METHODE ELECTRONICS INC
For the period ended Aug 1, 2026. Filed Sep 2, 2026.
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A company's report for each of its first three quarters. The financial statements are not audited. It shows how the business has moved since the last annual report, and what management says changed.
Aug 1, 2026 · Filed Sep 2, 2026
MEI$10.76+5.9%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-Q
Period ended 2026-01-31; filed 2026-03-05.
0000065270-26-000007
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-Q
Period ended 2026-08-01; filed 2026-09-02.
0000065270-26-000045
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 143 previous paragraphs and 114 current paragraphs.
35 unchanged; 41 reworded; 35 added; 66 removed; 1 previous and 3 current paragraphs rearranged.
Tables are not compared: 5 previous and 5 current tables excluded. Dates, whitespace, punctuation and numbering changes are ignored; changes to financial figures remain significant.
A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (35)
Current report
Changes, expiration, or renegotiation of the United States Mexico Canada Agreement (“USMCA”);
Current report
Effects from inflation;
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Risks related to geopolitical conflicts;
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Our ability to compete effectively;
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Contracts with customers are not for guaranteed volumes;
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Risks related to our exposure to technological change, customer concentration, and cyclical demand in the data center market;
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Our ability to realize the benefits from our deferred tax assets;
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Risks associated with litigation;
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Risks associated with government inquiries;
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Effects of changing government regulations;
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Global Trade Environment
Current report
We operate a global manufacturing and sourcing footprint and our business is subject to tariffs, import duties, and other trade compliance regulations imposed by the jurisdictions in which we operate and subject us to a complex and evolving body of trade compliance laws and regulations. Failure to comply with trade program regulations could increase our manufacturing costs and may have a material effect on our results of operations, financial position, and cash flows. Beginning in 2025, the U.S. implemented tariffs across multiple jurisdictions in which we operate, including broad country-level and product-specific measures, which was followed by retaliatory tariffs and other trade actions against U.S. goods and services. In early 2026, the U.S. Supreme Court ruled that U.S. tariffs imposed under the International Emergency Economic Powers Act (“IEEPA”) on goods imported into the U.S. were unauthorized. Following the ruling, new tariffs were subsequently imposed under different statutes.
Current report
Given our various manufacturing sites, including Canada, China, Egypt, Europe and Mexico, the continuation or expansion of tariffs or other trade barriers could increase input costs, pressure margins or affect customer demand. During fiscal 2026, we mitigated these effects through a variety of strategies, including negotiated price adjustments and ongoing cost recovery arrangements with our customers, as well as supply chain optimization initiatives. To the extent similar mitigation efforts are insufficient, new or expanded tariffs could have a material effect on our results of operations, financial position, and cash flows.
Current report
Geopolitical Conflicts and Global Supply Chain Disruptions
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Vehicle Electrification
Current report
Cost of products sold increased $20.7 million, or 10.5%, to $217.7 million (82.0% of net sales) in the three months ended August 1, 2026, compared to $197.0 million (81.9% of net sales) in the three months ended August 2, 2025. Foreign currency translation increased cost of products sold by $1.1 million. Excluding foreign currency translation, cost of products sold increased $19.6 million. The increase was primarily due to higher sales volumes and product mix, including material costs and freight inflation. The increase was partially offset by a divestiture and program roll-offs in the Interface segment.
Current report
Selling and administrative expenses increased $9.3 million, or 25.4%, to $45.9 million (17.3% of net sales) in the three months ended August 1, 2026, compared to $36.6 million (15.2% of net sales) in the three months ended August 2, 2025. Excluding foreign currency translation, selling and administrative expenses increased $9.1 million. The increase was primarily due to higher employee costs and professional fees.
Current report
Interest expense, net was $5.2 million in the three months ended August 1, 2026, compared to $5.9 million in the three months ended August 2, 2025. The decrease was primarily driven by lower overall borrowings and lower interest rates during the three months ended August 1, 2026, compared to the three months ended August 2, 2025.
Current report
Other expense (income), net
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Net income (loss)
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Net sales in North America increased $8.1 million to $44.7 million in the three months ended August 1, 2026, compared to $36.6 million in the three months ended August 2, 2025. The increase was due to higher sales volume and mix driven by higher demand from customers (including customer recoveries).
Current report
Automotive segment gross profit increased $1.9 million to $2.0 million in the three months ended August 1, 2026, compared to $0.1 million in the three months ended August 2, 2025. Gross profit margins increased to 1.9% in the three months ended August 1, 2026, compared to 0.1% in the three months ended August 2, 2025. The higher gross profit was primarily due to improved operational performance, including customer recoveries, lower inventory adjustments, and improved scrap.
Current report
Industrial segment net sales increased $33.3 million, or 27.0%, to $156.8 million in the three months ended August 1, 2026, compared to $123.5 million in the three months ended August 2, 2025. Excluding foreign currency translation, net sales increased $32.0 million. The increase was due to organic growth in the data center business and an increase in demand for on-highway and off-highway lighting products (including customer recoveries).
Current report
Interface segment net sales decreased $8.0 million, or 73.4%, to $2.9 million in the three months ended August 1, 2026, compared to $10.9 million in the three months ended August 2, 2025. The decrease was primarily due to the divestiture of our dataMate business in the fourth quarter of fiscal year 2026 and program roll-offs as the consumer appliance business winds down.
Current report
Interface segment gross profit decreased $4.1 million, or 120.6%, to a gross loss of $0.7 million in the three months ended August 1, 2026, compared to gross profit of $3.4 million in the three months ended August 2, 2025. Gross profit margins decreased to negative 24.1% in the three months ended August 1, 2026, compared to 31.2% in the three months ended August 2, 2025. The decrease in gross profit margins was primarily due to lower sales volumes and mix.
