Key Tronic Corporation Form 8-K Filing

Key Tronic Corporation has announced a strategic decision to modify its China-based operations, ceasing manufacturing activities at its China facility by the fourth fiscal quarter of 2026. The company plans to pivot towards sourcing and procurement in China to support its global operations. This move is expected to yield approximately $1.2 million in quarterly savings post-completion and reduce geopolitical risks. The company anticipates incurring around $1.1 million in severance expenses and $0.2 million in related compensation costs. Additionally, non-cash expenses totaling $4.8 million to $5.8 million are expected for inventory, assets, and deferred taxes. The company also noted ongoing restructuring in its Mexico facility, expecting an additional $2.5 to $3.5 million in severance charges for further quarterly savings of $2.1 million.