Knowles Stock Earnings Reports

Knowles reported a strong Q3 2025 with revenue of $153M (up 7% YoY), non-GAAP EPS of $0.33 (up 22% YoY) and operating cash flow of $29M — all at or above the high end of guidance. By segment: Medtech & Specialty Audio was $65M (up 2% YoY) with gross margins above 50% for the full year expected; Precision Devices was $88M (up 12% YoY) with 41.5% segment gross margin driven by higher utilization in ceramic capacitors and RF microwave products. Management highlighted robust design-win momentum across medtech, defense, industrial and EV/energy markets, with defense demand and bookings particularly strong. The specialty film product line (pulse power / capacitors) is a key growth driver: management expects the energy order plus existing backlog to drive specialty film revenue to roughly $55M–$60M next year, and they are expanding capacity. Q4 guidance: revenue $151M–$161M (midpoint +9% YoY), adjusted EBITDA margin 22%–24%, EPS $0.33–$0.37, operating cash flow $30M–$40M, capex ~$12M for the quarter. Balance sheet/cash actions: $20M of buybacks in Q3, debt reduced, cash $93M, net leverage ~0.6x trailing EBITDA and liquidity >$350M. Company sees tariff exposure as limited (<5% of revenue) and has prebuys to mitigate palladium cost volatility. Management expects sequential gross margin improvement into Q4 and further improvement in 2026 as specialty film ramps, with organic company growth anticipated at the high end (~4%–6%) next year driven by new design-win ramps and specialty film capacity coming online. Management remains open but disciplined on M&A.