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(i)
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(ii)
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(iii)
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(iv)
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(v)
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adds that there will be an automatic and permanent reduction of $75 million to the 2028 Extended Revolving Commitments at such time as the Company and its Subsidiaries have received gross cash proceeds from certain Dispositions exceeding $50 million occurring after the Amendment effective date, and
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(vi)
Current report
Further information on previous amendments, applicable waivers, and terms of the Existing Credit Agreement are included in our Annual Report on Form 10-K for the year ended May 2, 2026, which was filed with the SEC on June 24, 2026.
Current report
As of August 1, 2026, the outstanding balance under the revolving credit facility consisted of $294.4 million (€255.3 million) of euro-denominated borrowings and $17.0 million of US dollar denominated borrowings. The weighted-average interest rate on outstanding euro-denominated and US dollar borrowings under the Existing Credit Agreement was approximately 5.7% and 7.3%, respectively, as of August 1, 2026.
Current report
During the three months ended August 1, 2026, the Company made net repayments on outstanding borrowings of $10.1 million.
Removed paragraphs (66)
Previous report
• Inflation;
Previous report
• Ability to compete effectively;
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• Risks relating to our use of requirements contracts;
Previous report
• Ability to remediate a material weakness in our internal control over financial reporting;
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• Risks associated with litigation and government inquiries;
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• Changing government regulations;
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Overview
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Macroeconomic Conditions
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There is continued uncertainty about the future relationship between the U.S. and various other countries with respect to tariffs, trade policies, government regulations, treaties and trade agreements. We are exposed to market risk with respect to increased and volatile duties assessed on raw materials (including copper, steel and aluminum), component parts (including semiconductors), and finished goods we import into the U.S. from our various manufacturing sites, including those in Mexico, China, Egypt, Europe and Canada. Should any of these tariffs or other trade barriers expand, raw materials and finished goods that we import will face higher prices, which could lead to reduced margins or increased prices that could, in turn, cause decreased customer demand. To the extent that we are unable to obtain price increases or there is a significant decrease in customer demand, new or higher tariffs could have a material effect on our results of operations.
Previous report
The US-Israeli strikes in Iran and the Iranian retaliatory strikes in the Middle East have affected the global economy and given rise to potential global security issues that may adversely affect international business and economic conditions. This conflict in the Middle East may cause additional disruption in the supply chains, including logistics issues and inflationary challenges, which may adversely affect our business and results of operations. Additionally, certain of our customers and suppliers may be negatively affect by these events, which in turn may negatively affect the markets where we do business.
Previous report
The global economy continues to experience volatile disruptions including to the commodity, labor, and transportation markets, arising from a combination of geopolitical events and various economic and financial factors. These disruptions have affected our operations and may continue to affect our business, financial condition, and results of operations. As a result of continued inflation, we have implemented measures to mitigate certain adverse effects of higher costs. However, we have been unable to fully mitigate or pass through the increases in our costs to our customers, which will likely continue in the future.
Previous report
Global Supply Chain Disruptions
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Recent Events
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Sale of a Business
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On March 5, 2026, we entered into and closed on an asset purchase agreement with a third party (the “Buyer”) pursuant to which we sold substantially all of the assets of our dataMate business (the “Transaction”). The aggregate consideration for the Transaction consists of a purchase price of approximately $16.4 million, subject to customary working capital adjustments. The Transaction also includes customary representations, warranties, covenants, and indemnification provisions. Due to the proximity of the closing date of the Transaction with the date of the filing of this Quarterly Report on Form 10-Q, the initial accounting for the Transaction, including the determination of the final purchase price adjustment and the allocation of the consideration, is not yet completed. Based on preliminary estimates, we expect to record a gain on the sale in the range of $9.0 million to $10.5 million. Proceeds from the transaction are expected to be used for general corporate purposes, including debt reduction and working capital needs.
Previous report
The dataMate business is included in the Interface segment, and represents less than 2% of our consolidated net sales for both the nine months ended January 31, 2026 and fiscal year ended May 3, 2025.
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Sale of Assets
Previous report
We finalized a purchase and sale agreement to sell one of our locations to a third party for a purchase price of $4.7 million, which is subject to satisfaction of customary closing conditions and the relocation of the dataMate business. Accordingly, the property has not been classified as held for sale as of January 31, 2026. The net book value of this location as of January 31, 2026 was $3.5 million. The Buyer is expected to relocate the dataMate business on or before April 19, 2026, and the sale of assets is expected to close no later than May 10, 2026. Proceeds from the sale of assets are expected to be used for general corporate purposes, including debt reduction and working capital needs.
Previous report
Consolidated Results of Operations
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Net sales decreased $69.9 million, or 8.8%, to $721.1 million in the nine months ended January 31, 2026, compared to $791.0 million in the nine months ended February 1, 2025. Foreign currency translation increased net sales by $25.0 million. Excluding foreign currency translation, net sales decreased $94.9 million. The decrease was primarily due to lower sales volumes in the Automotive segment and Interface segment, partially offset by higher sales volumes in the Industrial segment.
Previous report
Cost of products sold decreased $3.7 million, or 1.9%, to $194.9 million (83.4% of net sales) in the three months ended January 31, 2026, compared to $198.6 million (82.8% of net sales) in the three months ended February 1, 2025. Foreign currency translation increased cost of products sold by $8.8 million. Excluding foreign currency translation, cost of products sold decreased $12.5 million. The decrease was primarily due to lower material costs as a result of lower sales volumes.
