Napco Stock Falls 18% on the Day It Reported Fiscal First-Quarter Results
The company said its equipment revenue fell 7.3% as two locking distributors cut purchases, while recurring service revenue grew 11.5%.
Key points
- Napco fell 18.4% Monday to $32.10 on the day it reported fiscal first-quarter results
- Equipment revenue fell 7.3% to $23.9 million; the company blamed two locking distributors cutting purchases
- Recurring service revenue rose 11.5% to $26.1 million; net income rose 6.9% to $13.0 million
- Free cash flow fell to $2.3 million from $11.4 million a year earlier
Napco Security Technologies (Nasdaq: NSSC) fell 18.4% on Monday, Nov. 2, 2026, closing at $32.10 from a previous close of $39.35. The S&P 500 ETF (SPY) moved -0.48% that session, and trading volume ran about 8.5 times its usual level. The drop came the same day the company reported results for its fiscal first quarter ended Sept. 30, 2026, in a press release filed with an 8-K and a 10-Q.
Equipment sales fell while service revenue rose
Net revenue rose 1.7% to a first-quarter record $50.0 million. Recurring service revenue increased 11.5% to $26.1 million, while equipment revenue fell 7.3% to $23.9 million. Chief Executive Kevin Buchel said in the release that the equipment decline was driven by two locking distributors reducing their purchases during the quarter, and that sell-through at both distributors grew year-over-year.
Profit rose, cash flow fell
Net income rose 6.9% to a first-quarter record $13.0 million, and diluted earnings per share rose 5.9% to $0.36. Non-GAAP adjusted EBITDA increased 3.8% to $15.5 million. Free cash flow fell to $2.3 million from $11.4 million a year earlier, a 79.8% decline, as operating cash flow dropped to $2.8 million. Cash, cash equivalents and marketable securities totaled about $134.6 million at quarter end.
The board declared a quarterly dividend of $0.17 per share, payable Jan. 4, 2027, to holders of record on Dec. 14, 2026.
Sources
Written with AI from SEC filings and market data, and checked against those sources before publishing. Our editorial standards.
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More on Napco Security Technologies
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