Chip Rui's questions to RICHARDSON ELECTRONICS (RELL) leadership • Q1 2026
Question
Chip Rui of Rui Asset Management asked for an expansion on the impact of repower initiatives and the "Big Beautiful Bill" on the wind business, noting the company's aftermarket focus. He also inquired about the outlook for operating leverage and muted expense growth for the remainder of the year. Finally, he asked for details on the reported pickup in the legacy RF business.
Answer
Greg Peloquin, General Manager of Power and Microwave Technologies Group, explained that government decisions to remove subsidies for new turbines are driving repowering efforts, which benefit the company's aftermarket pitch energy modules. He anticipates double-digit growth for GES in FY 2026 due to these trends. Wendy Diddell, Chief Operating Officer, stated that operating expenses for the full year are expected to be up only slightly over FY 2025, as the company continues to manage SG&A levels effectively while investing in growth programs. Ed Richardson, CEO, clarified that the RF tube business remains stable and profitable, with the company managing inventory as a major supplier exits the market. Greg Peloquin added that growth in the solid-state RF side is driven by increased demand in military, defense, RF communications, drones, and SATCOM applications.