Daktronics, Inc.
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Item 1. BUSINESS
Business Overview
Daktronics designs, manufactures, and sells electronic display systems and related solutions used in sports, commercial, and transportation applications. The Company’s offerings include standard display products as well as custom-designed and integrated systems that incorporate display hardware, control systems, and software.
The Company’s product portfolio ranges from small scoreboards and electronic displays to large-scale video display systems deployed in stadiums, arenas, commercial facilities, and other public venues. These systems are often integrated with related technologies, including control, timing, and audio systems, and are used to present real-time data, graphics, animation, and video.
Daktronics operates a vertically integrated business model that includes marketing and sales, engineering and product design and development, manufacturing, installation, and ongoing customer support. This lifecycle approach allows the
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Company to support customers from initial system design and installation through long-term maintenance, upgrades, and replacement cycles.
In addition to equipment sales and installation, the Company provides services that include technical support, professional services, and software-based solutions that enable customers to operate and manage their display systems.
Daktronics was founded in 1968 in Brookings, South Dakota and became a publicly traded company in 1994.
The Company operates globally, with manufacturing, sales, and service capabilities that support customers across multiple geographic regions and end markets. We currently employ 2,693 people globally.
We are headquartered at 201 Daktronics Dr., Brookings, SD 57006, telephone 605-692-0200. Our Internet address is https://www.daktronics.com.
Available Information
We file annual, quarterly, and current reports, proxy statements, and other information with the SEC pursuant to Section 13(a) or 15(d) of the Exchange Act. Daktronics makes available, free of charge on the “Investor Relations” section of our website at https://investor.daktronics.com/, our annual reports on Form 10-K; quarterly reports on Form 10-Q; current reports on Form 8-K; Forms 3, 4 and 5 filed on behalf of directors and executive officers; and any amendments to those reports filed or furnished pursuant to the Exchange Act. Our reports and other information filed with the SEC are made available online as soon as reasonably practicable after such material is electronically filed with, or furnished to, the SEC. Information contained on our website is not deemed to be incorporated by reference into this Report or filed with the SEC.
Additionally, you may read all of the materials that we file with the SEC by visiting the SEC's website at www.sec.gov. This site contains reports, proxy and information statements, and other information regarding the Company and other companies that file electronically with the SEC.
Reportable Segments
We focus our sales and marketing efforts on markets, geographical regions, and products. Our five business segments consist of four domestic business units and the International business unit. The four domestic business units consist of Commercial, Live Events, High School Park and Recreation, and Transportation, all of which include the geographic territories of the United States and Canada. Financial information concerning these segments is set forth in this Form 10-K in “Part II, Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations” and “Note 3. Segment Reporting” of the Notes to our Consolidated Financial Statements included in this Form 10-K.
Industry Background
The market for large-format digital display systems has evolved from the use of traditional scoreboards and basic electronic displays to integrated visual communication systems that combine hardware, software, and services. Advancements in light emitting diode (“LED”) technology have enabled the development of high-resolution, energy-efficient displays capable of delivering dynamic video, graphics, and data in a wide range of environments.
Today, digital display systems are used across multiple vertical markets, including sports and live events, commercial and advertising, transportation, and other public and private infrastructure applications. These systems are used to inform, entertain, and engage audiences, and increasingly serve as platforms for advertising, real-time information delivery, and enhanced user experience.
Industry demand is supported by continued adoption of digital display technologies, including the ongoing transition from static to digital signage, increasing display resolution and size, and the use of integrated software and control systems to manage content and operations. In addition, the declining cost of display technologies and advancements in manufacturing processes have expanded the accessibility and application of these systems across a broader set of customers and use cases.
Description of Business
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We are engaged in a full range of activities: marketing and sales, engineering and product design and development, manufacturing, technical contracting, professional services, and customer service and support. Each of those activities is described below:
Marketing and Sales. Our sales force is comprised of direct sales staff and resellers, including AV integrators, located throughout the world supporting all customer types in both sales and service. We primarily use our direct sales force for large integrated display system sales in professional sports, colleges and universities, and commercial spectacular projects. We also use our direct sales force to sell to out-of-home advertising companies, transportation system operators, and certain high school, park and recreation customers. The majority of our products sold by resellers are standard catalog products such as video boards and dynamic message systems and increasingly include indoor micro-LED configurable display systems. We also utilize resellers outside North America for large integrated system sales where we do not have a direct sales presence. We support our resellers through direct mail, email advertising, social media campaigns, trade journal advertising, product and installation training, trade show exhibitions, and accessibility to our regional sales and service teams and demonstration equipment.
