Evertz Technologies (ET) Q2 2026 earnings summary

Executive summary

• Q2 Fiscal 2026 sales reached CAD 132.7 million, up 18.4% sequentially and 6% year-over-year, with strong growth in both hardware and software/services revenue; international revenue grew 12.5% to CAD 34.2 million.

• U.S.-Canada region revenue was CAD 98.5 million, up 24% sequentially and 3.9% year-over-year.

• Net earnings were CAD 18.6 million, a 16.9% increase from the same quarter last year, with fully diluted EPS of CAD 0.24, up from CAD 0.21.

• Recurring software and services revenue totaled CAD 60.7 million, up 17.6% sequentially and 11% year-over-year, now representing 46% of total revenue.

• Regular quarterly dividend increased to CAD 0.205 per share and a special dividend of CAD 1 per share was declared, both payable December 24.

Financial highlights

• Gross margin was CAD 77.8 million or 58.6% of revenue, compared to 59.3% in the prior year, within the 56%-60% target range.

• Working capital stood at CAD 205.7 million, including cash of CAD 96.7 million as of October 31, 2025.

• Earnings from operations totaled CAD 25.0 million, up 17.0% sequentially.

• Cash from operations was negative CAD 5.4 million, but excluding non-cash working capital and taxes, generated CAD 25.2 million.

• Investment in R&D was CAD 36.6 million for the quarter, 27.6% of revenue.

Outlook and guidance

• Purchase order backlog exceeded CAD 240 million at quarter-end, with November shipments of CAD 46 million.

• 60% of the current backlog is expected to convert within the next 12 months.

• Management remains confident in maintaining the gross margin target range despite potential trade uncertainties.

• Continued robust demand and adoption of IP-based and cloud solutions across media, broadcast, and government sectors.