Kimball Electronics Q2 Earnings Match Estimates, Revenues Decline Y/Y

Core Insights - Kimball Electronics (KE) reported second-quarter fiscal 2026 earnings of 28 cents per share, matching Zacks Consensus Estimates, but down from 29 cents per share a year ago [1][10] - Revenues for the quarter were $341.28 million, missing the Zacks Consensus Estimate by 0.36% and down from $357.4 million in the same quarter last year [1][10] Financial Performance - The medical vertical contributed 28% to KE's second-quarter revenue, growing 15% year over year to $96.3 million, driven by strong performance in core medical programs [3] - The automotive vertical, accounting for 48% of total revenue, declined 13% year over year to $162.3 million [4] - The industrial segment, contributing 24% of total revenues, saw a 5% year-over-year decline to $82.7 million [5] - Gross profit increased 19% year over year to $27.8 million, with gross margin rising 160 basis points to 8.2% [6] - Non-GAAP operating income was $15.31 million, up 14.8% year over year, with a non-GAAP operating margin increase of 80 basis points to 4.5% [6] Balance Sheet and Cash Flow - As of December 31, 2025, KE had cash and cash equivalents of $77.85 million, up from $75.7 million as of September 30, 2025 [7] - The company generated $6.9 million in cash from operations, marking the eighth consecutive quarter of positive operating cash flow [7] - Total debt stood at $154.2 million [7] Guidance and Outlook - For fiscal 2026, KE raised its net sales guidance to a range of $1.40 billion to $1.46 billion, up from the previous outlook of $1.35 billion to $1.45 billion [8] - The Zacks Consensus Estimate for fiscal 2026 revenues is $1.41 billion, indicating a year-over-year decline of 5.4% [8] - Adjusted operating income is projected to be 4.2% to 4.5% of net sales, an increase from the earlier estimate of 4.0% to 4.25% [9]