AstroNova (ALOT) Q3 2026 earnings summary

Executive summary

• Q3 FY26 revenue was $39.2M, up 8.5% sequentially but down 3.1% year-over-year, with net income of $0.4M ($0.05 per share); non-GAAP net income was $1.5M ($0.20 per share).

• Product ID segment revenue grew 2.0% year-over-year and 8.5% sequentially, while Aerospace revenue declined 12.7% year-over-year but saw sequential growth and a 39.4% increase in operating profit.

• Gross margin improved to 36.2% (up 230 bps year-over-year), with non-GAAP gross margin at 37.2%; adjusted EBITDA reached $4.2M (10.7% margin).

• Strong cash generation in Q3, with $3.4M in operating cash flow and $13.5M in liquidity; debt reduced by $3.2M in the quarter and $6.4M year-to-date.

• Transformation and restructuring actions, including a 10% workforce reduction and MTEX portfolio realignment, are expected to yield $3M in annualized savings.

Financial highlights

• Q3 revenue: $39.2M (down 3.1% YoY, up 8.5% sequentially); Q3 net income: $0.4M ($0.05/share); adjusted EBITDA: $4.2M (10.7% margin).

• Gross profit: $14.2M (up 3.5% YoY); gross margin: 36.2% (GAAP), 37.2% (non-GAAP); operating income: $1.3M (3.3% margin), non-GAAP $2.6M (6.5% margin).

• Cash from operations: $3.4M for Q3, $8.1M year-to-date; total liquidity at quarter-end: $13.5M.

• Net debt leverage ratio at 3.38, below the 4.75 covenant; fixed charge coverage ratio at 1.27, above the 1.05 requirement.

• CapEx for Q3 was $86,000; year-to-date CapEx was $0.2M.

Outlook and guidance

• FY26 revenue guidance reiterated at $149M–$154M, with Q4 revenue expected between $36M–$41M.

• Adjusted EBITDA margin for FY26 projected at 7.5%–8.5%.

• Anticipated margin tailwind in FY27 from the expiration of a major royalty agreement.

• Restructuring expected to complete by end of FY26, with $3M in annualized savings.