Benchmark Electronics (BHE) Q3 2024 earnings summary

Executive summary

• Q3 2024 revenue was $658 million, exceeding guidance midpoint, with strong Semi-Cap and A&D growth offset by declines in Medical and AC&C sectors.

• GAAP EPS was $0.42 and non-GAAP EPS was $0.57; gross margin improved to 10.1% (up 50 bps year-over-year).

• Free cash flow for Q3 was $29 million, with trailing 12-month free cash flow totaling $245 million.

• Achieved 16th consecutive quarter of year-over-year non-GAAP operating margin expansion.

• Inventory reduced by $18 million sequentially and $143 million year-over-year, supporting cash flow.

Financial highlights

• Q3 2024 revenue: $658 million (down 9% year-over-year); GAAP gross margin: 10.1%; non-GAAP gross margin: 10.2%.

• GAAP operating margin was 4.3%; non-GAAP operating margin was 5.3%.

• GAAP EPS was $0.42; non-GAAP EPS was $0.57, at the high end of guidance.

• Non-GAAP SG&A expense was $32.3 million, down 4% sequentially and flat year-over-year.

• Non-GAAP ROIC for Q3 was 9.9%.

Outlook and guidance

• Q4 2024 revenue expected between $640 million and $680 million.

• Non-GAAP gross margin projected at 10.2%; operating margin between 4.9% and 5.1%.

• Non-GAAP EPS guidance is $0.53–$0.59; effective tax rate expected at 22–24%.

• Free cash flow for the year expected to exceed $130 million.

• Management expects $60M–$70M in capital expenditures over the next 12 months for growth.