Universal Electronics Reports Financial Results for the Second Quarter 2026

About this update from Universal Electronics Inc.

Universal Electronics Inc. (UEI) (Nasdaq: UEIC) reported financial results for the three months ended June 30, 2026. Financial Results for the Three Months Ended June 30, 2026 compared to the same period in 2025 In Q2 2026, we significantly reduced our operational costs, improving our ability to generate profits going forward. GAAP operating expenses decreased by $7.1 million and adjusted non-GAAP operating expenses were down $6.2 million. GAAP net sales were $73.2 million, compared to $97.7 million. GAAP net sales in connected home were $25.1 million, compared to $34.1 million. GAAP net sales in home entertainment were $48.1 million, compared to $63.6 million. GAAP gross margins were 35.4%, compared to 29.9%; Adjusted non-GAAP gross margins were 35.4%, compared to 29.9%. GAAP operating income was $4.8 million, compared to GAAP operating income of $1.0 million; Adjusted non-GAAP operating income was $5.8 million, compared to Adjusted non-GAAP operating income of $2.9 million. GAAP net income was $1.6 million, or $0.12 per diluted share, compared to $(2.9) million, or $(0.22) per diluted share; Adjusted non-GAAP net income was $4.6 million, or $0.34 per diluted share, compared to Adjusted non-GAAP net income of $2.4 million, or $0.18 per diluted share. At June 30, 2026, cash and cash equivalents were $32.4 million. At June 30, 2026, shareholders' equity was $143.0 million. For a more detailed explanation of non-GAAP financial measures, please refer to the "Use of Non-GAAP Financial Metrics" and "Reconciliation of Adjusted Non-GAAP Financial Results" located elsewhere in this press release. Special Dividend UEI's Board of Directors has declared a one-time special cash dividend of $0.24 per share on its outstanding common stock. The special dividend will be payable on October 15, 2026 to stockholders of record as of the close of business on August 24, 2026. The special dividend reflects the Board's confidence in UEI’s financial position and its commitment to disciplined capital allocation while continuing to invest in UEI’s strategic initiatives and long-term growth opportunities. The declaration and payment of future dividends, if any, will remain subject to the discretion of the Board of Directors and will depend on UEI's financial condition, results of operations, capital requirements, contractual obligations and other factors the Board deems relevant. Amazon Patent Infringement Litigation UEI announced that it has filed a patent infringement lawsuit against Amazon.com, Inc., Amazon Web Services, Inc. and Amazon.Com Services LLC (collectively, “Amazon”) in the United States District Court for the Central District of California. The complaint alleges that certain Amazon products and services infringe multiple UEI patents relating to UEI's innovations in remote control and smart home connectivity technology. The asserted patents reflect decades of UEI's investment in research and development and the advancement of technologies that enable intuitive consumer experiences across entertainment and connected home devices. UEI believes that filing this action was necessary to protect its intellectual property rights. Through the litigation, UEI seeks appropriate remedies for Amazon's alleged infringement, including injunctive relief and monetary damages as provided by law. Financial Outlook We continue to expect adjusted non‑GAAP diluted earnings per share to be in the range of $0.45 to $0.65 for the fiscal year ending December 31, 2026, compared to $0.31 per share in fiscal 2025, consistent with our prior guidance. Management Transition UEI announced the appointment of Wade M. Jenke as President and Chief Executive Officer, succeeding Richard K. Carnifax, who has resigned from his roles with UEI to pursue an exceptional leadership opportunity with a company generating multi-billion-dollar annual revenue. Mr. Jenke previously served as UEI's Chief Financial Officer and has played a key role in the Company's operational and financial transformation. Raymond (Sui Man) Ho has been appointed as UEI’s Chief Financial Officer, succeeding Mr. Jenke. Mr. Ho previously served as UEI’s Interim Chief Financial Officer from September 2025 until December 2025 and has served as UEI's Sr. Vice President, Finance and in various other roles for more than 15 years. In addition, UEI appointed Joseph (Lee) Haughawout as Chief Operating Officer. Mr. Haughawout most recently served as UEI’s SVP, Product Development and has held leadership positions across the