Benchmark Reports Fourth Quarter and Fiscal Year 2025 Results

Benchmark Electronics, Inc. (NYSE: BHE) today announced financial results for the fourth quarter and year ended December 31, 2025. Fourth quarter 2025 results: Revenue of $704 millionDiluted GAAP earnings per share of $0.17Diluted non-GAAP earnings per share of $0.71Operating cash flow of $59 million with free cash flow of $48 million Full year 2025 results: Revenue of $2,659 millionDiluted GAAP earnings per share of $0.68Diluted non-GAAP earnings per share of $2.40Operating cash flow of $124 million with free cash flow of $85 million “I am proud of our team’s performance in 2025, culminating in the fourth quarter’s high single-digit revenue growth and EPS growth at more than double that rate,” said Jeff Benck, Benchmark’s CEO. Benck continued, “As I transition out of the CEO role at the end of the quarter, I have complete confidence in David and the leadership team. Benchmark is in excellent hands and well-positioned for continued success.” David Moezidis, Benchmark’s President, continued, “I want to thank Jeff for his leadership and for the strong foundation he has built for Benchmark’s next chapter. I’m confident in the opportunities ahead of us and look forward to continuing our momentum as we execute on our growth strategy and create value for all our stakeholders.” Three Months Ended Summary GAAP Items December 31, September 30, December 31, (Amounts in millions, except per share data) 2024 2025 2025 Revenue $ 657 $ 681 $ 704 Gross Margin 10.3 % 10.0 % 10.5 % Operating Margin 4.3 % 3.5 % 2.9 % Diluted EPS $ 0.44 $ 0.39 $ 0.17 Three Months Ended Summary Non-GAAP Items(1) December 31, September 30, December 31, (Amounts in millions, except per share data) 2024 2025 2025 Revenue $ 657 $ 681 $ 704 Gross Margin 10.4 % 10.1 % 10.6 % Operating Margin 5.1 % 4.8 % 5.5 % Diluted EPS $ 0.61 $ 0.62 $ 0.71 Summary GAAP Items Year Ended December 31, (Amounts in millions, except per share data) 2024 2025 Revenue $ 2,656 $ 2,659 Gross Margin 10.2 % 10.2 % Operating Margin 4.1 % 2.9 % Diluted EPS $ 1.66 $ 0.68 Summary Non-GAAP Items(1) Year Ended December 31, (Amounts in millions, except per share data) 2024 2025 Revenue $ 2,656 $ 2,659 Gross Margin 10.2 % 10.2 % Operating Margin 5.1 % 4.9 % Diluted EPS $ 2.29 $ 2.40 (1) A reconciliation of non-GAAP results to the most directly comparable GAAP measures and a discussion of why management believes these non-GAAP results are useful are included below. Fourth Quarter and Fiscal Year Revenue by Sector Three Months Ended Year Ended December 31, September 30, December 31, December 31, December 31, (In millions) 2024 2025 2025 2024 2025 Semi-Cap $ 198 30 % $ 185 27 % $ 171 24 % $ 723 27 % $ 741 28 % Industrial 140 21 153 22 144 20 573 22 575 22 A&D 117 18 129 19 137 20 434 16 514 19 Medical 117 18 126 19 144 21 451 17 484 18 AC&C 85 13 88 13 108 15 475 18 345 13 Total $ 657 100 % $ 681 100 % $ 704 100 % $ 2,656 100 % $ 2,659 100 % Cash Conversion Cycle Three Months Ended December 31, September 30, December 31, 2024 2025 2025 Days in accounts receivable 57 50 50 Days in contract asset 23 26 23 Days in inventory 85 75 69 Days in accounts payable (54 ) (56 ) (58 ) Days in advance payments from customers (22 ) (18 ) (17 ) Days in cash conversion cycle 89 77 67 First Quarter 2026 Guidance Revenue between $655 million and $695 millionDiluted GAAP earnings per share between $0.31 and $0.37Diluted non-GAAP earnings per share between $0.53 and $0.59Non-GAAP earnings per share guidance excludes stock-based compensation expense of approximately $5.4 million and other non-operating expenses of $5.1 million to $5.5 million, which includes restructuring, amortization of intangibles and other expenses. Fourth Quarter 2025 Earnings Conference Call The Company will host a conference call to discuss the results today at 5:00 p.m. Eastern Time. The live webcast of the call and accompanying reference materials will be accessible by logging on to the Company’s website at www.bench.com. A replay of the broadcast will also be available on the Company’s website. About Benchmark Electronics, Inc. Benchmark provides comprehensive solutions across the entire product lifecycle by leading through its innovative technology and engineering design services, leveraging its optimized global supply chain, and delivering world-class manufacturing services in the