Littelfuse, Inc.

good day everyone and welcome to the little fuse first quarter 2026 earnings conference call today's call is being recorded at this time we'll turn the call over to the vice president of investor relations david kelly please proceed good morning and welcome to the little views first quarter 2026 earnings conference call with me today are greg henderson president and ceo and abby candlewall executive vice president and cfo this morning we reported results for our first quarter and a copy of our earnings release and slide presentation is available in the investor relations section of our website. A webcast of today's conference call will also be available on our website. Please advance to slide two for our disclaimers. Our discussions today will include forward-looking statements. These forward-looking statements may involve significant risk and uncertainties. Please review today's press release and our forms 10-K and 10-Q for more details about important risk, that could cause actual results to differ materially from our expectations. We assume no obligation to update any of this forward-looking information. Also, our remarks today refer to non-GAAP financial measures. A reconciliation of these non-GAAP financial measures to the most comparable GAAP measure is provided in our earnings release available in the investor relations section of our website. I will now turn the call over to Greg.

Thank you, David, and thank you to everyone for joining us today. This morning, I'll start with highlights from our first quarter and then provide an update on the progress we're making on our strategic priorities. We delivered a strong start to the year. The first quarter results exceeding our expectations. Net sales were 657 million, up 19% year-over-year, 9% organically, and we delivered meaningful margin expansion across our segments. Our teams executed well as we capitalized on broad-based demand strength across several key markets. We continue to benefit from our leadership position in safe and efficient electrical energy transfer as our markets and applications transitions toward higher power and higher energy density architectures. Our strategic focus and customer-centric go-to-market model are enabling us to engage earlier and more deeply with our customers. Importantly, we are seeing early tangible benefits from our Salesforce realignment as we solve our customers' increasingly complex challenges with our full technology portfolio. Taking a closer look at our performance by end market in the quarter, We delivered strong double-digit growth in data centers and grid utility infrastructure, where demand continues to be fueled by the broader electrification megatrend. Across our diversified industrial market, we drove meaningful revenue growth supported by broad-based demand and strong channel execution. In construction and industrial equipment markets, we're seeing mixed demand trends, as strength in construction and industrial automation was partially offset by continued soft residential HVAC demand. Finally, in passenger vehicles, Sales were up high single digits, reflecting content expansion and share gains amid a soft global production environment, while commercial vehicle sales expanded mid-single digits driven by solid execution. We exited the first quarter with a book-to-bill well above 1.0, while bookings were again up more than 20% versus the prior year. We expect continued growth momentum and focused execution in the second quarter. I want to recognize our global teams for delivering a strong start to the year and for positioning the company well going forward. Now let's shift to our strategic priorities, starting with our sharpened growth focus. A key pillar of this strategy is our expansion within the grid and utility infrastructure market. Having closed the Bassler acquisition this past December, we have already begun to see the transformative impact of this integration. Bassler significantly strengthens our position in high power applications, and I'm pleased to report that Bassler outpaced our initial expectations during its first full quarter as part of the LittleFuse portfolio. We are seeing an acceleration in demand for high-power protection and excitation systems, driven by the critical need for grid modernization to support the global build-out of data center infrastructure. As an example of our momentum in the quarter, we secured a strategic design win with a market leader for data center power system solutions. This customer chose our protection, automation, and control capabilities for a new 800-volt system deployment due to our advanced feature set and differentiated high-voltage DC solutions. Our integrated system ensures comprehensive high-power protection while enhancing system reliability and reducing architectural complexity for the customer. We also secured a significant design win with a leading U.S. grid infrastructure utility for our high-power excitation systems in the quarter. With shipments slated to begin in 2027, this win provides meaningful long-term visibility into Bassler's growth trajectory. While we are in the early stages, the potential for Bassler and LittleFuse revenue synergies is increasingly clear. The complimentary nature of Bassler's technologies and our protection capabilities allows us to move up the value chain, offering more comprehensive and higher power solutions to our customers. Now, turning to our second strategic priority, which is to partner more closely with our customers to help better understand and solve their technology challenges. As we mentioned in our 4Q call, we went live with a new go-to-market model at the beginning of 2026, where our sales teams are realigned to our customers and enabled to sell our complete portfolio. Today, I wanted to update you on recent progress we're making in our transportation market. In transportation, we are a market leader for low, medium, and high voltage overcurrent and overvoltage solutions. And even though the end market is growing slowly, the rising complexity of electronic architectures is driving unique requirements for our advanced protection solutions. By partnering closely with our lead global OEM customers and demonstrating very high reliability solutions and predictable delivery, we have been able to increase our share in a number of key over-current and over-voltage protection platforms. In the first quarter, these share gains led to our high single-digit growth. In addition, due to our collaboration on next-generation platforms, we've been meaningfully expanding our pipeline and are on track for double-digit design wind growth in the transportation and logistics market in 2026. Now, turning to our third strategic priority, enhancing operational excellence. As we continue to scale best practices across the organization and take a more programmatic approach to measuring execution, we are seeing clear evidence that these efforts are delivering tangible results. By applying consistent operational and financial discipline across the company, we are driving meaningful margin expansion across the portfolio. Transportation is a good example of how this discipline is translating into results. With targeted productivity initiatives and improved execution across our footprint, we're driving solid profitability expansion despite mixed underlying market conditions. The results are reflected in a strong 200 basis point increase in transportation margins for the quarter. Turning to our semiconductor products business, we see meaningful long-term profitability enhancement opportunities. This starts with protection, a model franchise within LittleFuse with a demonstrated track record of execution and operating discipline. Once again in the quarter, protection delivered significant revenue growth and attractive profitability as we capitalized on accelerating customer demand. In power semiconductors, we are applying the same discipline approach. As we outlined last quarter, we are increasing our focus on higher growth, higher value applications, while rationalizing lower value products and optimizing our footprint. We are seeing signs of improving power semiconductor demand, but we are balancing that momentum with continued portfolio actions as we work toward long-term structural profitability improvement. We remain early in this process, and as we finalize our path forward, we will continue to update you on our regular progress. Across LittleFuse, operational excellence remains a key pillar of our long-term strategy. As we execute on this framework, we believe we are positioning WillowFuse for sustainable and scalable long-term margin expansion. We look forward to detailing our full financial playbook at our investor day next week. Taking a step back, we are encouraged by our momentum as we move into the second quarter, supported by strong backlog, high customer engagement, and disciplined execution. We look forward to sharing additional details on our strategy, long-term growth drivers, and financial objectives at our investor day on May 14th in New York. With that, I'll turn the call over to Abhi to walk through the financials in more detail.

