Cognex (CGNX) Q4 2025 earnings summary

Executive summary

• Achieved 8% constant currency revenue growth and 38% adjusted EPS growth in 2025, with strong Q4 and full-year financial performance and momentum across strategic objectives.

• Completed a strategic portfolio review, exiting $22M of low/no-growth, low-margin product lines, and began a transformation of the operating model to drive efficiency.

• Acquired 9,000 new customer accounts in 2025, tripling the prior year's rate and doubling the customer base, supported by a new website and sales force transformation.

• Launched several AI-enabled products, strengthening leadership in industrial machine vision and expanding market share.

• Strategic focus on AI-driven product innovation, customer experience, and operational efficiency, including portfolio optimization and cost reductions.

Financial highlights

• Q4 2025 revenue grew 10% year-over-year to $252M; full-year revenue was $994M, up 9% year-over-year.

• Adjusted EBITDA margin reached 22.7% in Q4 and 21.5% for the year, expanding 420–440 bps year-over-year.

• Adjusted EPS grew 35% year-over-year in Q4 to $0.27 and 38% for the year to $1.02; free cash flow up 77% to $237M.

• Returned $206M to shareholders in 2025, including $151M in share repurchases; board approved a $500M increase to repurchase authorization.

• Q4 operating income was $35M (+14% YoY); full-year: $163M (+41% YoY); Q4 net income: $33M (+15% YoY); full-year: $114M (+8% YoY).

Outlook and guidance

• Q1 2026 revenue expected between $235M–$255M, ~13% growth at midpoint; adjusted EBITDA margin 19%–22%; adjusted EPS $0.22–$0.26, ~50% growth at midpoint.

• Targeting 25% adjusted EBITDA margin run rate by end of 2026, with at least 20% adjusted EPS growth.

• Through-cycle adjusted EBITDA margin range raised to 25%–31%; revenue CAGR remains 13%–14%; free cash flow conversion expected >100%.