AstroNova 2026 Q3 Earnings Net Income Surges 57.5% Despite Revenue Decline

AstroNova (ALOT) reported fiscal 2026 Q3 earnings on Dec 10, 2025, with net income rising 57.5% to $378,000 from $240,000 in the prior year, while revenue fell 3.1% to $39.17 million. The company maintained its full-year revenue guidance of $149 million-$154 million and adjusted EBITDA margin targets of 7.5%-8.5%, signaling confidence in margin tailwinds from an expiring royalty agreement.

Revenue

AstroNova’s Q3 revenue of $39.17 million reflected a 3.1% year-over-year decline, driven by a 12.7% drop in the Aerospace segment. The Product ID segment, however, saw stable performance with 2.0% year-over-year growth. Hardware sales totaled $12.72 million, while Supplies revenue reached $20.57 million, and Service and Other segments contributed $5.88 million.

Earnings/Net Income

The company’s EPS surged 66.7% to $0.05 in 2026 Q3 from $0.03 in the prior year, driven by improved margins and cost discipline. Despite the revenue decline, net income growth underscored effective operational leverage, with the EPS increase outpacing the top-line contraction.

Price Action

The stock price of AstroNova dropped 7.68% in the latest trading day but gained 9.66% over the past week, reflecting mixed investor sentiment. Month-to-date, shares have declined 8.41%, aligning with broader market volatility.

Post-Earnings Price Action Review

The strategy of buying AstroNova shares following a revenue raise quarter-over-quarter on the report date and holding for 30 days underperformed significantly. It generated a CAGR of -16.30% and an excess return of -109.09%, far below the benchmark’s 67.96%. With a Sharpe ratio of -0.36 and a maximum drawdown of 0.00%, the approach highlighted high risk and negative returns relative to the market.

CEO Commentary

Jorik Ittmann, CEO, emphasized progress in AstroNova’s transformation, citing improved customer engagement and margin expansion. He noted 14% growth in AstroMachine sales for Product ID and a 24% year-over-year increase in aerospace orders. Strategic priorities include reorganizing sales teams, advancing next-gen print solutions like MTEX, and transitioning customers to ToughWriter systems, which now dominate 80% of flight deck printer shipments.

Guidance

AstroNova reiterated full-year fiscal 2026 revenue guidance of $149 million-$154 million (Q4 revenue: $36 million-$41 million) and adjusted EBITDA margins of 7.5%-8.5%. The CEO highlighted margin tailwinds from a $2.2 million annualized savings post-2027 royalty expiration and disciplined capital allocation, with full-year CapEx under $0.5 million.

Additional News

1. Credit Facility Expansion: AstroNova announced a $27.5 million credit facility to strengthen liquidity and support strategic initiatives.

2. MTEX Acquisition: The company expanded its Product ID portfolio with MTEX, adding mid-to-high volume direct-to-package printers.

3. Workforce Restructuring: AstroNova reduced its global workforce by 10%, primarily in the Product ID segment, to align with operational efficiency goals.