Core Viewpoint - Kornit Digital Ltd. is set to release its financial results for Q4 and the full year ended December 31, 2025, on February 11, 2026, prior to market opening [1]. Group 1: Financial Results Announcement - The financial results will be discussed in an earnings conference call and webcast on February 11, 2026, at 8:30 am ET [2]. - The conference call will be accessible via Kornit's website and will include dial-in options for participants [2]. Group 2: Company Overview - Kornit Digital is a global leader in sustainable, on-demand digital fashion and textile production technologies, providing end-to-end solutions including digital printing systems, inks, consumables, software, and fulfillment services [3]. - The company operates globally, serving customers in over 100 countries, with headquarters in Israel and offices in the USA, Europe, and Asia Pacific [3].

Core Viewpoint - The article introduces a new analyst contributing to Seeking Alpha, emphasizing a focus on long-term investment strategies and contrarian investing in companies with simple business models that have lost market attention [2]. Group 1: Analyst Background - The analyst has 10 years of experience in the automotive industry, specializing in machine design, and has transitioned to stock market analysis due to the war in Ukraine [2]. - The analyst has spent four years studying investment philosophy and value investing, aiming to contribute insights to the Seeking Alpha community [2]. Group 2: Investment Philosophy - The analyst prefers companies that are undervalued and not in the spotlight, avoiding richly valued and crowded stocks [2]. - A long-term investment horizon of 12-24 months is favored for ideas to materialize, indicating a patient approach to investing [4]. - The analyst is influenced by notable investors such as G. Spier, Ch. Munger, H. Marks, B. Graham, P. Lynch, and D. Gladiš [2].

Core Viewpoint - Kornit Digital Ltd. has appointed Andrew G. Backman as Chief Capital Markets Officer to enhance its capital markets activities and investor relations [1][2] Group 1: Appointment Details - Andrew G. Backman will support Kornit's capital markets activities, investor relations, and corporate and business development initiatives starting January 13, 2026 [1] - Backman has extensive experience in capital markets, having participated in over $30 billion in transactions and maintaining relationships with institutional investors and analysts [2] Group 2: Executive Insights - Kornit Digital's CEO, Ronen Samuel, expressed confidence in Backman's return, highlighting his understanding of the company and relationships in the capital markets [3] - Backman emphasized his excitement to return to Kornit during a pivotal time for the company, noting its role in the digital transformation of textile and apparel production [3] Group 3: Company Overview - Kornit Digital is a leader in sustainable, on-demand digital fashion and textile production technologies, offering end-to-end solutions including digital printing systems and fulfillment services [4] - The company operates globally, serving customers in over 100 countries, with headquarters in Israel and offices in the USA, Europe, and Asia Pacific [4]

Group 1: Market Overview - Equities reached a record high in Q3 2025, driven by gains in technology and declining bond yields [1] - The U.S. Federal Reserve lowered rates by 25 basis points in mid-September 2025 [1] - The Meridian Contrarian Fund returned 6.72% (net) during the quarter, underperforming the Russell 2500 Index's 9.00% and the Russell 2500 Value Index's 8.18% [1] Group 2: Kornit Digital Ltd. Overview - Kornit Digital Ltd. (NASDAQ:KRNT) specializes in digital textile printing solutions, providing a sustainable alternative to traditional screen printing [3] - The stock experienced a one-month return of -6.46% and a 52-week decline of 57.87%, closing at $13.33 with a market capitalization of $612.816 million on November 28, 2025 [2] - Kornit Digital Ltd. reported revenues of $53.1 million in Q3 2025, aligning with the guidance range of $49 million to $55 million [4] Group 3: Investment Perspective on Kornit Digital Ltd. - The investment in Kornit Digital Ltd. was initiated after a significant stock decline from $180 to below $20, attributed to volatile orders and macroeconomic concerns [3] - Despite recent weaknesses in 2025 due to macro and tariff issues, the company maintains a strong balance sheet with over $10 per share in cash and a reasonable valuation of 0.7x EV/sales [3] - Kornit Digital Ltd. is not among the 30 Most Popular Stocks Among Hedge Funds, with 19 hedge fund portfolios holding the stock at the end of Q3, up from 15 in the previous quarter [4]