organization for more than 20 years. The Board of Directors expressed its gratitude to Mr. Carnifax for his outstanding leadership during an important period for UEI. Mr. Carnifax helped establish a strong foundation for UEI through a renewed focus on operational execution, transparency, accountability and disciplined capital allocation. The Board of Directors noted that Mr. Jenke has also been instrumental in executing the Company's turnaround initiatives and is exceptionally well positioned to lead UEI through its next phase. The Board of Directors expressed its full confidence in Mr. Jenke and the strengthened leadership team to build on the momentum achieved over the past several quarters and continue creating long-term value for our shareholders. Conference Call Information UEI’s management team will hold a conference call today, Thursday, August 6, 2026 at 4:30 p.m. ET / 1:30 p.m. PT, to discuss its second quarter 2026 earnings results, review recent activity and answer questions. To attend the call please register at: https://edge.media-server.com/mmc/p/n7ydfz8z/ to receive a computer-generated dial-in number and a unique pin number. The conference call will also be broadcast live on the investor section of the UEI website where it will be available for replay for 90 days. Use of Non-GAAP Financial Metrics In addition to reporting financial results in accordance with generally accepted accounting principles, or GAAP, UEI provides Adjusted non-GAAP information as additional information for its operating results. References to Adjusted non-GAAP information are to non-GAAP financial measures. These measures are not required by, in accordance with, or an alternative for, GAAP and may be different from non-GAAP financial measures used by other companies. UEI’s management uses these measures for reviewing the financial results of UEI for budget planning purposes and for making operational and financial decisions. Management believes that providing these non-GAAP financial measures to investors, as a supplement to GAAP financial measures, help investors evaluate UEI’s core operating and financial performance and business trends consistent with how management evaluates such performance and trends. Additionally, management believes these measures facilitate comparisons with the core operating and financial results and business trends of competitors and other companies. Adjusted non-GAAP gross profit is defined as gross profit excluding stock-based compensation expense. Adjusted non-GAAP operating expenses are defined as operating expenses excluding stock-based compensation expense, amortization of intangibles acquired, and severance. Adjusted non-GAAP net income (loss) is defined as net loss excluding the aforementioned items, foreign currency gains and losses, and the related tax effects of all adjustments, as well as valuation allowances on certain deferred tax assets and certain net deferred tax adjustments. Adjusted non-GAAP earnings (loss) per diluted share is calculated using Adjusted non-GAAP net income (loss). A reconciliation of these financial measures to the most directly comparable GAAP financial measures is included at the end of this press release. We do not provide a reconciliation for forward-looking non-GAAP financial metrics because reconciliation information is not available without unreasonable effort, such as attempting to make assumptions that cannot reasonably be made on a forward-looking basis to determine the corresponding GAAP metric. About Universal Electronics Universal Electronics Inc. (Nasdaq: UEIC) is the global leader in wireless universal control solutions for the home. The company brings to life millions of innovative control products each year that focus on a user-centric approach to building control products and applications that simplify user interaction with highly complex technologies in the home, removing interoperability challenges as a roadblock for user adoption, with privacy first and a secure by design approach to today's smart devices. Our products are offered by the world's leading brands in home entertainment and the connected home markets, including Fortune 500 customers Daikin, Carrier, Comcast, Vivint Smart Home, Samsung, Sony, Hunter Douglas and Somfy. The company's pioneering breakthrough innovations include its award-winning voice control entertainment remote controls and QuickSet Cloud, the world's leading platform for automated device and service discovery, set-up and control, and user experience personalization for the home. For more information, visit www.uei.com . Forward-looking Statements This press