Kimball Electronics, Inc. reported a significant decline in financial performance for the fiscal year ending June 30, 2025, with net sales of $1.49 billion, a decrease of 13% from $1.71 billion in the previous fiscal year. The company's gross profit also fell by 26% to $104.4 million, resulting in a gross margin of 7.0%, down from 8.2% in fiscal 2024. Net income decreased by 17% to $17.0 million, or $0.68 per diluted share, compared to $20.5 million, or $0.81 per diluted share, in the prior year. The decline in revenue was attributed to reduced demand across all end markets, particularly in automotive and industrial sectors, as well as the impact of customer inventory overstocking in the medical market.
In terms of operational changes, Kimball Electronics completed the divestiture of its GES business on July 31, 2024, which contributed to the overall revenue decline. The company also undertook restructuring efforts to align its cost structure with reduced demand, incurring $11 million in restructuring expenses during the fiscal year. Additionally, the company announced the closure of its Tampa facility, with production activities transferred to other locations, including a newly expanded facility in Mexico. As of June 30, 2025, Kimball Electronics employed approximately 5,700 people, a slight decrease from the previous year.
Geographically, the company reported net sales of $445.7 million from Mexico, $341.8 million from the United States, and $241.9 million from Poland, among other regions. The total number of customers decreased from 65 to 58, with a notable concentration of sales from key customers such as Nexteer Automotive and ZF, which accounted for 19% and 11% of net sales, respectively. The company’s operational metrics indicated a focus on managing working capital effectively, with cash provided by operating activities increasing significantly to $183.9 million, driven by improved inventory management and reduced receivables.
Looking ahead, Kimball Electronics anticipates a marginal decline in consolidated net sales for fiscal year 2026, primarily due to the ongoing impact of the loss of a major automotive program. The company plans to continue its focus on cost control while investing in new capabilities, including the expansion of its medical contract manufacturing operations. The management remains cautious about market conditions and is committed to monitoring customer demand closely to navigate the challenges ahead.
About Kimball Electronics, Inc.
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