Vishay Precision Group (VPG 2.26%), a manufacturer of precision sensors and measurement systems, reported earnings for Q2 FY2025 on August 5, 2025. The company’s main news was a better-than-expected performance, with revenue (GAAP) of $75.2 million and non-GAAP earnings per share of $0.17, each surpassing analyst predictions by 3.1% and 325%, respectively. However, both revenue and profits declined year-over-year, and margins fell as operational and market challenges persisted. The quarter showed some stabilizing trends in sales and orders, but also highlighted ongoing cost and margin pressures.
| Metric | Q2 2025 | Q2 2025 Estimate | Q2 2024 | Y/Y Change |
|---|---|---|---|---|
| EPS (Non-GAAP) | $0.17 | $0.04 | $0.31 | (45.2%) |
| Revenue | $75.2 million | $72.93 million | $77.4 million | (2.8%) |
| Adjusted Operating Margin | 4.8 % | 7.6 % | (2.8 pp) | |
| Free Cash Flow (Non-GAAP) | $4.7 million | N/A | ||
| Adjusted EBITDA | $7.9 million | $10.2 million | (22.5%) |
Source: Analyst estimates provided by FactSet. Management expectations based on management's guidance, as provided in Q1 2025 earnings report.
Company Overview and Key Focus Areas
Vishay Precision Group designs and manufactures precision sensors, weighing solutions, and measurement systems. Its products include strain gages, force sensors, and specialized measurement equipment, which are used in transportation, industrial automation, medical, and steel production markets. The company’s global footprint includes factories in the United States, Israel, and Germany.
Recently, Vishay Precision Group has focused on four core priorities: strategic acquisitions, product innovation, operational efficiency, and brand strength. Strategic acquisitions like KELK and Nokra have strengthened its measurement systems for steel and aluminum industries, while ongoing investments focus on advanced sensors for new applications such as humanoid robotics. Improving manufacturing efficiency and cost control remains central, particularly through factory consolidations and supply chain management.
Quarter in Review: Financial and Business Highlights
Revenue (GAAP) reached $75.2 million, ahead of expectations but down 2.8% from the prior year. Management cited a third consecutive quarter of sequential order growth. Orders totaled $79.9 million, up 7.5% quarter-over-quarter. The overall book-to-bill ratio, which measures the relationship between orders received and goods shipped, rose to 1.06, suggesting modest recovery in demand.
Breaking performance down by segment, the Sensors division saw revenue fall 8.0% year-over-year to $26.6 million, due to lower consumer demand for strain gages. Gross margin in this segment declined, primarily due to decreased volume and the effects of tariffs. The Measurement Systems segment posted an 8.9% decline in revenue on a GAAP basis compared to the prior year, reflecting slower steel industry demand. The Weighing Solutions segment, which supplies force and weight measurement components for transportation and industrial customers, was a bright spot: revenue increased 7.2% year-over-year and gross profit margin reached a record 39.6% (GAAP), supported by higher volumes and positive currency effects.
On the profitability front, operating margin (GAAP) softened across the company. Adjusted operating margin dropped to 4.8%, compared to 7.6% for Q2 FY2024. The company indicated that start-up, restructuring, and severance costs contributed to the margin compression, along with unfavorable tariffs. Despite these pressures, Vishay Precision Group generated $4.7 million of adjusted free cash flow, maintaining a solid cash position. A one-time building sale in July 2025, after Q2 FY2025, brought in $10.8 million, funding debt repayment to save about $700,000 in annual interest.
Capacity investments and product development continued, especially in support of new robotics and automation initiatives. Early orders from humanoid robotics customers marked the initial stages for these advanced sensors, although the revenue contribution remains small. Management reported ongoing cost reduction initiatives, targeting $5 million in annual savings for FY2025, mainly by improving material costs and manufacturing processes. The period did not see any new acquisitions or buybacks.
Forward Outlook and Investor Considerations
Management guided that revenue for Q3 FY2025 will range between $73 million and $81 million, assuming currency rates remain stable. The full-year effective tax rate is expected to be 27% in FY2025.
Investors should monitor several key factors in the coming quarters: the speed of margin recovery as cost reductions progress, ongoing effects from tariffs or currency shifts, and the performance of the company’s Weighing Solutions segment. Trends in order intake and backlog, particularly for the Measurement Systems segment, will also be important indicators of underlying demand.
Revenue and net income presented using U.S. generally accepted accounting principles (GAAP) unless otherwise noted.