Previous report
Cost of products sold decreased $56.1 million, or 8.7%, to $591.1 million (82.0% of net sales) in the nine months ended January 31, 2026, compared to $647.2 million (81.8% of net sales) in the nine months ended February 1, 2025. Foreign currency translation increased cost of products sold by $19.2 million. Excluding foreign currency translation, cost of products sold decreased $75.3 million. The decrease was primarily due to lower material costs as a result of lower sales volumes. Restructuring and asset impairment charges included within cost of products sold were $0.1 in the nine months ended January 31, 2026, compared to $0.4 million in the nine months ended February 1, 2025.
Previous report
Gross profit margin was 16.6% of net sales in the three months ended January 31, 2026, compared to 17.2% of net sales in the three months ended February 1, 2025. The decrease in gross profit margin was primarily a result of lower sales volume and product mix in the Automotive segment and Interface segment.
Previous report
Selling and administrative expenses increased $1.4 million, or 3.7%, to $39.1 million (16.7% of net sales) in the three months ended January 31, 2026, compared to $37.7 million (15.7% of net sales) in the three months ended February 1, 2025. Excluding foreign currency translation, selling and administrative expenses increased $0.4 million. Restructuring and asset impairment charges included within selling and administrative expenses were $0.4 million in the three months ended January 31, 2026, primarily related to employee termination benefits.
Previous report
Selling and administrative expenses decreased $11.8 million, or 9.3%, to $114.7 million (15.9% of net sales) in the nine months ended January 31, 2026, compared to $126.5 million (16.0% of net sales) in the nine months ended February 1, 2025. Excluding foreign currency translation, selling and administrative expenses decreased $13.9 million. The decrease was primarily due to lower professional fees. Restructuring and asset impairment charges included within selling and administrative expenses were $2.3 million in the nine months ended January 31, 2026, compared to $0.3 million in the nine months ended February 1, 2025, primarily related to employee termination benefits.
Previous report
Interest expense, net was $5.4 million in the three months ended January 31, 2026, compared to $5.5 million in the three months ended February 1, 2025. The decrease was due to a lower level of borrowings and lower interest rates, partially offset by the unfavorable effects of foreign exchange rates on the euro denominated interest.
Previous report
Interest expense, net was $17.0 million in the nine months ended January 31, 2026, compared to $16.5 million in the nine months ended February 1, 2025. The increase was due to the unfavorable effects of foreign exchange rates on the euro denominated interest and higher amortization of debt issuance costs, partially offset by a lower interest rates and a lower level of borrowings. Additionally, in the nine months ended months ended February 1, 2025, there was a gain of $0.4 million recognized on a cross-currency swap that was settled in December 2024.
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Other expense, net
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Other expense, net was $1.6 million in the three months ended January 31, 2026, compared to $0.5 million in the three months ended February 1, 2025. Net foreign exchange loss was $2.6 million in the three months ended January 31, 2026, compared to $1.3 million in the three months ended February 1, 2025.
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Income tax expense
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Income tax expense was $2.8 million (-21.4% effective tax rate) in the three months ended January 31, 2026, compared to $6.2 million (-75.6% effective tax rate) in the three months ended February 1, 2025. Income tax expense was $12.7 million (-54.3% effective tax rate) in the nine months ended January 31, 2026, compared to $14.6 million (-74.1% effective tax rate) in the nine months ended February 1, 2025.
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Net loss
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Automotive
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Net sales in North America decreased $11.5 million to $40.3 million in the three months ended January 31, 2026, compared to $51.8 million in the three months ended February 1, 2025. The decrease was due to a reduction in electric vehicle volumes, partially offset by new program launches.
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Automotive segment net sales decreased $73.2 million, or 18.5%, to $322.8 million in the nine months ended January 31, 2026, compared to $396.0 million in the nine months ended February 1, 2025. Excluding foreign currency translation, net sales decreased $86.1 million. The change is attributable to the following:
Previous report
Net sales in North America decreased $70.7 million to $117.1 million in the nine months ended January 31, 2026, compared to $187.8 million in the nine months ended February 1, 2025. The decrease was due to a reduction in electric vehicle volumes, partially offset by new program launches.
Previous report
Net sales in EMEA decreased $1.5 million to $180.2 million in the nine months ended January 31, 2026, compared to $181.7 million in the nine months ended February 1, 2025. Excluding foreign currency translation, net sales in EMEA decreased $14.1 million due primarily to lower sales volumes of sensor and user interface products.
Previous report
Net sales in Asia decreased $1.0 million to $25.5 million in the nine months ended January 31, 2026, compared to $26.5 million in the nine months ended February 1, 2025. Excluding foreign currency translation, net sales in Asia decreased $1.3 million primarily due to lower sales volumes.
Previous report
Automotive segment gross profit decreased $1.1 million, or 36.7%, to $1.9 million in the three months ended January 31, 2026, compared to $3.0 million in the three months ended February 1, 2025. Excluding foreign currency translation, gross profit decreased $2.0 million. Gross profit margins decreased to 1.8% in the three months ended January 31, 2026, compared to 2.6% in the three months ended February 1, 2025. The decrease in gross profit margins was primarily due to lower sales volumes and mix in North America.
Previous report
Automotive segment gross profit decreased $21.6 million, or 83.7%, to $4.2 million in the nine months ended January 31, 2026, compared to $25.8 million in the nine months ended February 1, 2025. Gross profit margins decreased to 1.3% in the nine months ended January 31, 2026, compared to 6.5% in the nine months ended February 1, 2025. The decrease in gross profit was primarily due to lower sales volumes and mix and higher operating expenses in North America.
