Strattec Security Corporation

Strattec Security Corporation Earnings Recaps

STRT Consumer Discretionary 2 recaps
Q3 2026 May 9, 2026

Shares dropped 16.2% following earnings, reflecting investor disappointment primarily with continued sales deceleration driven by EV program cancellations, ongoing margin pressures from tariffs and foreign exchange headwinds, and a cautious outlook on growth despite cost-cutting efforts.

Key takeaways
  • Q3 sales declined 4.5% year-over-year, impacted by approximately $9 million in annualized revenue loss from canceled EV platforms, mainly affecting Ford and Hyundai Kia.
  • Gross margin improved 50 basis points to 16.5%, aided by $1.7 million in restructuring savings and recoveries, partially offset by higher labor costs, tariffs ($5-$7 million annual incremental), and foreign exchange headwinds.
  • Operating expenses increased to $17.6 million (12.8% of sales) from $16 million (11.1% of sales) as transformation initiatives and executive transitions added costs.
  • Operating cash flow remained healthy at $11.4 million, with $107 million in cash providing balance sheet flexibility.
  • Growth initiatives remain nascent and face challenges amid a cyclical automotive market, tariffs, and supply chain disruptions, limiting near-term visibility.
Full recap
Q2 2026 Feb 6, 2026

Strattec Security Corporation posted robust second-quarter results for fiscal year 2026, with net income nearly quadrupling year-over-year, supported by strong sales growth amidst industry challenges.

Key takeaways
  • Sales increased 6% to $137.5 million, driven by pricing, new program launches, and tariff recovery.
  • Gross margin expanded 330 basis points year-over-year to 16.5%, bolstered by favorable pricing and production volume increases.
  • Net income surged to $5 million ($1.21 per diluted share), while adjusted earnings per share rose 163% to $1.71.
  • Generated $14 million in cash from operations, with a strong balance sheet featuring $99 million in cash and minimal debt.
  • Implemented a voluntary retirement program expected to yield annualized savings of $3.4 million, reinforcing cost management efforts.
Full recap