Gross margins have deteriorated significantly from a 13.6% peak in 2024Q2 to a concerning 5.4% in 2026Q1, reflecting structural challenges in maintaining value-add spreads.
| Sales/Revenue | 555.69M | 546.49M | 581.6M | 588.42M | 539.39M | 454.83M | 357.61M | 519.7M | 354.53M | 313.33M |
| Revenue Growth % | -0.04% | -6.04% | -1.16% | 9.09% | 18.59% | 27.19% | -31.19% | 46.59% | 13.15% | - |
| Cost of Goods Sold | 372.43M | 492.48M | 510.51M | 518.72M | 478.32M | 403.45M | 326.11M | 460.99M | 303.95M | 278.59M |
| COGS % of Revenue | - | 90.12% | 87.78% | 88.15% | 88.68% | 88.7% | 91.19% | 88.7% | 85.73% | 88.91% |
| Gross Profit | 46.31M | 54.01M | 71.1M | 69.7M | 61.07M | 51.38M | 31.5M | 58.72M | 50.58M | 34.74M |
| Gross Margin % | 8.33% | 9.88% | 12.22% | 11.85% | 11.32% | 11.3% | 8.81% | 11.3% | 14.27% | 11.09% |
| Gross Profit Growth % | - | -24.03% | 2% | 14.14% | 18.87% | 63.09% | -46.35% | 16.09% | 45.6% | - |
| Operating Expenses | 53.07M | 57.85M | 26.54M | 49.51M | 35.3M | 58.77M | 38M | 60.68M | 28.41M | 25.31M |
| OpEx % of Revenue | - | 10.59% | 4.56% | 8.41% | 6.54% | 12.92% | 10.63% | 11.68% | 8.01% | 8.08% |
| Selling, General & Admin | 45.09M | 48.14M | 45.11M | 41.77M | 32.69M | 31.91M | 27.29M | 56.02M | 24.31M | 21.55M |
| SG&A % of Revenue | - | 8.81% | 7.76% | 7.1% | 6.06% | 7.02% | 7.63% | 10.78% | 6.86% | 6.88% |
| Research & Development | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 |
| R&D % of Revenue | - | - | - | - | - | - | - | - | - | - |
| Other Operating Expenses | 3M | 9.72M | -18.57M | 7.74M | 2.61M | 26.86M | 10.71M | 4.65M | 4.1M | 3.76M |
| Operating Income | -11.57M | -3.84M | 44.55M | 20.19M | 25.77M | -7.39M | -6.5M | -1.96M | 22.17M | 9.43M |
| Operating Margin % | -2.08% | -0.7% | 7.66% | 3.43% | 4.78% | -1.63% | -1.82% | -0.38% | 6.25% | 3.01% |
| Operating Income Growth % | - | -108.63% | 120.66% | -21.66% | 448.72% | -13.74% | -231.87% | -108.83% | 135.19% | - |
| EBITDA | 31.19M | 37.44M | 82.14M | 55.27M | 55.09M | 24.39M | 25.59M | 31.04M | 42.64M | 30.16M |
| EBITDA Margin % | 5.61% | 6.85% | 14.12% | 9.39% | 10.21% | 5.36% | 7.16% | 5.97% | 12.03% | 9.62% |
| EBITDA Growth % | -59.14% | -54.42% | 48.62% | 0.34% | 125.83% | -4.69% | -17.57% | -27.19% | 41.38% | - |
| D&A (Non-Cash Add-back) | 42.75M | 41.29M | 37.59M | 35.08M | 29.31M | 31.78M | 32.09M | 33M | 20.47M | 20.73M |
| EBIT | -11.57M | -3.84M | 44.55M | 19.98M | 25.77M | -7.39M | -6.5M | -2.11M | 22.73M | 9.43M |
| Net Interest Income | -8.65M | -10.21M | -10.99M | -11.09M | -3.38M | -2M | -2.67M | -6.73M | -3.88M | -4.18M |
| Interest Income | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 |
| Interest Expense | 4.99M | 10.21M | 10.99M | 11.09M | 3.38M | 2M | 2.67M | 6.73M | 3.88M | 4.18M |
| Other Income/Expense | -13.99M | -10.21M | -10.99M | -11.31M | -3.38M | -2M | -2.67M | -6.88M | -4.69M | -4.18M |
| Pretax Income | -25.55M | -14.06M | 33.56M | 8.88M | 22.39M | -9.39M | -9.17M | -8.84M | 17.48M | 5.25M |
| Pretax Margin % | -4.6% | -2.57% | 5.77% | 1.51% | 4.15% | -2.07% | -2.56% | -1.7% | 4.93% | 1.67% |
| Income Tax | -9.25M | -5.95M | 7.6M | 1.04M | 3.67M | -1.94M | -2.07M | -4.09M | -459K | 0 |
| Effective Tax Rate % | 36.19% | 42.31% | 22.63% | 11.7% | 16.37% | 20.68% | 22.63% | 46.24% | -2.63% | 0% |
| Net Income | -16.3M | -8.11M | 25.97M | 7.84M | 18.73M | -7.45M | -7.09M | -4.75M | 17.93M | 5.25M |
| Net Margin % | -2.93% | -1.48% | 4.46% | 1.33% | 3.47% | -1.64% | -1.98% | -0.91% | 5.06% | 1.67% |
| Net Income Growth % | -171.68% | -131.23% | 231.06% | -58.11% | 351.34% | -5.06% | -49.21% | -126.5% | 241.88% | - |
| Net Income (Continuing) | -16.3M | -8.11M | 25.97M | 7.84M | 18.73M | -7.45M | -7.09M | -4.75M | 17.93M | 5.25M |
| Discontinued Operations | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 |
| Minority Interest | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 |
| EPS (Diluted) | -0.80 | -0.40 | 1.24 | 0.38 | 0.92 | -0.37 | -0.36 | -0.27 | 0.91 | 0.27 |
| EPS Growth % | -173.08% | -132.26% | 226.32% | -58.7% | 348.65% | -2.78% | -33.33% | -129.67% | 237.04% | - |
| EPS (Basic) | - | -0.40 | 1.26 | 0.38 | 0.92 | -0.37 | -0.36 | -0.27 | 0.91 | 0.27 |
