Key Tronic (KTCC) Q4 2025 earnings summary

Executive summary

• Fiscal 2025 revenue declined significantly due to reduced demand from major customers and delays in new program launches caused by global tariff uncertainties.

• Significant headcount reductions of 800 jobs and cost-saving initiatives, including automation, were implemented to align with lower demand and improve gross margins.

• Investments and expansion of manufacturing capacity in Arkansas and Vietnam support near-shoring, tariff mitigation, and future growth.

• New program wins in multiple sectors and a major consigned manufacturing contract are expected to exceed $20 million annually.

Financial highlights

• Q4 FY25 revenue was $110.5M, down from $126.6M in Q4 FY24; full-year FY25 revenue was $467.9M, down from $566.9M in FY24.

• Q4 FY25 gross margin was 6.2% (vs. 7.2% prior year); full-year gross margin improved to 7.8% from 7.0%.

• Net loss for Q4 FY25 was $3.9M ($0.36/share) vs. $2M ($0.18/share) in Q4 FY24; full-year net loss was $8.3M ($0.77/share) vs. $2.8M ($0.26/share) in FY24.

• Adjusted net loss for Q4 FY25 was $3.8M ($0.35/share); full-year adjusted net loss was $5.0M ($0.47/share).

• Cash flow from operations was $18.9M for FY25, up from $13.8M in FY24; Q4 FY25 cash flow from operations was $8.8M.

Outlook and guidance

• No formal forward-looking guidance provided for Q1 FY26 due to uncertainty in timing of new product ramps and tariff impacts.

• Management expects growth in U.S. and Vietnam production, a strong pipeline of new business, and improved profitability as new programs ramp.

• By end of FY26, about half of manufacturing is expected to be in U.S. and Vietnam facilities.

• Anticipates $8M in capital expenditures for FY26, focused on automation and production equipment.