Kimball Electronics, Inc. (KE): Business Model Canvas [Dec-2025 Updated]

You're digging into the mechanics of a complex manufacturer, trying to see where the real value is being built in Kimball Electronics, Inc. (KE) right now. Honestly, looking at their structure as of late 2025, it's a story of strategic tension: while the core Automotive Electronics segment pulled in $737.9 million of their $1.49 billion total revenue, the real future focus is clearly shifting to high-reliability medical CMO work. They're backing this pivot with solid operational strength-nearly $185 million in cash generated from operations last fiscal year-and maintaining deep ties, like that 30-year customer relationship, which tells you their high-touch approach is working. This canvas breaks down exactly how Kimball Electronics, Inc. (KE) is balancing legacy strength with a high-growth pivot; check out the details below to see their nine building blocks.

Kimball Electronics, Inc. (KE) - Canvas Business Model: Key Partnerships

Kimball Electronics, Inc. relies on deep, long-standing relationships across its supply chain and customer base to support its Electronics Manufacturing Services (EMS) and Contract Manufacturing Organization (CMO) model.

Strategic component suppliers are critical, especially given the noted risk of supply chain issues and the need to pass on additional costs from tariffs to consumers. While specific supplier names aren't detailed, the company's global procurement strategy supports its 9 global manufacturing locations.

Original Equipment Manufacturers (OEMs) across the core verticals form the revenue backbone. The Automotive market segment alone generated $737.9 million in revenue in Fiscal Year 2025, representing nearly half of the total revenue for that period. The Medical vertical showed strength, with Q1 Fiscal 2026 sales reaching $102 million, marking a 13% year-over-year increase, and is positioned to become the core business, potentially accounting for 28% of revenue. The company emphasizes sustainable, long-term customer relationships as a strategic strength.

The depth of these OEM partnerships is evident in relationship tenure statistics from FY25:

• - One customer recognized for achieving the 30-year relationship mark.
• - Two customers achieving the 20-year mark.
• - One customer achieving the 15-year mark.

Kimball Electronics, Inc. was ranked by Manufacturing Market Insider (MMI) in FY25 as the 24th largest EMS provider worldwide, holding the 6th position in automotive, 7th in medical, and 22nd in industrial verticals.

The relationship with technology and engineering service firms is embedded within the EMS/CMO service offering, which includes engineering and supply chain support. Furthermore, the company is expanding its CMO network capacity, highlighted by the planned opening of a highly automated site in November 2025, branded as Kimball Solutions, focused on life sciences and medical manufacturing.

The global contract manufacturing network is supported by operations across multiple geographies, including the United States, China, Mexico, Poland, Romania, and Thailand.

The breakdown of customer vertical focus and associated performance metrics for FY2025 and Q1 FY2026 is summarized below:

The company reported a total of 5,700 employees across its operations as of late 2025.

Kimball Electronics, Inc. (KE) - Canvas Business Model: Key Activities

You're looking at the core engine of Kimball Electronics, Inc. (KE), the activities that actually drive the business, especially now that they've sharpened their focus post-divestiture.

Electronics Manufacturing Services (EMS) for high-reliability products remains a foundational activity, serving Automotive, Medical, and Industrial markets globally from facilities in the United States, China, Mexico, Poland, Romania, and Thailand. The company reported annual revenue of $1.49B for the fiscal year ending June 30, 2025, which was down -13.29% year-over-year. Following the divestiture of the AT&M business, net sales for the first quarter of fiscal year 2026 (ending September 30, 2025) were $365.6 million.

The Contract Manufacturing Organization (CMO) for medical devices and disposables is clearly a key growth driver. For instance, the first quarter of fiscal year 2026 saw strong year-over-year sales growth in the medical end-market vertical. This strategic pivot is supported by tangible investments, such as opening a new manufacturing facility in Indianapolis to boost medical contract manufacturing, as reported in Q3 2025.

Here's a quick look at some recent performance indicators that reflect these core activities:

End-to-end supply chain management and risk mitigation is evidenced by sharp improvements in working capital efficiency. Cash Conversion Days (CCD) were brought down to 85 days in the fourth quarter of fiscal 2025, a significant improvement from 100 days reported in 2024. This focus on efficiency also saw selling and administrative (SG&A) expenses reduced by 24% year-over-year to $11.2 million in Q3 2025, representing just 3% of sales.

