TTM Technologies Q1 Earnings Call Highlights

Key Points

• TTM reported a record quarter, beating guidance with Q1 revenue of $846 million (+30% YoY) and non-GAAP EPS of $0.75, driven largely by sustained demand tied to AI and defense (management says about 80% of net sales are tied to those megatrends).
• Order strength and mix: companywide book-to-bill was 1.41 with a 90-day backlog of $787 million; Aerospace & Defense comprised 40% of sales (up 11% YoY) while Data Center & Networking was 36% (up 61% YoY).
• Margins and outlook improved — non-GAAP gross margin rose to 22.3% and operating margin to 12.8% — while management raised full-year CapEx to $300–$320M to expand capacity (Penang ramp improving, Eau Claire expansion progressing) and guided Q2 revenue of $930–$970M and non-GAAP EPS of $0.82–$0.88.

TTM Technologies NASDAQ: TTMI reported first-quarter fiscal 2026 results that exceeded its prior guidance and set quarterly records for both revenue and non-GAAP earnings per share, as demand tied to artificial intelligence and defense spending continued to drive growth.

Record quarter driven by AI and defense demand

President and CEO Edwin Roks said the company is focused on two strategic directions: “advanced interconnect,” including complex printed circuit boards, substrates, and advanced packaging, and a second direction that extends those capabilities into modules, subsystems, and systems such as RF modules, thermal and power management, edge and AI processing products, and integrated mission systems.

Roks said TTM continues to see “healthy multi-year tailwinds” from artificial intelligence and defense, reiterating a prior view that about 80% of net sales are tied to those two megatrends. He also said the company is “tracking well ahead” of its previously communicated plan to grow revenue 15% to 20% annually over the next three years and to double earnings from 2025 to 2027, goals he said were reiterated on the company’s February earnings call.

For the quarter, TTM posted sales of $846 million and non-GAAP EPS of $0.75 per diluted share, which Roks said were both above the company’s guidance and “all-time quarterly highs.” Revenue rose 30% year-over-year, which management attributed to “continued demand strength” in data center and networking tied to AI, along with strong growth in medical, industrial, and instrumentation as well as aerospace and defense.

Segment performance and backlog trends

Roks detailed end-market mix and growth trends:

• Aerospace and Defense: 40% of Q1 sales; up 11% year-over-year. Roks cited significant bookings tied to the LTAMDS air defense radar, AN/APS-153 maritime surveillance radar, and a transportable radar surveillance system for ballistic missile detection and tracking. He also said the company has a first booking “confirmed to support Golden Dome.” A&D book-to-bill was 1.1, with program backlog of $1.6 billion, similar to the prior-year level.
• Data Center and Networking: 36% of Q1 sales; up 61% year-over-year, which Roks said was above expectations as customers build out AI data centers.
• Medical, Industrial, and Instrumentation: 16% of Q1 sales; up 61% year-over-year. Roks pointed to demand for AI-enabled robotics in medical and automated test equipment for AI applications. He highlighted a win for a “major continuous glucose monitoring custom product,” with TTM involved on both current and next-generation designs.
• Automotive: 8% of Q1 sales. Roks said the company remains selective, focusing on higher value-add products that fit its margin targets, while supporting Tier 1 customers as they transition advanced capabilities to ancillary end markets.

Companywide, the overall book-to-bill ratio was 1.41 in the quarter, with the commercial reporting segment at 1.65 and the A&D reporting segment at 1.10. The 90-day backlog was $787 million at quarter-end, up from $570 million a year earlier.

Margins improve on mix and operating leverage

Executive Vice President and CFO Daniel Boehle said net sales rose to $846 million from $649 million a year ago, driven by strength in data center and networking, medical/industrial/instrumentation, and aerospace and defense, partially offset by a “more modest than anticipated decline” in automotive.

On a GAAP basis, operating income was $72.4 million, up from $50.3 million a year earlier. GAAP net income was $50 million, or $0.47 per diluted share, compared with $32.2 million, or $0.31 per diluted share, in the year-ago quarter.

