Kimball Electronics, a global contract manufacturer specializing in electronics and manufacturing solutions for automotive, medical, and industrial markets, reported revenue ahead of Wall Street’s expectations in Q1 CY2025. The company’s sales fell by 11.9% year on year to $374.6 million but beat analyst estimates by 10.8%. Kimball Electronics expects the full year’s revenue to be around $1.42 billion, close to analysts’ estimates.
The company’s non-GAAP profit of $0.27 per share was 42.1% above analysts’ consensus estimates. This performance is a positive signal for investors, but it is essential to analyze the company’s long-term sales growth and profitability to determine if it is a good investment opportunity.
Kimball Electronics has been in operation since 1961, and its revenue growth over the last five years has been sluggish at 4.5% compounded annual growth rate (CAGR). This falls short of our benchmark for the industrials sector and raises concerns about the company’s ability to sustain growth in a competitive market.
Looking at Kimball Electronics’ quarterly revenue growth, we see that it has been growing but relinquishing its gains over the last two years. The company’s revenue fell by 5% annually over this period, which is a decline from the previous year. This trend indicates that Kimball Electronics may be struggling to adapt to changing market conditions and customer demands.
In Q1 CY2025, Kimball Electronics’ revenue fell by 11.9% year on year to $374.6 million but beat Wall Street’s estimates by 10.8%. The company expects the full year’s revenue to be around $1.42 billion, close to analysts’ estimates. This performance is a mixed bag, with both positive and negative signals.
One of the key takeaways from Kimball Electronics’ Q1 results is its operating margin. The company reported an operating profit margin of 3.1% in Q1 CY2025, down from 4.1% in the same quarter last year. This decline in profitability raises concerns about the company’s ability to maintain its competitiveness and generate sustainable profits.
Kimball Electronics’ earnings per share (EPS) also declined by 23% over the last two years. This drop in EPS is a cause for concern, as it indicates that the company may be struggling to adjust to shrinking demand and changing market conditions. The decline in EPS is further exacerbated by the company’s operating margin decline.
The company’s revenue guidance for the full year of $1.42 billion at the midpoint is an essential aspect to consider when evaluating Kimball Electronics’ performance. The company has consistently reported higher revenue than analyst estimates, but its ability to sustain this trend over the long term remains uncertain.
The market capitalization of Kimball Electronics stands at $360.2 million, which is a significant figure considering the company’s revenue and profitability. However, it is essential to consider the company’s industry and competitive landscape when evaluating its market value.
In conclusion, while Kimball Electronics’ Q1 CY2025 results show some positive signs, such as beating analyst estimates and reporting higher revenue than expected, there are also concerns about the company’s long-term sales growth and profitability. The decline in EPS and operating margin raises questions about the company’s ability to sustain its competitiveness and generate sustainable profits.
Sales Growth Analysis
Kimball Electronics’ sales growth has been sluggish over the last five years, with a CAGR of 4.5%. This falls short of our benchmark for the industrials sector and raises concerns about the company’s ability to sustain growth in a competitive market.
The company’s revenue fell by 5% annually over the last two years, which is a decline from the previous year. This trend indicates that Kimball Electronics may be struggling to adapt to changing market conditions and customer demands.
Quarterly Revenue Growth Analysis
Kimball Electronics’ quarterly revenue growth has been growing but relinquishing its gains over the last two years. The company’s revenue fell by 5% annually over this period, which is a decline from the previous year.
This trend indicates that Kimball Electronics may be struggling to adapt to changing market conditions and customer demands. In Q1 CY2025, the company’s revenue fell by 11.9% year on year to $374.6 million but beat Wall Street’s estimates by 10.8%.
Operating Margin Analysis
Kimball Electronics’ operating profit margin declined from 4.1% in the same quarter last year to 3.1% in Q1 CY2025. This decline in profitability raises concerns about the company’s ability to maintain its competitiveness and generate sustainable profits.
The decline in EPS is further exacerbated by the company’s operating margin decline. Kimball Electronics’ non-GAAP profit of $0.27 per share was 42.1% above analysts’ consensus estimates, but this positive signal is overshadowed by concerns about the company’s long-term sales growth and profitability.
Earnings Per Share Analysis
Kimball Electronics’ EPS declined by 23% over the last two years. This drop in EPS is a cause for concern, as it indicates that the company may be struggling to adjust to shrinking demand and changing market conditions.
The decline in EPS is further exacerbated by the company’s operating margin decline. Kimball Electronics’ non-GAAP profit of $0.27 per share was 42.1% above analysts’ consensus estimates, but this positive signal is overshadowed by concerns about the company’s long-term sales growth and profitability.
Conclusion
In conclusion, while Kimball Electronics’ Q1 CY2025 results show some positive signs, such as beating analyst estimates and reporting higher revenue than expected, there are also concerns about the company’s long-term sales growth and profitability. The decline in EPS and operating margin raises questions about the company’s ability to sustain its competitiveness and generate sustainable profits.
Investors should carefully evaluate Kimball Electronics’ performance over the next quarter to determine if it is a good investment opportunity. The company’s revenue guidance for the full year of $1.42 billion at the midpoint is an essential aspect to consider when evaluating Kimball Electronics’ performance.