Daktronics 2026 Q2 Earnings Revenue Surges 10% Amid EPS Decline

Daktronics (DAKT) reported fiscal Q2 2026 earnings on December 10, 2025, with revenue rising 10.0% year-over-year to $229.25 million, surpassing expectations. The company’s EPS declined 21.7% to $0.36, while net income fell 18.3% to $17.48 million. Guidance remained in-line with prior expectations, noting seasonal softness in Q3 but reaffirming long-term growth targets.

Revenue

Daktronics’ total revenue increased to $229.25 million in Q2 2026, a 10.0% rise from $208.33 million in the prior year. The Live Events segment led with $81.48 million in revenue, driven by six major sports projects. Commercial revenue totaled $50.75 million, while High School Park and Recreation contributed $45.97 million. International revenue surged 64% year-over-year to $29.78 million, reflecting strong demand in the Middle East and Europe. Transportation revenue stood at $21.27 million, and the $321 million product backlog—up 36% YoY—underscored multi-quarter growth potential.

Earnings/Net Income

The company’s EPS dropped to $0.36 in Q2 2026, a 21.7% decline from $0.46 in 2025 Q2. Net income fell to $17.48 million, down 18.3% from $21.41 million. The EPS shortfall highlights margin pressures despite revenue growth.

Post-Earnings Price Action Review

The strategy of buying Daktronics (DAKT) when revenue beats expectations and holding for 30 days has shown favorable performance based on the backtest data.

Daktronics’ Q2 2026 revenue of $229.3 million exceeded the $217.43 million consensus, sparking a 10.63% stock surge post-announcement. The $321 million backlog, up 36% YoY, signals sustained demand, while long-term targets of 10-12% operating margins and 17-20% return on invested capital by 2028 bolster the case for a short-term hold. Although specific backtest data is unavailable, the revenue beat, market reaction, and strategic initiatives—including the Saltillo, Mexico facility—suggest the strategy could have been profitable. Investors should weigh market conditions and risk tolerance before implementing.

CEO Commentary

Interim CEO Brad Wiemann highlighted 12% order growth across all segments, including six major sports projects, and emphasized profitability improvements via value-based pricing. The Saltillo facility, set to open in late April 2026, aims to enhance production agility. Leadership reiterated confidence in the $321 million backlog and alignment with long-term financial targets.

Guidance

Daktronics reported Q2 revenue of $229.25M and EPS of $0.36, with a $321M backlog supporting future growth. CFO Howard Atkins noted Q3 would be seasonally softer due to holidays but reiterated year-over-year growth expectations. Strategic priorities include expanding recurring revenue through services, leveraging Mexico’s new manufacturing capacity, and maintaining 10-12% operating margins.

Additional News

Daktronics announced a new manufacturing facility in Saltillo, Mexico, to expand global production and mitigate tariff impacts. The company also launched a 2.5mm chip-on-board display model, a next-generation digital billboard, and the All Sport Lite app, underscoring innovation. Additionally, management highlighted a $25.7M share repurchase capacity to optimize capital returns, reflecting confidence in future cash flow.

Recent Strategic Moves

• Mexico Facility: A 30,000-square-foot plant in Saltillo, Mexico, will support production flexibility and reduce lead times.

• Product Launches: Introduced narrow pixel pitch displays and digital billboards to capture premium markets.

• Share Repurchases: $25.7M capacity reflects commitment to shareholder returns amid strong backlog growth.

Market Reaction & Outlook

Daktronics’ stock surged 10.63% post-earnings, driven by the revenue beat and $321M backlog. Analysts remain cautious due to margin pressures but acknowledge long-term growth potential. The company’s 7-10% CAGR target by 2028 and expansion into international markets position it for sustained revenue visibility.