Melexis Nv (belgium) Stock Earnings Reports

Melexis reported Q2 2026 sales of EUR 217.3m (up 3% YoY, 7% QoQ) with gross margin at 40.5% and operating margin at 17.8%. Net income was EUR 30.8m (EUR 0.76/sh), down 19% YoY but up 33% QoQ. The Board declared an interim dividend of EUR 1.30 gross per share. Management highlighted stronger order momentum through the quarter, particularly in position sensors (automotive steering/braking and robotic joints), motor drivers (thermal management and robotics), and traction for new power-electronic solutions (snubber, digital current sensors). Melexis launched three new Q2 products (lighting chip with DC-DC, a 4-position contactless switch, and a digital current sensor). China showed particularly strong growth driven by local customers; Q3 China activity is expected to be even higher. Inventory was reduced versus year-end partly due to consumption and revaluation; management expects to rebuild inventory later in the year. Pricing: Melexis has not implemented broad price increases in 2026 and is prioritizing volume/long-term customer relationships while negotiations continue. Outlook: Q3 sales guidance EUR 220–225m; H2 sales EUR 445–455m with gross margin around 41% and operating margin around 18% (assumes EUR/USD 1.15). FY2026 CapEx expected around EUR 40m. Management reiterated continued R&D investment, footprint shifts toward China (assembly & test today; wafer localization ramping later), and ongoing work on cost-of-yield and margin roadmap toward longer-term gross margin targets (~45%). Key investor takeaways: modest but improving top-line momentum with margin expansion QoQ, constructive product/market diversification (automotive + robotics + data center/thermal), disciplined pricing stance favoring volume, and clear China strategy—but visibility remains short (4–5 months) and management expects wage inflation and other cost pressures to moderate operating leverage near term.