Vishay Precision Group Q2 Earnings Call Highlights

Key Points

• Revenue rose 12% year over year to $83.9 million, while orders reached $95.5 million and the book-to-bill ratio was 1.14, marking the seventh consecutive quarter at or above 1.0.
• The Sensors segment was the key growth driver, with record bookings of $48.1 million and a 1.44 book-to-bill ratio, supported by demand from AI infrastructure, semiconductor equipment, fiber-optic communications, aerospace and defense. VPG also received a production nomination from its initial humanoid robotics customer, which could ramp to thousands of robots per week later in 2026.
• Profitability was pressured by foreign exchange, higher costs and a roughly $3 million KELK shipment delay, resulting in a $1.7 million GAAP loss. Management expects third-quarter revenue of $84 million to $89 million, delayed KELK shipments to contribute more significantly in the fourth quarter, and full-year organic growth above its 8%–10% target.

Vishay Precision Group NYSE: VPG reported second-quarter 2026 revenue of $83.9 million, up 12% from a year earlier and essentially flat sequentially, as strong demand in its Sensors segment offset mixed conditions elsewhere in the business. The company said orders reached $95.5 million, producing a consolidated book-to-bill ratio of 1.14 and marking the seventh consecutive quarter at or above 1.0.

CEO and President Ziv Shoshani said order momentum reflected the company’s strategy to increase exposure to secular growth markets, including semiconductor equipment, data-center infrastructure, fiber-optic communications, aerospace and defense. The company generated $11.6 million of bookings from business-development initiatives during the quarter and $21.6 million in the first half, placing it on track for its $45 million full-year objective.

Revenue was affected by a temporary delay of roughly $3 million in shipments at the KELK business within Measurement Systems. Shoshani said supply-chain challenges related to the rollout of a new enterprise resource planning system caused the delays. The company said the ERP issues have been addressed, production has returned to normalized levels, and it expects to ship the delayed orders by the end of the fourth quarter.

Sensors orders reach a quarterly record

The Sensors segment generated revenue of $33.4 million, approximately flat from the first quarter and up 26% year over year. Segment bookings rose 6% sequentially to a record $48.1 million, resulting in a book-to-bill ratio of 1.44.

VPG attributed demand to AI-related infrastructure investments. Shoshani cited strong precision-resistor orders from semiconductor equipment manufacturers and semiconductor-device makers that use the products in custom test systems. Bookings from makers of long-haul, high-speed fiber-optic transmission equipment also remained elevated, while demand for avionics and defense applications continued.

The company received a formal vendor nomination letter from its initial humanoid robotics customer during the quarter. According to Shoshani, the customer expects to begin a production ramp in the second half of 2026, potentially increasing from tens of robots per week to hundreds and then thousands per week by year-end. VPG has hired and trained personnel, made capital investments and ordered raw materials based on the customer’s projected demand, he said.

Humanoid-related bookings were approximately $500,000 during the second quarter, while sales totaled $320,000. Shoshani said VPG is also providing prototypes to third and fourth humanoid customers, while a second customer is reevaluating and refining its designs. The company has identified approximately 150 potential humanoid suppliers as part of its customer-development efforts.

VPG said it is expanding Sensors manufacturing capacity and staffing to serve demand across AI infrastructure, data centers, defense and other AI-related markets. Capacity designated for the initial humanoid customer could support thousands of robots per week once orders are received, Shoshani said.

Mixed conditions in Weighing Solutions and Measurement Systems

Weighing Solutions revenue was $30.3 million, essentially unchanged sequentially and 3% higher than the prior-year period. Higher transportation and general-industrial sales, along with original equipment manufacturer construction demand, offset lower revenue from industrial weighing, precision agriculture and medical equipment markets.

Orders in the segment declined 13% sequentially to $28.6 million, producing a 0.94 book-to-bill ratio. Shoshani said demand was stable but mixed, with positive trends in consumer e-bike applications and construction equipment in the U.S. and Europe. Those conditions were offset by lower transportation orders associated with higher oil prices and softer industrial demand.

Despite flat revenue, Weighing Solutions gross margin rose 300 basis points sequentially to 37.3%, driven by cost reductions and favorable product mix.

Measurement Systems revenue declined 3% sequentially but increased 5% year over year. The company said lower sales in aerospace, military and space, or AMS, and transportation markets were partially offset by higher steel-market sales. The KELK shipment delays remained in backlog, according to management.

Orders in Measurement Systems were approximately $19 million, down 22% sequentially, which VPG attributed to the timing of DSI customer projects and continuing challenges in global steel markets. However, the company said its DTS business continued to see order growth from aerospace and defense markets. DTS was also named Supplier of the Year by Automotive Testing Technology International, Shoshani said.

Profitability affected by foreign exchange and mix

Second-quarter gross margin was 38.6%, essentially unchanged from the first quarter. Operating margin was negative 0.4%, while adjusted operating margin was 1.7% after restructuring costs, stock-based compensation and severance costs.

CFO Bill Clancy said unfavorable foreign exchange rates reduced operating profit by approximately $900,000 sequentially and $3.3 million from the prior-year period. Sensors gross margin was 31.5%, pressured by foreign exchange, higher material costs and wage increases tied to additional hiring. Measurement Systems gross margin was 52.5%, with manufacturing efficiencies offsetting lower volume and unfavorable mix.

VPG reported a GAAP loss of $1.7 million, or $0.13 per diluted share. Adjusted net earnings were $586,000, or $0.04 per diluted share. Adjusted EBITDA was $5.5 million, or 6.5% of revenue, compared with $5.9 million in the first quarter.

The company generated nearly $1 million in second-quarter cost savings and $1.6 million in the first half. Management remains on track to achieve about $6 million in 2026 savings as part of a three-year plan targeting approximately $20 million in reductions through manufacturing footprint optimization, automation and procurement efficiencies.

VPG ended the quarter with $75.7 million in cash after paying down $5 million of debt. Long-term debt stood at $15.6 million, leaving a net cash position of $60 million. Clancy said the debt repayment should reduce annual net interest expense by approximately $300,000.

Third-quarter outlook

For the third quarter, VPG expects revenue of $84 million to $89 million, based on constant second-quarter exchange rates and excluding anticipated tariff refunds to customers that management said would be profit neutral. The company has received roughly $1.5 million in tariff reimbursements so far in the third quarter, Clancy said.

Management said it expects some improvement in KELK output during the third quarter, with the larger contribution from delayed shipments expected in the fourth quarter. VPG expects full-year organic revenue growth to exceed the 8% to 10% annual target in its three-year operating model, with Clancy describing the outlook as double-digit revenue growth for 2026.

About Vishay Precision Group (NYSE:VPG)

Vishay Precision Group NYSE: VPG specializes in the design, manufacture and calibration of precision sensors, instrumentation and measurement systems used in a broad range of applications. Its product portfolio includes load cells, tension links, weighing modules, torque transducers, digital indicators and data acquisition systems. These solutions serve critical requirements for accuracy, reliability and repeatability in sectors such as industrial automation, test and measurement, medical devices, food and beverage processing, aerospace and defense.

The company traces its roots to the sensor and measurement division of Vishay Intertechnology, Inc, from which it was spun off as an independent public company in March 2016.

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