Engineering and Product Design and Development. The large format electronic display industry is characterized by ongoing product innovations and developments in technology and complementary services. To remain competitive, we have a tradition of applying engineering resources throughout our business to anticipate and respond rapidly to system needs in the marketplace. We employ and contract with engineers and technicians in the areas of mechanical and electrical design; applications engineering; software design; quality design; and customer and product support. Product managers assigned to each product family assist our sales staff in training and implementing product improvements ensuring each product maintains maximum reliability and serviceability. We employ and contract with process engineers to assist in quality and reliability processing in our product design testing and manufacturing areas. We also make selected investments in and contract with affiliated companies to support and advance technologies and capabilities for our product lines and solutions.
Manufacturing. The majority of our products are manufactured in the United States, specifically in South Dakota and Minnesota. We also have manufacturing facilities in China and Ireland, and plan to open a facility in Mexico in fiscal 2027. We perform component manufacturing, system manufacturing (metal fabrication, electronic assembly, sub-assembly, and final assembly), and testing in-house for most of our products to control quality, improve response time, and maximize cost-effectiveness. Given the cyclical nature of some parts of our business and our dispersed sales geography, we balance and maintain our ability to manufacture the same products across our plants so we can efficiently utilize our capacity and reduce costs. A key strategy of ours is to increase standardization and commonality of parts and manufacturing processes across product lines using product platforms to increase efficiencies. Other strategies include supplier management programs, reduction in complexity focus, and lean manufacturing techniques. For more details on our facilities, see “Part I, Item 2. Properties” in this Form 10-K.
Technical Contracting. We serve as a technical contractor for larger display system installations requiring custom designs and innovative product solutions. The purchase of display systems typically involves competitive proposals. As part of our response to a proposal request, we may suggest additional products or features to assist the prospective customer in analyzing the optimal type of display system. We usually include site preparation and installation services related to the display system in our proposal. In these cases, we serve as a contractor and may retain subcontractors for electrical, steel, and installation labor. We have developed relationships with many subcontractors throughout the United States and internationally, producing an advantage in bidding and delivering on these projects. We are licensed as a general contractor in many jurisdictions.
Professional Services. To assist our clients’ ability to engage, inform, and entertain their audiences, we provide professional services including event support, event production curriculum, content creation, product maintenance, marketing assistance, initial and ongoing hardware and software training, control room design, and continuing technical support for operators.
Customer Service and Support. We offer limited warranties on our products, ranging from one to 10 years, against failure due to defective parts or workmanship. In addition, we offer service agreements of various scopes. To serve our customers, we provide help-desk access, parts repair and replacement, display monitoring, and on-site support. Our technical help desk has experienced technicians who are on-call 24 hours a day to support events and sites. Our field service personnel and third-party service partners are trained to provide on-site support. We use third-party service partners to allow us to respond to changes in volume of service requests we experience during our seasonal peaks.
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Products and Technologies
The two principal components of our systems are the display and the control system, which manages the operation of the display. We produce displays varying in complexity, size, and resolution. The physical dimensions of a display depend on the size of the viewing area, the distance from the viewer to the display, and the amount and type of information to be displayed. The control system is comprised of various combinations of computer hardware, video processing hardware, and software products designed to compile information provided by the operator and other integrated sources to display information, graphics, video, or animation on the displays. We customize our products according to the design specifications of the customer and the conditions of the environment in which our products function.