Showing the first 40 of 66 passages. Open the source sections for the rest.
Reworded paragraphs (41)
Previous wording
• Dependence on the automotive, commercial vehicle, and construction industries;
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Dependence on the automotive, commercial vehicle, data center and construction industries;
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• Production delays or cancelled orders;
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Effects from production delays or cancelled orders;
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• Changes in global trade policies, including tariffs;
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Changes in global trade policies, including tariffs, and other costs of our global business;
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• Ability to withstand pricing pressures, including price reductions;
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Our ability to withstand pricing pressures, including price reductions;
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• Ability to successfully benefit from acquisitions and divestitures;
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Our ability to successfully benefit from acquisitions and divestitures;
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• Ability to manage our debt levels;
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Our ability to manage our debt levels and refinance or extend our credit agreement;
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• Ability to comply with restrictions and covenants under our credit agreement;
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Our ability to comply with restrictions and covenants under our credit agreement;
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• Recognition of goodwill and other intangible asset impairment charges;
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Recognition of goodwill, other intangible asset, and long-lived asset impairment charges;
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• Effects of IT disruptions or cybersecurity incidents;
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Effects of information technology (“IT”) disruptions or cybersecurity incidents;
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• Ability to innovate and keep pace with technological changes; and
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Our ability to innovate and keep pace with technological changes; and
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• Ability to protect our intellectual property.
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Our ability to protect our intellectual property.
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Additional details and factors are discussed under the caption “Risk Factors” in Part I, Item 1A of our Annual Report on Form 10-K for the year ended May 3, 2025 and in Part II, Item 1A of this Quarterly Report. New risks and uncertainties arise from time to time, and it is impossible for us to predict these events or how they may affect us. Any forward-looking statements made by us speak only as of the date on which they are made. We are under no obligation to, and expressly disclaim any obligation to, update or alter our forward-looking statements, whether as a result of new information, subsequent events or otherwise.
Current wording
Additional details and factors are discussed under the caption “Risk Factors” in Part I, Item 1A of our Annual Report on Form 10-K for the year ended May 2, 2026. New risks and uncertainties arise from time to time, and it is impossible for us to predict these events or how they may affect us. Any forward-looking statements made by us speak only as of the date on which they are made. We are under no obligation to, and expressly disclaim any obligation to, update or alter our forward-looking statements, whether as a result of new information, subsequent events or otherwise.
Previous wording
We are a leading global supplier of custom engineered solutions with sales, engineering and manufacturing locations in North America, Europe, Middle East, and Asia. We design, engineer, and produce mechatronic products for Original Equipment Manufacturers (“OEMs”) utilizing our broad range of technologies for user interface, light-emitting diode (“LED”) lighting system, power distribution, and sensor applications.
Current wording
We are a leading global supplier of custom engineered solutions with sales, engineering, and manufacturing locations in North America, Europe, the Middle East, and Asia. We design, engineer, and manufacture mechatronic products for Original Equipment Manufacturers (“OEMs”) and tiered suppliers across mobility, industrial, and commercial markets. Our capabilities include power distribution, including busbars, smart connect systems, battery disconnect units, and integrated circuit boards; as well as user interface components, specialized light-emitting diode (“LED”) lighting solutions, and sensor applications. Our business is managed on a segment basis, with those segments being Automotive, Industrial and Interface.
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Our solutions are found in the end markets of transportation (including automotive, commercial vehicle, e-bike, aerospace, bus and rail), cloud computing infrastructure, construction equipment, and consumer appliances.
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Our financial performance depends on varying conditions in the markets we serve. Our products are found in the end markets of transportation (including automotive, commercial vehicle, e-bike, aerospace, bus and rail), cloud computing and data center infrastructure, and construction equipment. Demand in these markets tends to fluctuate in response to overall economic conditions. Our sales may also be affected by our customers’ inventory levels and production schedules, consumer adoption rates, and supply chain challenges. Our operations are also affected by geopolitical risks, currency fluctuations, political and economic uncertainty, tariffs and related trade disruptions, and regulatory and trade compliance matters.
Previous wording
We continue to face a variety of supply chain challenges in fiscal 2026, including the procurement of automotive-grade semiconductors. In addition, we have experienced, and may continue to experience, business interruptions, including customer shutdowns and increased material and logistics costs and labor shortages. Changes in government regulations in areas including, but not limited to, trade and tariff regulations as noted above, could also increase our costs. We continue to work closely with suppliers and customers to mitigate and minimize the potential adverse effect from global supply chain disruptions. However, if we are not able to mitigate any direct or indirect supply chain disruptions, this may have a material adverse effect on our financial condition, results of operations, and cash flows.
Current wording
The global economy continues to experience volatile disruptions to the commodity, labor, and transportation markets. The geopolitical tensions and military conflicts in the Middle East have affected global economic and security conditions. Continued or renewed conflict in the region may cause additional disruption to supply chains, including logistics issues and inflationary pressure on energy and transportation costs. We continue to work closely with suppliers and customers to mitigate and minimize the potential adverse effects from global supply chain disruptions. However, if we are not able to mitigate any direct or indirect supply chain disruptions, this may have a material effect on our results of operations, financial condition, and cash flows.
Previous wording
Our business in the future will be affected by the broad trend of electrification. The adoption of EVs has been slower than anticipated, which may affect our financial condition, results of operations, and cash flows. Certain of our customers have recently announced shifts to their EV strategies and we are pursuing these customers for price adjustments and other commercial recoveries. If we are not successful in obtaining these recoveries, we may experience production inefficiencies, including underutilized capacity and workforce disruptions, which could affect our profitability and estimates of future cash flows.