following industries: advanced computing and communications (AC&C), aerospace and defense (A&D), industrial, medical, and semiconductor capital equipment (Semi-Cap). Benchmark’s global operations include facilities in seven countries and its common shares trade on the New York Stock Exchange under the symbol BHE. Forward-Looking Statements This press release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended and Section 21E of the Securities Exchange Act of 1934, as amended. These forward-looking statements are identified as any statement that does not relate strictly to historical or current facts and may include words such as “anticipate,” “believe,” “intend,” “plan,” “project,” “forecast,” “strategy,” “position,” “continue,” “estimate,” “expect,” “may,” “will,” “could,” “predict,” and similar expressions of the negative or other variations thereof. In particular, statements, expressed or implied, concerning the Company’s outlook and guidance for first quarter and fiscal year 2026 results, future operating results or margins, the ability to generate sales and income or cash flow, expected revenue mix, the Company’s business strategy and strategic initiatives, the Company’s expectations regarding enterprise AI opportunities, anticipated growth in bookings, and the Company’s expectations regarding restructuring charges, stock-based compensation expense, amortization of intangibles, and capital expenditures, among others, are forward-looking statements. Although the Company believes these statements are based on and derived from reasonable assumptions, they involve risks, uncertainties and assumptions that are beyond the Company’s ability to control or predict, relating to operations, markets and the business environment generally, including those discussed under Part I, Item 1A of the Company's Annual Report on Form 10-K for the year ended December 31, 2024, and in any of the Company’s subsequent reports filed with the Securities and Exchange Commission. Events relating to the possibility of customer demand fluctuations, supply chain constraints, continuing inflationary pressures, the effects of foreign currency fluctuations and high interest rates, the potential of another U.S. government shutdown and the economic impacts, volatility and uncertainty resulting therefrom, geopolitical uncertainties including continuing hostilities and tensions, trade restrictions and sanctions, tariffs and retaliatory countermeasures, the ability to utilize the Company’s manufacturing facilities at sufficient levels to cover its fixed operating costs, or write-downs or write-offs of obsolete or unsold inventory, may have resulting impacts on the Company’s business, financial condition, results of operations, and the Company’s ability (or inability) to execute on its plans. Should one or more of these risks or uncertainties materialize, or should underlying assumptions prove incorrect, actual outcomes, including the future results of the Company’s operations, may vary materially from those indicated. Undue reliance should not be placed on any forward-looking statements. Forward-looking statements are not guarantees of performance. All forward-looking statements included in this document are based upon information available to the Company as of the date of this document, and the Company assumes no obligation to update. Non-GAAP Financial Measures Management discloses certain non‐GAAP information to provide investors with additional information to analyze the Company’s performance and underlying trends. These non-GAAP financial measures exclude restructuring charges, stock-based compensation expense, amortization of intangible assets acquired in business combinations, certain legal and other settlement losses (gains), customer insolvency losses (recoveries), asset impairments, other significant non-recurring costs and the related tax impacts, including discrete tax items, and other non-GAAP tax adjustments, of all of the above. A detailed reconciliation between GAAP results and results excluding certain items (“non-GAAP”) is included in the following tables attached to this document. In situations where a non-GAAP reconciliation has not been provided, the Company was unable to provide such a reconciliation without unreasonable effort due to the uncertainty and inherent difficulty predicting the occurrence, the financial impact and the periods