Gentex Q4 Earnings Miss Expectations, Sales Decline Y/Y

Core Insights - Gentex Corporation (GNTX) reported a fourth-quarter 2024 earnings per share (EPS) of 39 cents, missing the Zacks Consensus Estimate of 49 cents and reflecting a 22% year-over-year decline [1] - The company’s net sales for the quarter were $542 million, falling short of the Zacks Consensus Estimate of $602 million and decreasing by 8% compared to the previous year [2] Financial Performance - Gross margin for the quarter was 32.5%, down 200 basis points from the fourth quarter of 2023, attributed to lower-than-expected sales, an unfavorable product mix, and challenges in overhead cost management [2] - Total operating expenses increased by 22% year over year to $86.5 million, with engineering and R&D expenses rising to $47.06 million from $41.53 million, and SG&A expenses increasing to $30.53 million from $29.06 million [5] Segmental Performance - The Automotive segment, which is the primary revenue contributor, reported net sales of $531.3 million, down from $578.7 million in the year-ago quarter and below the estimate of $585.9 million [3] - Auto-dimming mirror shipments in North America decreased by 10% to 3,438,000 units, while international shipments fell by 14% year over year to 7,339,000 units, leading to a total shipment decline of 13% to 10,777,000 units [3] Other Sales and Dividends - Other net sales, including dimmable aircraft windows and fire protection products, decreased from $10.5 million to $10.3 million, missing the estimate of $13.5 million [4] - Gentex paid a dividend of 12 cents per share during the quarter and repurchased 603,396 shares at an average price of $30.54 per share, with nearly 9.4 million shares remaining for buyback as of December 31, 2024 [6] 2025 Guidance - For 2025, Gentex expects net sales to be in the range of $2.40-$2.45 billion, compared to $2.31 billion in 2024, with a projected gross margin of 33.5-34.5% [7] - Capital expenditure is anticipated to be between $125 million and $150 million, while operating expenses are estimated to be in the range of $310-$320 million [7]