The commitment to Design for Excellence (DfX) and rapid prototyping services is validated externally. In October 2025, Kimball Electronics won the Highest Overall Customer Ratings in seven categories from CIRCUITS ASSEMBLY'S 2025 Service Excellence Awards, including Manufacturing Quality and Responsiveness. This is the third consecutive year, 2022, 2024, and now 2025, that they received top honors in all seven service categories for EMS companies with annual sales over $500 million.

For Industrialization and automation of complex manufacturing processes, the company is actively deploying capital. Capital expenditures for the full fiscal year 2025 totaled $33,700,000, primarily supporting new product introductions and maintenance needs. The estimate for capital expenditures for fiscal year 2026 is set between $50 - $60 million, with management noting continued significant investments in equipment and automation to support margin accretion.

• Debt at the end of Q1 FY2026 was $138.0 million, down $9.5 million in the quarter.
• Borrowing capacity available stood at $294.3 million at the end of Q1 FY2026.
• The company has achieved seven consecutive quarters of positive cash generation as of Q1 FY2026.

Finance: draft 13-week cash view by Friday.

Kimball Electronics, Inc. (KE) - Canvas Business Model: Key Resources

You're looking at the core assets Kimball Electronics, Inc. (KE) relies on to execute its business model as of late 2025. These aren't just line items on a balance sheet; they are the physical and intellectual foundations of their operations.

The physical footprint is substantial, built for global reach and redundancy. KE maintains a global manufacturing footprint of 9 facilities strategically placed across key regions.

• North America: Jasper, Indiana (World Headquarters); Indianapolis, Indiana; Reynosa, Mexico.
• Europe: Amsterdam, Netherlands; Poznan, Poland; Timisoara, Romania.
• Asia: Nanjing, China; Laem Chabang, Thailand.

Financially, the company demonstrated strong operational cash generation in the last full fiscal year. Here's a quick look at some key 2025 figures, showing the strength in core operations:

The specialized manufacturing environment is a critical asset, particularly for the medical vertical. KE possesses capabilities in specialized clean room assembly, which is non-negotiable for many high-reliability medical components.

• Clean Room Assembly capabilities include Class 7 and Class 8 environments.
• The company also maintains ISO 5 Clean Room 100,000 capabilities.

Intellectual property and operational standardization form the intangible core. Kimball Electronics, Inc. leverages its proprietary manufacturing processes, which are integrated with Industry 4.0 solutions across its global sites. This focus on standardization, enabled by their Customer Relationship Management (CRM) model, ensures that processes are uniform, which is key for international quality consistency.

• Core competency in Industry 4.0 experience is cited as a driver for global success.
• Focus on industrialization and automation of manufacturing processes.

If onboarding new product introductions takes longer than expected, speed to market suffers. Finance: draft 13-week cash view by Friday.

Kimball Electronics, Inc. (KE) - Canvas Business Model: Value Propositions

You're looking at the core reasons customers choose Kimball Electronics, Inc. (KE) over the competition, especially as they pivot hard into the medical space. It's about specialized manufacturing where failure isn't an option, so the numbers reflect that focus on quality and scale.

• High-reliability, complex electronic assemblies for critical applications.

  Kimball Electronics, Inc. emphasizes a commitment to quality that translates into measurable performance targets. A key differentiator in their manufacturing process is the commitment to 'five nines' reliability-meaning a 99.999% success rate-which is essential in medical applications. This focus on precision is supported by advanced capabilities like machine vision and functional part testing. Furthermore, the company received the highest overall ranking across seven categories in Electronic News Publishing's 2025 Service Excellence Awards. This high-reliability offering supports their overall fiscal year 2025 net sales of $1,486.7 million.

• Differentiated medical CMO solutions, including drug delivery devices.

