Kimball Electronics Reports Q3 Results With Double-Digit Sequential Medical Sales Growth; Company Affirms Guidance for Fiscal 2026 With Adjusted Operating Margin Expected at High End of Range

Three Months Ended

Nine Months Ended

March 31,

March 31,

(Amounts in Thousands, except EPS)

2026

2025

2026

2025

Net Sales

$

352,922

$

374,607

$

1,059,805

$

1,106,255

Operating Income

$

11,755

$

11,716

$

36,976

$

29,061

Adjusted Operating Income (non-GAAP)

$

14,781

$

15,706

$

47,623

$

41,629

Operating Income %

3.3

%

3.1

%

3.5

%

2.6

%

Adjusted Operating Income (non-GAAP) %

4.2

%

4.2

%

4.5

%

3.8

%

Net Income

$

5,719

$

3,817

$

19,442

$

10,403

Adjusted Net Income (non-GAAP)

$

8,033

$

6,837

$

27,208

$

19,718

Diluted EPS

$

0.23

$

0.15

$

0.78

$

0.41

Adjusted Diluted EPS (non-GAAP)

$

0.33

$

0.27

$

1.10

$

0.79

Three Months Ended

Nine Months Ended

March 31,

March 31,

2026

*

2025 ⁽²⁾

*

Percent

Change

2026

*

2025 ⁽²⁾

*

Percent Change

$

160.5

46

%

$

165.5

44

%

(3

)%

$

487.2

46

%

$

533.7

48

%

(9

)%

106.1

30

%

115.2

31

%

(8

)%

304.0

29

%

288.9

26

%

5

%

86.3

24

%

93.9

25

%

(8

)%

268.6

25

%

281.6

26

%

(5

)%

$

352.9

100

%

$

374.6

100

%

(6

)%

$

1,059.8

100

%

$

1,104.2

100

%

(4

)%

—

—

%

—

—

%

—

%

—

—

%

2.1

—

%

(100

)%

$

352.9

100

%

$

374.6

100

%

(6

)%

$

1,059.8

100

%

$

1,106.3

100

%

(4

)%

*

As a percent of Total Net Sales

(1)

Sales from our Automation, Test, and Measurement business (AT&M), which was divested effective July 31, 2024, were previously included in the industrial vertical

(2)

In the third quarter of fiscal 2025, the Company reported a non-recurring sale of consigned medical inventory totaling $24 million, or 21% of medical sales in that quarter. In addition, beginning in the first quarter of fiscal year 2026, sales to customers related to commercial transportation, previously included in the automotive vertical, are now reflected in the industrial vertical; prior periods have been recast to conform to current period presentation

–

Automotive includes electronic power steering, body controls, advanced driver-assistance systems, and electronic braking systems

–

Medical includes sleep therapy and respiratory care, image guided therapy, in vitro diagnostics, drug delivery, AED, and patient monitoring

–

Industrial includes climate controls, automation controls, public safety, IoT and factory automation, efficient energy, off highway equipment, and commercial transportation

Conference Call / Webcast

Date:

Wednesday, May 6, 2026

Time:

10:00 AM Eastern Time

Live Webcast:

investors.kimballelectronics.com/events-and-presentations/events

Dial-in #:

877-407-8293 (or 201-689-8349)

For those unable to participate in the live webcast, the call will be archived at investors.kimballelectronics.com .

Forward-Looking Statements

Non-GAAP Financial Measures

About Kimball Electronics, Inc.

Condensed Consolidated Statements of Income

(Unaudited)

Three Months Ended

(Amounts in Thousands, except Per Share Data)

March 31, 2026

March 31, 2025

Net Sales

$

352,922

100.0

%

$

374,607

100.0

%

Cost of Sales

325,107

92.1

%

347,711

92.8

%

Gross Profit

27,815

7.9

%

26,896

7.2

%

Selling and Administrative Expenses

15,214

4.4

%

13,154

3.6

%

Restructuring Expense

850

0.2

%

2,026

0.5

%

Asset Impairment

(4

)

—

%

—

—

%

Operating Income

11,755

3.3

%

11,716

3.1

%

Interest Income

203

0.1

%

100

—

%

Interest Expense

(2,072

)

