Benchmark Electronics reported record third-quarter revenue of $811 million, up 19% from a year earlier, with GAAP and adjusted earnings per share also higher year over year. The electronics manufacturing and engineering services provider raised its 2026 revenue outlook, citing broader demand across its business and continued bookings momentum.
Key details
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Revenue growth accelerated: Third-quarter revenue rose from $681 million a year earlier and $756 million in the second quarter. The company now expects full-year 2026 revenue growth of about 16%, lifting its outlook further above the $3 billion annual revenue level it said it had established as a goal last quarter.
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Earnings increased year over year, but GAAP EPS fell from the prior quarter: Diluted GAAP earnings per share were 47 cents, up 21% from 39 cents a year ago, but below 55 cents in the second quarter. Non-GAAP diluted EPS was 84 cents, up 35% from 62 cents a year ago and above 75 cents in the second quarter.
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Margins were stronger than a year ago: GAAP gross margin was 10.4%, compared with 10.0% a year earlier; GAAP operating margin was 3.8%, up from 3.5%. On a non-GAAP basis, gross margin was 10.5% versus 10.1%, and operating margin was 5.5% versus 4.8%. Non-GAAP operating margin improved from 5.2% in the second quarter.
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Growth reached most business sectors:
- Semiconductor capital equipment revenue was $241 million, or 30% of the total, up from $185 million a year earlier.
- Advanced computing and communications revenue rose to $132 million from $88 million, representing 16% of sales.
- Industrial revenue increased to $172 million from $153 million, while medical revenue grew to $138 million from $126 million.
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Aerospace and defense revenue was $128 million, compared with $129 million a year earlier.
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Cash generation and working-capital measures: Benchmark generated $30 million in operating cash flow and $14 million in free cash flow. Its cash conversion cycle was 54 days, down from 59 days in the second quarter and 77 days a year earlier. The cycle reflects the time tied up in receivables, contract assets and inventory, net of payment timing to suppliers and customer advances.
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Fourth-quarter outlook: The company expects revenue of $815 million to $855 million, GAAP diluted EPS of 58 to 64 cents, and non-GAAP diluted EPS of 85 to 91 cents. The non-GAAP EPS outlook excludes about $7.8 million of stock-based compensation and $2.7 million to $3.2 million of other expenses, including restructuring and intangible amortization.
Plain-English implications
Benchmark’s higher full-year revenue outlook reflects its expectation that the recent sales momentum will continue into the fourth quarter. The reported figures also show that year-over-year growth was not confined to one sector, although semiconductor capital equipment remained the company’s largest business by revenue.