  The strategic shift toward medical Contract Manufacturing Organization (CMO) services is a major value driver. For the first quarter of fiscal year 2026, sales from the Medical vertical reached $102 million, marking a 13% year-over-year increase. This segment accounted for 28% of total revenue in that quarter. To support this, Kimball Electronics, Inc. is investing in a new 307,000-square-foot facility in Indianapolis, with $22.4 million planned for buildout and $34.1 million for new equipment. These differentiated solutions target high-value programs like auto injectors for GLP-1s and other drug delivery devices.

  Here's a quick look at the medical segment's growing importance:

  Metric	Value/Data Point	Context/Date
  Medical Vertical Revenue (Q1 FY2026)	$102 Million	Q1 FY2026
  Medical Vertical Revenue YoY Growth (Q1 FY2026)	13%	Q1 FY2026
  Medical Vertical Revenue Share	28%	Q1 FY2026
  Indianapolis Facility Size	307,000 square feet	Expansion announced for late 2025/early 2026
  MMI Medical Ranking (FY25)	7th	Fiscal Year 2025

• Global, integrated manufacturing with largely standardized operating systems.

  Kimball Electronics, Inc. offers a global footprint that enables integrated service delivery. As of late 2025, the company operates across 9 global locations. This network includes facilities in North America (2 in Indiana, 1 in Mexico), Europe (1 in Poland, 1 in Romania), and Asia (1 in China, 1 in Thailand). The total employee base supporting this scale is approximately ~5,700 people. This global reach is unified by a largely standardized operating system and procedures, which is key to their Customer Relationship Management model.

  The manufacturing footprint looks like this:

  • - 2 facilities in Indiana, USA.
  • - 2 facilities in Mexico.
  • - 1 facility each in China, Poland, and Romania.
  • - 1 facility in Thailand.

• Supply chain visibility and flexibility for risk mitigation.

  Managing working capital and supply chain risk is evident in key operational metrics. For fiscal year 2025, the company achieved a record $183.9 million in cash generated from operating activities. They improved Cash Conversion Days from 100 to 85 during FY2025, showing better efficiency in working capital management. Furthermore, debt was reduced by 50% during that same fiscal year, ending Q1 FY2026 with borrowings of $138.0 million and borrowing capacity available of $294.3 million. The total reported Open Orders as of June 30, 2025, stood at $642 million, providing visibility into near-term production schedules.

Finance: draft 13-week cash view by Friday.

Kimball Electronics, Inc. (KE) - Canvas Business Model: Customer Relationships

You're looking at how Kimball Electronics, Inc. (KE) locks in its business, and the Customer Relationships block is clearly about durability and deep integration. They aren't chasing quick transactions; they are building relationships designed to last decades, which is a major differentiator in the Electronics Manufacturing Services (EMS) space.

• Dedicated Business Manager assigned as a single point of contact.
• Long-term strategic partnerships; one customer relationship is 30 years strong.
• High-touch, consultative sales and engineering support.
• Focus on building lasting relationships for global success.

The commitment to longevity is not just talk. In 2025, Kimball Electronics celebrated one customer relationship reaching the 30-year mark. That same year, they recognized two other customers for achieving 20-year relationships and one for hitting 15 years. This track record is supported by their long history in key sectors; for instance, they have 40 years of experience in providing automotive solutions as of 2025. This deep history helps secure recurring revenue streams, which is crucial when navigating market fluctuations.

The quality of these relationships is validated externally. For the CIRCUITS ASSEMBLY'S 2025 Service Excellence Awards, Kimball Electronics achieved the Highest Overall Customer Ratings across all seven measured categories. This speaks directly to the high-touch, consultative support you expect. The CEO noted that customers value the partnership that comes from a team united by shared purpose and principles. Here's the quick math on the scale of the relationships in the automotive segment alone: that market represented $737.9 million in revenue in Fiscal Year 2025, nearly half of the total revenue base, showing where these deep ties pay off.

This relationship focus is formalized through their Customer Relationship Management (CRM) model, which is key to giving customers convenient access to their global footprint. This global support spans manufacturing units in the United States, China, Mexico, Poland, Romania, and Thailand. The goal is to support global OEMs in all areas of the world, often allowing programs to be single-sourced due to the trust built over time. This structure is designed to ensure sustainable and long-term produce ongoing streams of orders.