Our product offerings fall into two broad categories: (1) various families of digital display hardware systems and (2) the control systems and software that manage and drive those displays. The following product families reflect this structure:
Audio/Visual Hardware and Digital Media Players
•Video displays/video walls
•Sport scoreboard solutions
•LED Message displays and signs
•ITS (intelligent transportation systems) dynamic message signs
•Mass Transit displays
•Sound systems
•Digital billboards
•Digital street furniture
•Digit and price displays
•Indoor dynamic messaging systems
Software and Controllers
•Venus® Control Suite (“VCS”)
•All Sport Scoring Control
•Show Control
•Camino
Each of these product families is described below:
Video Displays/Video Walls. These displays are comprised of a large number of full-color pixels capable of showing various levels of video feeds, pre-rendered graphics, and animated content with Real Time Data capabilities. These displays include red, green, and blue LEDs arranged in various combinations to form pixels. The electronic circuitry, which controls the pixels, allows for variances in the relative brightness of each LED to provide a full color spectrum, thereby displaying video images in striking, vibrant colors. Variables in video displays include the spacing of the pixels (pixel pitch), the resolution of the displays (number of pixels), the brightness of the displays (nits), the number of discrete colors the display is able to produce (color depth), the viewing angles, and the LED technology.
We offer a broad range of indoor and outdoor LED video displays with these varying features. Examples of offerings include centerhung displays, landmark displays, video walls, ribbon board displays, hanging banners, roadside displays, digital billboards, corporate office entrance displays, conference room displays, control room displays, and video displays designed for arenas, stadiums, retail stores, restaurants, malls, transportation hubs, and other similar indoor facilities.
Video displays deliver content that serves as a revenue generation source for our customers through advertising or as an information and entertainment communication medium (such as scoring, statistics, live video, video replays, wayfinding, advertising, and control center information), or provide interior design elements to create luxurious space to feature digital art. These displays are supported by control software, video processing hardware, and proprietary digital media players that enable playback, routing, and management of live video, graphics, and scheduled content.
The control components for video displays in live event applications include our Show Control Software Suite, which can integrate newer features like our Camino graphics engine, as well as proprietary digital media players, and video processors. These control components provide capabilities for the display of live video and real-time content on our displays. The Show Control Software Suite can operate an entire network of displays within a venue from a single, intuitive control interface. Its features allow users to instantly deliver media clips, camera feeds, and streaming information to any display in a venue.
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Financial statements
data from SEC XBRL filings. Values are as-reported; restatements supersede originals. Values reported in .
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Item 7. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
Management’s Discussion and Analysis of Financial Condition and Results of Operations (“MD&A”) provides a narrative from the perspective of management relating to the financial condition, results of operations, liquidity, capital resources, and other factors that may impact our financial performance.
The MD&A should be read in conjunction with the accompanying Consolidated Financial Statements and Notes to the Consolidated Financial Statements included in this Form 10-K.
Daktronics operates on a 52- or 53-week fiscal year, with our fiscal year ending on the Saturday closest to April 30 of each year. When April 30 falls on a Wednesday, the fiscal year ends on the preceding Saturday. Within each fiscal year, each quarter is comprised of a 13-week period following the beginning of each fiscal year. In each 53-week year, an additional week is added to the first quarter, and each of the last three quarters is comprised of a 13-week period. The fiscal year ended May 2, 2026 contained operating results for 53 weeks. The fiscal years ended April 26, 2025 and April 27, 2024 contained operating results for 52 weeks.
The year-over-year comparisons in this MD&A are as of and for the fiscal years ended May 2, 2026 and April 26, 2025, unless stated otherwise. Information pertaining to fiscal year 2024, including but not limited to, a comparison of fiscal 2025 with fiscal 2024 results of operations, liquidity, and other information, can be found in Part II, Item 7 “Management’s Discussion And Analysis Of Financial Condition And Results Of Operations” of our Annual Report on Form 10-K for fiscal 2025 filed with the SEC on June 25, 2025 under the sections entitled “Results of Operations - Consolidated Performance Summary” and “Results of Operations - Reportable Segment Performance Summary.”