Current wording
Our business in the future will be affected, in part, by the broad trend toward electrification. Adoption of electric vehicles (“EV”) has been slower than anticipated and certain of our customers have announced shifts to their EV strategies. As a result of these changes in EV consumer demand, we may experience production inefficiencies, including underutilized capacity and workforce disruptions, particularly if we are unable to redeploy excess capacity, which may have a material effect on our results of operations, financial condition, and cash flows.
Previous wording
We maintain our financial records on the basis of a 52 or 53-week fiscal year ending on the Saturday closest to April 30. Fiscal 2026 is a 52-week year and fiscal 2025 was a 53-week year. The three months ended January 31, 2026 and February 1, 2025 were each 13-week periods, while the nine months ended January 31, 2026 and February 1, 2025, were 39 and 40-week periods, respectively. The following discussions of comparative results among periods should be reviewed in this context.
Current wording
Our fiscal year ends on the Saturday closest to April 30, typically resulting in a 52-week year, but occasionally giving rise to an additional week, resulting in a 53-week year. Fiscal 2027 and fiscal 2026 are both 52-week years. The three months ended August 1, 2026 and August 2, 2025 are both 13-week periods. The following discussions of comparative results among periods should be reviewed in this context.
Previous wording
The table below compares our results of operations between the three and nine months ended January 31, 2026 and the three and nine months ended February 1, 2025:
Current wording
The table below compares our results of operations between the three months ended August 1, 2026 and the three months ended August 2, 2025:
Previous wording
Net sales decreased $6.2 million, or 2.6%, to $233.7 million in the three months ended January 31, 2026, compared to $239.9 million in the three months ended February 1, 2025. Foreign currency translation increased net sales by $11.7 million. Excluding foreign currency translation, net sales decreased $17.9 million. The decrease was primarily due to lower sales volumes in the Automotive segment and Interface segment, partially offset by higher sales volumes in the Industrial segment.
Current wording
Net sales increased $24.9 million, or 10.4%, to $265.4 million in the three months ended August 1, 2026, compared to $240.5 million in the three months ended August 2, 2025. Foreign currency translation increased net sales by $1.9 million. Excluding foreign currency translation, net sales increased $23.0 million. The increase was primarily driven by higher sales volume and mix in the Industrial segment due to organic growth in the data center business and an increase in demand for on-highway and off-highway lighting products (including customer recoveries). The increase was partially offset by lower sales in the Interface segment due to a divestiture and program roll-offs as the consumer appliance business winds down.
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Gross profit margin was 18.0% of net sales in the nine months ended January 31, 2026, remaining relatively consistent compared to 18.2% of net sales in the nine months ended February 1, 2025.
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Gross profit margin was 18.0% of net sales in the three months ended August 1, 2026, remaining consistent compared to 18.1% of net sales in the three months ended August 2, 2025.
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Amortization of intangibles was $5.8 million in the three months ended January 31, 2026, compared to $5.8 million in the three months ended February 1, 2025. Amortization of intangibles was $17.4 million in the nine months ended January 31, 2026, compared to $17.6 million in the nine months ended February 1, 2025.
Current wording
Amortization of intangibles was $5.7 million in the three months ended August 1, 2026, compared to $5.8 million in the three months ended August 2, 2025.
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Other expense, net was $4.3 million in the nine months ended January 31, 2026, compared to $2.9 million in the nine months ended February 1, 2025. Net foreign exchange loss was $5.7 million in the nine months ended January 31, 2026, compared to $3.6 million in the nine months ended February 1, 2025. Other expense, net in the nine months ended January 31, 2026 includes a non-cash write-off of $0.6 million of unamortized debt issuance costs, compared to $1.2 million in the nine months ended February 1, 2025. In addition, other expense, net includes $0.5 million of a net gain on sale of assets in the nine months ended January 31, 2026, compared to $0.3 million in the nine months ended February 1, 2025.
Current wording
Other income, net was $1.8 million in the three months ended August 1, 2026, compared to other expense, net of $1.3 million in the three months ended August 2, 2025. Net foreign exchange gain was $1.3 million in the three months ended August 1, 2026, compared to a loss of $1.5 million in the three months ended August 2, 2025. In the three months ended August 2, 2025, there was a non-cash write-off of unamortized debt issuance costs of $0.6 million and a net gain on the sale of assets of $0.5 million.
Previous wording
The effective tax rate for the three and nine months ended January 31, 2026 differs from the U.S. federal statutory tax rate of 21% primarily due to an increase in a valuation allowance for U.S. deferred tax assets, an unfavorable effect from global intangible low-tax income, and non-deductible interest, partially offset by the effect of income derived from foreign operations with lower statutory tax rates. The effective tax rate for the three and nine months ended February 1, 2025 differs from the U.S. federal statutory tax rate of 21% primarily due to an increase in a valuation allowance for U.S. deferred tax assets and global intangible low-tax income, partially offset by income derived from foreign operations with lower statutory tax rates and research deductions claimed in foreign jurisdictions and foreign exchange loss.
Current wording
Income tax expense was $4.1 million (-56.2% effective tax rate) in the three months ended August 1, 2026, compared to $4.2 million (-68.9% effective tax rate) in the three months ended August 2, 2025. The effective tax rate for the three months ended August 1, 2026 differs from the U.S. federal statutory tax rate of 21% primarily due to an increase in a valuation allowance for U.S. deferred tax assets, an unfavorable effect from Net Controlled Foreign Corporation (CFC) Tested Income (“NCTI”), non-deductible interest, and Pillar 2 top-up tax, partially offset by the effect of income derived from foreign operations with lower statutory tax rates. The effective tax rate for the three months ended August 2, 2025 differs from the U.S. federal statutory tax rate of 21% primarily due to an increase in a valuation allowance for deferred tax assets of $1.7 million, additional expense from global intangible low-tax income (“GILTI”), and non-deductible interest, partially offset by earnings from foreign operations with lower statutory tax rates.
