We investigated relations between kindergarten precursors and second-grade reading skills in deaf and hard-of-hearing (DHH) children, and aimed to identify subgroups based on reading skills, in order to explore early signs of later reading delays. DHH children (n = 23, M[subscript age] kindergarten = 6.25) participated from kindergarten-second grade. They were tested on phonological awareness, letter knowledge, spoken vocabulary, speechreading, fingerspelling, and sign vocabulary in kindergarten, and word decoding and reading comprehension in second grade. In second grade, word decoding scores were low-average while reading comprehension scores were below average compared to hearing norms. Word decoding correlated with phonological awareness, letter knowledge, and spoken vocabulary. Reading comprehension correlated with all measures except fingerspelling. Cluster analysis identified three second-grade-reading subgroups; group-1: below-average word decoding and reading comprehension; group-2: high-average word decoding, below-average reading comprehension; group-3: average word decoding and reading comprehension. Furthermore, group-1 differed from group-2 and group-3 on word decoding, group-1 and group-2 differed from group-3 in reading comprehension. Regarding kindergarten measures, group-1 scored below group-2 on letter knowledge, and below group-3 on spoken and sign vocabulary. We found that particularly letter knowledge and spoken and sign vocabulary seem to be crucial for the development of reading skills 2 years later.