Non-GAAP Measures
Contribution margin, which is a financial measure that is not defined under accounting principles generally accepted in the United States (“GAAP”), is utilized by management to evaluate segment profitability and guide resource allocation decisions. It is defined as gross profit less selling expenses. Selling expenses primarily include personnel-related costs, travel and entertainment, marketing expenditures (such as showroom operations, product demonstrations, depreciation and maintenance, conventions, and trade shows), costs associated with customer relationship management and marketing systems, bad debt expense, third-party commissions, and other related expenses. In the “Results of Operations - Reportable Segment Performance Summary” section of this MD&A, contribution margin is reconciled to gross profit, which is the most directly comparable GAAP financial measure.
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In addition to gross profit, management considers contribution margin a meaningful metric for assessing the financial performance of individual segments. Management believes this measure provides investors with a useful view of our segment-level performance consistent with the approach used by management. By presenting contribution margin, we aim to enhance transparency and allow investors to better understand how we evaluate and manage our business operations.
Overview
Daktronics designs, manufactures, and provides electronic display systems and solutions used to inform, entertain, and communicate in a variety of end markets, including sports, commercial, and transportation. Our offerings include standard display products as well as customized digital display systems integrated with control, software, and content management capabilities.
Our product portfolio ranges from small-scale scoreboards and message displays to large, complex video display systems deployed in stadiums, arenas, commercial facilities, and other high-visibility environments. These systems are often integrated with related technologies, including control systems, timing equipment, audio systems, and software platforms that enable customers to manage and operate display content.
We operate a vertically integrated business model that includes product design and engineering, manufacturing, installation, and ongoing support services. This lifecycle approach allows us to support customers from initial project planning and system deployment through long-term maintenance, upgrades, and replacement cycles.
In addition to equipment sales and installation, we provide a range of services, including technical support, professional services, and software-based solutions. These offerings support customers in operating their systems and managing content over the life of the display and contribute to recurring revenue opportunities.
Our operations include marketing and sales, engineering and development, manufacturing, project execution, and customer service, supported by a global footprint that enables us to serve customers across multiple regions.
Known Trends and Uncertainties
During fiscal 2026, we remained focused on the execution of initiatives intended to support sustainable growth, improve operating margins, and enhance returns on invested capital. The Company’s operating roadmap, informed by multi‑year analysis and planning, is intended to support improved alignment between demand and financial performance. Demand trends during fiscal 2026 reflected continued market adoption of digital display technologies and the breadth of Daktronics’ integrated product and service offerings, underscoring the importance of disciplined execution across our operations.
The business environment remains dynamic, with several external factors continuing to influence customer demand and operational costs. The Company is affected by U.S. government‑imposed tariffs on electronic components, aluminum, steel, and copper, as well as reciprocal tariffs imposed by foreign countries. In addition, changes to U.S. trade policy, including the elimination of the de minimis exemption for certain low‑value shipments, continue to increase logistics and import‑related costs. These tariffs have adversely impacted gross margins and influenced customer purchasing behavior, particularly for projects dependent on federal funding, and may continue to do so in the future. In response, Daktronics continues to evaluate pricing strategies and sourcing plans to mitigate these effects; however, the ultimate impact on demand and profitability remains uncertain.
On February 20, 2026, the U.S. Supreme Court ruled that tariffs imposed by the U.S. presidential administration under the International Emergency Economic Powers Act (“IEEPA”) exceeded presidential authority and were invalid. Following the ruling, the administration implemented a temporary global tariff under alternative trade authorities and has indicated an intention to increase the tariff rate to as much as 15%. The timing, duration, and final rate of these tariffs remain uncertain. In addition, on April 20, 2026, the U.S. Customs and Border Protection (“CBP”) opened a refund portal related to amounts previously paid under the invalidated IEEPA tariffs. While the Company may pursue potential refunds through this process, the timing and amount of refunds, if any, are uncertain.
As of the date these financial statements were issued, no amounts related to potential refunds have been recorded in the accompanying financial statements. The Company is evaluating available information and monitoring developments related to the ongoing litigation and CBP’s refund process. Due to the uncertainty regarding eligibility, timing, and the final resolution of tariff refund related administrative matters, the Company is unable to reasonably estimate the likelihood, amount or timing of any potential refunds.
