Nortech Systems Inc (NAS:NSYS)

Q2 2026 Nortech Systems Inc Earnings Call Transcript

Aug 12, 2026 / 08:30 PM GMT

Release Date Price: $15.21 (+2.22%)

Transcript 10-Q8-K

Key Points

Positve

Nortech Systems Inc (NSYS) reported a 9.3% year-over-year increase in net sales, reaching $33.5 million in Q2 2026.
Gross margin improved to 17%, up 120 basis points from the prior year, driven by higher revenue and improved manufacturing cost absorption.
Total order backlog grew 19.8% year-over-year to $93.8 million, with 90-day shipment backlog up 25.8%, indicating strong future demand.
The company is well-positioned in the nearshoring landscape with its North American footprint, including operations in Mexico under the USMCA framework.
Nortech Systems Inc (NSYS) is investing in innovative technologies like Power over Fiber and ruggedized fiber optics, which are gaining traction in aerospace, defense, and medical markets.
Year-to-date operating income turned positive at $670,000, compared to an operating loss of $871,000 in the same period last year.

Negative

Aerospace and defense sales decreased 12.8% in the quarter due to one customer reducing post-COVID inventory levels.
Industrial sales declined 4.7%, impacted by customer inventory adjustments and temporary production disruptions from the transfer of manufacturing to Monterey, Mexico.
Operating expenses increased to $5.1 million from $4.1 million, primarily due to higher incentive compensation accruals in 2026.
Cash used in operating activities was $2.4 million in the first half of 2026, with significant cash tied up in accounts receivable and inventory to support growing backlog.
The tariff environment remains uncertain, and while the company is pursuing reimbursement for previously paid IEPA-related tariffs, no amounts have been recognized as of June 30, 2026.
The company faces ongoing supply chain challenges, including component constraints, longer lead times, and price volatility, which could impact production continuity.

Refinitiv StreetEvents Event Transcript
E D I T E D V E R S I O N

NSYS.OQ - Nortech Systems Inc
Q2 2026 Nortech Systems Inc Earnings Call
Aug 12, 2026 / 08:30PM GMT

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Presentation
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Unidentified_1 [1]
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Good afternoon, ladies and gentlemen, and welcome to the Nortek Systems Incorporated second quarter 2026 earnings conference call.

With me on the line today are Jay Miller, President and Chief Executive Officer and Andrew Laference, Chief Financial Officer and Senior Vice President of Finance.

All lines have been placed on a listen-only mode and the call will be open for questions and comments following the management presentation.

At this time, it is my pleasure to turn the call over to Andy Laference.

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Unidentified_2 [2]
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