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CHICAGO - Methode Electronics, Inc. (NYSE:MEI) shares plunged 9.6% after the company reported disappointing third quarter results and provided weak guidance for the fourth quarter.
The custom-engineered solutions provider posted an adjusted loss of $0.21 per share for Q3, missing analyst estimates for a loss of $0.12 per share. Revenue fell 7.6% year-over-year to $239.9 million, also falling short of expectations for $259.27 million.
Methode’s Q3 sales were negatively impacted by lower volume in the Automotive segment, particularly in Asia and North America. This was partially offset by higher demand for power distribution products for data centers in the Industrial segment.
For the fourth quarter, Methode forecasts revenue between $240-255 million, well below the consensus estimate of $292.7 million.
"Our journey to transform Methode is well underway," said President and CEO Jon DeGaynor. "Our actions to improve execution, while still in an early phase, positively impacted our financial results but were partially masked by challenging market headwinds."
Despite the weak quarter, Methode reaffirmed its expectation for fiscal 2026 net sales to be greater than fiscal 2025 and pre-tax income to be positive and notably greater than fiscal 2025.
The company generated positive free cash flow of $19.6 million in Q3, up from $12.2 million a year ago, driven by proactive delays in capital expenditures.
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