in which the non-GAAP adjustments may be recognized. Management uses non‐GAAP measures that exclude certain items in order to better assess operating performance and help investors compare results with our previous guidance. This document also references “free cash flow”, a non-GAAP measure, which the Company defines as cash flow from operations less additions to property, plant and equipment and purchased software. The Company’s non‐GAAP information is not necessarily comparable to the non‐GAAP information used by other companies. Non‐GAAP information should not be viewed as a substitute for, or superior to, net income or other data prepared in accordance with GAAP as a measure of the Company’s profitability or liquidity. Readers should consider the types of events and transactions for which adjustments have been made. Immaterial Correction of an Error During the fourth quarter of fiscal 2025, we identified immaterial errors related to our income tax calculation. We evaluated the effects of these errors and concluded that they were not material to any previously issued annual or interim financial statements. Accordingly, prior year amounts presented herein for 2024 have been adjusted to correct the immaterial error, which as of December 31, 2024 and for the year then ended (i) understated income tax expense by $2.2 million, income tax receivable by $2.2 million, current taxes payable by less than $0.1 million, deferred tax liabilities by $3.7 million, and (ii) overstated deferred tax assets by $7.2 million and shareholder’s equity by $8.7M. Benchmark Electronics, Inc. and Subsidiaries Condensed Consolidated Statements of Income (Amounts in Thousands, Except Per Share Data) (UNAUDITED) Three Months Ended Year Ended December 31, December 31, 2024 2025 2024 2025 Sales $ 656,887 $ 704,331 $ 2,656,105 $ 2,659,108 Cost of sales 588,962 630,162 2,386,081 2,389,044 Gross profit 67,925 74,169 270,024 270,064 Selling, general and administrative expenses 37,470 38,769 149,460 159,658 Amortization of intangible assets 1,204 1,204 4,817 4,817 Restructuring charges and other costs 727 14,053 6,336 29,540 Income from operations 28,524 20,143 109,411 76,049 Interest expense (6,175 ) (4,097 ) (26,922 ) (20,158 ) Interest income 2,879 1,730 10,208 9,552 Other expense, net (1,350 ) (1,833 ) (8,802 ) (3,909 ) Income before income taxes 23,878 15,943 83,895 61,534 Income tax expense 7,656 9,970 22,769 36,682 Net income $ 16,222 $ 5,973 $ 61,126 $ 24,852 Earnings per share: Basic $ 0.45 $ 0.17 $ 1.70 $ 0.69 Diluted $ 0.44 $ 0.17 $ 1.66 $ 0.68 Weighted-average number of shares outstanding: Basic 35,973 35,677 35,970 35,879 Diluted 36,659 36,193 36,759 36,300 Benchmark Electronics, Inc. and Subsidiaries Condensed Consolidated Balance Sheets (In Thousands) (UNAUDITED) December 31, December 31, 2024 2025 Assets Current assets: Cash and cash equivalents $ 315,152 $ 322,064 Restricted cash 12,875 336 Accounts receivable, net 412,458 391,101 Contract assets 167,578 182,870 Inventories 553,654 482,544 Prepaid expenses and other current assets 44,720 69,226 Total current assets 1,506,437 1,448,141 Property, plant and equipment, net 225,097 223,784 Operating lease right-of-use assets 117,995 102,664 Goodwill and other long-term assets 284,915 297,126 Total assets $ 2,134,444 $ 2,071,715 Liabilities and Shareholders’ Equity Current liabilities: Current installments of long-term debt $ 6,737 $ 3,750 Accounts payable 354,218 403,222 Advance payments from customers 143,614 115,545 Accrued liabilities 144,536 113,060 Total current liabilities 649,105 635,577 Long-term debt, net of current installments 250,457 206,826 Operating lease liabilities 108,997 98,689 Other long-term liabilities 21,313 30,820 Total liabilities 1,029,872 971,912 Shareholders’ equity 1,104,572 1,099,803 Total liabilities and shareholders’ equity $ 2,134,444 $ 2,071,715 Benchmark Electronics, Inc. and Subsidiaries Condensed Consolidated Statements of Cash Flows (In Thousands) (UNAUDITED) Year Ended December 31, 2024 2025 Cash flows from operating activities: Net income $ 61,126 $ 24,852 Depreciation and amortization 46,144 47,630 Stock-based compensation expense 13,366 17,198 Asset impairments — 11,102 Accounts receivable 33,953 25,667 Contract assets 7,401 (15,292 ) Inventories 127,840 75,167 Accounts payable (18,283 ) 32,397 Advance payments from customers (61,269 ) (28,068 ) Other