CHICAGO - Methode Electronics, Inc. (NYSE:MEI) saw its stock surge 18.8% after reporting a narrower-than-expected loss and better-than-anticipated revenue for its fiscal second quarter.
The custom-engineered solutions provider posted a loss of $0.05 per share, beating analyst estimates for a $0.16 per share loss. Revenue came in at $292.6 million, surpassing the consensus forecast of $269.78 million.
Methode's net sales increased slightly to $292.6 million from $288.0 million in the same quarter last year. The company attributed the growth primarily to higher demand for power distribution products for data centers, which offset weakness in the automotive segment in Asia.
"The team is energized, and these results demonstrate that we are heading in the right direction," said President and CEO Jon DeGaynor. "Our sales in the quarter were the highest that we have reported since fiscal 2023, and our pre-tax income returned to positive territory."
For fiscal 2025, Methode reaffirmed its expectation for net sales to be similar to fiscal 2024 but raised its adjusted pre-tax income guidance from approaching breakeven to approximately breakeven. The company expects third-quarter fiscal 2025 net sales to be similar to the prior year, with the fourth quarter projected to be significantly stronger than the third.
Looking further ahead to fiscal 2026, Methode reiterated its outlook for net sales to exceed fiscal 2025 levels, with pre-tax income expected to be positive and notably higher than fiscal 2025.
The company noted that its guidance is subject to various factors, including the successful launch of new programs, EV program take rates, cost recovery efforts, and broader economic conditions.
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