The Productivity Treadmill
13 of 15 filers across 1 sector are flagging higher cost pressure. Accelerated into 2025Q2, since cooling. Consensus loosened: 2025Q1 was 86% rising; 2026Q1 now 50%. Reached 6 sectors at its 2025Q4 peak, now concentrated in 1 sector. Almost entirely a cost story (99%). Shifting from explaining to guiding — the narrative is turning forward. Recent filings describe "Product price increases are in excess of material and inflationary cost pass through."
APD is offsetting fixed-cost inflation and depreciation through disciplined productivity improvements, but the two forces are in close contest with no clear winner.
DISTINCT NEW FILERS PER QUARTER
✦ WHAT THE DIFF CAUGHT
Rhetoric shifted from backward-looking cost reconciliation (explaining historical trade-offs) to present-tense prioritization (positioning cost discipline as an active competitive weapon against ongoing inflation).
REPRESENTATIVE SIGNAL FROM FILINGS
“Product price increases are in excess of material and inflationary cost pass through”
Product price increases exceed material and inflationary cost pass-through to customers, expanding margins.
“The higher costs reflect inflation, depreciation, and incentive compensation, which were partially mitigated by productivity improvements”
Inflation in costs increased during the first half of fiscal 2025, partially mitigated by productivity improvements.
DRIVERS