changes in working capital and other, net (21,053 ) (66,689 ) Net cash provided by operating activities 189,225 123,964 Cash flows from investing activities: Additions to property, plant and equipment and software (33,253 ) (38,544 ) Other investing activities, net 486 5,846 Net cash used in investing activities (32,767 ) (32,698 ) Cash flows from financing activities: Share repurchases (5,100 ) (26,848 ) Net debt activity (74,283 ) (47,385 ) Other financing activities, net (29,724 ) (31,671 ) Net cash used in financing activities (109,107 ) (105,904 ) Effect of exchange rate changes (2,537 ) 9,011 Net increase (decrease) in cash and cash equivalents and restricted cash 44,814 (5,627 ) Cash and cash equivalents and restricted cash at beginning of year 283,213 328,027 Cash and cash equivalents and restricted cash at end of year $ 328,027 $ 322,400 Benchmark Electronics, Inc. and Subsidiaries Reconciliation of GAAP to Non-GAAP Financial Results (Amounts in Thousands, Except Per Share Data) (UNAUDITED) Three Months Ended Year Ended Dec 31, Sep 30, Dec 31, Dec 31, 2024 2025 2025 2024 2025 Income from operations (GAAP) $ 28,524 $ 23,661 $ 20,143 $ 109,411 $ 76,049 Restructuring charges and other costs 727 1,211 2,952 6,336 7,444 Stock-based compensation expense 2,626 5,345 2,121 13,366 17,198 Amortization of intangible assets 1,204 1,205 1,204 4,817 4,817 Asset impairments — — 11,102 — 11,102 Legal and other settlement loss(1) 239 816 1,174 1,778 13,064 Other — 357 60 — 728 Customer insolvency (recovery) — — — (316 ) — Non-GAAP income from operations $ 33,320 $ 32,595 $ 38,756 $ 135,392 $ 130,402 GAAP operating margin 4.3 % 3.5 % 2.9 % 4.1 % 2.9 % Non-GAAP operating margin 5.1 % 4.8 % 5.5 % 5.1 % 4.9 % Gross profit (GAAP) $ 67,925 $ 67,943 $ 74,169 $ 270,024 $ 270,064 Stock-based compensation expense 503 515 498 1,668 1,958 Customer insolvency (recovery) — — — (316 ) — Non-GAAP gross profit $ 68,428 $ 68,458 $ 74,667 $ 271,376 $ 272,022 GAAP gross margin 10.3 % 10.0 % 10.5 % 10.2 % 10.2 % Non-GAAP gross margin 10.4 % 10.1 % 10.6 % 10.2 % 10.2 % Selling, general and administrative expenses $ 37,470 $ 41,520 $ 38,769 $ 149,460 $ 159,658 Stock-based compensation expense (2,123 ) (4,830 ) (1,623 ) (11,698 ) (15,240 ) Legal and other settlement loss(1) (239 ) (471 ) (1,173 ) (1,778 ) (2,069 ) Other — (357 ) (60 ) — (728 ) Non-GAAP selling, general and administrative expenses $ 35,108 $ 35,862 $ 35,913 $ 135,984 $ 141,621 Net income (GAAP) $ 16,222 $ 14,263 $ 5,973 $ 61,126 $ 24,852 Restructuring charges and other costs 727 1,211 2,952 6,336 7,444 Stock-based compensation expense 2,626 5,345 2,121 13,366 17,198 Amortization of intangible assets 1,204 1,205 1,204 4,817 4,817 Asset impairments — — 11,102 — 11,102 Legal and other settlement loss(1) 239 816 1,174 1,778 13,064 Refinancing of Credit Facilities — — — — 224 Other — 357 60 — 728 Customer insolvency (recovery) — — — (316 ) — Income tax adjustments(2) 1,230 (905 ) 1,182 (3,006 ) 7,840 Non-GAAP net income $ 22,248 $ 22,292 $ 25,768 $ 84,101 $ 87,269 Diluted earnings per share: Diluted (GAAP) $ 0.44 $ 0.39 $ 0.17 $ 1.66 $ 0.68 Diluted (Non-GAAP) $ 0.61 $ 0.62 $ 0.71 $ 2.29 $ 2.40 Weighted-average number of shares used in calculating diluted earnings per share: Diluted (GAAP) 36,659 36,182 36,193 36,759 36,300 Diluted (Non-GAAP) 36,659 36,182 36,193 36,759 36,300 Net cash provided by operations $ 45,916 $ 36,608 $ 58,676 $ 189,225 $ 123,964 Additions to property, plant and equipment and software (9,032 ) (11,494 ) (10,590 ) (33,253 ) (38,544 ) Free cash flow $ 36,884 $ 25,114 $ 48,086 $ 155,972 $ 85,420 (1) Includes settlement of the tax assessment in Mexico that was previously disclosed under Note 15 in Part II, Item 8 of the Company’s Annual Report on Form 10-K for the year ended December 31, 2024. (2) This amount represents the tax impact of the non-GAAP adjustments, including discrete tax items, using the applicable effective tax rates. For the three months and year ended December 31, 2025, $4.7 million and $16.0 million, respectively, in discrete tax charges relating to tax impacts that are non-recurring, event-driven, or attributable to prior periods, and not reflective of the Company’s current-year operating performance. For More Information, Please Contact: Paul Mansky, Investor Relations and Corporate Development 1-623-300-7052 or [email protected] Source: BENCHMARK ELECTRONICS