KN · Knowles Corporation

Knowles Corporation delivered strong Q1 2026 results from continuing operations, with revenues of $153.1 million reflecting 16% year-over-year growth, surpassing the high-end of prior guidance as noted by CEO Jeffrey Niew. This performance was fueled by robust demand across Medtech, Defense, Industrial, and Electrification end markets, complemented by new design wins and a healthy backlog. Precision Devices segment grew 17.4% year-over-year, driven by broad-based strength and improved factory utilization, while MedTech & Specialty Audio increased 13.9% from higher hearing health shipments tied to customer product launches. Gross margin expanded significantly to 43.8% on a GAAP basis (from 40.3%) and 45.5% non-GAAP (from 41.6%), reflecting favorable product mix, pricing, and operational leverage. Non-GAAP diluted EPS surged 50% to $0.27, supported by higher volumes, margin gains, and lower interest expense. Operating cash flow was seasonally negative at $(0.7) million. For Q2 2026, the company guides revenues to $152-162 million and non-GAAP EPS to $0.28-0.32, with operating cash flow expected at $20-30 million. Management highlighted execution on strategy, leveraging unique technologies and customer intimacy for custom products, positioning for full-year organic growth above May 2025 investor day targets. Results exclude the divested Consumer MEMS Microphones business from December 2024.