Group revenue declined 9.0% to US$991.1 million
Gross profit margin improved from 31.5% to 31.9%
Profit attributable to shareholders of the Company decreased 14.5% to US$74.7 million
Interim dividend of US17.0 cents per ordinary share, unchanged
Strong financial position
HONG KONG, Nov. 13, 2025 /PRNewswire/ -- VTech Holdings Limited (HKSE: 303) today announced its results for the six months ended 30 September 2025.
"VTech reported a decline in revenue and profit in the first half of the financial year 2026, as lower sales of electronic learning products and contract manufacturing services offset an increase for telecommunication products. In particular, electronic learning products sales were negatively impacted by a temporary halt to shipment in response to changes in US tariff policy. Profit attributable to shareholders of the Company decreased largely because of the lower revenue, despite a slight improvement in gross profit margin," said Mr. Allan Wong, Chairman and Group CEO of VTech Holdings Limited.
Results and Dividend
Group revenue for the six months ended 30 September 2025 fell by 9.0% to US$991.1 million, from US$1,089.7 million in the corresponding period last year. Sales were lower in all regions.
Profit attributable to shareholders of the Company decreased by 14.5% to US$74.7 million. The decrease in profit was attributable to lower revenue, increased total operating expenses as a percentage of Group revenue and a higher Group effective tax rate. Gross profit margin posted a slight improvement during the period.
Basic earnings per share decreased by 14.7% to US29.5 cents, compared to US34.6 cents in the same period of the previous financial year.
The Board of Directors has declared an interim dividend of US17.0 cents per ordinary share, unchanged from the interim dividend declared in the first half of the financial year 2025.
Costs
The Group's gross profit margin in the first six months of the financial year 2026 was 31.9%, an improvement over the 31.5% recorded in the same period of the previous financial year. This was mainly attributable to lower cost of materials, as material prices decreased during the period. A more favourable product mix, increases in product prices, stronger European currencies against the US dollar and lower freight charges also contributed to the higher margin. These gains were partially offset by higher tariff and direct labour costs.
Segment Results
North America
Group revenue in North America decreased by 12.1% to US$398.3 million in the first six months of the financial year 2026. Higher sales of contract manufacturing services (CMS) were offset by declines in electronic learning products (ELPs) and telecommunication (TEL) products. North America was VTech's second largest market, accounting for 40.2% of Group revenue.
ELPs revenue in this region fell by 25.4% to US$167.0 million. This was mainly attributable to changes in US tariff policies. In April this year, the US announced substantial tariff increases on Chinese imports, before reducing them on 12 May. In response, VTech halted shipments to the US for several weeks and raised prices for products sold to the US market, while retailers delayed their store sets for the Autumn season. This negatively impacted both orders and in-store sales during the first half of the financial year 2026. Meanwhile, sales in Canada also posted a decline. Nonetheless, in the first nine months of the calendar year 2025, VTech maintained its leadership in electronic learning toys from infancy through toddler to preschool in the US and Canada[1].
In standalone products, sales declined mainly because of the lower shipments to the US. Core learning product categories and key product lines all posted sales decreases, for both the VTech and LeapFrog brands. Despite this, the first six months saw the Group introduce more exciting new products that bring fun and learning to children in innovative ways. The new VTech introductions included VTech Baby® 4-in-1 Steps & Stages Activity Center™, Buzz & Learn Activity Table™, Get Growing Tractor & Mower Ride-On™ and Kidi Superstar Jr. DJ Mixer™. LeapFrog saw the launch of Strum & Count Wooden Guitar™, Preschool Game & Go™ and Touch & Learn eReader™.
Platform products also showed a sales decline. Those of LeapFrog rose, driven by continued growth for Magic Adventures® Globe and the launch of a brand-new product, the award-winning LeapMove™. LeapMove is a motion-based learning system that blends full-body physical activity with early educational content, helping children build school skills through immersive, play-driven experiences. There was also a contribution from LeapStart® Reading Buddies, a revamped version of the popular LeapStart interactive reading system. Sales of the VTech brand declined, however, largely owing to lower sales of KidiZoom® Smartwatch and Touch & Learn Activity Desk™. Subscriptions to LeapFrog Academy™ were stable.
The Group's ELPs again won prestigious awards in North America, testifying to their ability to lead the market in quality and innovation. In the US, LeapMove made both Walmart's "2025 Top Toys List" and Target's "2025 Bullseye's Top Toys List", while the VTech Baby 4‑in-1 Steps & Stages Activity Center and Get Growing Tractor & Mower Ride-On won "2025 Good Housekeeping Best Toy Awards". In Canada, VTech Baby 4-in-1 Steps & Stages Activity Center was included in Walmart Canada's "2025 Top Toys List" and the VTech Baby Explore & Move With Puppy™ in the Toys"R"Us Canada "2025 Top Toys List".
TEL products revenue in North America fell by 8.0% to US$84.8 million in the first half of the financial year 2026.
Sales of residential phones declined, as the market continued to contract. During the period, however, VTech introduced more new products. Among them, the feature-rich AT&T DLP73290, designed with both home and business use in mind, has sold particularly well. During the first six months of the financial year 2026, VTech remained the number one cordless phone brand in the US market[2].
Sales of commercial phones were also down. Higher sales of hotel phones and SIP (Session Initiation Protocol) phones were insufficient to offset lower sales of multi-line analogue phones and headsets. Growth in the hotel phones category was boosted by increasing sales of the "Next Gen" product line. Snom branded SIP phones also recorded higher sales, offsetting a decline in orders from a customer. During the period, the new Snom D8 series of SIP desktop phones was successfully launched in the US and has been well received by the market. Multi-line analogue phones posted a sales decline, as the products reached the end of their life cycle, while the transfer of production by a customer to the Group's Gigaset facilities in Germany resulted in lower sales of headsets.
Other telecommunication products reported an increase, ...