(0.6

)%

(2,936

)

(0.8

)%

Non-Operating Income (Expense), net

(1,099

)

(0.3

)%

(1,726

)

(0.4

)%

Other Income (Expense), net

(2,968

)

(0.8

)%

(4,562

)

(1.2

)%

Income Before Taxes on Income

8,787

2.5

%

7,154

1.9

%

Provision (Benefit) for Income Taxes

3,068

0.9

%

3,337

0.9

%

Net Income

$

5,719

1.6

%

$

3,817

1.0

%

Earnings Per Share of Common Stock:

Basic

$

0.23

$

0.15

Diluted

$

0.23

$

0.15

Average Number of Shares Outstanding:

Basic

24,469

24,728

Diluted

24,648

24,872

(Unaudited)

Nine Months Ended

(Amounts in Thousands, except Per Share Data)

March 31, 2026

March 31, 2025

Net Sales

$

1,059,805

100.0

%

$

1,106,255

100.0

%

Cost of Sales

975,286

92.0

%

1,032,332

93.3

%

Gross Profit

84,519

8.0

%

73,923

6.7

%

Selling and Administrative Expenses

43,166

4.1

%

37,107

3.4

%

Restructuring Expense

4,083

0.4

%

9,019

0.8

%

Asset Impairment (Gain on Disposal)

294

—

%

(1,264

)

(0.1

)%

Operating Income

36,976

3.5

%

29,061

2.6

%

Interest Income

717

0.1

%

575

0.1

%

Interest Expense

(6,520

)

(0.6

)%

(11,969

)

(1.1

)%

Non-Operating Income (Expense), net

(4,403

)

(0.5

)%

(4,155

)

(0.4

)%

Other Income (Expense), net

(10,206

)

(1.0

)%

(15,549

)

(1.4

)%

Income Before Taxes on Income

26,770

2.5

%

13,512

1.2

%

Provision (Benefit) for Income Taxes

7,328

0.7

%

3,109

0.3

%

Net Income

$

19,442

1.8

%

$

10,403

0.9

%

Earnings Per Share of Common Stock:

Basic

$

0.79

$

0.42

Diluted

$

0.78

$

0.41

Average Number of Shares Outstanding:

Basic

24,559

24,859

Diluted

24,822

25,047

Condensed Consolidated Statements of Cash Flows

Nine Months Ended

(Unaudited)

March 31,

(Amounts in Thousands)

2026

2025

Net Cash Flow provided by Operating Activities

$

29,837

$

105,870

Net Cash Flow used for Investing Activities

(38,090

)

(5,160

)

Net Cash Flow provided by (used for) Financing Activities

2,455

(126,615

)

Effect of Exchange Rate Change on Cash, Cash Equivalents, and Restricted Cash

540

13

Net Decrease in Cash, Cash Equivalents, and Restricted Cash

(5,258

)

(25,892

)

Cash, Cash Equivalents, and Restricted Cash at Beginning of Period

89,467

78,779

Cash, Cash Equivalents, and Restricted Cash at End of Period

$

84,209

$

52,887

(Unaudited)

Condensed Consolidated Balance Sheets

March 31,
2026

June 30,
2025

(Amounts in Thousands)

ASSETS

Cash and cash equivalents

$

82,462

$

88,781

Receivables, net

225,983

222,623

Contract assets

75,711

71,812

Inventories

273,251

273,500

Prepaid expenses and other current assets

43,351

36,027

Assets held for sale

6,610

6,861

Property and Equipment, net

274,937

264,804

Goodwill

6,191

6,191

Other Intangible Assets, net

2,039

2,427

Other Assets, net

113,770

104,286

Total Assets

$

1,104,305

$

1,077,312

LIABILITIES AND SHARE OWNERS ’ EQUITY

Current portion of long-term debt

$

34,682

$

17,400

Accounts payable

229,068

218,805

Advances from customers

18,590

35,867

Accrued expenses

53,178

46,489

Long-term debt, less current portion

127,850

129,650

Other long-term liabilities

63,295

59,217

Share Owners’ Equity

577,642

569,884

Total Liabilities and Share Owners’ Equity

$

1,104,305

$

1,077,312

Other Financial Metrics

(Unaudited)

