Cognex Corp
NASDAQ:CGNX
Cognex Corp
Cognex Corporation emerged on the scene with a vision to blend cutting-edge technology with industrial efficiency, carving out a niche in the machine vision industry. Founded by Dr. Robert Shillman in 1981, the company initially saw its innovation as a way to develop a computer program that could read alphanumeric codes, a task simple for humans but daunting for machines. Today, Cognex has grown into a leading provider of vision systems, software, and sensors. At its core, the company thrives on developing advanced algorithms that enable machines to "see" and interpret visual data with clarity and precision. These technologies play an essential role in automating manufacturing processes, reducing defects, delivering consistent quality, and ensuring that products meet strict specifications before they reach consumers.
Cognex's revenue model hinges on its ability to provide industrial clients with tailored machine vision solutions that improve operational efficiency and cost-effectiveness. The company sells its products directly to manufacturers in sectors such as automotive, consumer electronics, logistics, and pharmaceuticals. Additionally, Cognex offers service packages, including training and customer support, which ensures clients derive maximum utility from their products. The company's strategic investments in research and development fuel its growth by continually expanding the capabilities of machine vision technologies, ensuring it stays ahead in a rapidly evolving landscape. This relentless focus on innovation and customization is what positions Cognex as a trusted partner in the ongoing digital transformation of industries worldwide.
Cognex Corporation emerged on the scene with a vision to blend cutting-edge technology with industrial efficiency, carving out a niche in the machine vision industry. Founded by Dr. Robert Shillman in 1981, the company initially saw its innovation as a way to develop a computer program that could read alphanumeric codes, a task simple for humans but daunting for machines. Today, Cognex has grown into a leading provider of vision systems, software, and sensors. At its core, the company thrives on developing advanced algorithms that enable machines to "see" and interpret visual data with clarity and precision. These technologies play an essential role in automating manufacturing processes, reducing defects, delivering consistent quality, and ensuring that products meet strict specifications before they reach consumers.
Cognex's revenue model hinges on its ability to provide industrial clients with tailored machine vision solutions that improve operational efficiency and cost-effectiveness. The company sells its products directly to manufacturers in sectors such as automotive, consumer electronics, logistics, and pharmaceuticals. Additionally, Cognex offers service packages, including training and customer support, which ensures clients derive maximum utility from their products. The company's strategic investments in research and development fuel its growth by continually expanding the capabilities of machine vision technologies, ensuring it stays ahead in a rapidly evolving landscape. This relentless focus on innovation and customization is what positions Cognex as a trusted partner in the ongoing digital transformation of industries worldwide.
Revenue Growth: Cognex reported 2025 revenue of $994 million, up 9% year-over-year, marking the first year of substantial organic growth since 2021.
Margin Expansion: Adjusted EBITDA margin reached 21.5% for 2025, a 440 basis point improvement, beating the company’s earlier milestones.
EPS Acceleration: Adjusted EPS grew 38% year-over-year to $1.02; GAAP diluted EPS for Q4 was $0.19, up 18%.
Cost Reduction & Portfolio Review: Cognex exited $22 million of low growth/low margin business and identified $35–40 million in further annualized cost reductions by end of 2026.
2026 Margin Ambition: Updated long-term target to 25–31% adjusted EBITDA margin, with a specific run-rate goal of 25% by end of 2026.
Q1 2026 Guidance: Revenue expected between $235–255 million (up ~13% at midpoint), adjusted EBITDA margin between 19–22%, and adjusted EPS of $0.22–0.26, representing ~50% year-over-year growth.
End Market Trends: Logistics, consumer electronics, and packaging drove momentum, while automotive remains soft but is expected to stabilize.
Strong Cash Generation: Free cash flow reached $237 million, up 77% year-over-year, with 138% trailing 12-month conversion.
Customer Growth: Added 9,000 new customer accounts in 2025, triple the prior year, as a result of sales force transformation and digital investments.
