Vtech (303) Q4 2026 earnings summary

Executive summary

• Revenue declined 6.9% year-over-year to $2,027.5 million, with decreases across all regions and business segments.

• Gross profit margin improved to 32.7% from 31.5%, driven by lower material costs, favorable product mix, and currency effects.

• Operating profit dropped 9.4% to $171 million, with operating margin down to 8.4%.

• Net profit attributable to shareholders decreased 14.5% to $134.1 million; net margin fell to 6.6%.

• Basic EPS declined 14.7% to $0.529; total dividend per share for the year was $0.53.

Financial highlights

• North America revenue fell 9.1% to $811.6 million, with all product lines declining.

• Europe revenue dropped 6.3% to $899.9 million; ELPs and TEL products grew, but CMS declined sharply.

• Asia Pacific revenue decreased 2.1% to $294.7 million; ELPs grew 4.9%, but TEL and CMS fell.

• Other regions revenue fell 5.3% to $21.3 million; ELPs up 8.6%, TEL down 15.2%.

• Net cash balance declined 21.3% to $264 million; stock turnover days increased to 128.

Outlook and guidance

• Revenue is expected to grow in FY2027, with ELPs and TEL products forecast to rise and CMS to remain steady.

• Gross profit margin projected to decline due to rising material costs.

• ELPs growth to be driven by new standalone and platform products, including licensed IPs and expanded LeapMove content.

• TEL products to benefit from new LTE devices, Gigaset portfolio, and AI-enabled baby monitors.

• CMS capacity to double in Malaysia by mid-2027; Mexico facility fully operational.