Universal Electronics(US:UEIC)2025-11-06 22:24Financial Performance - Net sales for the three months ended September 30, 2025, were $90.552 million, a decrease of 11.3% compared to $102.073 million for the same period in 2024[40]. - The company reported net sales of $280.543 million for the nine months ended September 30, 2025, a slight decrease of 1.4% compared to $284.425 million for the same period in 2024[40]. - For the three months ended September 30, 2025, the company reported a net loss of $8.33 million, compared to a net loss of $2.66 million for the same period in 2024[125]. - The basic earnings per share for the three months ended September 30, 2025, was $(0.62), compared to $(0.20) for the same period in 2024[125]. - Total revenue for the three months ended September 30, 2025, was $90.55 million, down from $102.07 million in the same period of 2024, representing a decrease of approximately 11.4%[130]. Revenue Breakdown - Revenue from the connected home channel increased to $29.793 million for the three months ended September 30, 2025, up 12.4% from $26.368 million in the same period of 2024[40]. - Revenue from the home entertainment channel decreased to $60.759 million for the three months ended September 30, 2025, down 19.7% from $75.705 million in the same period of 2024[40]. - Net sales to Daikin Industries Ltd. increased to $18,576 thousand, representing 20.5% of net sales for the three months ended September 30, 2025, compared to 12.4% for the same period in 2024[49]. Cash and Liquidity - Total cash and cash equivalents increased to $31.506 million as of September 30, 2025, up from $26.783 million at December 31, 2024, representing a growth of 10.2%[39]. - The U.S. Credit Line has a maximum availability of $75.0 million, with total availability of $54.1 million based on the accounts receivable coverage ratio as of September 30, 2025[66]. - As of September 30, 2025, the total interest expense on borrowings under the U.S. Credit Line was $0.4 million, down from $1.0 million for the same period in 2024, representing a decrease of 60%[70]. - The China Credit Line had a maximum availability of up to RMB 130.0 million (approximately $18.3 million) as of September 30, 2025, with no remaining availability[73]. Assets and Liabilities - Accounts receivable, net decreased to $83.800 million as of September 30, 2025, from $114.182 million at December 31, 2024, a decline of 26.6%[43]. - Total inventories as of September 30, 2025, amounted to $80,605 thousand, a slight increase from $79,355 thousand as of December 31, 2024[50]. - Long-lived tangible assets decreased to $40,334 thousand as of September 30, 2025, down from $48,529 thousand at December 31, 2024[54]. - Total intangible assets, net, decreased to $22,583 thousand as of September 30, 2025, from $24,038 thousand at December 31, 2024[58]. - The total accrued compensation as of September 30, 2025, was $19.1 million, a decrease from $20.9 million at December 31, 2024, reflecting a reduction of approximately 8.6%[85]. Expenses and Charges - The company recorded impairment charges of $1.2 million related to the shutdown of its Mexico manufacturing facility during the three and nine months ended September 30, 2025[56]. - The company incurred severance expenses of $1.7 million for the three months ended September 30, 2025, as part of a global reduction in force strategy[84]. - The company recognized a total of $4.6 million in factory restructuring charges since September 2023, with no further expenses expected from this plan[92]. - Total restructuring costs incurred from inception to date amount to $7.6 million, with severance expenses at $5.4 million and other exit expenses at $2.2 million[96]. Legal Matters - The arbitration ruling in favor of the company against IT Convergence awarded approximately $0.2 million, with both parties having 90 days to appeal[110]. - The company recorded an accrual of approximately $4.2 million for a judgment in favor of Tongshun Company, which was paid during the second quarter of 2025[109]. - In the litigation against Roku, the Federal Circuit affirmed the invalidation of Roku's patent claims on June 17, 2025, which is expected to impact future legal proceedings[104]. - The trial date for the consolidated district court case against Roku is set for March 16, 2027, following the lifting of a stay on the case[103].