release contains "forward-looking statements" within the meaning of federal securities laws, including statements about payment of a special dividend; litigation with Amazon; our future financial results anticipated trends in our business and market conditions; management transition actions; and similar statements concerning anticipated future events and expectations that are not historical facts. We caution you that these statements are not guarantees of future performance and are subject to numerous risks and uncertainties, including those we identify below and other risk factors that we identify in our annual report on Form 10-K for the year ended December 31, 2025 and the periodic reports filed and furnished since then. Risks that could affect forward-looking statements in this press release include: our continued ability to timely develop and deliver innovative control solutions and technologies that are accepted by our customers, both near- and long-term; our ability to attract new customers and to successfully capture sales in all markets we serve, including in the climate control and connected home markets as anticipated by management; our ability to manage management transition actions; our ability to continue optimizing our manufacturing footprint and realize the lower concentration risks as expected by management; our ability to maintain our market share in the traditional subscription broadcast market; our ability to manage through the worldwide inflationary pressures and macroeconomic conditions; our ability to successfully execute our strategic actions and plans; our ability to continue to manage our business, inventories and cash flows to achieve our net sales, margins and earnings through financial discipline, operational efficiency, product line management, liquidity requirements, capital expenditures and other investment spending expectations; our continued ability to successfully enforce our patented technology, including with respect to our litigation against Roku and Amazon; our continued ability to strategically enhance, expand, and monetize our IP portfolios; the continued fluctuation in our market capitalization; the use of artificial intelligence applications which could result in cybersecurity incidents that implicate the personal data of end users or other unintended ethical, reputational, competitive harm or legal liability; the direct and indirect impact we may experience with respect to our business and financial results and management’s ability to anticipate and mitigate the impact stemming from the continued economic uncertainty affecting consumers’ confidence and spending, natural disasters or other events beyond our control, public health crises (including an outbreak of infectious disease), governmental actions, including the changes in or enhanced use of laws, regulations and policies may have on our business including the impact of decreased governmental incentive programs worldwide or of enhanced or expanded trade regulations, including the expanded use of tariffs, pertaining to importation of our products, the effects of political unrest, war, terrorist activities, or other hostilities; the effects and uncertainties and other factors more fully described in our reports filed with the SEC. Since it is not possible to predict or identify all of the risks, uncertainties and other factors that may affect future results, the above list should not be considered a complete list. Further, any of these factors could cause actual results to differ materially from the expectations we express or imply in this press release. We make these forward-looking statements as of the date hereof, and we undertake no obligation to publicly update or revise any forward-looking statement, whether as a result of new information, future events or otherwise, except as required by law or regulation. UNIVERSAL ELECTRONICS INC. CONSOLIDATED BALANCE SHEETS (In thousands, except share-related data) (Unaudited)       June 30, 2026   December 31, 2025 ASSETS         Current assets:         Cash and cash equivalents   $ 32,399     $ 32,306   Accounts receivable, net     83,885       79,320   Contract assets     8,396       8,091   Inventories     70,041       77,793   Prepaid expenses and other current assets     7,155       6,803   Assets held for sale     1,157       —   Income tax receivable     1,207       806   Total current assets     204,240       205,119   Property, plant and equipment, net     25,723       27,600   Intangible assets, net     20,152       21,968   Operating lease right-of-use assets     10,356       10,203   Deferred income taxes     