Vishay Precision Group (VPG) Q2 FY26 earnings call: guidance and Q&A

Could you provide more details on the humanoid pipeline, including the number of engagements and how it compares to the end of 2025? Also, is the current capacity expansion primarily for humanoid demand or broader sensor customers?

VPG has received a vendor nomination from its initial humanoid customer, expecting a production ramp in H2 2026. A second customer is refining designs, and VPG is prototyping for third and fourth customers, while also identifying 150 potential suppliers. Current capacity expansion is mainly for AI infrastructure, data center, and defense, with humanoid-specific capacity designated for the initial customer's projected volume.

“At this point in time, the initial customer indicated the expectation of a production ramp-up in the second half of the year from tens of bots per week up to hundreds and even thousands per week by the end of the year. The company is ready and have already hired personnel, which are in training. We made the capital investments for the capacity and we have ordered the raw material.”

asked by Jaeson Schmidt · answered by Ziv Shoshani

Could you confirm the math that stripping out FX and the ERP delay would bring Q2 EBITDA to around $10 million, and that the delayed orders will be filled by year-end?

The CFO confirmed that the FX effect was $900,000 sequentially, and an unusual product volume mix accounted for $800,000. Adding the $3 million KELK delay at a 1.5 contribution margin would bring the total closer to $9 million in adjusted EBITDA, and the delayed orders are expected to be shipped by year-end.

“So the math is, if you look quarter-over-quarter, the -- I would say that the FX effect is $900,000. Then we had a very unusual product volume mix based on higher contract pricing, which we don't expect to repeat itself. It was around $800,000 altogether, now $1.7 million. In addition, if you add the $3 million of our KELK business at a contribution margin of [ 1.5 ]. So the total comes to, I would say... Yes, close to $9 million.”

asked by Josh Nichols · answered by Ziv Shoshani

Given the softness in Weighing and Measurement Systems, do you expect these levels to persist or improve in the back half of the year?

For Measurement Systems, Q1 had strong orders, Q2 was soft but Q3 orders are expected to improve, with DTS benefiting from AMS tailwinds. Weighing Solutions saw softness in general weighing and precision ag, offset by construction. Management expects an improved second half for both, but not a rapid acceleration unless interest rates or inflation decrease, which would trigger more industrial investments.

“I do believe that based on the situation, we should see an improved second half of the year but I'm not sure if there are enough indication to show a much stronger improvement or I would say, a much more rapid order intake in the second half of the year. But I think that at this point in time, there is a higher likelihood for an improved business environment in the second half of the year in respect to the first half but not in a very significant way unless interest rates or inflation, interest rates would go down.”

asked by Josh Nichols · answered by Ziv Shoshani

Can you discuss your ability to raise prices given higher input costs (material and labor)? What is the magnitude of these price increases and when will they impact the P&L?

Labor costs are increasing due to hiring for capacity expansion. Material costs are also up due to inflation. VPG has implemented selective price increases on new orders, which should start benefiting the P&L in H2, initially in the hundreds of thousands. However, the large existing backlog ($135.8 million) means significant impact will only be seen on new orders, limiting the immediate P&L effect.

“Any price increases, we would be able to place only with new orders, not with existing backlog. Therefore, I would say that at this point in time, we will not -- given the large backlog, we will not be able to see a much more meaningful effect on the ASP increase in the P&L. But we did put in place a price increase program.”

asked by John Franzreb · answered by Ziv Shoshani

Will the deferred KELK orders be balanced between Q3 and Q4, or primarily a Q4 event? Also, how much capacity is being added for humanoid robotics and what incremental revenue could it address?

Some KELK improvements will be seen in Q3, but the larger output from delayed shipments is expected in Q4. For humanoid robotics, VPG has made significant capital investments based on the initial customer's projections, enabling support for thousands of bots per week once orders are received. Additional investments would be made for more opportunities.

“We -- currently, we are putting in place capacity based on our customers' projection. As I said, we made already a significant capital investments based on their projection and this -- we would be able to support with the investment that we made. I believe we would be able to support thousands of bots per week once we get the orders once we get the orders, yes.”

asked by John Franzreb · answered by Ziv Shoshani