Reports Q3 Net Sales Up 22.0%, Net Income Up 515.5%

Optical Cable Corporation (OCC) reported a significant increase in its financial performance for the third quarter of fiscal year 2026. Net sales for the quarter rose by 22.0% to $24.3 million, up from $19.9 million in the same period last year. This growth was attributed to increased sales in the enterprise, data center, and specialty markets. Sales to customers outside the United States also contributed, increasing by 28.8%, while domestic sales grew by 20.3% compared to the prior year.

The company's gross profit saw a substantial increase of 43.9% to $9.1 million in the third quarter of fiscal year 2026, compared to $6.3 million in the third quarter of fiscal year 2025. This led to an improved gross profit margin of 37.4%, up from 31.7% in the previous year. Management noted that higher sales volumes positively impacted the gross profit margin by spreading fixed manufacturing costs over a larger revenue base, a benefit of operating leverage.

Selling, general and administrative (SG&A) expenses increased by 21.4% to $7.0 million from $5.7 million in the prior year's third quarter. As a percentage of net sales, however, SG&A expenses remained relatively stable at 28.7% for the current quarter, compared to 28.8% in the same period last year. The rise in SG&A expenses was primarily driven by a $941,000 increase in employee and contracted sales personnel-related costs and a $179,000 increase in shipping costs, both linked to higher net sales.

Net income for the third quarter of fiscal year 2026 reached $1.9 million, or $0.21 per diluted share, a significant improvement from $302,000, or $0.04 per diluted share, in the third quarter of fiscal year 2025. For the first nine months of fiscal year 2026, net sales increased 18.3% to $62.9 million, and the company returned to a net income of $2.5 million, contrasting with a net loss of $1.5 million in the prior year's nine-month period. The company's sales order backlog also grew to $13.5 million at the end of the third quarter of fiscal year 2026, up from $7.3 million at October 31, 2025.