Novanta (NOVT) Q4 2025 earnings summary

Executive summary

• Achieved record Q4 and full-year 2025 revenue of $981M, with 9% reported and 2% organic Q4 growth, and 4% sequential growth.

• Adjusted diluted EPS for Q4 2025 increased 20% to $0.91; adjusted EBITDA grew 17% to $60.7M.

• Bookings surged 25% year-over-year in Q4, with a book-to-bill of 1.11; all business units posted double-digit bookings growth and positive book-to-bill for the first time since 2022.

• New product revenue grew over 60% for the year and 80% in Q4, raising the vitality index to 24% of sales; Keonn acquisition outperformed expectations.

• Margins and cash flow were below expectations due to prioritizing customer deliveries and regionalized manufacturing, resulting in higher dual running costs and elevated inventory.

Financial highlights

• Q4 2025 non-GAAP adjusted gross profit was $118M (45.5% margin), down 150 bps year-over-year.

• Full-year adjusted gross profit was $452M (46% margin), compared to $442M (46.5%) in 2024.

• Q4 Adjusted EBITDA was $61M (23.5% margin), up 17% year-over-year; full-year adjusted EBITDA was $221M, up 5.3%.

• Q4 non-GAAP adjusted EPS was $0.91, up 20% year-over-year; full-year EPS was $3.29, up 7%.

• Q4 operating cash flow was $9M (vs. $62M prior year); full-year was $64M, impacted by inventory builds and AR timing.

• Ended Q4 with $381M cash, $251M–$260M gross debt, net leverage ratio of -0.5x to net debt of negative $121M.

Outlook and guidance

• 2026 GAAP revenue expected at $1.03B–$1.05B (4–6% organic growth).

• Adjusted gross margin target for 2026 is 47% (100 bps expansion).

• 2026 Adjusted EBITDA expected at $245M–$250M (24% margin), low double-digit growth.

• 2026 Adjusted EPS guidance: $3.50–$3.65 (up to 11% growth), including $0.22–$0.24 dilution from equity raise and $0.14 from one-time equity grant.

• Operating cash flow guidance for 2026: $145M–$185M, more than double 2025.

• Q1 2026 revenue expected at $250M–$255M (+1–3% organic, +7–9% reported); Adjusted EPS $0.75–$0.80 (+8% YoY).