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The global market for digital display systems continues to expand, supported by customer investments in manufacturing capacity and ongoing advancements in display and control technologies. The industry is experiencing increased adoption of surface mount and chip‑on‑board technologies, particularly for narrow pixel pitch (“NPP”) and micro‑LED applications, as customers seek higher performance, increased efficiency, and improved reliability. In addition, continued innovation in software, artificial intelligence, and professional services is influencing content creation, user interfaces, system monitoring, and security capabilities across digital display platforms.
Daktronics participates in target markets that are large and growing and are supported by demand from customers seeking to enhance audience experiences in sports, commercial, and transportation environments. As these markets evolve, the Company continues to invest in capacity, systems, and resources to support execution, address customer requirements, and pursue growth opportunities; however, the timing and extent of market adoption and demand may vary based on economic conditions, customer funding availability, and competitive dynamics.
To address evolving market conditions and competitive dynamics, we continue to focus on execution initiatives related to digital capabilities, cost structure optimization, and market expansion. These efforts are intended to enhance operating efficiency, improve delivery and service performance, and support long‑term growth opportunities. While these initiatives are designed to improve financial performance and capital efficiency over time, their effectiveness depends on successful execution, sustained customer demand, and the Company’s ability to manage costs, complexity, and operational change. As a result, the timing and extent of associated benefits remain uncertain.
The Company continues to monitor and adjust its capacity and resource levels in response to market conditions. As part of its efforts to increase manufacturing flexibility and operational agility, Daktronics is expanding its global manufacturing footprint to include a facility in Mexico. The facility is expected to commence production in fiscal 2027. While the Company expects the facility to support cost structure efficiency and manufacturing flexibility over time, the pace of the production ramp‑up and the extent and timing of any associated financial benefits depend on execution, staffing, and market conditions.
There may be periods in which sales levels and expense trends are not fully aligned, particularly as the Company continues to invest in operational execution, systems, and corporate governance. These investments may exert pressure on near‑term profitability; however, they are intended to support operating effectiveness, scalability, and long‑term value creation. The timing and magnitude of any associated benefits remain uncertain and depend on execution and market conditions.
Despite ongoing uncertainties related to tariffs, geopolitical developments, and federal funding priorities, the fundamental drivers of demand within the audiovisual industry continue to influence customer purchasing decisions. Increased adoption of LED‑based display systems across end markets, together with the Company’s ongoing development of technologies, services, and sales channels, may support long‑term growth opportunities. However, actual demand and growth levels will depend on broader economic conditions, customer funding availability, and competitive dynamics.
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RESULTS OF OPERATIONS
Consolidated Performance Summary
The following is an analysis of changes in key items included in the statements of operations for fiscal 2026 as compared to fiscal 2025 (in thousands).
| 2026 | % of Net sales (1) | 2025 | % of Net sales (1) | Dollar Change (1) | Percent Change (1) | |||||||||||||||||||||||||
| Net sales | $ | 838,706 | 100.0 | % | $ | 756,477 | 100.0 | % | $ | 82,229 | 10.9 | % | ||||||||||||||||||
| Cost of sales | 609,700 | 72.7 | 560,990 | 74.2 | 48,710 | 8.7 | ||||||||||||||||||||||||
| Gross profit | 229,006 | 27.3 | 195,487 | 25.8 | 33,519 | 17.1 | ||||||||||||||||||||||||
| Operating expenses: | ||||||||||||||||||||||||||||||
| Selling | 64,815 | 7.7 | 60,011 | 7.9 | 4,804 | 8.0 | ||||||||||||||||||||||||
| General and administrative | 59,885 | 7.1 | 63,498 | 8.4 | (3,613) | (5.7) | ||||||||||||||||||||||||
| Product design and development | 43,458 | 5.2 | 38,860 | 5.1 | 4,598 | 11.8 | ||||||||||||||||||||||||