Previous wording
Net loss was $15.9 million in the three months ended January 31, 2026, compared to $14.4 million in the three months ended February 1, 2025. Net loss was $36.1 million in the nine months ended January 31, 2026, compared to $34.3 million in the nine months ended February 1, 2025. The increase in net loss for both periods was attributable to the aforementioned items.
Current wording
Net loss was $11.4 million in the three months ended August 1, 2026, compared to $10.3 million in the three months ended August 2, 2025. The change in net loss for both periods was attributable to the aforementioned items.
Previous wording
Automotive segment net sales decreased $9.5 million, or 8.2%, to $106.2 million in the three months ended January 31, 2026, compared to $115.7 million in the three months ended February 1, 2025. Excluding foreign currency translation, net sales decreased $15.3 million. The change is attributable to the following:
Current wording
Automotive segment net sales decreased $0.4 million, or 0.4%, to $105.7 million in the three months ended August 1, 2026, compared to $106.1 million in the three months ended August 2, 2025. Excluding foreign currency translation, net sales decreased $1.0 million. The change is attributable to the following:
Previous wording
Net sales in EMEA increased $2.1 million to $58.0 million in the three months ended January 31, 2026, compared to $55.9 million in the three months ended February 1, 2025. Excluding foreign currency translation, net sales in EMEA decreased $3.4 million due primarily to lower sales volumes of sensor and user interface products.
Current wording
Net sales in EMEA decreased $7.9 million to $53.7 million in the three months ended August 1, 2026, compared to $61.6 million in the three months ended August 2, 2025. Excluding foreign currency translation, net sales in EMEA decreased $8.0 million due primarily to lower sales volumes driven by lower demand from customers.
Previous wording
Net sales in Asia decreased $0.1 million to $7.9 million in the three months ended January 31, 2026, compared to $8.0 million in the three months ended February 1, 2025. Excluding foreign currency translation, net sales in Asia decreased $0.4 million primarily due to lower sales volumes.
Current wording
Net sales in Asia decreased $0.6 million to $7.3 million in the three months ended August 1, 2026, compared to $7.9 million in the three months ended August 2, 2025. Excluding foreign currency translation, net sales in Asia decreased $1.1 million primarily due to lower sales volume and mix.
Previous wording
Automotive segment loss from operations was $12.7 million in the three months ended January 31, 2026, compared to $9.0 million in the three months ended February 1, 2025. The loss from operations was primarily due to higher selling and administrative expenses and lower gross profit.
Current wording
Automotive segment loss from operations was $11.7 million in the three months ended August 1, 2026, compared to $12.5 million in the three months ended August 2, 2025. The decrease in operating loss was primarily due to higher gross profit, partially offset by an increase in selling and administrative expenses.
Previous wording
Industrial segment gross profit increased $1.6 million, or 4.5%, to $36.8 million in the three months ended January 31, 2026, compared to $35.2 million in the three months ended February 1, 2025. Excluding foreign currency translation, gross profit decreased $0.4 million. Gross profit margins decreased to 30.0% in the three months ended January 31, 2026, compared to 31.5% in the three months ended February 1, 2025. Gross profit margins decreased due to higher material costs.
Current wording
Industrial segment gross profit increased $6.2 million, or 15.6%, to $45.9 million in the three months ended August 1, 2026, compared to $39.7 million in the three months ended August 2, 2025. Excluding foreign currency translation, gross profit increased $5.6 million. Gross profit margins decreased to 29.3% in the three months ended August 1, 2026, compared to 32.1% in the three months ended August 2, 2025. Gross profit margins decreased due to higher material and freight costs partially offset by higher sales volumes and customer recoveries.
Previous wording
Industrial segment income from operations increased $2.6 million, or 11.5%, to $25.2 million in the three months ended January 31, 2026, compared to $22.6 million in the three months ended February 1, 2025. Excluding foreign currency translation, income from operations increased $1.3 million. The increase was primarily due to higher gross profit and lower selling and administrative expenses.
Current wording
Industrial segment income from operations increased $5.1 million, or 19.2%, to $31.6 million in the three months ended August 1, 2026, compared to $26.5 million in the three months ended August 2, 2025. Excluding foreign currency translation, income from operations increased $4.6 million. The increase was primarily due to higher gross profit.
Previous wording
Interface segment income from operations decreased $2.1 million, or 95.5%, to $0.1 million in the three months ended January 31, 2026, compared to $2.2 million in the three months ended February 1, 2025.
Current wording
Interface segment income from operations decreased $3.8 million, or 126.7%, to a loss from operations of $0.8 million in the three months ended August 1, 2026, compared to income from operations of $3.0 million in the three months ended August 2, 2025. The decrease was primarily due to lower gross profit.
Previous wording
Our liquidity requirements are primarily to fund our business operations, including capital expenditures and working capital requirements, as well as to fund debt service requirements, dividends and stock repurchases. Our primary sources of liquidity are cash flows from operations, existing cash balances and borrowings under our senior secured credit agreement. We believe our liquidity position will be sufficient to fund our existing operations and current commitments for at least the next twelve months. However, if economic conditions remain for longer than we expect due to supply chain disruptions, inflationary pressure or other geopolitical risks, or if we are unable to maintain compliance with our debt covenants, our liquidity position could be severely affected. Additionally, we may consider other options to enhance our financial and operating position. Such options may include refinancing or restructuring initiatives, sales of assets, and reductions or delays in capital spending.
