Oct 30, 2026 earnings call — Transformation progress and full-year outlook
Generated $10.8 million in cash from operations and ended the quarter with $111.8 million in cash and no debt.
Revenue $0.1B (est $0.1B) · EPS $1.85 (est $1.47)
Key quotes
"Including these actions, the annualized savings associated with restructuring initiatives implemented since we began the transformation in fiscal 2025 are over $10 million."
"During the quarter, we repurchased approximately 68,000 shares for $5 million while continuing to build our cash balance."
"We have an active funnel of acquisition targets and incurred $2.4 million in business development expenses during the quarter, primarily related to advancing these opportunities."
Analyst Q&A 2
Gross margin, engineering expense, and acquisition timing
Q (John Franzreb · Sidoti): The analyst asked why management guided to a lower full-year gross margin after a 16.6% quarter, and asked how SAE costs and the ED&D recoveries should be viewed going forward. He also asked about the likely size and timing of any acquisition given the recent charge.
A: Management said lower volumes are the main reason for the weaker margin outlook, and that currency could help while material costs are rising; restructuring will help in the second half. They said SAE was about $15 million in the quarter, which included about $1 million fee of ED&D, so adjusted it is probably $16.5 million, and ED&D recoveries are frequent but not to that magnitude. On acquisitions, there is no exact size formula, they are using advisors, and timing is hard to specify.
"That is the biggest reason for the range on the gross margin going forward of 15%-16%." — Matthew Pauli (CFO)
New model wins and share buybacks
Q (Ethan Starr): The analyst asked what progress the company has made winning business on future new vehicle models and new content, and he asked whether the company will continue to repurchase shares.
A: Management said automotive is a long-cycle business and they will follow North American production over the next two years; they are actively engaged with current and new customers and are making progress but won’t have visibility beyond two years until probably the end of the fiscal year. They also said share repurchases are part of how they are thinking about deploying capital, along with investing in the business and evaluating acquisitions.
"We really won't have line of sight to something beyond the next two years until probably the end of our fiscal year." — Jennifer Slater (CEO)