Key Tronic Earnings Call Transcripts
Fiscal Year 2026
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Revenue declined year-over-year due to legacy customer demand and program transitions, but gross margin improved on cost efficiencies. New program wins and expanded U.S./Vietnam capacity are expected to drive sequential revenue growth and a return to profitability in Q4 FY2026.
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Q2 FY2026 saw revenue decline and a net loss due to reduced demand and restructuring charges, but new program wins and cost-saving initiatives are expected to drive future growth. Major investments in U.S. and Vietnam facilities position the company for recovery and margin improvement.
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Revenue fell 25% year-over-year to $98.8 million, with a net loss of $2.3 million, as customer demand softened and new program launches were delayed. Gross margin improved sequentially, and new programs in the U.S. and Vietnam are ramping, but profitability depends on further execution and filling excess capacity in Mexico.
Fiscal Year 2025
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Revenue and profitability declined sharply year-over-year due to reduced demand and tariff-related delays, but operational efficiencies and cost reductions improved gross margins. New program wins, facility expansions in Arkansas and Vietnam, and a strong pipeline position the company for future growth.
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Q3 FY25 saw revenue drop to $112M and a net loss of $0.6M, but gross margin improved to 7.7% due to cost reductions. New business wins and expansions in Arkansas and Vietnam aim to offset tariff and demand challenges, with no Q4 guidance given amid ongoing uncertainty.
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Q2 FY25 saw revenue drop to $113.9M and a net loss of $4.9M, mainly due to component shortages and reduced demand. Margins and profitability are expected to recover as new programs ramp and operational improvements take effect, but tariff uncertainties persist.
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Q1 FY25 revenue declined year-over-year due to $9M in program delays, but operating efficiencies, margin improvements, and inventory reductions drove higher net income. Guidance for Q2 expects stable revenue and continued margin strength, with Vietnam poised for growth.
Fiscal Year 2024
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Fiscal 2024 saw revenue decline due to weather and a cyber incident, but gross margin improved to 9% and adjusted net income rose year-over-year. Cost reductions, new program wins, and a strong business pipeline position the company for growth and higher profitability in fiscal 2025.