TLDR
- Richardson Electronics jumps on triple-digit profit growth in Q1 FY2026
- Strong Q1 drives Richardson Electronics stock up 20% after hour
- Q1 earnings surge lifts Richardson Electronics to multi-month highs
- Profit tripled, no debt: Richardson Electronics rallies on results
- Semiconductor and PMT strength power Richardson Electronics’ rebound
Richardson Electronics (RELL) stock closed at $10.61, rising 7.83% on the day, then surged another 20.64% after hours to $12.80.
The spike followed the company’s Q1 FY2026 earnings release, which showed a triple-digit increase in net profit. The strong financials and confident outlook supported the sharp rise in trading activity.
The company reported net income of $1.9 million, up from $0.6 million in the prior year’s first quarter. Operating income more than tripled to $1.0 million, reflecting stronger margins and disciplined cost management. Earnings per share rose to $0.13, compared to $0.04 in Q1 FY2025.
Backed by solid demand from the semiconductor and electron tube segments, the firm also generated positive operating cash flow. EBITDA increased to $3.3 million, nearly doubling the $1.7 million figure from last year’s quarter. The business reported no debt and maintained $35.7 million in cash reserves.
Segment Strength and Operational Efficiency Drive Financial Upside
The Power and Microwave Technologies (PMT) segment led the growth, excluding divested Healthcare assets, with a 10.5% year-over-year net sales gain. Overall net sales rose 6.8% excluding Healthcare, supported by stronger demand in the wafer fabrication and distributed tube markets. PMT gross margin rose to 31.3%, up from 30.1% a year earlier.
Canvys posted an 8.3% rise in sales, driven by improving European market conditions, although margins declined due to a shift in product mix and increased shipping costs. GES saw a sales decline of $0.8 million, largely due to the absence of a major locomotive order from last year. However, wind segment sales within GES increased, indicating balanced demand drivers.
Company-wide gross margin reached 31.0%, up from 30.6% the prior year. Operating expenses slightly decreased to $16.0 million, aided by reduced travel costs. The expense ratio improved to 29.2% of sales from 30.0%, boosting operating leverage.
Backlog Holds Firm as Growth Pipeline Remains Robust
The total backlog stood at $134.7 million, slightly higher than $134.2 million reported last fiscal year. Increases in PMT and Canvys offset a timing-driven drop in GES orders. The company described the GES pipeline as healthy, with continued interest in programs across global projects.
Richardson Electronics maintained capital discipline with $1.0 million invested in facilities, IT systems, and manufacturing. The company paid out dividends during the quarter, contributing to the slight reduction in cash holdings. It extended its $20 million credit facility with PNC Bank through 2028, with no outstanding balance.
The Board declared a quarterly dividend of $0.06 per share, payable on November 26, 2025. Class B shareholders will receive $0.054 per share on the same date. This move reflects continued confidence in sustainable cash flow and financial stability.
