Methode Electronics ( MEI Quick Quote MEI - Free Report) reported first-quarter fiscal 2023 earnings of 58 cents per share, which beat the Zacks Consensus Estimate by 20.83% but declined 23.7% from the year-ago fiscal quarter’s reading. Net sales dipped 1.9% from the year-ago fiscal quarter’s level to $282.4 million. The figure beat the Zacks Consensus Estimate by 2.69%. The top-line decline from the year-earlier fiscal quarter’s figure was primarily attributed to lower sales volumes in the Automotive segment, mostly due to demand weakness in Asia and Europe. Supply-chain constraints hurt sales in North America, while weaker activity in Europe was due to the conflict in Ukraine. Also, foreign currency transcation losses impacted sales negatively by $14 million. Quarterly Details Automotive net sales decreased 9.8% from the year-ago fiscal quarter’s number to $176.6 million. Industrial net sales increased 17.3% from the prior-year fiscal quarter’s level to $92.1 million. The increase was primarily due to higher sales in commercial vehicle lighting and industrial non-EV power-related product offerings. Interface net sales increased 2.4% from the year-ago fiscal quarter’s figure to $13 million. Medical net sales increased $0.9 million from the year-earlier fiscal quarter’s tally to $1.6 million. Gross margin contracted 300 basis points (bps) from the year-ago fiscal quarter’s level to 21.9%. Adjusted EBITDA contracted 330 bps from the year-ago fiscal quarter’s reading to 13.7%. Operating expenses increased 6.4% from the last fiscal year’s quarterly figure to $40 million. Selling, general and administrative (SG&A) expenses increased 7.6% from the year-ago fiscal quarter’s level to $35.3 million. As a percentage of revenues, operating expenses increased 110 bps from the year ago period at 14.2%. SG&A also increased 110 bps from the corresponding year-ago fiscal quarter’s levels at 12.5%, respectively. Operating income declined 36.1% from the year-ago fiscal quarter’s level to $21.8 million. The decrease from the prior-year fiscal quarter’s number was primarily due to lower sales, and higher material and freight costs due to supply-chain issues and product mix. Operating margin contracted 410 bps to 7.7%. Balance Sheet & Cash Flow As of July 30, 2022, cash and cash equivalents were $152.4 million compared with $172 million as of Apr 30, 2022. Debt was $207.2 million at the end of the fiscal first quarter compared with $210.5 million in the previous fiscal quarter. Net debt, defined as debtless cash and cash equivalents, was $54.8 million. Moreover, free cash flow was $3.1 million. Guidance For fiscal 2023, Methode Electronics expects sales between $1.16 billion and $1.21 billion. Earnings are expected in the range of $2.70-$3.10 per share. Zacks Rank & Stocks to Consider Methode Electronics currently carries a Zacks Rank #3 (Hold). The stock has outperformed the broader Zacks Computer & Technology sector on a year-to-date basis. While Methode Electronics’ shares have lost 20% year to date, the sector has fallen 20.8%. Here are some better-ranked stocks in the broader Computer and Technology sector: ASE Technology ( ASX Quick Quote ASX - Free Report) carries a Zacks Rank #2 (Buy) at present. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here. ASX’s shares have slumped 22.4% in the year-to-date period compared with the Zacks Electronics - Semiconductors industry’s decline of 21.8%. Monolithic Power Systems ( MPWR Quick Quote MPWR - Free Report) carries a Zacks Rank of 2, currently. MPWR’s shares have risen 13.5% in the year-to-date period against the Zacks Semiconductor - Analog and Mixedindustry’s decline of 20.8%. Arista Networks ( ANET Quick Quote ANET - Free Report) presently sports a Zacks Rank #1. ANET’s shares have dropped 39% in the year-to-date period compared with the Zacks Communication - Components industry’s decline of 24.9%.