| Total operating expenses | 168,158 | 20.0 | 162,369 | 21.5 | 5,789 | 3.6 | ||||||||||||||||||||||||
| Operating income | 60,848 | 7.3 | 33,118 | 4.4 | 27,730 | 83.7 | ||||||||||||||||||||||||
| Nonoperating income (expense): | ||||||||||||||||||||||||||||||
| Interest income (expense), net | 3,630 | 0.4 | 1,347 | 0.2 | 2,283 | 169.5 | ||||||||||||||||||||||||
| Change in fair value of convertible note | — | — | (22,521) | (3.0) | 22,521 | 100.0 | ||||||||||||||||||||||||
| Other expense, net | (6,144) | (0.7) | (17,795) | (2.4) | 11,651 | 65.5 | ||||||||||||||||||||||||
| Income (loss) before income taxes | 58,334 | 7.0 | (5,851) | (0.8) | 64,185 | 1097.0 | ||||||||||||||||||||||||
| Income tax expense | 12,958 | 1.5 | 4,270 | 0.6 | 8,688 | 203.5 | ||||||||||||||||||||||||
| Net income (loss) | $ | 45,376 | 5.4 | % | $ | (10,121) | (1.3) | % | $ | 55,497 | 548.3 | % | ||||||||||||||||||
| Diluted earnings per share | $ | 0.92 | $ | (0.21) | $ | 1.13 | 537.6 | % | ||||||||||||||||||||||
| Diluted weighted average shares outstanding | 49,382 | 47,587 | 1,795 | 3.8 | % | |||||||||||||||||||||||||
| Orders | $ | 860,835 | $ | 781,347 | $ | 79,488 | 10.2 | % | ||||||||||||||||||||||
(1) Amounts are calculated based on unrounded numbers and therefore may not recalculate using the rounded numbers provided. In addition, percentages may not add in total due to rounding.
Sales, orders, gross profit, and operating expenses were impacted as a result of fiscal 2026 including 53 weeks compared to the 52 weeks in fiscal 2025.
Net Sales: The net sales increase in fiscal 2026 was the result of higher volumes of revenue conversion across business units, primarily driven by the Commercial, Live Events, High School Park and Recreation, and International business units.
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The amount of revenue recognized associated with performance obligations satisfied in prior periods during the years ended May 2, 2026 and April 26, 2025 was immaterial.
For the years ended May 2, 2026 and April 26, 2025, our operating income was negatively impacted by a net amount of 0.3 percent of over‑time revenue, or $1.1 million and $1.2 million, respectively, reflecting a consistent level of impact from changes in contract estimates across periods. These amounts result from changes in contract estimates related to projects in progress at the beginning of the respective period. For the year ended May 2, 2026, these changes in estimates resulted primarily from favorable project execution of 0.4 percent of overtime revenue, or $1.6 million, reduced cost estimates, and contingencies that were relieved when conditions were resolved. Gross unfavorable changes in contract estimates were 0.7 percent of overtime revenue, or $2.6 million, and were immaterial in fiscal 2026. For the year ended April 26, 2025, these changes in estimates resulted primarily from favorable project execution of 0.8 percent of overtime revenue, or $2.8 million, reduced cost estimates, and contingencies that were relieved when conditions were resolved. Gross unfavorable changes in contract estimates were 1.1 percent of overtime revenue, or $4.0 million, and were immaterial in fiscal 2025. See “Note 1. Nature of Business and Summary of Significant Accounting Policies” of the Notes to our Consolidated Financial Statements included in this Form 10-K for more information regarding revenue recognition.
Orders: Order volume growth was driven by higher bookings in the Live Events, High School Park and Recreation, Transportation, and International business units, partially offset by reduced activity in the Commercial business unit. Demand remained supported by continued investment in large‑scale video display systems across the professional sports, transportation, education, and international markets. This activity included projects at major professional sports venues, continued momentum in aviation and intelligent transportation systems, increased adoption of video displays in school and community applications, and opportunities in international markets. As a project‑based business, order volume can fluctuate based on the timing and size of individual projects. During fiscal 2026, bookings benefited from a higher level of large-scale projects available in the marketplace.
Gross profit: The gross profit percentage increase was driven by a combination of strategic pricing, continued operational efficiencies, and overall project mix across our business. Total warranty expense as a percent of sales decreased to 1.3 percent for fiscal 2026 as compared to 1.6 percent during fiscal 2025 primarily due to favorable cost experience.
