjusted EBITDA

$

$

$

$

$

$

Segment Adjusted EBITDA Margin

%

%

%

%

%

%

Restructuring and other charges (credits)

$

—

$

$

1

$

(3

)

$

$

(4

)

Capital expenditures

$

6

$

5

$

5

$

4

$

$

5

Forged Wheels

Third-party sales

$

$

$

$

$

$

Provision for depreciation and amortization

$

$

$

$

$

$

Segment Adjusted EBITDA

$

$

$

$

$

$

Segment Adjusted EBITDA Margin

%

%

%

%

%

%

Restructuring and other charges

$

—

$

—

$

1

$

—

$

1

$

—

Capital expenditures

$

$

9

$

$

$

$

Differences between the total segment and consolidated

totals are in Corporate.

Howmet Aerospace Inc. and subsidiaries

Calculation of Financial Measures (unaudited)

(in U.S. dollar millions)

Reconciliation of Total Segment Adjusted EBITDA to Consolidated Income Before Income Taxes

Income before income taxes

$

$

$

$

$

$

Loss on debt redemption

—

—

6

—

6

—

Interest expense, net

Other expense, net

9

Operating income

$

$

$

$

$

$

Segment provision for depreciation and amortization

Unallocated amounts:

Restructuring and other charges (credits)

—

(1

)

—

(4

)

Corporate expense(1)

Total Segment Adjusted EBITDA

$

$

$

$

$

$

Total Segment Adjusted

EBITDA is a non-GAAP financial measure. Management believes that this measure is meaningful to investors because Total Segment Adjusted

EBITDA provides additional information with respect to the Company's operating performance and the Company’s ability to meet its

financial obligations. The Total Segment Adjusted EBITDA presented may not be comparable to similarly titled measures of other companies.

Howmet’s definition of Total Segment Adjusted EBITDA (Earnings before interest, taxes, depreciation, and amortization) is net margin

plus an add-back for depreciation and amortization. Net margin is equivalent to Sales minus the following items: Cost of goods sold; Selling,

general administrative, and other expenses; Research and development expenses; and Provision for depreciation and amortization. Special

items, including Restructuring and other charges (credits), are excluded from net margin and Segment Adjusted EBITDA. Differences between

the total segment and consolidated totals are in Corporate.

(1) Pre-tax special items included in Corporate expense

Plant fire reimbursements, net

$

—

$

(6

)

$

—

$

)

$

)

$

—

Costs (benefits) associated with closures, supply chain disruptions, and other items

1

—

(1

)

1

1

1

Total Pre-tax special items included in Corporate expense

$

1

$

(6

)

$

(1

)

$

)

$

)

$

1

Howmet Aerospace Inc. and subsidiaries

Calculation of Financial Measures (unaudited), continued

(in U.S. dollars millions)

Reconciliation of Free cash flow

Quarter ended

Cash provided from operations

$

$

Capital expenditures

)

)

Free cash flow

$

$

The Accounts Receivable Securitization program remains unchanged at

Free cash flow is a non-GAAP financial measure. Management believes

that this measure is meaningful to investors because management reviews cash flows generated from operations after taking into consideration

capital expenditures (due to the fact that these expenditures are considered necessary to maintain and expand the Company's asset base

and are expected to generate future cash flows from operations). It is important to note that Free cash flow does not represent the residual

cash flow available for discretionary expenditures since other non-discretionary expenditures, such as mandatory debt service requirements,

are not deducted from the measure.

Howmet Aerospace Inc. and subsidiaries

Calculation of Financial Measures (unaudited), continued

(in U.S. dollar millions, except per-share and share amounts)

Reconciliation of Net income excluding Special items

Quarter ended

Net income

$

$

$

Diluted earnings per share ("EPS")

$

$

$

Average number of diluted shares

Special items:

Restructuring and other credits

—

—

(4

)

Plant fire reimbursements, net

—

)

—

Costs associated with closures, supply chain disruptions, and other items

1

1

1

Subtotal: Pre-tax special items

1

)

(3

)

Tax impact of Pre-tax special items(1)

—

2

1

Subtotal

1

(9

)

(2

)

Discrete and other tax special items(2)

(6

)

(2

)

9

Total: After-tax special items

(5

)

)

7

Net income excluding Special items

$

$

$

Diluted EPS excluding Special items

$

$

$

Net income excluding Special

items and Diluted EPS excluding Special items are non-GAAP financial measures. Management believes that these measures are meaningful

to investors because management reviews the operating results of the Company excluding the impacts of Restructuring and other credits,

Discrete tax items, and Other special items (collectively, “Special items”). There can be no assurances that additional Special

items will not occur in future periods. To compensate for this limitation, management believes that it is appropriate to consider both

Net income and Diluted EPS determined under GAAP as well as Net income excluding Special items and Diluted EPS excluding Special items.

(1)

The Tax impact of Pre-tax special items is based on the applicable statutory rates whereby the difference between such rates and the

Company’s consolidated estimated annual effective tax rate is itself a Special item.

