Core Insights - Data I/O Corporation's LumenX-M8 Manual Programming System has won the 2025 Mexico Technology Award in the Device Programming category, highlighting its innovation in electronics manufacturing [2][5] - The LumenX-M8 is designed to deliver high-speed, high-performance programming in manual production environments, supporting up to eight programming sites with the same engine used in automated systems [3][4] - The system is aimed at low volume production and new product introduction (NPI) environments, facilitating a seamless transition to volume production while ensuring quality and efficiency [3][4] Company Overview - Data I/O Corporation has been a leader in providing advanced security and data deployment solutions for microcontrollers, security ICs, and memory devices since 1972 [6] - The company focuses on enabling the design and manufacture of electronic products across various industries, including automotive, IoT, medical, and consumer electronics [6] - Data I/O's solutions are backed by a global support network, ensuring reliable and cost-effective product development for its customers [6]

Data I/O Issues Update on Cybersecurity IncidentAll Systems Operational with No Impact to Customers or OrdersSeptember 04, 2025 9:00 AM EDT | Source: Data I/O Corp.Redmond, Washington--(Newsfile Corp. - September 4, 2025) - Data I/O Corporation (NASDAQ: DAIO), the leading global provider of advanced security and data deployment solutions for microcontrollers, security ICs and memory devices, today provided an update on the recently announced cybersecurity incident.William Wentworth, the Compan ...

Part I. Financial Information [Financial Statements (Unaudited)](index=2&type=section&id=Item%201.%20Financial%20Statements) The unaudited consolidated financial statements for H1 2025 show decreased assets and equity, a net loss, and negative operating cash flow compared to prior periods [Consolidated Balance Sheets](index=2&type=section&id=CONSOLIDATED%20BALANCE%20SHEETS) Consolidated Balance Sheet Highlights (in thousands) | Account | June 30, 2025 | December 31, 2024 | Change | | :--- | :--- | :--- | :--- | | **Assets** | | | | | Cash and cash equivalents | $9,969 | $10,326 | ($357) | | Total Current Assets | $20,627 | $21,157 | ($530) | | Total Assets | $24,117 | $24,970 | ($853) | | **Liabilities & Equity** | | | | | Total Current Liabilities | $5,076 | $5,072 | $4 | | Total Liabilities | $6,871 | $7,344 | ($473) | | Total Stockholders' Equity | $17,246 | $17,626 | ($380) | - Total assets decreased from **$25.0 million** at the end of 2024 to **$24.1 million** as of June 30, 2025, primarily driven by a decrease in cash and cash equivalents[9](index=9&type=chunk)[10](index=10&type=chunk) [Consolidated Statements of Operations](index=3&type=section&id=CONSOLIDATED%20STATEMENTS%20OF%20OPERATIONS) Q2 2025 vs Q2 2024 Performance (in thousands, except per share) | Metric | Q2 2025 | Q2 2024 | YoY Change | | :--- | :--- | :--- | :--- | | Net sales | $5,948 | $5,062 | +17.5% | | Gross margin | $2,960 | $2,757 | +7.4% | | Gross margin % | 49.8% | 54.5% | -4.7 p.p. | | Operating income (loss) | ($844) | ($566) | -49.1% | | Net income (loss) | ($742) | ($797) | +6.9% | | Diluted EPS | ($0.08) | ($0.09) | +11.1% | H1 2025 vs H1 2024 Performance (in thousands, except per share) | Metric | H1 2025 | H1 2024 | YoY Change | | :--- | :--- | :--- | :--- | | Net sales | $12,124 | $11,161 | +8.6% | | Gross margin | $6,148 | $5,977 | +2.9% | | Gross margin % | 50.7% | 53.6% | -2.9 p.p. | | Operating income (loss) | ($1,221) | ($1,426) | +14.4% | | Net income (loss) | ($1,124) | ($1,604) | +30.0% | | Diluted EPS | ($0.12) | ($0.18) | +33.3% | [Consolidated Statements of Comprehensive Income (Loss)](index=4&type=section&id=CONSOLIDATED%20STATEMENTS%20OF%20COMPREHENSIVE%20INCOME%20(LOSS)) - For the six months ended June 30, 2025, the company reported a comprehensive loss of **$820,000**, an improvement from the **$1,842,000** comprehensive loss in the same period of 2024, aided by a **positive foreign currency translation gain of $304,000**[14](index=14&type=chunk) [Consolidated Statement of Stockholders' Equity](index=4&type=section&id=CONSOLIDATED%20STATEMENT%20OF%20STOCKHOLDERS'%20EQUITY) - Total stockholders' equity decreased from **$17.6 million** at the end of 2024 to **$17.2 million** at June 30, 2025, primarily due to a **net loss of $1.12 million** for the six-month period, partially offset by share-based compensation and positive other comprehensive income[16](index=16&type=chunk) [Consolidated Statements of Cash Flows](index=5&type=section&id=CONSOLIDATED%20STATEMENTS%20OF%20CASH%20FLOWS) Cash