Universal Electronics Inc. (UEI) reported a decrease in net sales for the fiscal year ended December 31, 2024, totaling $394.9 million, down 6.1% from $420.5 million in 2023. The decline in revenue was attributed to lower customer demand in both the home entertainment and climate control segments, with the latter particularly affected by reduced governmental subsidies for heat pump technology in Europe. Despite the drop in sales, UEI's gross profit increased to $114.0 million, resulting in a gross profit margin of 28.9%, up from 23.2% in the previous year. This improvement was largely due to the execution of a factory footprint optimization plan that reduced excess manufacturing capacity.
The company's operating loss for 2024 was $15.3 million, a significant improvement compared to an operating loss of $85.3 million in 2023. This reduction in losses was supported by a decrease in operating expenses as a percentage of sales, which fell to 32.7% from 43.5% in the prior year. UEI's income tax expense was $5.4 million, slightly down from $6.0 million in 2023, reflecting the company's ongoing efforts to manage its tax liabilities amid fluctuating financial performance.
Strategically, UEI has focused on expanding its presence in the climate control market, which has seen increased demand for energy-efficient solutions. The company has also made significant changes to its manufacturing operations, including the opening of a new factory in Vietnam and the closure of two factories in China. These moves are part of a broader strategy to diversify its manufacturing footprint and reduce reliance on a single geographic area. As of December 31, 2024, UEI employed 3,838 staff members globally, with a notable portion dedicated to manufacturing and supply chain operations.
Looking ahead, UEI aims to build a long-term revenue pipeline by securing new product design wins with major HVAC original equipment manufacturers (OEMs) and expanding its QuickSet Cloud software offerings. The company plans to leverage its technology to enhance customer engagement and drive recurring revenue streams through software licensing. UEI's management remains cautious about macroeconomic conditions, including inflationary pressures and potential tariffs, which could impact future performance. The company is committed to optimizing its operations and exploring strategic partnerships to strengthen its market position.
About UNIVERSAL ELECTRONICS INC
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