Deswell Industries, Inc. (NASDAQ: DSWL) has filed its Annual Report on Form 20-F with the United States Securities and Exchange Commission (SEC), disclosing audited financial statements for the fiscal year ended March 31, 2026. The filing provides investors with a comprehensive overview of the company’s financial performance and operational status for FY26. This regulatory submission ensures transparency for shareholders and market participants regarding the manufacturer's fiscal health.

The Annual Report is publicly accessible on the SEC’s website at http://www.sec.gov . Deswell stated that it will deliver a paper copy of the fiscal 2026 Annual Report on Form 20-F, including complete audited financial statements, free of charge to any shareholder within a reasonable time after request. To obtain a physical copy, shareholders must submit a written request to Deswell Industries, Inc., located at 10B, Edificio Associacao Industrial De Macau, No. 32-36 Rua do Comandante Mata e Oliveira, Macau, Special Administrative Region, PRC.

Business Operations

Deswell manufactures injection-molded plastic parts and components, electronic products and subassemblies, and metallic molds and accessory parts. The company serves original equipment manufacturers (OEMs) and contract manufacturers primarily through its factories in the People’s Republic of China. Its product portfolio includes a wide variety of plastic parts used in consumer and industrial products, as well as printed circuit board assemblies using surface mount (SMT) technology.

Key Product Segments

Company Profile

Deswell operates manufacturing facilities in the People’s Republic of China, focusing on precision engineering for global OEMs. The company produces finished products such as telephones, professional audio equipment, home audio products, and Internet-of-Things (IoT) devices. For more information, investors can visit the company’s website at www.deswell.com .

Deswell Industries, Inc. reported net sales of $61.3 million for the fiscal year ended March 31, 2026, a decrease of 9.3% compared to $67.6 million in fiscal 2025. The company announced a second half cash dividend of $0.10 per share and a special cash dividend of $0.20 per share, payable on July 16, 2026. Net income for the year declined to $10.6 million from $11.1 million in the prior year, while basic and diluted net income per share fell to $0.67 from $0.70.

Financial Performance

The decline in annual revenue was driven by lower sales across both segments. Net sales for the six months ended March 31, 2026, were $28.1 million, a decrease of 13.4% from $32.4 million in the same period last year. The plastic segment saw sales decrease by 27.0% to $4.0 million, while the electronic segment sales fell by 10.6% to $24.1 million.

Total gross margin for the second half of fiscal 2026 increased slightly to 21.1% from 20.9% in the prior year. The plastic segment's gross profit margin decreased to 13.2% from 22.6%, attributed to lower sales revenues and increased labor costs due to a rise in the minimum hourly wage. Conversely, the electronics segment's gross profit margin improved to 22.4% from 20.6%, driven by higher-margin offerings and cost control measures.

Operational Highlights

Operating income for the year decreased to $2.0 million from $3.3 million in fiscal 2025. For the second half of fiscal 2026, the company recorded an operating expense of $0.5 million, compared to an operating income of $1.5 million in the same period of fiscal 2025. Non-operating income for the second half was $3.1 million, compared to $3.3 million in the prior year, primarily comprising gains on marketable securities and interest income.

Mr. Edward So, Chief Executive Officer, commented that the company delivered solid results despite elevated inflation and rising raw material prices. He noted that margin performance improved due to cost reduction initiatives and that the balance sheet remains strong with no debt.

Balance Sheet and Dividends

As of March 31, 2026, Deswell Industries held $23.1 million in cash and cash equivalents and working capital totaling $86.5 million. The company has no long-term or short-term borrowings. The board of directors declared a cash dividend of $0.10 per share and a special cash dividend of $0.20 per share for the second half of the fiscal year. The dividends are payable on July 16, 2026 to shareholders of record as of July 2, 2026.