Flow Summary for Six Months Ended June 30 (in thousands) | Cash Flow Activity | 2025 | 2024 | | :--- | :--- | :--- | | Net cash provided by (used in) operating activities | ($233) | ($284) | | Cash provided by (used in) investing activities | ($347) | ($164) | | Cash provided by (used in) financing activities | ($95) | ($223) | | **Net change in cash** | **($675)** | **($671)** | - Cash and cash equivalents decreased by **$675,000** during the first six months of 2025, ending the period at **$10.0 million**, driven by cash used in operating and investing activities[19](index=19&type=chunk) [Notes to Consolidated Financial Statements](index=5&type=section&id=Notes%20to%20Consolidated%20Financial%20Statements) - The company operates as a global market leader for advanced programming and security deployment solutions used in electronics manufacturing[21](index=21&type=chunk) Revenue by Category - Six Months Ended June 30 (in thousands) | Net sales by type | 2025 | 2024 | Change | | :--- | :--- | :--- | :--- | | Equipment | $6,315 | $5,719 | +10.4% | | Adapter | $4,293 | $3,662 | +17.2% | | Software and Maintenance | $1,516 | $1,780 | -14.8% | | **Total** | **$12,124** | **$11,161** | **+8.6%** | - The company operates as a single segment entity, designing, manufacturing, and selling programming systems[59](index=59&type=chunk) [Management's Discussion and Analysis of Financial Condition and Results of Operations](index=12&type=section&id=Item%202.%20Management's%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management reports operational progress and revenue growth despite economic headwinds, maintaining a debt-free balance sheet with $10 million in cash [Overview](index=12&type=section&id=Overview) - The company made progress in key operational areas and improved its cost basis despite a challenging global economic environment[63](index=63&type=chunk) - A significant automated programming system order was received late in Q2 from a leading global automotive EV supplier[63](index=63&type=chunk) - Management remains cautious due to near-term headwinds from economic and cross-border trade uncertainty, which has stalled some capital investments[66](index=66&type=chunk) [Results of Operations](index=15&type=section&id=Results%20of%20Operations) Q2 2025 Key Operational Metrics (in millions, except percentages) | Metric | Q2 2025 | Q2 2024 | Change | | :--- | :--- | :--- | :--- | | Net Sales | $5.9M | $5.1M | +17.5% | | Bookings | $5.8M | $5.6M | +3.6% | | Gross Margin % | 49.8% | 54.5% | -4.7 p.p. | | R&D Expense | $1.66M | $1.41M | +17.6% | | SG&A Expense | $2.14M | $1.91M | +12.1% | - Net sales in Q2 2025 were **$5.9 million**, a **17.5% increase** from the prior year, driven by strong growth in non-automated programming systems and adapter sales[82](index=82&type=chunk) - Gross margin declined to **49.8%** in Q2 2025 from **54.5%** in Q2 2024, attributed to a lower margin product mix and configuration of automated systems for a large customer order[87](index=87&type=chunk) - Bookings in Q2 2025 were **$5.8 million**, including a **$1.4 million order** for 10 PSV automated systems from a major EV supplier in China, with automotive electronics constituting **66% of Q2 bookings**[84](index=84&type=chunk) [Financial Condition, Liquidity and Capital Resources](index=17&type=section&id=Financial%20Condition,%20Liquidity%20and%20Capital%20Resources) - As of June 30, 2025, the company had working capital of **$15.6 million** and cash and cash equivalents of **$10.0 million**[93](index=93&type=chunk) - Cash decreased by **$534,000** from December 31, 2024, due to one-time expenses and investments, partially offset by an improved cost structure[93](index=93&type=chunk) - The company has no debt and believes it has sufficient cash to fund operations and capital requirements for at least the next year[93](index=93&type=chunk)[96](index=96&type=chunk) [Non-GAAP Financial Measures](index=17&type=section&id=NON-GENERALLY%20ACCEPTED%20ACCOUNTING%20PRINCIPLES%20(GAAP)%20FINANCIAL%20MEASURES) Reconciliation of Net Income to EBITDA and Adjusted EBITDA (in thousands) | Metric | Q2 2025 | Q2 2024 | | :--- | :--- | :--- | | Net Income (loss) | ($742) | ($797) | | EBITDA earnings (loss) | ($687) | ($379) | | Adjusted EBITDA, excluding equity compensation | ($437) | $3 | - Adjusted EBITDA, excluding equity compensation, was **($437,000)** in Q2 2025, a significant decrease from **$3,000** in Q2 2024[98](index=98&type=chunk) [Quantitative and Qualitative Disclosures About Market Risk](index=18&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) The company states that this section is not applicable for this reporting period - Not applicable[101](index=101&type=chunk) [Controls and Procedures](index=18&type=section&id=Item%204.