LSI Industries Inc. (NASDAQ:LYTS) reported fiscal second-quarter results on Thursday that were largely in line with market expectations, with revenue coming in slightly ahead of forecasts despite tough year-on-year comparisons.
Shares in the commercial lighting and display solutions group rose 1.67% in pre-market trading following the announcement.
LSI posted adjusted earnings per share of $0.26, just under the analyst consensus of $0.27. Revenue totalled $147 million, modestly above the $145.96 million expected by the market. Sales were flat compared with the same quarter last year, as the company offset unusually strong, event-driven demand in the grocery segment seen in the prior-year period.
“The strength of our diversified, solutions-based model was evident in the second quarter, enabling LSI to deliver solid performance despite a challenging prior-year comparison,” said James A. Clark, President and Chief Executive Officer of LSI Industries. “Double-digit sales growth within our Lighting segment, continued execution of large project activity in Display Solutions, sustained profitability, and strong free cash generation, underscore the durability and resiliency of our operating model.”
Performance was led by the Lighting segment, where sales increased 15% year on year and adjusted EBITDA margin improved by 70 basis points. By contrast, the Display Solutions division recorded a 10% decline in revenue as demand from the grocery vertical normalized to more typical seasonal levels.
The company generated strong free cash flow of $23.3 million during the quarter, enabling it to reduce total debt by $22.7 million and lower its net debt to trailing twelve-month adjusted EBITDA ratio to just 0.4x. LSI also declared its regular quarterly cash dividend of $0.05 per share, payable on February 10, 2026.
Looking ahead, management expressed confidence in the growth outlook, noting that Lighting segment orders were up 10% year on year at the end of the quarter, while orders in Display Solutions increased 8%, supporting a stronger backlog entering the fiscal third quarter.