Knowles KN Q2 2025 Earnings Preview Upside Expected on Strong Revenue Growth

Forward-Looking Analysis
Knowles Corporation anticipates Q2 2025 revenue between $135 million and $145 million, with a year-over-year increase of 4%. Analysts expect the company's EPS to range from $0.21 to $0.25 on a non-GAAP basis. The Precision Devices segment is experiencing increased order activity, while the MedTech and Specialty Audio segments continue to perform as expected. Despite macroeconomic uncertainties such as tariffs, Knowles is not witnessing a slowdown in demand. The company expects strong cash generation for the year, with anticipated net cash provided by operating activities between $10 million and $20 million. The upcoming earnings report will be crucial in assessing how Knowles navigates these challenges and opportunities, as it remains focused on sustaining growth across its core segments. The report will provide insights into Knowles' ability to maintain its revenue trajectory and manage costs effectively in a dynamic market environment.

Historical Performance Review
In Q1 2025, Knowles reported revenues of $132.20 million and a net income of -$2.00 million, translating to an EPS of -$0.02. The company's gross profit stood at $53.30 million. Revenues hit the high end of the guided range, and non-GAAP EPS was at the midpoint. Despite strong revenue performance, the quarter resulted in a net loss, partly due to higher operating expenses and restructuring charges. This performance highlights the importance of managing operational costs and aligning strategic initiatives to achieve profitability.

Additional News
Knowles Corporation is focused on expanding its presence in specialty electronic components for innovative technologies. The company repurchased $5 million in shares and reduced debt by $15 million in Q1 2025. Knowles has emphasized its commitment to growth in the MedTech and Precision Devices segments, with increased order activities and backlogs in these areas. CEO Jeffrey Niew expressed optimism about achieving year-over-year growth for 2025. The company plans to outline its strategic initiatives for the upcoming year during its Investor Day event, scheduled for May 13th, 2025.

Summary & Outlook
Knowles Corporation's financial health appears robust, with revenue growth and strong cash generation expectations for 2025. The Precision Devices and MedTech segments are key growth drivers, offsetting macroeconomic risks such as tariffs. Despite a Q1 net loss, Knowles remains focused on managing operational costs and leveraging its strengths in specialty electronic components. The company's outlook is optimistic, bolstered by strategic initiatives to enhance market presence and drive sustained growth. Overall, Knowles' future prospects seem bullish, supported by increased demand across its core business segments.