Mayville Engineering Company, Inc. (MEC) reported fourth‑quarter 2025 results that showed net sales of $134.3 million, a 10.7% year‑over‑year increase driven by a $15 million rise in Data Center & Critical Power awards and a $20 million increase in Construction & Access sales. The company’s manufacturing margin fell to 6.6% of net sales from 8.9% in the same quarter a year earlier, largely due to $1.2 million in project launch costs in the Data Center & Critical Power segment and $1.7 million in early‑stage inefficiencies in the Commercial Vehicle segment.
MEC posted a net loss of $4.4 million, or ($0.22) per diluted share, versus a net income of $16.0 million, or $0.76 per diluted share, in the same quarter last year. The prior‑year profit was heavily influenced by a $25.5 million lawsuit settlement, which is why the year‑over‑year comparison of earnings is distorted.
Full‑year 2025 net sales totaled $546.5 million, and the company recorded a net loss of $8.1 million. The company’s guidance for 2026 remains unchanged: full‑year sales of $580 million to $620 million and adjusted EBITDA of $50 million to $55 million. Adjusted EBITDA for the quarter was $6.3 million, a miss against the consensus estimate of $11.1 million.
"Total sales for the fourth quarter increased 10.7% on a year‑over‑year basis to $134.3 million," said CFO Rachele Lehr. "The manufacturing margin rate was 6.6% for the fourth quarter, attributing the decrease to project launch costs and early‑stage inefficiencies."
"We closed fiscal 2025 with strong momentum within our Data Center & Critical Power end market, securing $15 million of incremental project awards during the fourth quarter, strengthening our 2026 orderbook," said CEO Jag Reddy. "Our fourth quarter margin performance was pressured…reflecting deliberate investments to support program readiness and execution. These margin pressures are 'transitory in nature and importantly, position MEC to deliver profitable growth in 2026 and beyond.'"
The company highlighted that the Data Center & Critical Power segment is expected to represent more than 20% of revenue in 2026, and that cross‑selling synergies from the Accu‑Fab acquisition are projected to generate $40 million to $50 million in additional revenue. Management emphasized disciplined capital allocation and a focus on debt reduction through free cash flow generation.
Investors reacted cautiously to the results, citing the miss on adjusted EBITDA and the modest guidance for 2026 as key concerns. The company’s margin compression, driven by investment‑related costs, and the loss in the quarter tempered enthusiasm for the outlook.
"Finally, we remain committed to disciplined capital allocation. With end‑market conditions still uneven, we are prioritizing debt reduction through free cash flow generation, supported by focused working capital management," added CEO Jag Reddy.
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