2,915       5,496   Other assets     3,943       3,611   Total assets   $ 267,329     $ 273,997   LIABILITIES AND STOCKHOLDERS’ EQUITY         Current liabilities:         Accounts payable   $ 54,291     $ 48,945   Lines of credit     20,831       24,079   Accrued compensation     14,536       17,496   Accrued sales discounts, rebates and royalties     4,164       6,132   Accrued income taxes     1,578       2,524   Other accrued liabilities     19,852       20,134   Total current liabilities     115,252       119,310   Long-term liabilities:         Operating lease obligations     6,651       6,193   Deferred income taxes     1,526       1,507   Income tax payable     74       74   Other long-term liabilities     865       729   Total liabilities     124,368       127,813   Commitments and contingencies         Stockholders’ equity:         Preferred stock, $0.01 par value, 5,000,000 shares authorized; none issued or outstanding     —       —   Common stock, $0.01 par value, 50,000,000 shares authorized; 26,441,443 and 26,146,367 shares issued on June 30, 2026 and December 31, 2025, respectively     264       261   Paid-in capital     351,508       350,222   Treasury stock, at cost, 13,537,944 and 13,537,944 shares on June 30, 2026 and December 31, 2025, respectively     (375,016 )     (375,016 ) Accumulated other comprehensive income (loss)     (17,936 )     (19,115 ) Retained earnings     184,141       189,832   Total stockholders’ equity     142,961       146,184   Total liabilities and stockholders’ equity   $ 267,329     $ 273,997   UNIVERSAL ELECTRONICS INC. CONSOLIDATED STATEMENTS OF OPERATIONS (In thousands, except per share amounts) (Unaudited)     Three Months Ended June 30,   Six Months Ended June 30,     2026       2025       2026       2025   Net sales $ 73,238     $ 97,665     $ 152,274     $ 189,991   Cost of sales   47,332       68,469       105,768       134,712   Gross profit   25,906       29,196       46,506       55,279   Research and development expenses   4,340       6,959       9,791       14,190   Selling, general and administrative expenses   16,777       21,229       35,826       43,835   Operating income (loss)   4,789       1,008       889       (2,746 ) Interest income (expense), net   (176 )     (358 )     (270 )     (711 ) Other income (expense), net   (1,828 )     (1,751 )     (1,601 )     (1,699 ) Income (loss) before provision for income taxes   2,785       (1,101 )     (982 )     (5,156 ) Provision for income taxes   1,144       1,811       4,709       4,030   Net income (loss) $ 1,641     $ (2,912 )   $ (5,691 )   $ (9,186 )               Earnings (loss) per share:               Basic $ 0.13     $ (0.22 )   $ (0.45 )   $ (0.70 ) Diluted $ 0.12     $ (0.22 )   $ (0.45 )   $ (0.70 ) Shares used in computing earnings (loss) per share:               Basic   12,743       13,200       12,681       13,141   Diluted   13,425       13,200       12,681       13,141   UNIVERSAL ELECTRONICS INC. CONSOLIDATED STATEMENTS OF CASH FLOWS (In thousands) (Unaudited)       Six Months Ended June 30,       2026       2025   Cash flows from operating activities:         Net income (loss)   $ (5,691 )   $ (9,186 ) Adjustments to reconcile net income (loss) to net cash provided by (used for) operating activities:         Depreciation and amortization     6,185       7,622   Provision for credit losses     299       19   Deferred income taxes     2,725       641   Shares issued for employee benefit plan and compensation     1       331   Employee and director stock-based compensation     1,289       3,433   Gain on sale of property, plant, and equipment     41       —   Impairment of long-lived assets     20       110   Changes in operating assets and liabilities:         Accounts receivable and contract assets     (6,487 )     23,348   Inventories     8,054       1,715   Prepaid expenses and other assets     561       3,728   Accounts payable and accrued liabilities     (84 )     (15,395 ) Accrued income taxes     (1,392 )     1,339   Intercompany receivable/payable         Net cash provided by (used for) operating activities     5,521       17,705   Cash flows from investing activities:         Purchase of Blue Chip Swap securities     —       (2,544 ) Sale of Blue Chip Swap securities     —       2,314   Acquisitions of property, plant and equipment     (1,591 )     (2,261 ) Acquisitions of intangible assets     (704 )     (1,498 ) Net cash provided by (used for) investing activities     (2,295 )     (3,989 ) Cash flows from financing activities:         Borrowings under lines of credit     34,200       41,000   Repayments on lines of