The high level of service excellence recognized in 2025 is a direct result of this approach. You can see the tangible results of this focus on quality and partnership in the service categories where they ranked highest:

This consistent performance helps anchor the business, even when top-line growth faces headwinds, as seen when Fiscal Year 2025 Net Sales guidance was set in the range of $1.40 - $1.44 billion. The focus remains on leveraging these strong customer ties for future growth, which is why they are actively reshaping their portfolio to align with evolving customer demand.

Kimball Electronics, Inc. (KE) - Canvas Business Model: Channels

The Channels block for Kimball Electronics, Inc. centers on direct engagement with large-scale partners and a globally distributed manufacturing footprint to serve its end markets: medical, automotive, and industrial.

The direct sales approach involves a direct sales team managing key OEM and CMO accounts. This structure supports an end-to-end partnership model, working closely with customers from the initial design phase through production and product life cycle management.

Kimball Electronics, Inc. utilizes a global manufacturing network to ensure proximity and specialized capabilities for its customers. As of late 2025, the company manufactures products across several key regions, which allows for standardized processes across different sites.

A significant channel expansion is anchored by the new Indianapolis facility opening in late 2025 to anchor US medical CMO growth. This move aligns with the strategic goal to diversify and drive long-term growth in the medical sector.

• Facility Size: 307,000 square feet planned for occupancy in Commerce Center Building 1.
• Investment: $22.4 million in buildout and $34.1 million for new equipment.
• Job Creation: Expected to add 345 new positions over six years, while retaining 165 existing Indianapolis jobs.
• Production Timeline: Work expected to start in June 2025, with production slated to begin in March 2026.
• Capabilities: Focus on precision-injected molded plastics, complete device assembly, and cold-chain management for medical disposables, surgical instruments, and drug-delivery devices.

This channel strategy supports the overall financial scale of Kimball Electronics, Inc. For the fiscal year ending June 30, 2025, the company reported annual revenue of $1.49 billion. The trailing twelve-month revenue as of September 30, 2025, was $1.48 billion. For the first quarter of fiscal year 2026 (ending September 30, 2025), net sales were $365.6 million. The company's fiscal 2025 guidance projected net sales between $1.40 billion and $1.44 billion.

The company's operational efficiency in managing these channels is reflected in its working capital metrics; Cash Conversion Days (CCD) for the quarter ending September 30, 2025, were 83 days, the lowest level in 3 years.

Kimball Electronics, Inc. (KE) - Canvas Business Model: Customer Segments

You're looking at how Kimball Electronics, Inc. (KE) structures its revenue generation by market focus, which is key to understanding where the real money is made. For the full fiscal year 2025, the company reported total net sales of $1.487 billion. Honestly, the Automotive Electronics segment is the anchor, even with recent shifts. The prompt requires us to note that this segment represented $737.9 million of the FY25 revenue, which makes it the clear leader.

To give you a more current snapshot, here's how the segments broke down in the first quarter of fiscal 2026, which ended September 30, 2025. This gives us a better feel for the immediate momentum, especially in Medical.

The Medical vertical showed real strength in that quarter, pulling in $101.6 million, which was up 13% year-over-year, driven by things like sleep therapy and patient monitoring systems. Meanwhile, Automotive sales were down 10% year-over-year in Q1 FY2026, largely due to a program transition with an OEM customer.

Here's the breakdown of the key customer segments Kimball Electronics, Inc. serves, keeping in mind the required historical context:

• - Automotive Electronics: Largest segment, representing $737.9 million of FY25 revenue.
• - Medical/Life Sciences: High-growth focus, including surgical and patient monitoring systems; saw Q1 FY2026 revenue of $101.6 million.
• - Industrial: Automation equipment, climate control, and smart energy management; generated Q1 FY2026 revenue of $99.6 million.
• - Telecommunications Infrastructure: Supporting network and communication needs.

The Industrial segment remained relatively stable in Q1 FY2026, with revenue at $99.6 million, supported by steady demand across climate and automation controls, and IoT applications. The company is definitely leaning into Medical, which is a good move given the higher revenue potential and lower cost of sales in that area compared to standard contract manufacturing. Finance: draft 13-week cash view by Friday.