(2)

Discrete tax items for each period included the following:

•

for 1Q24, a benefit to release a valuation allowance related to U.S. foreign tax credits ($6), and a net benefit for other small items

($1);

•

for 4Q24, a benefit to release a valuation allowance related to U.S. state tax losses and credits ($6), an excess tax benefit for

stock compensation ($1), a charge for prior year audit assessments and tax adjustments $4, and a charge to adjust a valuation allowance

related to U.S. foreign tax credits $2; and

•

for 1Q25, a net charge related to the expiration of a tax holiday in China $6, a charge for a tax reserve established in Germany $2,

and a net charge for other small items $1.

Howmet Aerospace Inc. and subsidiaries

Calculation of Financial Measures (unaudited), continued

(in U.S. dollar millions)

Reconciliation of Operational tax rate

Effective tax rate, as reported

Special items(1)(2)

Operational tax rate, as adjusted

Income before income taxes

$

$

(3

)

$

Provision for income taxes

$

$

)

$

Tax rate

%

%

Operational tax rate is a non-GAAP financial measure. Management believes

that this measure is meaningful to investors because management reviews the operating results of the Company excluding the impacts of

Special items. There can be no assurances that additional Special items will not occur in future periods. To compensate for this limitation,

management believes that it is appropriate to consider both the Effective tax rate determined under GAAP as well as the Operational tax

rate.

(1)

Pre-tax special items for 1Q25 included Restructuring and other credits ($4), partially offset by Costs associated with closures,

supply chain disruptions, and other items $1.

(2)

Tax Special items includes discrete tax items, the tax impact on Special items based on the applicable statutory rates, the difference

between such rates and the Company’s consolidated estimated annual effective tax rate and other tax related items. Discrete tax

items for 1Q25 included a net charge related to the expiration of a tax holiday in China $6, a charge for a tax reserve established in

Germany $2, and a net charge for other small items $1.

Howmet Aerospace Inc. and subsidiaries

Calculation of Financial Measures (unaudited), continued

(in U.S. dollars millions)

Reconciliation of Adjusted EBITDA and Adjusted EBITDA

Quarter ended

margin excluding Special items

Sales

$

$

$

Operating income

$

$

$

Operating income margin

%

%

%

Net income

$

$

$

Add:

Provision for income taxes

$

$

$

Other expense, net

9

Interest expense, net

Restructuring and other credits

—

—

(4

)

Provision for depreciation and amortization

Adjusted EBITDA

$

$

$

Add:

Plant fire reimbursements, net

$

—

$

)

$

—

Costs associated with closures, supply chain disruptions, and other items

1

1

1

Adjusted EBITDA excluding Special items

$

$

$

Adjusted EBITDA margin excluding Special items

%

%

%

Incremental margin

Quarter ended

Third-party sales (a)

Operating income (b)

Adjusted EBITDA excluding Special items (c)

Incremental operating income margin (b)/(a)

Incremental margin (c)/(a)

Adjusted EBITDA, Adjusted EBITDA excluding Special items, Adjusted

EBITDA margin excluding Special items, Third-party sales, and Incremental margin are non-GAAP financial measures. Management believes

that these measures are meaningful to investors because they provide additional information with respect to the Company's operating performance

and the Company’s ability to meet its financial obligations. The Adjusted EBITDA presented may not be comparable to similarly titled

measures of other companies. The Company's definition of Adjusted EBITDA (Earnings before interest, taxes, depreciation, and amortization)

is net margin plus an add-back for depreciation and amortization. Net margin is equivalent to Sales minus the following items: Cost of

goods sold, Selling, general administrative, and other expenses, Research and development expenses, and Provision for depreciation and

amortization. Special items, including Restructuring and other credits, are excluded from Adjusted EBITDA.

Howmet Aerospace Inc. and subsidiaries

Calculation of Financial Measures (unaudited), continued

(in U.S. dollar millions)

Reconciliation of Adjusted Operating Income Excluding Special

Quarter ended

Items and Adjusted Operating Income Margin Excluding Special Items

Sales

$

$

$

Operating income

$

$

$

Operating income margin

%

%

%

Add:

Restructuring and other credits

$

—

$

—

$

(4

)

Plant fire reimbursements, net

—

)

—

Costs associated with closures, supply chain disruptions, and other items

1

1

1

Adjusted operating income excluding Special items

$

$

$

Adjusted operating income margin excluding Special items

%

%

%

Adjusted operating income excluding Special items and Adjusted operating

income margin excluding Special items are non-GAAP financial measures. Special items, including Restructuring and other credits, are excluded

from Adjusted operating income. Management believes that these measures are meaningful to investors because management reviews the operating

results of the Company excluding the impacts of Special items. There can be no assurances that additional Special items will not occur

in future periods. To compensate for this limitation, management believes that it is appropriate to consider both Operating income determined

under GAAP as well as Operating income excluding Special items.