credit     (46,713 )     (48,000 ) Proceeds from short term debt     7,621       —   Treasury stock purchased     —       (748 ) Net cash provided by (used for) financing activities     (4,892 )     (7,748 ) Effect of foreign currency exchange rates on cash and cash equivalents     1,759       1,510   Net increase (decrease) in cash and cash equivalents     93       7,478   Cash and cash equivalents at beginning of period     32,306       26,783   Cash and cash equivalents at end of period   $ 32,399     $ 34,261             Supplemental cash flow information:         Income taxes paid   $ 2,696     $ 2,096   Interest paid   $ 655     $ 1,238   UNIVERSAL ELECTRONICS INC. RECONCILIATION OF ADJUSTED NON-GAAP FINANCIAL RESULTS (In thousands, except per share amounts) (Unaudited)       Three Months Ended June 30,   Six Months Ended June 30,       2026       2025       2026       2025   NET SALES:                 Net sales - GAAP   $ 73,238     $ 97,665     $ 152,274     $ 189,991   Adjusted Non-GAAP net sales   $ 73,238     $ 97,665     $ 152,274     $ 189,991                     Cost of sales:                 Cost of sales - GAAP   $ 47,332     $ 68,469     $ 105,768     $ 134,712   Stock-based compensation expense     (12 )     (12 )     (25 )     (28 ) Adjusted non-GAAP cost of sales     47,320       68,457       105,743       134,684   Adjusted non-GAAP gross profit   $ 25,918     $ 29,208     $ 46,531     $ 55,307                     Gross margin:                 Gross margin - GAAP     35.4 %     29.9 %     30.5 %     29.1 % Stock-based compensation expense     0.0 %     0.0 %     0.0 %     0.0 % Adjusted non-GAAP gross margin     35.4 %     29.9 %     30.5 %     29.1 %                   Operating expenses:                 Operating expenses - GAAP   $ 21,117     $ 28,188     $ 45,617     $ 58,025   Stock-based compensation expense     (509 )     (1,637 )     (1,264 )     (3,405 ) Amortization of acquired intangible assets     (207 )     (207 )     (414 )     (426 ) Severance (1)     (272 )     —       (1,547 )     (275 ) Adjusted non-GAAP operating expenses   $ 20,129     $ 26,344     $ 42,392     $ 53,919                     Operating income (loss):                 Operating income (loss) - GAAP   $ 4,789     $ 1,008     $ 889     $ (2,746 ) Stock-based compensation expense     521       1,649       1,289       3,433   Amortization of acquired intangible assets     207       207       414       426   Severance (1)     272       —       1,547       275   Adjusted non-GAAP operating income (loss)   $ 5,789     $ 2,864     $ 4,139     $ 1,388                     Adjusted Non-GAAP operating income as a percentage of net sales     7.9 %     2.9 %     2.7 %     0.7 % UNIVERSAL ELECTRONICS INC. RECONCILIATION OF ADJUSTED NON-GAAP FINANCIAL RESULTS (In thousands, except per share amounts) (Unaudited)       Three Months Ended June 30,   Six Months Ended June 30,       2026       2025       2026       2025   Net income (loss):                 Net income (loss) - GAAP   $ 1,641     $ (2,912 )   $ (5,691 )   $ (9,186 ) Stock-based compensation expense     521       1,649       1,289       3,433   Amortization of acquired intangible assets     207       207       414       426   Severance (1)     272       —       1,547       275   Foreign currency (gain)/loss     1,914       1,738       1,832       1,542   Income tax provision on adjustments     (5 )     1,714       3,878       4,357   Adjusted non-GAAP net income (loss)   $ 4,550     $ 2,396     $ 3,269     $ 847                     Diluted shares used in computing earnings (loss) per share:                 GAAP     13,425       13,200       12,681       13,141   Adjusted non-GAAP     13,425       13,589       13,346       13,448                     Diluted earnings (loss) per share:                 Diluted earnings (loss) per share - GAAP   $ 0.12     $ (0.22 )   $ (0.45 )   $ (0.70 ) Total adjustments   $ 0.22     $ 0.39     $ 0.67     $ 0.75   Adjusted non-GAAP diluted earnings (loss) per share   $ 0.34     $ 0.18     $ 0.24     $ 0.06   (1) The three and six months ended June 30, 2026 include severance costs associated with a global reduction in force primarily impacting roles within the selling and general and administration functions as well as engineering and research and development functions. The six months ended June 30, 2025 includes severance per the Transition Agreement and Release of Claims dated March 19, 2025 between Paul D. Arling and the Company.   View source version on businesswire.com: https://www.businesswire.com/news/home/20260806014459/en/

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