Daktronics Surges After Strong Earnings and Expanded Buyback
The display maker beat Q2 estimates and reported a 36% jump in its product backlog, signaling strong future demand for its large-scale video systems.
Shares of Daktronics Inc. (NASDAQ: DAKT) climbed Wednesday after the electronic display manufacturer posted second-quarter financial results that surpassed analyst expectations, driven by strong growth in orders and a significant expansion of its project backlog.
The Brookings, South Dakota-based company reported net sales of $229.3 million for the quarter ending November 1, 2025, a 10% increase from the same period last year and beating consensus estimates of $213.9 million. Earnings per share came in at $0.35, decisively ahead of the $0.265 analysts had forecast. Following the news, the company's board authorized an additional $20 million for its share repurchase program.
The stock jumped more than 8% in morning trading to over $19 per share, reversing a month-long downtrend. The positive results were underpinned by a robust 36% year-over-year increase in the company's product backlog, which now stands at $320.6 million. This figure provides what the company called a "multi-quarter revenue runway" and suggests sustained demand for its large-format LED video displays, which are used in sports stadiums, billboards, and transportation hubs.
In a statement, Interim President and CEO Brad Wiemann credited the performance to strong execution across the business. "This was a solid quarter of revenue and profit expansion, a result of exemplary performance in our manufacturing, installation and service organizations," Wiemann said. He also highlighted improved profitability from "value-based pricing and operational efficiencies."
Daktronics noted significant order growth in its Live Events segment, securing large projects for three Major League Baseball stadiums and three Major League Soccer venues. According to its press release, the company is scheduled to install five MLB stadium projects in the upcoming spring.
The strong quarter comes as Daktronics prepares for a leadership transition. On December 3, the company announced it had appointed Ramesh Jayaraman as its new President and CEO, effective February 1, 2026. Wiemann will continue in his interim role until then. The appointment of a new chief executive during a period of operational strength may signal a strategic push to capitalize on the current market momentum.
Looking ahead, Daktronics is expanding its manufacturing footprint with a new facility planned for Mexico, expected to be operational by the end of fiscal 2026. The move is intended to support growing business and optimize its production network. The company reiterated its long-term financial targets, which include annual sales growth between 7-10% and an operating margin of 10-12%.
Despite the strong report, some analysts had recently taken a more cautious stance. Zacks Research, for instance, downgraded the stock from "strong-buy" to "hold" in November. However, the latest results and strong backlog could prompt analysts to revise their outlooks. Current analyst consensus from sources tracked by MarketBeat has a one-year price target of $27.50 for the stock, suggesting significant upside from its current levels.