All expense lines increased for variable compensation and profit sharing linked to revenue and operating margins achieved in fiscal 2026 as compared to amounts achieved in fiscal 2025. For fiscal 2026, these expenses totaled $3.5 million, including $1.5 million in cost of sales, $0.8 million in selling, $0.8 million in general and administrative, and $0.4 million in product design and development. In fiscal 2025, the amounts achieved were immaterial.
Selling: Selling expenses increased due to increases in personnel-related wages and benefits and increased staffing levels to support future growth.
General and administrative: General and administrative expenses decreased primarily due to lower professional fees and other costs as fiscal 2025 included elevated expenses related to investor engagement, corporate governance activities, and transformation initiatives. These decreases were partially offset by ongoing investments in information technology and support functions.
Product design and development: Product design and development expenses increased primarily due to higher personnel-related costs associated with increased staffing levels, as well as continued investments in advanced technologies and engineering services. During the year, we continued to invest in advancing our product capabilities to address evolving customer requirements and to improve product cost efficiency. Development efforts were focused on both standard product and control offerings, as well as ongoing initiatives in emerging technologies, including micro‑LED products and enhanced control system capabilities.
Interest income (expense), net: Interest income increased primarily due to higher cash levels invested in interest-bearing accounts offsetting interest expense. During fiscal 2025, the interest expense included interest on the Convertible Note, which was settled during fiscal 2025.
Change in fair value of Convertible Note: The change in fair value of the Convertible Note line item results from accounting for the Convertible Note. The fair value change was primarily caused by the forced conversion of the entire Convertible Note in the third and fourth quarters of fiscal 2025. All amounts due under the Convertible Note were settled in fiscal 2025.
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Other expense, net: Net other expense decreased in fiscal 2026, primarily reflecting a $3.8 million provision for losses on loans to an equity method affiliate, compared to a $15.5 million provision recorded for losses associated with a different affiliate in fiscal 2025.
Income tax expense: Income tax expense changed as a result of accounting for the Convertible Note. Our effective tax rate for fiscal 2026 was 22.2 percent. Our effective tax rate for fiscal 2025 was negative 73.0 percent. The effective income tax rate for fiscal 2025 was primarily impacted due to the Convertible Note fair value adjustment to expense that is not deductible for tax purposes. Additional other items impacting the rate were valuation allowances on equity investments, state taxes, and a write down of deferred taxes related to debt issuance costs on the conversion of the Convertible Note. In fiscal 2026, there were no further impacts of fair value adjustments on the Convertible Note and our effective tax rate has normalized closer to the U.S. statutory rate. See “Note 13. Income Taxes” of the Notes to our Consolidated Financial Statements included in this Form 10-K for further information.
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Reportable Segment Performance Summary
Non-GAAP Reconciliations: The following table shows information regarding our reportable segment financial performance of contribution margin reconciled to GAAP operating income for the fiscal years ended May 2, 2026 and April 26, 2025 (in thousands):
