Standex International (SXI) Q2 2026 earnings summary

Executive summary

• Q2 FY26 sales rose 16.6% year-over-year to $221.3M, with 6.4% organic growth and record order intake of $231M, driven by strong performance in Electronics and fast growth markets; new product sales grew 13% to $16.3M, and fast growth markets contributed 28% of total sales.

• Adjusted operating income rose 18.9% to $42.2M, adjusted EPS increased 8.9% to $2.08, and net income from continuing operations (GAAP) was $20.6M, up from $1.3M a year ago.

• Free cash flow after capex was $13M, up from $2.2M a year ago; paid down $10M in debt, reducing net leverage ratio to 2.3.

• Company reiterates FY26 sales outlook and remains on track for FY28 long-term targets, with significant capacity expansion underway in Croatia, Mexico, Houston, and India.

• Book-to-bill ratio was 1.04 overall and 1.08 in Electronics, indicating sustained demand.

Financial highlights

• Adjusted gross margin rose 120 bps year-over-year to 42.1%; adjusted operating margin up 30 bps to 19.0%; adjusted EBITDA margin 21.3% (+40 bps YoY).

• Adjusted EPS increased 8.9% year-over-year to $2.08; dividend per share $0.34 (+6.3% YoY).

• Free cash flow was $13M, up from $2.2M a year ago; net debt to EBITDA improved to 2.3x.

• Net debt at $437.7M; cash and equivalents at $97M.

• Backlog under one year increased 18.1% YoY to $282.1M, mainly from acquisitions.

Outlook and guidance

• FY26 revenue expected to grow by over $110M from FY25, driven by new products, fast growth markets, and full-year impact of acquisitions.

• New product sales expected to reach $85M, contributing ~300 bps to sales growth; over 15 new products to be launched in FY26.

• Fast growth market sales projected to exceed $270M, up 45% year-over-year.

• Q3 FY26 guidance: mid- to high single-digit organic growth, higher revenue and slightly higher adjusted operating margin.

• FY26 capex expected between $33M and $38M; depreciation and amortization expected at $24M–$26M.