Richardson Electronics 2026 Q2 Earnings Revenue Grows 5.7% as Net Loss Narrows 83.9%

Richardson Electronics (RELL) reported fiscal 2026 Q2 earnings on January 8, 2026, with revenue exceeding expectations but EPS falling short. The company’s shares dropped 12.84% in premarket trading following the results. CEO Edward Richardson highlighted six consecutive quarters of year-over-year growth, driven by green energy and Canvys businesses, while narrowing net losses by 83.9%. Guidance for FY 2026 emphasized growth in high-margin markets but lacked specific quantitative targets.

Revenue

Total revenue increased by 5.7% to $52.29 million in Q2 2026, driven by strong performance in green energy and Canvys. The Power Microwave Technologies (PMT) segment led with $35.21 million in revenue, while Green Energy Solutions (GES) and Canvys contributed $8.30 million and $8.78 million, respectively. Excluding the divested healthcare business, net sales grew 9.0%, reflecting robust demand in wind energy and medical OEM markets.

Earnings/Net Income

Richardson narrowed its net loss to $121,000 in Q2 2026, a 83.9% reduction from $751,000 in the prior-year period. Earnings per share improved to a loss of $0.01 from $0.05, marking a 80% per-share improvement. Despite these gains, the company missed EPS expectations and reported a slight net loss, underscoring ongoing profitability challenges.

Price Action

The stock price declined 2.09% in the latest trading day, 5.24% for the week, and 2.37% month-to-date. Post-earnings, shares fell 12.84% in premarket trading, reflecting investor concerns over the EPS miss despite revenue outperforming forecasts.

Post-Earnings Price Action Review

A strategy of buying RELL when revenues beat expectations and holding for 30 days generated a 149.51% return, outperforming the benchmark’s 80.61% by 68.90%. The Sharpe ratio of 0.41 and maximum drawdown of 0.00% indicate effective risk management, with minimal volatility observed during the backtest period.

CEO Commentary

CEO Edward Richardson emphasized the company’s strategic shift toward high-growth markets, including green energy and engineered solutions. He highlighted investments in organizational depth and technical expertise, calling the team “one of the strongest in the company’s history.” The CEO expressed optimism about FY 2026, citing disciplined profitability and innovation in power management and alternative energy.

Guidance

Management affirmed confidence in FY 2026 growth for PMT and GES, driven by wind energy and RF/microwave markets. Canvys and GES are expected to see 28% and 39% YoY sales growth, respectively, with a focus on global expansion and AI-driven efficiency. The CFO noted $33.1 million in cash and a $0.06/share dividend, aligning with the CEO’s emphasis on capital discipline.

Additional News

1. Healthcare Asset Divestiture: Richardson sold its healthcare business in Q3 2025 for $8.2 million, retaining CT tube engineering assets under an exclusive supply agreement. This move aims to simplify operations and prioritize high-growth sectors.

2. GES Expansion: Green Energy Solutions (GES) saw 39% YoY growth, driven by pitch energy modules for wind turbines and international partnerships with operators like RWE and NextEra.

3. Sweetwater Design Center Launch: The company announced a new design center in Sweetwater to accelerate innovation in green energy and power management, supporting global expansion and product development.