Frequency Electronics swings to loss in Q4 on restructuring and non-recurring charges

Frequency Electronics

15/07/2026 21:17

Overview
US precision timing tech firm's fiscal Q4 revenue declined yr/yr, missing analyst expectations
Company posted a net loss for the quarter, impacted by restructuring and non-recurring charges
Backlog reached record $111 mln, up 34% sequentially and 59% yr/yr

Outlook
Company reaffirms three-year minimum revenue target of at least $150 mln by fiscal 2029
Frequency Electronics sets minimum gross margin target of 50% and operating margin target of 30% by fiscal 2029
Company expects to return to normal cash generation in fiscal 2027

Result Drivers
REVENUE PULL-FORWARD - Co said Q4 revenue decline reflected prior-year revenue that was pulled forward, making for a difficult comparison
RESTRUCTURING AND NON-RECURRING CHARGES - Q4 results were impacted by a $3.8 mln inventory write-down, severance, and a one-time change in employee PTO policy, which depressed margins
INVESTMENTS IN ENGINEERING AND EFFICIENCY - Increased hiring and a manufacturing efficiency project raised costs in Q4 ahead of expected future growth

Company press release: ID:nGNX7zg1Ms

Key Details
Metric
Beat/Miss
Actual
Consensus Estimate
Q4 Revenue
Miss
$15.40 mln
$18.58 mln (2 Analysts)
Q4 EPS
 
-$0.50
 
Q4 Net Income
 
-$4.91 mln
 
Q4 Pretax Profit
Miss
-$6.68 mln
$2.53 mln (1 Analyst)
Q4 Operating Income
 
-$6.35 mln
 

Analyst Coverage
The current average analyst rating on the shares is "buy" and the breakdown of recommendations is 2 "strong buy" or "buy", no "hold" and no "sell" or "strong sell"
The average consensus recommendation for the electrical components & equipment peer group is "buy"
Wall Street's median 12-month price target for Frequency Electronics Inc is $65.00, about 10.3% above its July 14 closing price of $58.93
The stock recently traded at 56 times the next 12-month earnings vs. a P/E of 43 three months ago

For questions concerning the data in this report, contact Estimates.Support@lseg.com. For any other questions or feedback, contact reuters.support@thomsonreuters.com.

(This story was created using Reuters automation and AI based on LSEG and company data. It was checked and edited by a Reuters journalist prior to publication.)