Cognex Corp
Q2 2025 Earnings
Market Reaction
S&P 500 over the same 30 days: +1.67%.
Did CGNX Beat Earnings? Q2 2025 Results
Cognex delivered a clean beat to open the second half of 2025, with Q2 revenue of $249.09 million edging past the $246.11 million consensus by 1.21% and rising 4.1% year over year, while adjusted EPS of $0.24 topped the $0.24 estimate by 1.57%. The headline numbers were underpinned by a profitability milestone that caught investor attention: adjusted EBITDA margin crossed above 20% for the first time since Q2 2023, reaching 20.7%, as disciplined cost management drove operating expenses down 3% year over year and more than offset a 230 basis point compression in adjusted gross margin tied to less favorable industry mix and modest tariff headwinds. Free cash flow surged 74% to $40.43 million, and the company ended the quarter debt-free with $553.00 million in cash and investments. The strong results helped propel the stock to a new 52-week high. Looking ahead, management guided Q3 revenue of $245 to $265 million, representing approximately 9% year-over-year growth at the midpoint, with adjusted EPS of $0.24 to $0.29 implying 35% growth.
- Revenue growth driven by strength in Logistics and broader Factory Automation
- Consumer Electronics and Packaging drove Factory Automation growth
- Operating expenses declined 3% year over year through disciplined cost management
- Salesforce transformation delivering impactful results, expanding reach in Packaging customers
- Free cash flow conversion rate of 100% of net income in Q2
“We're focused on executing on our strategic priorities and delivering on our long-term financial framework to drive shareholder value. The second quarter represents an early, but meaningful, step forward in this journey, marked by continued Adjusted EBITDA margin expansion and strong free cash flow generation — both of which we believe are important indicators of our financial discipline and long-term value creation.”
Cognex CEO, on the earnings call
Forward Guidance & Outlook
For Q3 2025, Cognex guided revenue of $245 million to $265 million (excluding a one-time commercial partnership benefit of $8-$14 million), representing approximately 9% year-over-year growth at the midpoint. Adjusted EBITDA margin is expected at 19.5% to 22.5%, up significantly from 17.6% in Q3 2024. Adjusted EPS (diluted) is guided at $0.24 to $0.29, implying 35% year-over-year growth at the midpoint. The company continues to expect no material impact on Adjusted EPS or Adjusted EBITDA margin from tariffs, including recently announced trade agreements with China, Vietnam, and Indonesia. Cognex expects the One Big Beautiful Bill Act (OBBBA) to be neutral to Adjusted EPS in 2025 with a cash tax benefit of $12-$15 million expected in 2025.
CGNX YoY Financials
Figures from SEC filings and company reports. Not investment advice.