| Diluted Shares Outstanding | 20.45M | 20.47M | 20.97M | 20.7M | 20.68M | 20.83M | 19.9M | 17.45M | 19.69M | 19.69M |
| Basic Shares Outstanding | 20.45M | 20.47M | 20.61M | 20.42M | 20.4M | 20.4M | 19.9M | 17.45M | 19.69M | 19.69M |
| Dividend Payout Ratio | - | - | - | - | - | - | - | - | - | - |
Operating leverage and liquidity
As reported in recent financial filings, MEC's revenue growth has exhibited significant volatility, oscillating between a 19.1% contraction in 2025Q2 and a 10.7% expansion in 2025Q4, reflecting the company's high sensitivity to the cyclical nature of North American heavy-duty truck and industrial equipment build rates.
The inconsistent top-line performance suggests that MEC remains highly susceptible to the capital expenditure cycles of its primary OEM customers. Investors should monitor whether the recent 6.8% growth in 2026Q1 represents a sustainable recovery or merely a temporary fluctuation in order timing.
Based on the company's income statement data, gross margins have deteriorated from a peak of 13.6% in 2024Q2 to a concerning 5.4% in 2026Q1, indicating that the firm is struggling to maintain its value-add spread amidst rising input costs and lower production throughput.
The compression of gross margins suggests that MEC's pass-through pricing mechanisms may be lagging behind commodity price volatility or that the company is failing to absorb fixed facility costs. This trend warrants further investigation into whether the current margin profile is a cyclical trough or a permanent shift in competitive pricing power.
According to historical income statements, MEC's operating income has swung from a 19.0% margin in 2024Q4 to a negative 4.2% in 2026Q1, demonstrating that the company's high fixed-cost structure is currently amplifying the impact of revenue declines on the bottom line.
The inability to maintain positive operating income during periods of revenue contraction suggests that the company's overhead and labor costs are not sufficiently variable. This lack of operational flexibility may indicate that the business model requires higher utilization rates than currently achieved to reach a sustainable break-even point.
As disclosed in recent quarterly reports, MEC's net income has faced significant pressure, culminating in a net loss of $8.2 million in 2026Q1, which is further complicated by the impact of stock-based compensation expenses that continue to dilute shareholders despite the lack of profitability.
The transition from consistent profitability in 2024 to persistent net losses suggests that the company's earnings quality is currently strained by both operational inefficiencies and non-operating items. Investors should scrutinize the sustainability of these losses and whether the current expense structure is aligned with the company's long-term strategic pivot.
Based on reported figures, the company's extremely low cash position of $1.5 million combined with sustained negative operating margins suggests a precarious liquidity profile that may leave little room for error if the industrial cycle does not improve in the near term.
Short-sellers might focus on the potential for a capital raise or increased reliance on credit facilities to fund working capital requirements during this downturn. The market may be underestimating the risk that MEC's current operational model is fundamentally ill-equipped to handle prolonged periods of low demand.
Quick answers to the most common questions about buying MEC stock.
For fiscal year 2025, Mayville Engineering Company, Inc. (MEC) reported total revenue of $546.5M. This represents a 74.4% increase compared to $313.3M in 2017.
Mayville Engineering Company, Inc. (MEC) reported a net loss of $8.1M for the fiscal year ending 2025.
Mayville Engineering Company, Inc. (MEC) reported an operating income of $-3.8M, resulting in an operating profit margin of -0.7%. This margin reflects the operational efficiency of the business before interest and taxes.
Mayville Engineering Company, Inc. (MEC) generated $54.0M in gross profit for the year, representing a gross profit margin of 9.9%. This demonstrates the company's core pricing power and production efficiency.