Thank you, Greg, and good morning, everyone. Today, I will walk you through our first quarter results, followed by a second quarter outlook. Please turn to slide eight for details on our first quarter performance. All comparisons are versus the prior year, unless noted otherwise. Net sales in the first quarter were $657 million, up 19%, and 9% organically. The BASA acquisition contributed 6% to sales growth, while foreign exchange was a 3% tailwind. Adjusted EBITDA margin finished at 22.9%, up 280 basis points, reflecting strong volume leverage, favorable mix, and operational execution. Adjusted diluted earnings per share were $3.31, up 51% versus the prior year. We generated solid cash flow in the quarter. Operating cash flow was $80 million, and free cash flow was $66 million, up 55% year over year. We ended the quarter with strong liquidity, a net leverage ratio of approximately one times, and returned $90 million to shareholders through our dividend. Please turn to slide 10 for our segment highlights, starting with the electronics product segment. Sales for the quarter increased 18% year over year, with organic growth of 15%. Passive products again delivered strong growth, up 22% organically. Semiconductor products grew 8% organically, driven by strong demand for protection semiconductors. Across the electronics product segment, we benefited from increased data center and diversified industrial demand. Adjusted EBITDA margin for the electronics segment was 25.1%, up 300 basis points, reflecting strong volume leverage and execution. Into the second quarter, we expect to deliver on broad-based demand strength and continued execution as we balance power semiconductor product rationalization. Moving to our transportation product segment on slide 11, sales increased 5% year-over-year. Organic growth was 1%, driven by strength in passenger vehicle content expansion, share gains, and pricing that drove passenger vehicle organic sales of plus 4%. This was partially offset by lower commercial Waco volumes due to the impact of the marine business exit. Excluding the marine exit, commercial Waco sales were flat versus the prior year. Adjusted EBITDA margin increased 200 basis points to 19.1%, reflecting disciplined execution and productivity initiatives. Our teams remain focused on driving operational excellence, and we expect continued progress on our transportation profitability initiatives through 2026. Turning to slide 12, industrial segment sales increased 45% year-over-year. Organic growth was up 5%, supported by strong grid and utility infrastructure and data center demand, which was partially offset by soft residential HVAC volumes. The bachelor acquisition contributed 39% of growth, outpacing our expectations. Adjusted EBITDA margin increased 340 basis points to 21.9%, driven by volume leverage and max. We will continue to execute in our favorable industrial positioning in evolving markets to drive growth and profitability expansion. Turning to our outlook for the second quarter on slide 13, we expect continued solid demand across several of our key markets supported by a strong backlog and customer traction. Based on current market conditions, we expect second quarter net sales in the range of 690 million to 710 million. This represents 14% growth versus the prior year. We expect 8% organic growth and a contribution of 6% to growth from the Basler acquisition. We also expect second quarter adjusted diluted EPS to be in the range of $3.65 to $3.85 with an adjusted effective tax rate of 21% to 22%. We look forward to sharing our full strategy with you next week at Investor Day in New York. With that, operator, please open the call for Q&A.