NAPCO Security Technologies Q4 Earnings Call Highlights

Interested in NAPCO Security Technologies, Inc.? Here are five stocks we like better.

Record fiscal 2026 performance: Full-year revenue surpassed $200 million for the first time, rising 11.4% to $202.3 million, while adjusted EBITDA increased 27.9% to $66.7 million and free cash flow rose 15.2% to $59.2 million.

Recurring revenue continued to drive growth: Fourth-quarter recurring monthly service revenue increased 12.9% to $25.3 million with a 90.1% gross margin, and the prospective annual recurring revenue run rate reached approximately $103 million.

Leadership and strategy are evolving: Kevin Buchel became CEO and president as founder Dick Soloway moved to executive chairman. NAPCO plans to invest in connected-services products such as its MVP cloud platform, automation and distribution, while evaluating acquisitions and raising its quarterly dividend 13.3% to $0.17 per share.

3 Security Stocks Benefiting From The Growing Public-Safety Trend

NAPCO Security Technologies (NASDAQ:NSSC) reported record fiscal fourth-quarter and full-year revenue for fiscal 2026, supported by growth in recurring service revenue, intrusion products and radio sales. The company also outlined a leadership transition in which longtime executive Kevin Buchel became Chief Executive Officer and President, while founder Dick Soloway moved into the role of Founder and Executive Chairman.

"Fiscal 2026 was a year of exceptional performance and meaningful progress for NAPCO," Soloway said. He said the transition was intended to provide continuity, with Buchel bringing more than 25 years of experience at the company to the CEO role.

→ Rocket Lab's Sell-Off Is Fading—Is It Finally Safe to Buy?

Is Security Products Maker Napco Setting Up For Fresh Rally?

Fourth-quarter net sales rose 10% from a year earlier to a record $55.8 million. Recurring monthly service revenue increased 12.9% to $25.3 million, primarily driven by ongoing activations of StarLink radio fire communicators, while equipment revenue increased 7.7% to $30.5 million.

Recurring service revenue generated a 90.1% gross margin during the quarter. Total gross profit increased 27.7% to $34.2 million, and consolidated gross margin expanded to 61.3% from 52.8% in the prior-year period. Chief Financial Officer Andrew Vuono said quarterly gross profit benefited by approximately 600 basis points from IEEPA tariff refunds.

→ Travel + Leisure Goes Big—Is It Ready to Rally?

Equipment gross margin rose to 37.4% from 22.9% a year earlier. Vuono said equipment margins benefited from tariff refunds and lower inventory-reserve adjustments, partly offset by Section 122 tariff costs and higher technical service costs associated with investments in artificial-intelligence solutions intended to improve customer experience.