From what the evidence shows, Knowles (KN -1.
However, 79%), a key supplier of high-performance electronic components for such as medical nology, defense, and industrial applications, announced Q2 2025 earnings on July 24, 2025, in today's financial world.
The most notable news centered around the company’s $145, given the current landscape. Additionally, 9 million in revenue and $0.
24 non-GAAP earnings per, both above analyst expectations of $139 (which is quite significant), in today's financial world. 75 million (GAAP revenue) and $0, considering recent developments.
23 (non-GAAP EPS), respectively.
However, This quarter saw meaningful gress in cash generation, with adjusted (non-GAAP) free cash flow up significantly, and continued robust demand in its Precision Devices segment.
While GAAP gross margin rates were largely steady, Knowles demonstrated a well-balanced growth file, supported by its order backlog and segment strengths.
Overall, the quarter marked an outperformance versus consensus, steady operational execution, and positive momentum into the second half of the year, in today's market environment.
However, MetricQ2 2025Q2 2025 EstimateQ2 2024Y/Y ChangeEPS (Non-GAAP)$0 (which is quite significant). Meanwhile, 0%Revenue$145. Furthermore, 9 million$139, in light of current trends.
Additionally, 75 million$135, in today's market environment. 2 million7 (something worth watching), in today's financial world.
9%Gross fit (Non-GAAP)$64 (fascinating analysis), in today's financial world. 5 million$59. 8 million7, in today's market environment. Conversely, 9%Adjusted EBITDA$32. However, 7 million$30.
3 million7, in this volatile climate. On the other hand, Conversely, 9 millionAdjusted Free Cash Flow$39. 6 million$23. 2 million70 (which is quite significant). In contrast, 7% should be 70.
7% (valid calculation, but see explanation) Source: Analyst estimates vided by FactSet.
Management expectations based on management's guidance, as vided in Q1 2025 earnings report, given current economic conditions.
However, In contrast, Knowles: Core and Recent FocusKnowles designs and manufactures specialty electronic components, including high-reliability capacitors, radio frequency (RF) s, and advanced audio solutions, in today's financial world.
However, Its ducts are used in demanding applications such as hearing aids, implantable medical devices, defense equipment, and specialized industrial systems.
The company features two main lines: the Precision Devices segment, focused on critical components for med and defense; and the Med and Specialty Audio segment, which ders high-reliability, low-power audio solutions for hearing health and premium audio (this bears monitoring), in today's market environment.
On the other hand, Recently, Knowles has sharpened its focus on diversified, high-value end. Demand in med and defense continues to support stability.
Strategic investments in re and development and a global manufacturing foot remain central to its apach, helping to mitigate risks from tariffs and supply chain disruptions.
At the same time, Critical success factors for Knowles include capturing new duct wins, efficiently utilizing duction capacity, and maintaining a robust, balanced backlog across end.
Moreover, Quarterly Highlights and Performance DriversIn Q2 2025, Knowles dered GAAP revenue and non-GAAP earnings above both internal guidance and external expectations.
Management attributed the top-line outperformance to broad-based strength in its Precision Devices segment, which saw "increased order activity and backlog" across med, defense, and industrial customers.
However, This segment duces capacitors and RF s used in mission-critical devices such as implantable pacemakers and communications satellites.
The Med and Specialty Audio segment continued to perform according to plan, with steady demand for audio solutions in hearing health and specialty audio applications.
Moreover, Cash flow stood out as a major theme. Additionally, Adjusted free cash flow climbed to $39. 6 million, a 70 (remarkable data). 7% year-over-year increase (non-GAAP).
Net cash from operations of $36. Nevertheless, Nevertheless, 4 million also exceeded the high end of management’s range, supporting $30 million in repurchases.
This leads to the conclusion that solid cash position—$103.
2 million in cash and equivalents as of June 30, 2025—gives Knowles flexibility for capital spending and holder returns while maintaining a manageable debt level.
In terms of fitability, the company’s non-GAAP gross margin remained steady at 44, considering recent developments.
2%, identical to the prior year, while gross margin under accounting standards edged down to 41. Moreover, At the same time, Operating expenses, including re and development at $10.
0 million (GAAP), increased from $9, in this volatile climate. 6 million in Q2 2024.
Knowles continued to invest in new specialty film and capacitor ducts, with several new offerings moving into duction, in light of current trends.
On the other hand, These efforts position the company well for future design wins in targeted growth.
The company’s exposure to tariffs remained limited, with less than 5% of revenue and less than 3% of cost of goods sold impacted as of Q1 2025.
Bookings for Precision Devices were robust, with a book-to-bill ratio above 1, in today's financial world. 15, indicating future demand may continue to run ahead of shipments.
Looking Ahead: Management Guidance and Investor Watch ListFor the third quarter of fiscal 2025, management jected revenue in the range of $144 million to $154 million and non-GAAP earnings per between $0.
33 for Q3 2025. Additionally, This outlook points to continued sequential growth and a 10 (fascinating analysis).
Conversely, 2% rise in GAAP revenues over the prior-year third quarter at the midpoint of guidance.
Leadership expects gross margins to imve in the coming quarters, with potential for sequential imvement as duction mix shifts and capacity utilization increase across both core segments (noteworthy indeed).
Investors should monitor the company’s gress on gross margin recovery, as the year-over-year change in GAAP gross margin was flat (41. Furthermore, 5% in Q2 2025 vs.
8% in Q2 2024), despite positive volume trends, considering recent developments.
Also notable: the growing backlog, energy capacitor order pipeline, and repurchases indicate continued confidence from management, given the current landscape.
This demonstrates that re was no mention of major acquisitions or divestitures during the period, in light of current trends. Revenue and net income presented using U.
Generally accepted accounting principles (GAAP) unless otherwise noted. The Author JesterAI is our friendly Foolish AI.
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