On a non-GAAP basis, Boehle reported gross margin of 22.3%, up 150 basis points year-over-year, driven by higher volume and favorable product mix, “particularly in the data center, networking, and Aerospace and Defense end markets.” Non-GAAP operating margin was 12.8%, a 230-basis-point improvement, which he attributed to improved gross margin and operating leverage.

Adjusted EBITDA was $132.9 million, or 15.7% of net sales, compared with $99.5 million, or 15.3%, in the prior-year period. Non-GAAP net income was $80.1 million, or $0.75 per diluted share, up from $52.4 million, or $0.50 per diluted share, a year earlier.

Boehle also cited a $7 million foreign exchange loss in Q1 tied to a weakening U.S. dollar, compared with a $0.9 million gain in the year-ago quarter.

Cash flow, CapEx, and capacity expansion

Operating cash flow was $21.7 million despite higher working capital to support growth, compared with cash used in operations of $10.7 million a year ago. Free cash flow was a net usage of $85 million versus a net usage of $74 million, which Boehle said reflected increased capital expenditures to support organic growth.

During the Q&A, management discussed multiple expansion efforts. Roks said the company is making “really good progress” at the Eau Claire facility, describing it as about 750,000 square feet with “three modules” that can support either commercial or defense production, and adding that TTM plans to build an R&D center at the site to work closely with customers on new developments.

On costs tied to supply chain dynamics, Investor Relations Vice President Sean Hannan said the company is observing “some pressure in the supply chain environment” around lead times and pricing, but added it is not restricting TTM’s ability to reach its goals. Hannan also said the company was not currently observing a specific derivative impact on laminate costs stemming from higher oil prices.

Roks also provided an update on the Penang ramp, saying yields are improving and describing progress with an anchor customer, noting yields moving from “above 40% last quarter” to “closer to 70% and 80%.” He said the facility is getting close to break-even, adding he would “be very surprised” if Penang is not at break-even by Q4, “and hopefully earlier.” He reiterated prior commentary about a headwind from Penang ramp costs, saying the company is still on track to reduce that impact, referencing moving from 160 basis points to about 80 basis points for the full year, with an aim to do better.

On capital spending, Boehle said CapEx expectations for the year are increasing from roughly $240 million-$260 million to $300 million-$320 million. He attributed the change to accelerated spending in Asia and efforts to stay ahead of equipment lead times, noting deposits contributed to higher cash expenditures.

Outlook and upcoming investor events

For the second quarter of fiscal 2026, Boehle guided to net sales of $930 million to $970 million and non-GAAP EPS of $0.82 to $0.88 per diluted share. He said the company believes the sales growth trajectory in the first half should continue into the second half of the year, citing current demand dynamics.

Management also provided expected Q2 end-market mix: aerospace and defense at 36% of sales, data center and networking at 42%, medical/industrial/instrumentation at 14%, and automotive at about 8%.

Boehle said the company expects second-quarter SG&A expense to be about 7.4% of net sales and R&D expenditures to be about 1% of net sales, with interest expense around $10.6 million and an effective tax rate between 13% and 17%.

TTM also announced participation in upcoming conferences—the Barclays Leveraged Finance Conference on May 19 and the B. Riley 2026 Investor Conference on May 20—and said it will host an Investor Day on May 27 at the Nasdaq Exchange in New York City.

About TTM Technologies NASDAQ: TTMI

TTM Technologies, Inc is a leading global manufacturer of printed circuit boards (PCBs) and related electronic components. The company's product portfolio spans rigid, flexible and rigid-flex circuit boards, as well as advanced substrates, backplanes, hybrid circuits and integrated antenna modules. In addition to PCB fabrication, TTM offers comprehensive system‐level services, including design support, surface mount technology (SMT) assembly, cable and wire harness assembly, and complete box-build solutions to address end-to-end customer requirements.

Serving a broad array of end markets, TTM Technologies supports customers in the communications, computing, automotive, aerospace and defense, industrial, and medical sectors.

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