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Kimball Electronics Reports Q4 Results With Solid Finish to the Fiscal Year; Company Provides Guidance for Fiscal 2026

Fourth Quarter 2025 Highlights

• Net sales totaled $380.5 million, a 2% sequential increase compared to Q3
• Operating income of $16.5 million, or 4.3% of net sales
• Adjusted operating income of $19.6 million, or 5.2% of net sales
• Inventory of $273.5 million, a reduction of $23.1 million in the quarter
• Cash generated from operating activities of $78.1 million, the sixth consecutive quarter of positive cash flow
• Borrowings on credit facilities of $147.5 million, a $31.3 million decrease from Q3
• Cash Conversion Days of 85, the lowest result in three years

JASPER, Ind.--(BUSINESS WIRE)-- Kimball Electronics, Inc. (Nasdaq: KE) today announced financial results for the fourth quarter and fiscal year ended June 30, 2025.

Commenting on today鈥檚 announcement, Richard D. Phillips, Chief Executive Officer, stated, 鈥淚鈥檓 encouraged by the results for the fourth quarter and solid finish to the fiscal year. Q4 came in better than expected, as sales increased sequentially, margins improved, and working capital management drove our sixth consecutive quarter of positive cash flow which was used to pay down debt. Our balance sheet is now in a position of competitive strength with ample liquidity to weather an unpredictable environment, while providing dry powder for opportunistic investments.鈥�

Mr. Phillips continued, 鈥淚n total, fiscal 2025 was a year of 鈥榗ontrolling what we could control鈥�. I鈥檓 proud of our team as we made significant progress positioning the Company for a return to profitable growth with a record number of wins for future business, adjusting the cost structure and aligning the portfolio to demand trends, and intensifying our focus as a medical CMO. We expect fiscal 2026 to be another step forward in the journey which will unfold over time.鈥�

The Company ended the fourth quarter of fiscal 2025 with cash and cash equivalents of $88.8 million and borrowing capacity of $291.7 million. The Company invested $3.0 million to repurchase 162,000 shares of common stock.

Fiscal Year 2025 Highlights

• Net sales totaled $1,486.7 million, the third highest annual revenue total for the Company
• Operating income of $45.5 million, or 3.1% of net sales; adjusted operating income of $61.3 million, or 4.1% of net sales
• Inventory reduced $64.6 million, or 19%, in the fiscal year
• Debt paid down by $147.3 million, or 50%, year-over-year; the lowest level of debt in 3 years
• Cash generated from operating activities of $183.9 million, a record result for annual cash flow
• Invested $12.0 million to repurchase 653,000 shares of common stock

Net Sales by Vertical Market for Q4 and Full Year Fiscal 2025:

鈥淔iscal 2026 will be a year of transition. We expect modest top line growth in our medical and industrial businesses, but it will be offset by a decline in automotive, with a full year impact from the loss of the braking program in Reynosa. Margins are estimated to be in line with FY25, but it鈥檚 important to note that when top line growth returns, enhancements to our cost structure should support margin improvement. Capital expenditures will be heavily weighted toward our new facility in Indianapolis, with the balance supporting growth, automation, and maintenance.鈥�

Jana T. Croom
Chief Financial Officer

Fiscal Year 2026 Guidance

• Net sales of $1,350 - $1,450 million, a 2% to 9% decrease compared to fiscal 2025
• Adjusted operating income of 4.0% - 4.25% of net sales, compared to 4.1% of net sales in fiscal 2025
• Capital expenditures of $50 - $60 million

Forward-Looking Statements

Certain statements contained within this release are considered forward-looking, including our guidance, under the Private Securities Litigation Reform Act of 1995. The statements may be identified by the use of words such as 鈥渆xpect,鈥� 鈥渟hould,鈥� 鈥済oal,鈥� 鈥減redict,鈥� 鈥渨ill,鈥� 鈥渇uture,鈥� 鈥渙ptimistic,鈥� 鈥渃onfident,鈥� and 鈥渂elieve.鈥� Undue reliance should not be placed on these forward-looking statements. These statements are based on current expectations of future events and thus are inherently subject to uncertainty. If underlying assumptions prove inaccurate or known or unknown risks or uncertainties materialize, actual results could vary materially from our expectations and projections. These forward-looking statements are subject to risks and uncertainties including, without limitation, global economic conditions, geopolitical environment and conflicts such as the war in Ukraine, global health emergencies, availability or cost of raw materials and components, tariffs and other trade barriers, foreign exchange rate fluctuations, and our ability to convert new business opportunities into customers and revenue. Additional cautionary statements regarding other risk factors that could have an effect on the future performance of the company are contained in its Annual Report on Form 10-K for the year ended June 30, 2024.

Non-GAAP Financial Measures

This press release contains non-GAAP financial measures. The non-GAAP financial measures contained herein include constant currency growth, net sales excluding Automation, Test & Measurement, adjusted selling and administrative expenses, adjusted operating income, adjusted net income, adjusted diluted EPS, and ROIC. Reconciliations of the reported GAAP numbers to these non-GAAP financial measures are included in the Reconciliation of Non-GAAP Financial Measures section below. Management believes these measures are useful and allow investors to meaningfully trend, analyze, and benchmark the performance of the company鈥檚 core operations. The company鈥檚 non-GAAP financial measures are not necessarily comparable to non-GAAP information used by other companies.

About Kimball Electronics, Inc.

Kimball Electronics is a global, multifaceted manufacturer offering Electronics Manufacturing Services (EMS) and Contract Manufacturing Organization (CMO) solutions to customers around the world. From our operations in the United States, China, Mexico, Poland, Romania, and Thailand, our teams are proud to provide manufacturing services for a variety of industries. Recognized for a reputation of excellence, we are committed to a high-performance culture that values quality, reliability, value, speed, and ethical behavior. Kimball Electronics, Inc. (Nasdaq: KE) is headquartered in Jasper, Indiana.

To learn more about Kimball Electronics, visit .

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Financial highlights for the fourth quarter and fiscal year ended June 30, 2025 are as follows:

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Andrew D. Regrut

Treasurer and Investor Relations Officer

812.827.4151

[email protected]

Source: Kimball Electronics, Inc.