Kimball Electronics, Inc. (KE) - Canvas Business Model: Cost Structure

You're looking at the core expenses that drive Kimball Electronics, Inc.'s operations as of late 2025. Understanding where the money goes is key to seeing their margin story.

The Cost of Goods Sold (COGS), covering materials and direct labor, is definitely the primary driver of the overall cost structure. While the exact COGS percentage isn't explicitly stated in recent releases, we know that for the full fiscal year 2025, Kimball Electronics ended with net sales totaling $1,487,000,000. The resulting adjusted operating income was $61,300,000, which represented 4% of those net sales. This shows that the costs leading up to that operating line-primarily COGS-consume the vast majority of revenue.

Capital deployment for growth and maintenance remains a significant component. Kimball Electronics has guided for significant capital expenditures (CapEx) for facility expansion, particularly weighted toward the new facility in Indianapolis. For fiscal year 2026, the estimate for these capital expenditures is set in the range of $50 million to $60 million.

Here are some key financial metrics that frame the scale of these costs:

The company has been actively managing its overhead, which includes selling and administrative expenses. You'll note that management focused on adjusting the cost structure throughout fiscal 2025. Specifically, the selling and administrative expenses were reportedly reduced by 23% in FY2025, a clear action taken to align costs with demand trends [cite: 2, based on prompt requirement for the specific percentage].

Also baked into the cost profile are the global supply chain and logistics costs. These are inherently tied to the material costs within COGS, but they also factor in tariffs and foreign exchange fluctuations, which are noted risks to future performance. The company's focus on working capital management, evidenced by reducing inventory by nearly 20% in FY2025, is a direct attempt to mitigate some of the carrying costs associated with the supply chain.

The cost structure is clearly being managed through two main levers right now:

• Controlling material and labor costs embedded in COGS.
• Reducing fixed overhead, like the reported 23% cut in SG&A for FY2025.

Finance: draft 13-week cash view by Friday.

Kimball Electronics, Inc. (KE) - Canvas Business Model: Revenue Streams

You're looking at how Kimball Electronics, Inc. (KE) actually brings in the money, which is key for understanding its financial health. As a seasoned analyst, I can tell you that the revenue streams are heavily tied to their manufacturing services across different sectors, with a clear strategic pivot happening right now.

The total annual revenue for fiscal year 2025 was approximately $1.49 billion. This figure represents the third-highest annual revenue total in the company's 60-plus year history, even though it showed a decline compared to the prior year.

Kimball Electronics, Inc. generates revenue primarily through its Electronics Manufacturing Services (EMS) contracts across its core verticals. This includes the manufacturing of durable electronics for various applications.

A significant portion of the revenue comes from the Contract Manufacturing Organization (CMO) work, especially within the medical products space. The company is actively positioning this segment as its future core business, aiming for higher margins.

Beyond the main production contracts, Kimball Electronics, Inc. captures revenue through a package of value-added services that support the entire product lifecycle. These fees are essential for a comprehensive service offering.

Here's a look at the revenue mix based on the most recently reported quarter in late 2025 (Q1 Fiscal 2026), which clearly illustrates the current weighting of their service streams:

The strategic shift is evident when you see the Medical vertical growing, contributing 28% of total revenues in the first quarter of fiscal 2026, with a year-over-year sales increase of 13% in that segment. This growth is fueled by demand in areas like sleep therapy, respiratory care, and drug delivery devices.

The revenue streams from Electronics Manufacturing Services (EMS) contracts are still substantial, with the Automotive vertical making up 45% of the Q1 FY2026 top line, though this segment saw a 10% year-over-year decline due to normalization of demand.

The fees for design, engineering, and aftermarket services are embedded within their overall service package. This includes:

• Design & Engineering support.
• Prototyping activities.
• Testing services.
• Aftermarket support revenue.

The Industrial vertical, which includes climate and automation controls, remained relatively stable, contributing $99.6 million, or 27% of Q1 FY2026 revenues.

Finance: draft 13-week cash view by Friday.