Melexis (MELE) Q1 2025 earnings summary

Executive summary

• Q1 2025 sales reached €198.2 million, down 18% year-over-year but stable sequentially, with net income at €24.6 million, down 54% year-over-year but up 35% from Q4 2024.

• Gross profit margin declined to 38.2%, with operating margin at 14.6% and actions underway to improve by year-end.

• Sales in Asia-Pacific comprised 64% of total, with China showing resilience and 88% of sales from automotive applications.

• Strategic focus on electrification, robotization, innovation, and advancing China strategy with local partnerships and logistics.

• Four new products launched in Q1 2025, including innovations for automotive and Beyond Automotive markets.

Financial highlights

• Gross profit was €75.7 million (38.2%), down from €106.8 million (44.2%) in Q1 2024.

• Operating income was €29 million (14.6% of sales), down 55% year-over-year but up 5% sequentially.

• Net income was €24.6 million (€0.61/share), down 54% year-over-year but up 35% sequentially.

• Operating cash flow before working capital changes was €40.7 million, down 46% year-over-year.

• Free cash flow for Q1 2025 was €11 million; €15 million spent on share buybacks.

Outlook and guidance

• H1 2025 sales expected around €400 million; gross margin guidance revised to ~39% (from ~40%), operating margin to ~15% (from ~16%).

• CapEx for 2025 expected to be around €50 million.

• No guidance for H2 2025 due to market uncertainty and late order patterns.

• Anticipates sales upturn later in the year.