Strattec Security Reports Strong Q3 Earnings and Cash Flow

Strattec Security ( (STRT) ) has released its Q3 earnings. Here is a breakdown of the information Strattec Security presented to its investors.

Strattec Security Corporation is a leading provider of smart vehicle access, security, and authorization solutions for the global automotive industry, known for its innovative approach in transitioning from mechanical to integrated electro-mechanical systems. In its fiscal 2025 third-quarter earnings report, Strattec Security Corporation announced a strong cash generation of $20.7 million from operations, reflecting improved working capital velocity and cash earnings. The company reported a net income of $5.4 million, or $1.32 per diluted share, marking a significant increase from the previous year’s $1.5 million, or $0.37 per diluted share.

Key financial highlights include a 2.4% increase in net sales to $144.1 million, driven by price increases, favorable product mix, and new program launches. The company’s gross profit rose to $23.1 million, with a gross margin expansion of 560 basis points, aided by favorable foreign currency exchange and cost improvements. Strattec also achieved an adjusted EBITDA of $12.9 million, representing 8.9% of sales, up from 4.4% in the prior-year period. The company continued its cost reduction efforts, notably restructuring operations in Mexico and Milwaukee, aiming for $5 million in annualized savings.

Looking ahead, Strattec Security Corporation remains focused on mitigating the impact of tariffs, which are estimated to add $9 million to $12 million in costs annually. The company is implementing strategies to offset these costs through supply chain adjustments and operational excellence initiatives. With a healthy balance sheet and strategic cost-saving measures, Strattec is poised to navigate the evolving market conditions and enhance its earnings power.