(Amounts in Millions, except CCD)

At or For the

Three Months Ended

March 31,

December 31,

March 31,

2026

2025

2025

Depreciation and Amortization

$

10.3

$

9.3

$

9.2

Cash Conversion Days (CCD) ⁽¹⁾

90

91

99

Open Orders ⁽²⁾

$

602

$

557

$

642

(1)

Cash Conversion Days (“CCD”) are calculated as the sum of Days Sales Outstanding plus Contract Asset Days plus Production Days Supply on Hand less Accounts Payable Days and less Advances from Customers Days. CCD, or a similar metric, is used in our industry and by our management to measure the efficiency of managing working capital.

(2)

Open Orders are the aggregate sales price of production pursuant to unfulfilled customer orders.

Select Financial Results of Automation, Test and Measurement

(Unaudited)

(Amounts in Millions)

Three Months Ended

Nine Months Ended

March 31,

March 31,

2026

2025

2026

2025

Net Sales

$

—

$

—

$

—

$

2.1

Operating Income (Loss) ⁽¹⁾

$

—

$

—

$

(0.4

)

$

0.8

(1)

Amounts include gain (loss) on sale adjustments following the close of the sale on July 31, 2024: ($0.4 million) in the nine months ended March 31, 2026 and $1.3 million for the nine months ended March 31, 2025.

Reconciliation of Non-GAAP Financial Measures

(Unaudited, Amounts in Thousands, except Per Share Data)

Three Months Ended

Nine Months Ended

March 31,

March 31,

2026

2025

2026

2025

Net Sales Growth (vs. same period in prior year)

(6

)%

(12

)%

(4

)%

(14

)%

Foreign Currency Exchange Impact

3

%

(1

)%

2

%

—

%

Constant Currency Growth

(9

)%

(11

)%

(6

)%

(14

)%

Selling and Administrative Expenses, as reported

$

15,214

$

13,154

$

43,166

$

37,107

Stock Compensation Expense

(2,256

)

(1,955

)

(6,036

)

(4,528

)

SERP

76

(9

)

(234

)

(285

)

Adjusted Selling and Administrative Expenses

$

13,034

$

11,190

$

36,896

$

32,294

Operating Income, as reported

$

11,755

$

11,716

$

36,976

$

29,061

Stock Compensation Expense

2,256

1,955

6,036

4,528

SERP

(76

)

9

234

285

Restructuring Expense

850

2,026

4,083

9,019

Asset Impairment (Gain on Disposal)

(4

)

—

294

(1,264

)

Adjusted Operating Income

$

14,781

$

15,706

$

47,623

$

41,629

Net Income, as reported

$

5,719

$

3,817

$

19,442

$

10,403

Stock Compensation Expense, After-Tax

1,711

1,483

4,577

3,434

Restructuring Expense, After-Tax

606

1,537

2,966

6,840

Asset Impairment (Gain on Disposal), After-Tax

(3

)

—

223

(959

)

Adjusted Net Income

$

8,033

$

6,837

$

27,208

$

19,718

Diluted Earnings per Share, as reported

$

0.23

$

0.15

$

0.78

$

0.41

Stock Compensation Expense

0.07

0.06

0.19

0.14

Restructuring Expense

0.03

0.06

0.12

0.27

Asset Impairment (Gain on Disposal)

—

—

0.01

(0.03

)

Adjusted Diluted Earnings per Share

$

0.33

$

0.27

$

1.10

$

0.79

Twelve Months Ended

March 31,

2026

2025

Operating Income, as reported

$

53,450

$

48,669

SERP

563

381

Restructuring Expense

6,054

9,783

Asset Impairment (Gain on Disposal)

(833

)

(788

)

Stock Compensation Expense

8,027

6,278

Adjusted Operating Income

$

67,261

$

64,323

Tax Effect

20,770

20,174

After-tax Adjusted Operating Income

$

46,491

$

44,149

Average Invested Capital ⁽¹⁾

$

650,994

$

726,208

ROIC

7.1

%

6.1

%

(1)

Average invested capital is computed using Share Owners’ equity plus current and non-current debt less cash and cash equivalents averaged for the last five quarters.