Fiscal Year 2026 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Commercial | Percent of net sales (1) | Live Events | Percent of net sales (1) | High School Park and Recreation | Percent of net sales (1) | Transportation | Percent of net sales (1) | International | Percent of net sales (1) | Total | Percent of net sales (1) | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Net sales | $ | 180,772 | $ | 321,053 | $ | 183,250 | $ | 76,700 | $ | 76,931 | $ | 838,706 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Cost of sales | 129,345 | 71.6 | % | 245,428 | 76.4 | % | 122,673 | 66.9 | % | 52,825 | 68.9 | % | 59,429 | 77.2 | % | 609,700 | 72.7 | % | |||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Gross profit | 51,427 | 28.4 | 75,625 | 23.6 | 60,577 | 33.1 | 23,875 | 31.1 | 17,502 | 22.8 | 229,006 | 27.3 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Selling | 17,560 | 9.7 | 11,934 | 3.7 | 17,273 | 9.4 | 6,206 | 8.1 | 11,842 | 15.4 | 64,815 | 7.7 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Contribution margin | 33,867 | 18.7 | 63,691 | 19.8 | 43,304 | 23.6 | 17,669 | 23.0 | 5,660 | 7.4 | 164,191 | 19.6 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| General and administrative | — | — | — | — | — | — | — | — | — | — | 59,885 | 7.1 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Product design and development | — | — | — | — | — | — | — | — | — | — | 43,458 | 5.2 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Operating income | $ | 33,867 | 18.7 | % | $ | 63,691 | 19.8 | % | $ | 43,304 | 23.6 | % | $ | 17,669 | 23.0 | % | $ | 5,660 | 7.4 | % | $ | 60,848 | 7.3 | % | |||||||||||||||||||||||||||||||||||||||||||||||||
| Orders | $ | 172,089 | $ | 336,012 | $ | 188,245 | $ | 89,467 | $ | 75,022 | $ | 860,835 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Fiscal Year 2025 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Commercial | Percent of net sales (1) | Live Events | Percent of net sales (1) | High School Park and Recreation | Percent of net sales (1) | Transportation | Percent of net sales (1) | International | Percent of net sales (1) | Total | Percent of net sales (1) | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Net sales | $ | 156,203 | $ | 291,484 | $ | 165,921 | $ | 81,061 | $ | 61,808 | 756,477 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Cost of sales | 117,486 | 75.2 | % | 228,790 | 78.5 | % | 108,126 | 65.2 | % | 52,023 | 64.2 | % | 54,565 | 88.3 | % | 560,990 | 74.2 | % | |||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Gross profit | 38,717 | 24.8 | 62,694 | 21.5 | 57,795 | 34.8 | 29,038 | 35.8 | 7,243 | 11.7 | 195,487 | 25.8 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Selling | 17,106 | 11.0 | 11,002 | 3.8 | 15,758 | 9.5 | 5,404 | 6.7 | 10,741 | 17.4 | 60,011 | 7.9 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Contribution margin | 21,611 | 13.8 | 51,692 | 17.7 | 42,037 | 25.3 | 23,634 | 29.2 | (3,498) | (5.7) | 135,476 | 17.9 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| General and administrative | — | — | — | — | — | — | — | — | — | — | 63,498 | 8.4 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Product design and development | — | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Recent insider activity
| Date | Insider | Role | Action | Shares | Price | Value |
|---|---|---|---|---|---|---|
| 2026-07-01 | Anderson Sheila Mae | CDAO | Sell | -3,636 | $20.01 | -$72,756 |
| 2026-04-30 | Wendler Brett David | VP of Design & Development | Buy | +98 | $15.97 | $1,565 |
Source: SEC Form 4 filings.
Next expected filings
- ~2026-09-10 10-Q expected by 2026-09-11 (in 53 days)
- ~2026-12-10 10-Q expected by 2026-12-11 (in 144 days)
- ~2027-03-04 10-Q expected by 2027-03-05 (in 228 days)
- ~2027-06-23 10-K expected by 2027-07-04 (in 339 days)
Predicted from historical filing cadence; not an SEC commitment.
Recent SEC filings
- 2026-07-17 8-K Officer/Director Change
- 2026-06-24 8-K Earnings Release; Regulation FD Disclosure; Other Events; Financial Statements and Exhibits
- 2026-06-24 10-K Annual Report
- 2026-05-21 8-K Officer/Director Change; Financial Statements and Exhibits
- 2026-03-04 10-Q Quarterly Report
- 2026-03-04 8-K Earnings Release; Financial Statements and Exhibits
- 2026-02-20 8-K Officer/Director Change; Financial Statements and Exhibits
- 2026-02-02 8-K Officer/Director Change; Financial Statements and Exhibits
- 2026-01-21 8-K Officer/Director Change; Financial Statements and Exhibits
- 2025-12-23 8-K Regulation FD Disclosure; Other Events; Financial Statements and Exhibits
- 2025-12-10 10-Q Quarterly Report
- 2025-12-10 8-K Earnings Release; Other Events; Financial Statements and Exhibits
- 2025-12-03 8-K Material Agreement Entered; Material Agreement Terminated; Material Financial Obligation; Financial Statements and Exhibits
- 2025-12-03 8-K Officer/Director Change; Regulation FD Disclosure; Financial Statements and Exhibits
- 2025-10-30 8-K Material Agreement Entered; Officer/Director Change; Financial Statements and Exhibits