Sensor manufacturer Sensata Technology (NYSE: ST) reported Q4 CY2025 results beating Wall Street’s revenue expectations, with sales up 1.1% year on year to $917.9 million. The company expects next quarter’s revenue to be around $927 million, close to analysts’ estimates. Its non-GAAP profit of $0.88 per share was 2.1% above analysts’ consensus estimates.
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Sensata Technologies (ST) Q4 CY2025 Highlights:
- Revenue: $917.9 million vs analyst estimates of $912.8 million (1.1% year-on-year growth, 0.6% beat)
- Adjusted EPS: $0.88 vs analyst estimates of $0.86 (2.1% beat)
- Adjusted EBITDA: $211.5 million vs analyst estimates of $211.8 million (23% margin, in line)
- Revenue Guidance for Q1 CY2026 is $927 million at the midpoint, roughly in line with what analysts were expecting
- Adjusted EPS guidance for Q1 CY2026 is $0.83 at the midpoint, roughly in line with what analysts were expecting
- Operating Margin: 10.9%, up from 8.1% in the same quarter last year
- Free Cash Flow Margin: 16.5%, up from 15.3% in the same quarter last year
- Inventory Days Outstanding: 86, in line with the previous quarter
- Market Capitalization: $5.34 billion
“With our Q4 and Full Year 2025 results, I am pleased to report that we delivered on our objectives for the first year of our transformation journey. We expanded margins sequentially each quarter this year, dramatically improved free cash flow, strengthened our balance sheet, and, in the fourth quarter, we returned to year-over-year revenue growth,” said Stephan von Schuckmann, Sensata’s Chief Executive Officer.
Company Overview
Originally a temperature sensor control maker and a subsidiary of Texas Instruments for 60 years, Sensata Technology Holdings (NYSE: ST) is a leading supplier of analog sensors used in industrial and transportation applications, best known for its dominant position in the tire pressure monitoring systems in cars.
Revenue Growth
A company’s long-term sales performance can indicate its overall quality. Any business can put up a good quarter or two, but many enduring ones grow for years. Unfortunately, Sensata Technologies’s 4% annualized revenue growth over the last five years was mediocre. This was below our standard for the semiconductor sector and is a poor baseline for our analysis. Semiconductors are a cyclical industry, and long-term investors should be prepared for periods of high growth followed by periods of revenue contractions.
Long-term growth is the most important, but short-term results matter for semiconductors because the rapid pace of technological innovation (Moore's Law) could make yesterday's hit product obsolete today. Sensata Technologies’s performance shows it grew in the past but relinquished its gains over the last two years, as its revenue fell by 4.4% annually. 
This quarter, Sensata Technologies reported modest year-on-year revenue growth of 1.1% but beat Wall Street’s estimates by 0.6%. Adding to the positive news, Sensata Technologies’s growth inflected positively this quarter, news that will likely give some shareholders hope. Company management is currently guiding for a 1.7% year-on-year increase in sales next quarter.
Looking further ahead, sell-side analysts expect revenue to grow 3% over the next 12 months. While this projection implies its newer products and services will catalyze better top-line performance, it is still below average for the sector.
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Product Demand & Outstanding Inventory
Days Inventory Outstanding (DIO) is an important metric for chipmakers, as it reflects a business’ capital intensity and the cyclical nature of semiconductor supply and demand. In a tight supply environment, inventories tend to be stable, allowing chipmakers to exert pricing power. Steadily increasing DIO can be a warning sign that demand is weak, and if inventories continue to rise, the company may have to downsize production.
This quarter, Sensata Technologies’s DIO came in at 86, which is in line with its five-year average. At the moment, these numbers suggest that there isn’t any unusual buildup of inventory.
Key Takeaways from Sensata Technologies’s Q4 Results
It was good to see Sensata Technologies beat analysts’ EPS expectations this quarter. We were also happy its adjusted operating income narrowly outperformed Wall Street’s estimates. On the other hand, its revenue guidance for next quarter was in line. Zooming out, we think this was a mixed quarter. The stock traded up 2.4% to $37 immediately following the results.
So do we think Sensata Technologies is an attractive buy at the current price? What happened in the latest quarter matters, but not as much as longer-term business quality and valuation, when deciding whether to invest in this stock. We cover that in our actionable full research report which you can read here (it’s free).
