0000918541-26-000006
SEC filingNN, Inc. reported a net loss of $34.0 million for FY 2025, an improvement from a $38.3 million loss in FY 2024. Net sales declined 9.1% to $422.2 million, primarily due to rationalization of underperforming business and plants, the sale of the Lubbock operations, and lower volumes. Despite the sales decline, the loss from operations improved to $18.9 million from $27.5 million in the prior year, driven by lower depreciation and amortization expense and favorable changes in other operating items. The company generated $5.7 million in operating cash flow but used $11.0 million in investing activities for capital expenditures. Key forward-looking items include ongoing footprint optimization, new business wins in targeted growth areas, and the refinancing of the term loan facility completed in April 2025.
NN, Inc. reported a net loss of $34.0 million for the fiscal year ended December 31, 2025, representing an improvement from a net loss of $38.3 million in the prior year. Net sales decreased by $42.1 million (9.1%) to $422.2 million, primarily driven by the rationalization of underperforming business and plants, the sale of the Lubbock operations, lower volumes, and unfavorable foreign exchange effects. These decreases were partially offset by contributions from new business launches and higher precious metals pass-through pricing. The loss from operations improved to $18.9 million from $27.5 million in FY 2024, a favorable change of $8.6 million. This improvement was primarily due to lower depreciation and amortization expense (down $9.4 million) and a favorable change in other operating expense (income), net of $6.1 million, largely related to impairment charges recorded in the prior year.
Revenue declined across both reportable segments. Mobile Solutions net sales decreased by $39.9 million (14.1%) to $244.0 million, primarily due to rationalization of underperforming business and plants and lower volume in North America. Power Solutions net sales decreased by $1.9 million (1.1%) to $178.6 million, primarily due to the sale of the Lubbock operations, lower volumes, and unfavorable foreign exchange effects, partially offset by higher precious metals pass-through pricing. Geographically, 60% of products were sold to customers in North America, 19% in Asia, 10% in South America, and 11% in Europe. The top ten customers accounted for approximately 49% of net sales, with one Mobile Solutions customer representing 11% of consolidated net sales.
The gross margin decreased to 14.1% in FY 2025 from 15.0% in FY 2024. Cost of sales decreased by $32.0 million (8.1%), primarily due to the decrease in sales volume. The operating margin improved to -4.5% from -5.9% in the prior year. Selling, general, and administrative expense decreased by $3.3 million (6.7%), primarily due to lower compensation expense from headcount reduction. Depreciation and amortization expense decreased significantly by $9.4 million (20.7%), primarily due to the impact of historical purchase accounting step-up basis becoming fully depreciated in the second half of 2024.
The company generated $5.7 million in net cash from operating activities, a decrease from $11.1 million in the prior year. The decline was due to a decrease in other operating liabilities, an increase in inventory, and timing of dividend received from the joint venture. Net cash used in investing activities was $11.0 million, primarily for acquisition of property, plant and equipment ($12.9 million). Net cash used in financing activities was $2.5 million. Total assets decreased by $16.1 million to $440.8 million, while total liabilities increased by $5.5 million to $294.4 million. Working capital was $74.2 million as of December 31, 2025, compared to $83.7 million as of December 31, 2024. The company had $11.4 million in cash and cash equivalents and $26.7 million available for future borrowings under the ABL Facility as of year-end.
Management continues to execute on its enterprise transformation plan through obtaining new business wins in targeted growth areas, intentionally shifting the business portfolio, expanding margins through improved sales mix, cost improvement plans, improving underperforming plants, strategically rationalizing the footprint, achieving net cost-down through continuous improvement programs, and improving operating performance. The company completed a refinancing of its term loan in April 2025. Risk factors include increased prices or significant shortages of commodities, which could have a material adverse effect on the business. The company continues to monitor impacts of macroeconomic and geopolitical events, including inflationary cost pressures on metals and raw materials, elevated interest rates, and supply chain disruptions.