Core Insights - The analyst team has demonstrated a strong track record, achieving an annualized return of almost 40% over the past decade, with a long-only model portfolio return exceeding 23 times [1]. Group 1: Investment Focus - The company offers income-focused investment options for those preferring lower-risk firms with consistent dividend payouts [1]. - The analyst has expanded coverage to include the offshore drilling and supply industry, as well as the shipping industry, which encompasses tankers, containers, and dry bulk [2]. Group 2: Analyst Background - The analyst has a background in auditing with PricewaterhouseCoopers and has transitioned to day trading for nearly 20 years, successfully navigating significant market events such as the dotcom bubble and the subprime crisis [2]. - The analyst emphasizes the delivery of high-quality research to the Seeking Alpha community despite not being a native English speaker [2].

Core Insights - Kornit Digital Ltd. announced a CFO transition and a new $100 million share repurchase authorization, reflecting confidence in its strategy and long-term growth plan [1][5][6] CFO Transition - Lauri Hanover will step down as Chief Financial Officer for personal reasons, remaining in the position until mid-December 2025 to ensure a smooth transition [2] - Assaf Zipori has been appointed as the new CFO, bringing extensive financial expertise and operational leadership experience from previous roles, including Global CFO of Nano Dimension Ltd. [3][4] Share Repurchase Program - The Board of Directors has authorized a share repurchase program of up to $100 million, building on $165 million in repurchases executed since 2023 [5][6] - The program reflects Kornit's strong balance sheet and confidence in its long-term growth trajectory, with repurchases to be conducted in accordance with market conditions and regulations [6][7] Company Overview - Kornit Digital is a market leader in sustainable, on-demand digital fashion and textile production technologies, offering end-to-end solutions including digital printing systems and fulfillment services [8]

Core Points - The article emphasizes the importance of enabling Javascript and cookies in browsers to prevent access issues [1] - It highlights that users with ad-blockers may face restrictions when trying to access content [1] Summary by Categories Technical Requirements - Users are advised to enable Javascript and cookies in their browsers to ensure proper functionality [1] - The presence of ad-blockers can lead to blocked access, necessitating their temporary disablement [1]

Core Insights - Kornit Digital (KRNT) reported quarterly earnings of $0.09 per share, exceeding the Zacks Consensus Estimate of $0.04 per share, but down from $0.11 per share a year ago, representing an earnings surprise of +125.00% [1] - The company achieved revenues of $53.13 million for the quarter ended September 2025, surpassing the Zacks Consensus Estimate by 2.61% and up from $50.73 million year-over-year [2] - Kornit Digital has outperformed consensus EPS estimates three times in the last four quarters and has also topped revenue estimates three times during the same period [2] Financial Performance - The earnings surprise of +125.00% indicates strong performance relative to expectations, while the previous quarter also showed a positive surprise of +50% [1][2] - The current consensus EPS estimate for the upcoming quarter is $0.16 on revenues of $62.03 million, and for the current fiscal year, it is $0.21 on revenues of $210.03 million [7] Market Position - Kornit Digital shares have declined approximately 56.9% since the beginning of the year, contrasting with the S&P 500's gain of 15.1% [3] - The company currently holds a Zacks Rank 3 (Hold), suggesting that shares are expected to perform in line with the market in the near future [6] Industry Context - The Commercial Printing industry, to which Kornit Digital belongs, is currently ranked in the bottom 10% of over 250 Zacks industries, indicating potential challenges ahead [8] - Research indicates that the top 50% of Zacks-ranked industries outperform the bottom 50% by a factor of more than 2 to 1, highlighting the importance of industry performance on individual stock outcomes [8]