Current wording
Our liquidity requirements are primarily to fund our business operations, including capital expenditures and working capital requirements, as well as to fund debt service requirements and dividends. Our primary sources of liquidity are cash flows from operations, existing cash balances, and borrowings under our senior secured credit agreement. We believe our liquidity position will be sufficient to fund our existing operations and current commitments for at least the next twelve months. However, if economic conditions remain for longer than we expect due to the uncertainty in the global trade environment (including tariffs, import duties, and other trade compliance regulations), supply chain disruptions, inflationary pressures or other geopolitical risks, or if we are unable to maintain compliance with our debt covenants, our liquidity position could be severely affected. Additionally, we may consider other options to enhance our financial and operating position. Such options may include refinancing or restructuring initiatives, sales of assets, and reductions or delays in capital spending.
Previous wording
As of January 31, 2026, we had $133.7 million of cash and cash equivalents, of which $71.3 million was held in subsidiaries outside the U.S. Cash held by these subsidiaries is used to fund operational activities and can be repatriated, primarily through the payment of dividends and the repayment of intercompany loans, without creating material additional income tax expense.
Current wording
As of August 1, 2026, we had $116.2 million of cash and cash equivalents, of which $58.7 million was held in subsidiaries outside the U.S. Cash held by these subsidiaries is used to fund operational activities and can be repatriated, primarily through the payment of dividends and the repayment of intercompany loans, without creating material additional income tax expense.
Previous wording
On October 31, 2022, we entered into a Second Amended and Restated Credit Agreement (the “Credit Agreement”) with Bank of America, N.A., as Administrative Agent, Swing Line Lender and L/C Issuer, and the Lenders and other parties named therein. On March 6, 2024, we entered into a First Amendment to Second Amended and Restated Credit Agreement (the “First Amendment”) and on July 9, 2024, we entered into a Second Amendment to Second Amended and Restated Credit Agreement and First Amendment to Second Amended and Restated Guaranty (the “Second Amendment”) with Bank of America, N.A., as Administrative Agent, Swing Line Lender and L/C Issuer, the other Lenders party thereto and other parties thereto. On July 7, 2025, we entered into a Third Amendment to Second Amended and Restated Credit Agreement (the “Third Amendment”) with Bank of America, N.A., as Administrative Agent, Swing Line Lender and L/C Issuer, the other Lenders party thereto and other parties thereto.
Current wording
On October 31, 2022, we entered into a Second Amended and Restated Credit Agreement among the Company, Bank of America, N.A., as Administrative Agent, Swing Line Lender and L/C Issuer, and the Lenders and other parties named therein (as amended and with applicable waivers, the “Existing Credit Agreement”). The Existing Credit Agreement provided for a secured multicurrency revolving credit facility of $400 million and would have matured on October 31, 2027.
Previous wording
Among other things, the Third Amendment (i) reduced the revolving credit commitments from $500 million to $400 million, (ii) eliminated our option to increase the revolving credit commitments and/or add one or more tranches of term loans under the credit facility from time to time subject to certain limitations and conditions including approval of certain lenders, (iii) amended the consolidated interest coverage ratio covenant for the quarters ending August 2, 2025, November 1, 2025, January 31, 2026 and May 2, 2026 to relax that covenant to some extent for each of those quarters, (iv) amended the consolidated leverage ratio covenant for the quarters ending August 2, 2025, November 1, 2025, January 31, 2026, May 2, 2026 and August 1, 2026 to relax that covenant to some extent for each of those quarters, (v) amended the definition of “Consolidated EBITDA,” to include an add back for a portion of the inventory write-down taken in the fourth quarter of fiscal 2025, (vi) increased the interest rate during the period from July 7, 2025 to the date that financial statements and a compliance certificate are delivered for the fiscal quarter ending October 31, 2026 (such period, the “Third Amendment Period”), (vii) changed the commitment fee payment during the Third Amendment Period, (viii) extended, through the maturity date, the requirement to provide monthly financial statements to the lenders, (ix) restricted or decreased, during the Third Amendment Period, the amount of certain exceptions to covenants restricting liens on, investments by and indebtedness of the Company and its subsidiaries, (x) limited to $2.5 million, in any fiscal quarter during the Third Amendment Period, the general basket exception to a covenant restricting certain restricted payments (including dividends) by the Company and its subsidiaries, while allowing under that general basket exceptions up to an aggregate of $25 million of restricted payments during any other period, (xi) extended, through the maturity date, an “anti-cash hoarding” requirement contained in the Second Amendment such that if we have cash on hand in the U.S. (subject to certain exceptions) of more than $65 million for 10 consecutive business days, we will be required to prepay the indebtedness under the credit facility by the amount of such excess, and (xii) eliminated, during the Third Amendment Period, the investment, restricted payment and indebtedness baskets that had allowed for unlimited investments, restricted payments and indebtedness, as applicable, so long as (among other requirements) we met certain pro forma consolidated leverage ratio tests.
