Methode Electronics 2026 Q2 Earnings Widened Losses Amid Revenue Decline

Methode Electronics reported a 15.6% revenue decline to $246.90 million in 2026 Q2, missing expectations for a 18.8% drop but falling short of prior-year levels. The company reaffirmed its full-year guidance for $900–$1 billion in sales and $70–$80 million in adjusted EBITDA, despite a $100 million annual sales decline linked to shifting EV demand.

Revenue

The Automotive segment reported $117.50 million in revenue, while the Industrial segment contributed $138.70 million. The Interface segment added $9.50 million, but eliminations and corporate adjustments reduced the total to $246.90 million. The decline reflects lower sales volumes across all segments, with the Automotive division facing a 24.1% year-over-year drop due to legacy program roll-offs and reduced sensor/user interface product demand.

Earnings/Net Income

Methode’s losses deepened to $0.28 per share in 2026 Q2, a 460% wider loss compared to the prior year. Net loss expanded to $9.90 million, a 518.8% increase from $1.60 million in 2025 Q2. The significant widening of losses underscores the challenges in the company’s current financial performance.

Post-Earnings Price Action Review

The strategy of buying Methode shares after a revenue increase quarter-over-quarter and holding for 30 days underperformed severely. Over three years, it delivered an 83.52% loss, far worse than the 70.56% benchmark return. The excess return was -154.08%, with a CAGR of -45.43%, highlighting the strategy’s failure to capitalize on post-earnings momentum.

CEO Commentary

CEO Jon DeGaynor emphasized progress in the company’s transformation, citing “tangible improvements creating real value for customers and shareholders.” Despite a $100 million sales decline due to evolving EV demand, he reaffirmed fiscal 2026 guidance and expressed confidence in achieving positive free cash flow.

Guidance

The company maintains its fiscal 2026 guidance for $900–$1 billion in sales and $70–$80 million in adjusted EBITDA. Risks include U.S. tariffs, program launches, cost recovery, and supply chain disruptions. Free cash flow is expected to turn positive for the year.

Additional News

Methode’s Non-GAAP EPS of -$0.19 beat estimates by $0.01, with revenue of $246.9M exceeding forecasts by $9.21M. However, shares fell 5% post-earnings amid a wider-than-expected net loss of $0.28 per share. CEO DeGaynor highlighted strategic operational enhancements despite the sales decline, while free cash flow improved to $6.4 million in the first half of 2026.

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