Espey Mfg & Electronics (ESP) Q4 2026 earnings summary

Executive summary

• FY2026 sales rose 4.95% to $46.1M; net income increased to $11.2M from $8.1M, supported by stronger gross profit and other income.

• Backlog was $134.9M at June 30, 2026, including $123.7M funded; management expects revenue and new orders to grow in FY2027.

Financial highlights

• Net sales were $46.1M versus $44.0M in FY2025; growth reflected magnetics programs and field service, partly offset by lower power-supply sales.

• Gross profit rose to $16.3M from $12.7M; gross margin increased to 35.3% from 28.9%, aided by volume, favorable mix, milestone margins and lower-cost labor.

• Operating income was $11.6M versus $8.1M; net income was $11.2M versus $8.1M.

• Other income was $1.72M versus $1.60M; higher interest income was partly offset by a one-time $300K grant recognized in FY2025.

Outlook and guidance

• Management expects FY2027 revenue to exceed FY2026 and new orders to meet or exceed FY2026’s $41.4M.

• Approximately $48M of June 30, 2026 backlog is expected to ship in FY2027; backlog recognition is forecast at 36% in FY2027 and 35% in FY2028.

• Outstanding opportunities totaled approximately $173M as of September 5, 2026; awards are uncertain and many depend on defense spending allocations and competitive bids.

• New products with heavier engineering investment may temporarily compress gross profit; scaling and efficiency initiatives are expected to help offset upfront costs.