Financial Data and Key Metrics Changes - The company reported revenues of $53.1 million for Q3 2025, reflecting a 5% year-over-year growth [4] - EBITDA margin was approximately 2%, indicating progress towards full-year profitability [4] - Annual recurring revenue (ARR) from the all-inclusive click (AIC) model reached $21.5 million, up $2.6 million sequentially [8][18] - Non-GAAP gross margin for Q3 was 45.8%, down from 50.3% year-over-year, primarily due to inventory-related adjustments and U.S. tariff costs [16] Business Line Data and Key Metrics Changes - Product revenues grew year-over-year, driven by increased consumable sales and growth from the AIC model [15] - Service revenue also increased year-over-year, mainly due to greater upgrade activity [15] - Approximately 80% of Apollo systems now operate under the AIC model, enhancing recurring revenue streams [8] Market Data and Key Metrics Changes - The global screen printing market for blank apparel represents around 14 billion annual impressions, with Kornit targeting to capture approximately 5% of this market by 2030 [5] - In Asia, Kornit customers produced approximately 232 million impressions over the past 12 months, reflecting a 5% growth [9] - The company showcased its digital footwear solution at ITMA Asia, marking a significant step in expanding into adjacent markets [11] Company Strategy and Development Direction - Kornit is transitioning from one-time equipment sales to a recurring usage-based model through the AIC, which is expected to strengthen long-term profitability and customer lifetime value [13][14] - The company aims to expand its addressable market by focusing on footwear and other adjacent categories, with a total addressable market of approximately 1 billion pairs annually in footwear [12] - The strategy includes a deliberate shift towards building a more predictable and sustainable business model, with a focus on recurring revenue [26] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in achieving sequential growth in revenue, gross margin, and EBITDA in Q4 2025 [14] - For 2026, the company anticipates modest top-line growth in the low single digits, with significant expansion in EBITDA driven by higher utilization and scaling recurring revenues [14][26] - The management highlighted a strong pipeline for both AIC and CapEx deals, indicating better visibility for future growth [44] Other Important Information - The company is focused on managing operating expenses closely, with total non-GAAP operating expenses decreasing by 3.7% year-over-year [16][42] - Kornit is experiencing strong customer adoption of its Apollo systems, with over 40% of impressions produced for Barker Peril [6] - The company is expanding its operations in Asia, having recently introduced the AIC model in the region [9][30] Q&A Session Summary Question: Broader demand environment and inventory levels - Management noted that product and service revenues grew year-over-year, with a focus on expanding the AIC model for future growth [21][22] Question: Gross margin impacts - Management acknowledged headwinds from inventory adjustments and tariffs, with plans for price increases to offset these impacts [23] Question: 2026 growth outlook - Management indicated a conservative view on CapEx but expects low single-digit growth with stronger expansion in EBITDA [24][26] Question: Geographic revenue mix - North America is expected to remain the largest region, but Asia is anticipated to contribute more significantly moving forward [30] Question: Overall business environment in 2026 - Management expressed optimism about the pipeline and visibility for growth, expecting modest top-line growth and significant EBITDA expansion [44]

Financial Performance - Q3 2025 revenues reached $53.1 million[12], exceeding the midpoint of guidance[12] - Q3 2025 EBITDA margin was 20%[12] - Contracted annual recurring revenue (ARR) from AIC reached $21.5 million at the end of Q3 2025[12], and subsequently moved into Q4 to bring contracted ARR from AIC to $23.1 million[19] - Q3 2025 non-GAAP gross margin was 458%, compared to 503% in Q3 2024[36] - Q3 2025 non-GAAP operating expenses were $25.8 million, down from $26.8 million in Q3 2024[38] - Cash, deposits, and marketable securities were approximately $489.8 million at the end of Q3 2025[40] Business Updates - Kornit aims to serve 5% of the addressable market of bulk production runs below one thousand units by 2030[15] - 40% of Apollo and Atlas MAX PLUS systems sold in 2025 were to new customers[19] - 80% of Apollo systems operate under the AIC model[19] - Impressions grew to 232 million on a trailing twelve-month (TTM) basis in Q3, up approximately 5% year-over-year[19]