Benchmark Electronics ((BHE)) has held its Q3 earnings call. Read on for the main highlights of the call.
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Benchmark Electronics Reports Strong Q3 Performance Amid Sector Challenges
The recent earnings call from Benchmark Electronics painted a picture of robust performance, with the company achieving significant revenue growth in key sectors. Despite facing some challenges in the semi-cap and AC&C sectors, the company showcased strong financial discipline and effective cash flow management, contributing to an optimistic outlook.
Revenue and EPS Exceed Expectations
Benchmark Electronics reported a revenue of $681 million for the third quarter of 2025, marking a 6% sequential increase. The non-GAAP EPS reached $0.62, both figures hitting the high end of the company’s prior guidance. This performance underscores the company’s ability to meet and exceed market expectations.
Strong Performance in Medical and A&D Sectors
The company saw impressive growth in its medical and aerospace & defense (A&D) sectors. The medical sector experienced a 15% sequential and 18% year-over-year growth, while A&D revenue increased by 2% quarter-over-quarter and 26% year-over-year, highlighting the strength and resilience of these sectors.
Record Free Cash Flow
Benchmark Electronics generated $25 million in free cash flow during the third quarter, contributing to over $74 million in the last 12 months. This record cash flow demonstrates the company’s strong financial management and its ability to generate substantial cash from operations.
Strong Bookings and Strategic Wins
The company continued to build momentum with new bookings and strategic customer wins in both engineering and manufacturing. These achievements are expected to support future growth and enhance Benchmark’s competitive position in the market.
Semi-cap Sector Challenges
The semi-cap sector faced challenges, with revenue decreasing by 3% quarter-over-quarter and 1% year-over-year. This decline was attributed to softening demand from OEMs, increased China restrictions, and an evolving tariff environment, impacting the sector’s performance.
AC&C Revenue Down Year-Over-Year
While AC&C revenue saw an 18% increase quarter-over-quarter, it was down year-over-year. This mixed performance indicates areas where the company may need to focus on improving its strategies to boost growth in this sector.
Forward-Looking Guidance
Looking ahead, Benchmark Electronics provided a promising outlook for the upcoming quarter and beyond. The company expects Q4 revenue to range between $670 million and $720 million, with non-GAAP gross margins projected between 10.1% and 10.3%. The non-GAAP operating margin is anticipated to be between 5% and 5.2%, and non-GAAP diluted EPS is expected to be within $0.62 to $0.68. The company remains committed to maintaining strong financial discipline and managing working capital effectively.
In conclusion, Benchmark Electronics’ earnings call highlighted a strong overall performance, driven by significant growth in key sectors and strategic wins. Despite facing challenges in certain areas, the company’s robust financial management and positive forward-looking guidance suggest a promising future. Investors and stakeholders can remain optimistic about Benchmark’s ability to navigate the evolving market landscape.