Daktronics (DAKT) 4 Dec 24 2025 Q2 Earnings call transcript
1min read In the latest earnings call, Daktronics, a leading provider of digital display systems, showcased a strong financial performance for the second quarter of fiscal 2025. The company's revenue grew by 4.5% to $208 million, with a gross margin of 26.8% and an adjusted operating margin of 9.2%. These figures indicate a solid foundation for the company's growth trajectory.
Market Verticals and Strategic Priorities
Daktronics' market verticals, including Live Events, Commercial, Transportation, and International, have shown promising trends. The Live Events segment, in particular, has been a driving force behind the company's success, with significant installations for high-profile clients like the Miami Heat and the University of Connecticut. This market segment is expected to continue to grow, as venues enhance their facilities to attract fans and athletes.
In the Commercial segment, the company has made notable strides, with a large project for The Center in Atlanta and increased orders from out-of-home advertisers. The Transportation market, while experiencing some variability, remains solid, with a focus on digital signage and intelligent transportation systems. International orders, though slow, are showing signs of improvement, with contracts in Saudi Arabia and Australia.
Digital Transformation and Strategic Priorities
Daktronics is not resting on its laurels, as evidenced by its strategic initiatives to drive profitable growth and lower structural costs. The company is investing in enterprise performance management tools and modernized service systems to improve operational efficiency and customer experiences. These digital transformation efforts are expected to yield significant returns, with the goal of generating returns above the company's cost of capital and in the top range of the industry.
Investor Questions and Management's Responses
Analysts, including Anja Soderstrom from Sidoti and Mac Furst from Singular Research, posed questions about the company's financials, tariffs, and digital transformation initiatives. Management responded with confidence, highlighting the company's focus on strategic growth, maintaining gross margins, and adapting to regulatory changes.
Looking Ahead
With a strong foundation in place and a clear focus on strategic growth, Daktronics is well-positioned for the future. The company's digital transformation initiatives, combined with its market leadership in video communication displays and control systems, bode well for its continued success. As Daktronics moves into the second half of fiscal 2025, investors can expect further progress in its strategic priorities and financial performance.