Methode Electronics, Inc. (MEI) Announces Fiscal 2026 First Quarter Financial Earnings Results

Methode Electronics, Inc. (MEI) today announced its financial results for the most recent quarter, showcasing a strong performance that exceeded expectations. The company reported earnings per share of -$0.29, beating the consensus estimate of -$0.35 by $0.06. Additionally, Methode Electronics achieved quarterly revenue of $240.5 million, surpassing the revenue estimate of $219.7 million by $20.8 million.

Key Highlights:

• Net sales for Q1 FY2026 were $240.5 million, down from $258.5 million in the same quarter last year.
• Electric and hybrid vehicle applications accounted for 19% of net sales.
• Income from operations increased by $8.6 million, reaching $1.1 million.
• The company reported a net loss of $10.3 million, or $0.29 per diluted share.
• Free cash flow was strong at $18.0 million, marking the third consecutive quarter of positive free cash flow.
• Net debt decreased by $41 million over the last three quarters, totaling $202.3 million.
• The company affirmed its fiscal 2026 guidance, expecting net sales between $900 million and $1 billion and EBITDA between $70 million and $80 million.

Summary: Methode Electronics, Inc. reported its financial results for the first quarter of fiscal 2026, highlighting a net sales figure of $240.5 million, which reflects a decrease from the previous year. The decline was primarily attributed to lower sales in the Automotive segment, offset somewhat by growth in the Industrial segment, particularly in power products for data centers. President and CEO Jon DeGaynor noted, “The Methode transformation journey made further progress in the quarter and is firmly on track, as we continued to reduce costs and improve execution.” He emphasized the significant increase in operating income despite lower sales, showcasing the company’s operational improvements.

Looking ahead, Methode has reaffirmed its guidance for fiscal 2026, projecting net sales between $900 million and $1 billion and an EBITDA range of $70 million to $80 million. DeGaynor expressed confidence in the company’s trajectory, stating, “I am very proud of the hard work that the Methode team has put into our transformation, and the progress is tangible.” The company anticipates a stronger performance in the second half of the fiscal year, despite challenges such as declining EV demand and various market uncertainties.

Methode Electronics, Inc. (MEI) has experienced a tumultuous ride in the stock market, with a notable 6.21% decline over the past week, reflecting investor concerns about its financial health. Despite a more optimistic one-month increase of 11.88%, the stock has struggled significantly over the past year, down nearly 21%. The company’s fundamentals paint a concerning picture, with a negative price-to-earnings ratio of -4.08 and a net profit margin of -6.16%, indicating ongoing profitability challenges. Additionally, the revenue and free cash flow have both seen negative growth rates over the past two years, with declines of 5.74% and a staggering 71.98%, respectively. This raises questions about the company’s operational efficiency and ability to generate cash. Furthermore, a return on invested capital of -3.99% suggests that Methode is not effectively utilizing its investments to generate returns. As investors weigh these metrics against the stock’s recent volatility, the outlook for Methode Electronics remains uncertain, highlighting the need for a strategic turnaround to restore confidence.

Methode Electronics, Inc. designs, engineers, and produces mechatronic products worldwide. It operates through four segments: Automotive, Industrial, Interface, and Medical. The Automotive segment supplies electronic and electro-mechanical devices, and related products to automobile original equipment manufacturers directly or through their tiered suppliers. Its products include integrated center consoles, hidden switches, ergonomic switches, transmission lead-frames, and LED-based lighting and sensors, which incorporate magneto-elastic sensing and other technologies that monitor the operation or status of a component or system. The Industrial segment manufactures lighting solutions; industrial safety radio remote controls; braided flexible cables; current-carrying laminated busbars and devices; custom power-product assemblies, such as PowerRail solution; high-current low-voltage flexible power cabling systems; and powder-coated busbars that are used in various markets and applications comprising aerospace, cloud computing, commercial vehicles, industrial, military, power conversion, and transportation. The Interface segment provides various copper-based transceivers and related accessories for the cloud computing hardware equipment and telecommunications broadband equipment markets; user interface solutions for the appliance, commercial food service, and point-of-sale equipment markets; and fluid-level sensors for the marine/recreational vehicle and sump pump markets. The Medical segment offers Dabir Surfaces, a surface support technology aimed at pressure injury prevention for use by patients who are immobilized or otherwise at risk for pressure injuries, including patients undergoing long-duration surgical procedures. Methode Electronics, Inc. was incorporated in 1946 and is headquartered in Chicago, Illinois.