Gentex Cuts 2026 Gross-Margin Outlook After Third-Quarter Sales Fall

Gentex Corporation cut its 2026 gross-margin outlook after third-quarter sales declined 1.1% year over year, with customer issues and delayed launches contributing to a $35 million shortfall against its forecast.

Net sales for the quarter ended Sept. 30 were $647.7 million, down from $655.2 million a year earlier. Adjusted diluted earnings per share, a non-GAAP measure, held at $0.47. Diluted earnings under generally accepted accounting principles (GAAP) were $0.43 per share, compared with $0.46 a year earlier.

Sales came in about $35 million below Gentex's forecast at the start of the quarter. Customer issues and delayed launches contributed to the gap. Gross margin fell to 33.4% from 34.4%, as higher precious-metal costs and lower sales weighed on the results. President and CEO Steve Downing said, “The sales shortfall versus our beginning of quarter forecast reduced operating leverage for the quarter.”

The company revised its 2026 revenue outlook to about $2.65 billion, from a previous range of $2.65 billion to $2.75 billion. That change lowers the top end of its revenue outlook by $100 million. Gentex also reduced its gross-margin forecast to 34.0% to 34.5%, down from 34.5% to 35.5%.

The updated margin outlook includes $10 million to $15 million in additional costs expected in the fourth quarter. Gentex does not expect related recoveries until the first half of 2027. The company maintained its 2027 revenue outlook at $2.80 billion to $2.90 billion.

Gentex supplies digital vision, connected-car, dimmable-glass, fire-protection and consumer-electronics products. Its adjusted earnings measure excludes impairment charges, acquisition-related costs and severance costs. The difference between the unchanged adjusted per-share figure and lower GAAP earnings reflects two separate measures of quarterly results; the company reported both for the three months ended Sept. 30.