GET DAILY SIGNALSKnowles (KN) Posts Strong Q3 2026 Beat with +20% Revenue Growth and Optimistic Guidance
Key Takeaways
- Knowles reported third-quarter 2026 revenue of $184.0 million, up 20% year over year and ahead of the $172.1 million consensus estimate.
- Non-GAAP (adjusted) diluted earnings per share (EPS) came in at $0.38, beating the $0.36 consensus and rising 15% from $0.33 a year earlier.
- The Precision Devices segment led growth, with revenue up roughly 33% to $117 million on strong demand across Medtech, Defense, Industrial, and Electrification.
- Fourth-quarter guidance topped Wall Street forecasts, projecting revenue of $180 million to $190 million and non-GAAP diluted EPS of $0.39 to $0.43.
- Shares climbed about 3% in after-hours trading following the announcement.
Earnings Context and Why It Matters
Knowles Corporation is a specialty electronic components manufacturer that designs high-performance capacitors, radio frequency (RF) filters, advanced medtech microphones, and balanced armature speakers. After divesting its Consumer MEMS (micro-electromechanical systems) Microphones business in December 2024, the company has refocused on higher-margin precision components serving Medtech, Defense, Industrial, and Electrification markets. This quarterly report matters because it tests whether that strategic repositioning can translate into sustained, profitable growth. A beat-and-raise quarter would confirm that demand momentum, particularly in Precision Devices, remains intact and that the company's custom-engineered product strategy is resonating with customers. I also checked this using Tickeron’s AI Screener to see how the stock compares to others in the industry.
Reported Results
Knowles reported third-quarter 2026 revenue of $184.0 million, a 20% increase from $152.9 million in the prior-year period and above the $172.1 million consensus estimate. Non-GAAP diluted earnings per share (EPS) reached $0.38, exceeding the $0.36 consensus and up 15% from $0.33 a year earlier. Net income attributable to common shareholders was $21.6 million, while operating cash flow strengthened to $44.6 million from $29.1 million in the year-ago quarter.
Segment results were driven by Precision Devices, where revenue surged roughly 33% to $117 million on broad demand across all four major end markets. The company's book-to-bill ratio (a measure comparing new orders to completed billings) in Precision Devices remained above one for an eighth consecutive quarter, reaching 1.5, signaling continued order strength. MedTech & Specialty Audio revenue rose about 4% to $67 million. Management issued fourth-quarter guidance above consensus, calling for revenue of $180 million to $190 million and non-GAAP diluted EPS of $0.39 to $0.43, implying roughly 16% full-year 2026 revenue growth at the midpoint. From what I see, the consistency in order flow stands out here.
Market Reaction and Investor Sentiment
The market responded favorably to the beat-and-raise quarter, with Knowles (KN) shares rising roughly 3% in after-hours trading. Investor sentiment has been buoyed by the company's accelerating revenue growth, improving Precision Devices book-to-bill ratio, and above-consensus fourth-quarter guidance. The report reinforced confidence in the company's post-divestiture strategy and its exposure to secular growth trends across Medtech, Defense, Industrial, and Electrification. Key factors that supported sentiment included the eighth consecutive quarter of a book-to-bill ratio above one in Precision Devices and management's expectation for full-year 2026 revenue growth of approximately 16%. I’m watching this closely as the numbers align with the post-divestiture focus.
Forward Outlook and Key Factors to Monitor
Looking ahead, investors will be watching whether Knowles (KN) can sustain its elevated order momentum and convert it into continued revenue and margin expansion. Management's fourth-quarter guidance implies roughly 14% year-over-year revenue growth at the midpoint, with non-GAAP diluted EPS of $0.39 to $0.43.
Several factors deserve monitoring. First, the book-to-bill ratio in Precision Devices will be a key indicator of demand durability, given its eight-quarter streak above one. Second, gross margin trends across both segments will signal how effectively the company manages production volumes and capacity utilization as revenue scales.
Additionally, investors may track the ramp of new product lines, including specialty film and radio frequency (RF) filter programs, as well as any updates on tariffs, which management has previously characterized as representing less than 5% of revenue. Balance sheet strength, share repurchases, and progress on debt reduction remain secondary but relevant considerations for evaluating the company's long-term financial flexibility. One thing that stands out is how the guidance supports the broader growth narrative.
Using Tickeron’s AI Tools for Deeper Analysis
In my view, tools like Tickeron’s AI Screener have become helpful for quickly comparing Knowles (KN) against peers in the specialty components space. I ran a quick scan focused on industrial and medtech names to see how the recent book-to-bill trends and margin profile line up with similar companies. It’s a straightforward way to surface context without spending hours on manual research, and it helped confirm that the Precision Devices momentum appears distinctive. This kind of quick check fits naturally into reviewing quarterly results like these.
