Richardson Electronics (RELL) investor relations material

Executive summary

• Q1 FY2026 net sales rose 1.6% year-over-year to $54.6 million, with net income increasing to $1.9 million from $0.6 million, driven by PMT and Canvys growth and partially offset by the healthcare business sale.

• Gross margin improved to 31.0% from 30.6% year-over-year, supported by favorable product mix, engineered solutions, and improved manufacturing utilization.

• Operating income rose to $1.0 million from $0.3 million, and diluted EPS increased to $0.13 from $0.04.

• Positive operating cash flow was generated for the sixth consecutive quarter, with a strong cash position of $35.7 million and no debt.

• Excluding Healthcare, net sales increased 6.8% year-over-year, led by semiconductor wafer fab performance.

Financial highlights

• EBITDA doubled to $3.3 million from $1.7 million in the prior year’s first quarter.

• Operating expenses were $16.0 million (29.2% of net sales), down from $16.1 million (30.0%) year-over-year.

• Backlog at Q1 FY2026 was $134.7 million, up over 125% since FY2019.

• Other income included a $0.9 million non-recurring gain from a confidential settlement.

• Capital expenditures were $1.0 million in Q1; full-year CapEx expected at $4–5 million.

Outlook and guidance

• Expect continued growth in PMT and GES, with strong momentum entering Q2 FY2026 and double-digit GES growth projected for FY2026.

• Semi wafer fab sales anticipated to remain steady in Q1 and Q2, with significant growth forecasted for Q3 and Q4.

• Operating expenses expected to rise only modestly for the full year, maintaining leverage.

• Management expects existing liquidity and cash flow to meet capital and working capital needs for the next twelve months.

• Near-term volatility expected from global trade and U.S. economic policies, but only ~5% of purchases come from China.