Blue Bird 2Q25: Thesis Intact

Revenue: 3.7% y/y

Unit Volume: 2295 Buses, 265 EVs

Gross Margin: 19.7%

Diluted EPS: $0.79

I'm surprised by the reaction to this earnings print from Blue Bird. I thought it was very positive but the market seems to be lukewarm. I think this can be attributed to Blue Bird lowering their EV shipment guidance for the year from 1000+ to 800-1000 or because the stock had already risen ~12% leading up to the call. The numbers weren't incredible but they beat the expectations I had modeled and shipped more EVs than I had anticipated. They also announced a new bus chassis which apparently had overwhelmingly good feedback at WorkTruck Week 2025. I wish I had a little bit more of a platform than this blog and could speak to industry experts about how significant this is.

Blue Bird also stated that Rounds 2 and 3 of the EPA funding are flowing to school districts which is a really good sign on the regulatory front. They gave some further clarification on tariffs which the following slide summarizes:

The EVs and Alternative buses are more effected by the tariffs than ICE engine buses. Management signaled they may have a higher mix shift of ICE buses sold through FY25 because of this. I'll watch for that but nothing about the thesis has changed. This is still the dominant OEM in alternative school buses and there is pent-up demand for replacing old school buses. This quarter's strong volumes and solid gross margin support these theses, and I'll watch for more certainty on the tariffs front.