Knowles (KN) Q4 2025 earnings summary

Executive summary

• Achieved a breakthrough year by completing the transformation into an industrial technology leader focused on MedTech, Defense, Industrial, and Energy markets, exceeding Investor Day expectations and leveraging a proven M&A strategy.

• Revenue and EPS both surpassed guidance for Q4 and full year, driven by strong performance in MedTech, Specialty Audio, and Precision Devices.

• Robust bookings, a strong backlog, and new design wins position the company for continued growth into 2026 and beyond.

• Demonstrated strong historical financial performance, with robust margin expansion and a differentiated competitive advantage through customization at scale.

Financial highlights

• Q4 2025 revenue was $162.2 million, up 13.8% year-over-year, exceeding the high end of guidance.

• Full year 2025 revenue reached $593.2 million, up 7.2% year-over-year.

• Q4 2025 non-GAAP diluted EPS was $0.36, up 33.3% year-over-year; full year non-GAAP diluted EPS was $1.11, up 20.7%.

• Q4 2025 gross margin was 51.9%, up from 50% a year ago; Precision Devices segment Q4 gross margin was 40.1%.

• Net cash provided by operating activities was $114 million for the full year, representing 19.2% of revenues.

Outlook and guidance

• Q1 2026 revenue guidance is $143–$153 million, with non-GAAP diluted EPS expected between $0.22 and $0.26.

• Q1 2026 adjusted EBIT margin projected at 18%-20%.

• 2026–2029 targets: 8–10% revenue CAGR, 10–14% adjusted EBITDA CAGR, and 16–20% cash from operations as a percentage of revenue.

• Full year capital spending expected to support capacity expansion for large energy orders.

• Anticipates strong organic revenue growth above historic levels for 2026, with margin expansion potential in the back half of the year.