Current wording
extends the Third Amendment Period (the period from and including July 7, 2025 to and including the date that financial statements and compliance certificate are delivered for the fiscal quarter ending October 31, 2026, such period, the “Third Amendment Period”) (where, among other things, financial covenants are relaxed to a certain extent and certain exceptions to covenants restricting liens on, investments by and indebtedness of the Company and its subsidiaries are restricted or decreased) to and including the date that financial statements and compliance certificate are delivered for the fiscal quarter ending October 31, 2027,
Previous wording
As of January 31, 2026, the outstanding balance under the revolving credit facility consisted of $302.6 million (€255.3 million) of euro-denominated borrowings and $40.0 million of US denominated borrowings. The Amended Credit Agreement contains various representations and warranties, financial covenants (including covenants requiring us to maintain compliance with a minimum consolidated interest coverage ratio and a maximum consolidated leverage ratio, in each case as of the end of each fiscal quarter), restrictive and other covenants, and events of default. The covenants in the Amended Credit Agreement include an “anti-cash hoarding” requirement, as discussed above. As of January 31, 2026, we were in compliance with all the covenants in the Amended Credit Agreement. For further information, see Note 8, “Debt” to the condensed consolidated financial statements included in this Quarterly Report.
Current wording
As of August 1, 2026, we were in compliance with all the covenants in the Existing Credit Agreement.
Previous wording
Although we currently anticipate, based on our current projections and analyses, that we will be in compliance with the financial covenants contained in the Amended Credit Agreement, no assurance can be given that we will be or will remain in compliance with such covenants in the future. Factors that could increase our risk of future non-compliance include those identified in Part I – Item 1A, “Risk Factors” of our Annual Report on Form 10-K for the year ended May 3, 2025, as supplemented by subsequent filings with the Securities and Exchange Commission, including under Part II – Item 1A, “Risk Factors” in our Quarterly Report on Form 10-Q for the quarter ended August 2, 2025.
Current wording
Although we currently anticipate, based on our current projections and analyses, that we will be in compliance with the financial covenants contained in the Amended Credit Agreement, no assurance can be given that we will be or will remain in compliance with such covenants in the future. Factors that could increase our risk of future non-compliance include those identified in Part I – Item 1A,
Previous wording
Net cash provided by operating activities was $33.1 million in the nine months ended January 31, 2026, compared to net cash used by operating activities of $9.0 million in the nine months ended February 1, 2025. The increase was due to higher cash inflows from operating assets and liabilities of $18.9 million in the nine months ended January 31, 2026 primarily due to a lower investment in working capital items.
Current wording
Net cash used by operating activities was $7.8 million in the three months ended August 1, 2026, compared to net cash provided by operating activities of $25.1 million in the three months ended August 2, 2025. The decrease was due to higher cash outflows from operating assets and liabilities of $15.0 million in the three months ended August 1, 2026 primarily due to a higher investment in working capital items.
Previous wording
Net cash used by investing activities was $13.6 million in the nine months ended January 31, 2026, compared to $26.7 million in the nine months ended February 1, 2025. Capital expenditures were $16.6 million in the nine months ended January 31, 2026, compared to $32.5 million in the nine months ended February 1, 2025. In the nine months ended January 31, 2026, we received proceeds of $1.3 million from the sale of assets, compared to $2.7 million in the nine months ended February 1, 2025. In the nine months ended January 31, 2026, we received proceeds of $1.7 million from the redemption of certain life insurance policies.
Current wording
Net cash used by investing activities was $3.1 million in the three months ended August 1, 2026, compared to $5.8 million in the three months ended August 2, 2025. Capital expenditures were $3.1 million in the three months ended August 1, 2026, compared to $7.1 million in the three months ended August 2, 2025. In the three months ended August 1, 2026, we received no proceeds from the sale of assets, compared to $1.3 million in the three months ended August 2, 2025.
Previous wording
Net cash provided by financing activities was $1.0 million in the nine months ended January 31, 2026, compared to net cash used by financing activities of $16.6 million in the nine months ended February 1, 2025. In the nine months ended January 31, 2026, we had net proceeds from borrowings of $10.3 million, compared to net proceeds from borrowings of $5.8 million in the nine months ended February 1, 2025. In the nine months ended January 31, 2026, we paid $1.6 million of debt issuance costs associated with the Third Amendment, compared to $1.8 million of debt issuance costs associated with the Second Amendment. In the nine months ended February 1, 2025, we used $1.6 million of cash for the purchase of shares under the board-authorized share repurchase program in place at the time.
Current wording
Net cash used by financing activities was $12.3 million in the three months ended August 1, 2026, compared to net cash used by financing activities of $4.5 million in the three months ended August 2, 2025. In the three months ended August 1, 2026, we had net repayments from borrowings of $10.1 million, compared to net proceeds from borrowings of $0.4 million in the three months ended August 2, 2025. In the three months ended August 1, 2026, we paid no debt issuance costs compared to $1.6 million of debt issuance costs in the three months ended August 2, 2025.
Showing the first 40 of 41 pairs. Open the source sections for the rest.
Rearranged current paragraphs (3)
Current report — wording carried from elsewhere
On August 31, 2026, we entered into a Fourth Amendment to the Second Amended and Restated Credit Agreement (the “Amendment”) with Bank of America, N.A., as Administrative Agent, Swing Line Lender and L/C Issuer, the other Lenders party thereto and other parties thereto, which amends the Existing Credit Agreement (as amended by the Amendment, the “Amended Credit Agreement”). Unless defined herein, capitalized terms used in this description of the Amendment have the meanings given to them in the Amended Credit Agreement.
Current report — wording carried from elsewhere
extends the general basket exception to a covenant restricting certain restricted payments (including dividends) by the Company and its subsidiaries to $2.5 million in any fiscal quarter through the Maturity Date,
Current report — wording carried from elsewhere
“Risk Factors” of our Annual Report on Form 10-K for the year ended May 2, 2026, as supplemented by subsequent filings with the Securities and Exchange Commission.
Rearranged previous paragraphs (1)
Previous report — wording carried elsewhere
The Amended Credit Agreement provides for a secured multicurrency revolving credit facility of $400 million and matures on October 31, 2027.