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Contributor
Sergey Savastiouk, Ph.D. has a degree in Applied Mathematics from Moscow University and has extensive experience as an entrepreneur, investor, manager, and mathematician. His professional expertise is in applied mathematics, mathematical modeling, system and pattern analysis, and software and hardware system integration. He has served as the CEO of several hi-tech start-up companies and nonprofit organizations, which has given him proven capabilities in business strategy for high-tech start-up companies, market assessment, company formation, team building, product development, marketing, and sales. He has published numerous articles in journals and magazines on related fields. As a retail investor, he spent 15 years developing his proprietary trading and quantitative algorithms (now Tickeron’s A.I.), which brought him significant returns in trading the stock market. His current work and goal in founding Tickeron is to bring professional, sophisticated stock market analysis capabilities to retail investors via an easy-to-use interface.
Momentum Indicator for KN turns negative, indicating new downward trend
KN saw its Momentum Indicator move below the 0 level on October 12, 2026. This is an indication that the stock could be shifting in to a new downward move. Traders may want to consider selling the stock or exploring put options. Tickeron's A.I.dvisor looked at 83 similar instances where the indicator turned negative. In 56 of the 83 cases, the stock moved further down in the following days. The odds of a decline are at 67%.
Technical Analysis (Indicators)
Bearish Trend Analysis
The Moving Average Convergence Divergence Histogram (MACD) for KN turned negative on October 12, 2026. This could be a sign that the stock is set to turn lower in the coming weeks. Traders may want to sell the stock or buy put options. Tickeron's A.I.dvisor looked at 47 similar instances when the indicator turned negative. In 29 of the 47 cases the stock turned lower in the days that followed. This puts the odds of success at 62%.
KN moved below its 50-day moving average on October 14, 2026 date and that indicates a change from an upward trend to a downward trend.
The 10-day moving average for KN crossed bearishly below the 50-day moving average on October 20, 2026. This indicates that the trend has shifted lower and could be considered a sell signal. In 11 of 18 past instances when the 10-day crossed below the 50-day, the stock continued to move higher over the following month. The odds of a continued downward trend are 61%.
Following a 3-day decline, the stock is projected to fall further. Considering past instances where KN declined for three days, the price rose further in 50 of 62 cases within the following month. The odds of a continued downward trend are 59%.
Bullish Trend Analysis
The RSI Indicator points to a transition from a downward trend to an upward trend -- in cases where KN's RSI Indicator exited the oversold zone, 15 of 26 resulted in an increase in price. Tickeron's analysis proposes that the odds of a continued upward trend are 58%.
The Stochastic Oscillator suggests the stock price trend may be in a reversal from a downward trend to an upward trend. 44 of 56 cases where KN's Stochastic Oscillator exited the oversold zone resulted in an increase in price. Tickeron's analysis proposes that the odds of a continued upward trend are 79%.
Following a +7.81% 3-day Advance, the price is estimated to grow further. Considering data from situations where KN advanced for three days, in 204 of 303 cases, the price rose further within the following month. The odds of a continued upward trend are 67%.
KN may jump back above the lower band and head toward the middle band. Traders may consider buying the stock or exploring call options.
The Aroon Indicator entered an Uptrend today. In 198 of 256 cases where KN Aroon's Indicator entered an Uptrend, the price rose further within the following month. The odds of a continued Uptrend are 77%.
Fundamental Analysis (Ratings)
The Tickeron Profit vs. Risk Rating rating for this company is 35 (best 1 - 100 worst), indicating well-balanced risk and returns. The average Profit vs. Risk Rating rating for the industry is 70, placing this stock slightly better than average.
The Tickeron Price Growth Rating for this company is 46 (best 1 - 100 worst), indicating steady price growth. KN’s price grows at a higher rate over the last 12 months as compared to S&P 500 index constituents.
The Tickeron Valuation Rating of 64 (best 1 - 100 worst) indicates that the company is fair valued in the industry. This rating compares market capitalization estimated by our proprietary formula with the current market capitalization. This rating is based on the following metrics, as compared to industry averages: P/B Ratio (3.749) is normal, around the industry mean (4.683). P/E Ratio (44.769) is within average values for comparable stocks, (5.844). Projected Growth (PEG Ratio) (0.100) is also within normal values, averaging (1.658). Dividend Yield (0.000) settles around the average of (0.018) among similar stocks. P/S Ratio (4.852) is also within normal values, averaging (4.796).
The Tickeron SMR rating for this company is 75 (best 1 - 100 worst), indicating weak sales and an unprofitable business model. SMR (Sales, Margin, Return on Equity) rating is based on comparative analysis of weighted Sales, Income Margin and Return on Equity values compared against S&P 500 index constituents. The weighted SMR value is a proprietary formula developed by Tickeron and represents an overall profitability measure for a stock.
The Tickeron PE Growth Rating for this company is 85 (best 1 - 100 worst), pointing to worse than average earnings growth. The PE Growth rating is based on a comparative analysis of stock PE ratio increase over the last 12 months compared against S&P 500 index constituents.
The Tickeron Seasonality Score of 85 (best 1 - 100 worst) indicates that the company is significantly overvalued in the industry. The Tickeron Seasonality score describes the variance of predictable price changes around the same period every calendar year. These changes can be tied to a specific month, quarter, holiday or vacation period, as well as a meteorological or growing season.
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a manufacturer of communication infrastructure components
Industry ElectronicComponents
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