Cognex Q2 Earnings Call Centers on AI and Data Center Growth

CGNX Builds a Data Center Growth Platform

President and CEO Matt Moschner said that data center revenues remain a low single-digit percentage of company sales but are growing more than 30% year over year.

Moschner said that Cognex is seeing demand across component manufacturing, server and rack assembly and eventually deployment and maintenance. Most current revenues are still tied to quality assurance and visual inspection of components.

In Q&A, a Goldman Sachs analyst asked what is driving the opportunity. Moschner said that aggressive AI-oriented data center construction is increasing inspection needs, while newer technologies such as OneVision allow Cognex to address complex applications that were harder to solve previously.

Cognex Extends AI Across Its Product Portfolio

Moschner said that hundreds of customers are already using OneVision, Cognex's cloud-based AI training platform, to reduce deployment complexity and accelerate machine vision applications.

Moschner also pointed to new In-Sight products spanning entry-level inspection, advanced 3D vision and more complex applications, all within the same software environment.

A JPMorgan analyst asked which demonstrations were generating the strongest customer reaction. Moschner said that complex 2D inspection applications, including printed circuit boards and server-related components, stood out because AI tools can identify defects that conventional approaches struggled to address.

CGNX Broadens Customers and End Markets

Moschner said that Cognex added about 4,500 new customers year to date after adding roughly 9,000 in 2025. The next phase is a land-and-expand approach focused on identifying higher-potential accounts and increasing share of wallet.

Moschner said that packaging continues to contribute disproportionately to customer additions, while Cognex is also revitalizing relationships with systems integrators, machine builders, resellers and services partners.

Moschner raised the full-year outlook for logistics to high single-digit growth and expects double-digit growth in packaging, electronics and semiconductors. Automotive remains the exception, with a flat to low single-digit growth outlook.

Cognex Pushes More Revenue Through a Leaner Cost Base

CFO Dennis Fehr said that adjusted EBITDA margin reached 32.2%, up 1,150 basis points year over year, while adjusted operating expenses fell 5% in constant currency.

Fehr said that Cognex now expects about $35 million of annualized net cost reductions by year-end 2026. He added that the focus is shifting from direct cost reduction toward productivity improvements that allow the company to grow with largely existing resources.

Adjusted earnings per share (EPS) of $0.45 topped the Zacks Consensus Estimate of $0.42, while reported revenues of $291.3 million missed the consensus estimate of $293.2 million.

CGNX Guides for Growth With Some Second-Half Pressure

Fehr guided Q3 revenues to $300 million to $320 million, adjusted EBITDA margin to 32% to 35% and adjusted EPS to $0.50 to $0.54.

For 2026, Fehr said that Cognex expects revenues of $1.13 billion to $1.15 billion, adjusted EBITDA margin of 29% to 31% and adjusted EPS of $1.64 to $1.68.

Fehr said that memory prices are likely to create roughly 75 basis points of gross-margin headwind in the third quarter, with some pressure potentially continuing into the fourth quarter. He expects pricing actions to offset that effect over time, while favorable mix should remain supportive but less pronounced than in the first half.

Cognex Keeps Diversification and Operating Leverage Central

Moschner framed the strategy around technology leadership, customer experience and diversification, with AI-enabled inspection opening applications across data centers, packaging, electronics and semiconductors.

Fehr kept operating leverage equally prominent. Management's second-half priorities center on sustaining demand momentum, broadening the customer base, improving channel productivity and protecting margins as input costs rise.

Zacks Signals for CGNX

CGNX currently carries a Zacks Rank #2 (Buy). Its Growth Score is A, while its Value Score and Momentum Score are F and its VGM Score is D. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

The favorable Zacks Rank points to a stronger near-term ranking, while the Style Scores present a mixed profile. The Growth Score is the strongest individual signal, but the weaker Value, Momentum and VGM readings reduce the strength of the combined style picture. The Zacks Rank can change as analysts revise estimates after the just-reported results.

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