%20Controls%20and%20Procedures) Management concluded disclosure controls were effective, but a material weakness in IT user access and segregation of duties remains under remediation - Management concluded that disclosure controls and procedures were effective as of the evaluation date[102](index=102&type=chunk) - A material weakness in internal controls over financial reporting related to IT user access and segregation of duties, identified as of December 31, 2024, is still being remediated[103](index=103&type=chunk)[104](index=104&type=chunk) - Despite the material weakness, management performed additional procedures and concluded the financial statements are fairly presented in all material respects[103](index=103&type=chunk) Part II. Other Information [Legal Proceedings](index=18&type=section&id=Item%201.%20Legal%20Proceedings) As of June 30, 2025, the company was not a party to any material pending legal proceedings - The company reports no material pending legal proceedings as of June 30, 2025[106](index=106&type=chunk) [Risk Factors](index=18&type=section&id=Item%201A.%20Risk%20Factors) There have been no material changes to the risk factors previously disclosed in the company's Annual Report on Form 10-K for the year ended December 31, 2024 - The company states there are no material changes to the Risk Factors described in its Annual Report on Form 10-K for the year ended December 31, 2024[107](index=107&type=chunk) [Unregistered Sales of Equity Securities, Use of Proceeds, and Issuer Purchases of Equity Securities](index=18&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities,%20Use%20of%20Proceeds,%20and%20Issuer%20Purchases%20of%20Equity%20Securities) The company reported no unregistered sales, use of proceeds, or issuer purchases of equity securities, nor any Rule 10b5-1 trading arrangements - During the quarter ended June 30, 2025, no director or officer adopted or terminated any Rule 10b5-1 trading arrangement or other non-Rule 10b5-1 trading arrangement[112](index=112&type=chunk) [Exhibits](index=19&type=section&id=Item%206.%20Exhibits) The report lists several exhibits filed with the Form 10-Q, including a material contractor agreement, CEO/CFO certifications, and Interactive Data Files - Exhibits filed include an Independent Contractor Agreement with Theisen Advisory Group, CEO/CFO certifications, and Interactive Data Files[110](index=110&type=chunk)

Redmond, Washington--(Newsfile Corp. - August 11, 2025) - Data I/O Corporation (NASDAQ: DAIO), the leading global provider of advanced security and data deployment solutions for microcontrollers, security ICs and memory devices, today announced that Charles ("Charlie") DiBona will be joining the Company as Vice President and Chief Financial Officer, Secretary and Treasurer, effective August 11, 2025. Interim Chief Financial Officer Todd Henne will remain with the Company for a brief period to ensure a smoot ...

[Management Comments](index=1&type=section&id=Management%20Comments) Management reported sequential bookings growth, driven by a major Chinese EV order for UFS 4.0 systems, validating R&D and preparing for future 1TB UFS memory for AI - Delivered the **second consecutive quarter of sequential bookings growth**, following increases in Q1 2025 and Q4 2024[3](index=3&type=chunk) - Received a significant order for 10 PSV automated programming systems, valued at over **$1.4 million**, from a major Chinese EV manufacturing supplier, based on robust support for Universal Flash Storage (UFS) 4.0 technology[3](index=3&type=chunk) - The company focuses on technology leadership for the growing UFS memory market (expected **14% CAGR** over five years) and is preparing for next-generation **1TB UFS memory** for advanced AI applications by 2027[6](index=6&type=chunk) [Second Quarter 2025 Financial Results](index=1&type=section&id=Second%20Quarter%202025%20Financial%20Results) Q2 2025 saw net sales of $5.9 million, sequential bookings growth to $5.8 million, a gross margin of 49.8%, and a net loss of $742,000, with a solid $10.0 million cash balance [Revenue, Bookings and Margin](index=1&type=section&id=Revenue%2C%20Bookings%20and%20Margin) Q2 2025 net sales were $5.9 million, bookings reached $5.8 million, and gross margin was 49.8% due to product mix, with automotive electronics contributing 66% of bookings Net Sales and Bookings (in millions) | Metric | Q2 2025 | Q1 2025 | Q2 2024 | | :--- | :--- | :--- | :--- | | Net Sales | $5.9M | $6.2M | $5.1M | | Bookings | $5.8M | $4.6M | $5.6M | - Gross margin was **49.8%** in Q2 2025, compared to **51.6%** in Q1 2025 and **54.5%** in Q2 2024, with the decline driven by product mix and configuration for a large customer order[9](index=9&type=chunk) - Backlog stood at **$2.8 million** and deferred revenue was **$1.3 million** as of June 30, 2025[8](index=8&type=chunk) - Automotive electronics represented **66%** of Q2 2025 bookings, up from **59%** for the full year 2024[7](index=7&type=chunk) [Profitability and Expenses](index=2&type=section&id=Profitability%20and%20Expenses) Q2 2025 operating expenses were $3.8 million, including $480,000 in one-time costs, resulting in a net loss of $742,000 and an Adjusted EBITDA of ($437,000) Profitability and Expense Highlights | Metric | Q2 2025 | Q1 2025 | Q2 2024 | | :--- | :--- | :--- | :--- | | Operating Expenses | $3.8M | $3.6M | $3.3M | | Net Loss | ($742,000) | ($382,000) | ($797,000) | | EPS (loss) | ($0.08) | ($0.04) | ($0.09) | | Adjusted EBITDA | ($437,000) | ($98,000) | $3,000 | - Q2 2025 operating expenses included approximately **$480,000** in one-time expenses for investments and transition requirements[10](index=10&type=chunk) - Excluding one-time expenses, Adjusted EBITDA for Q2 2025 would have been **$43,000**[10](index=10&type=chunk) [Balance Sheet and Liquidity](index=2&type=section&id=Balance%20Sheet%20and%20Liquidity) The company maintained a solid balance sheet with $10.0 million in cash, $15.6 million in net working capital, and no debt as of Q2 2025 - Cash balance was **$10.0 million** as of June 30, 2025[10](index=10&type=chunk) - Net working capital was **$15.6 million** on June 30, 2025[10](index=10&type=chunk) - The Company continues to have **no debt**[10](index=10&type=chunk) [Financial Statements](index=3&type=section&id=Financial%20Statements) This section presents unaudited consolidated financial statements for Q2 2025 and 2024, including the Statement of Operations, Balance Sheet, and GAAP to non-GAAP reconciliations [Consolidated Statements of Operations](index=3&type=section&id=Consolidated%20Statements%20of%20Operations) Q2 2025 net sales were $5.95 million, resulting in an operating loss of $844,000 and a net loss of $742,000, or ($0.08) per share Q2 2025 vs Q2 2024 Statement of Operations (in thousands) | Line Item | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | | :--- | :--- | :--- | | Net sales | $5,948 | $5,062 | | Gross margin | $2,960 | $2,757 | | Total operating expenses | $3,804 | $3,323 | | Operating income (loss) | $(844) | $(566) | | Net income (loss) | $(742) | $(797) | | Diluted earnings (loss) per share | $(0.08) | $(0.09) | [Consolidated Balance Sheets](index=3&type=section&id=Consolidated%20Balance%20Sheets) As of June 30, 2025, total assets were $24.1 million, with $10.0 million in cash, total liabilities of $6.9 million, and stockholders' equity of $17.2 million Balance Sheet Highlights (in thousands) | Account | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Cash and cash equivalents | $9,969 | $10,326 | | Total Current Assets | $20,627 | $21,157 | | Total Assets | $24,117 | $24,970 | | Total Current Liabilities | $5,076 | $5,072 | | Total Stockholders' Equity | $17,246 | $17,626 | [Non-GAAP Financial Measure Reconciliation](index=4&type=section&id=Non-GAAP%20Financial%20Measure%20Reconciliation) Q2 2025 GAAP net loss of $742,000 was reconciled to an Adjusted EBITDA (excluding equity compensation) of ($437,000), which would be $43,000 excluding one-time expenses Q2 2025 GAAP to Non-GAAP Reconciliation (in thousands) | Metric | Amount | | :--- | :--- | | Net Loss (GAAP) | $(742) | | EBITDA | $(687) | | Adjusted EBITDA (excl. equity comp) | $(437) | | One-time expenses/investments | $480 | | Adjusted EBITDA (excl. one-time items) | $43 | [Other Information](index=2&type=section&id=Other%20Information) This section provides investor conference call details, business information, forward-looking statement disclaimers, and clarification on non-GAAP financial measures - A conference call to discuss the financial results was scheduled for July 24, 2025, at 2 p.m. Pacific Time[11](index=11&type=chunk) - The press release contains forward-looking statements and non-GAAP financial measures, with the company stating that non-GAAP measures provide meaningful supplemental information and reconciliations are provided[13](index=13&type=chunk)[15](index=15&type=chunk)

Financial Data and Key Metrics Changes - Net sales for Q2 2025 were $5 million, down from $6.2 million in Q1 2025 but up from $5.1 million in Q2 2024 [11] - Gross margin as a percentage of sales was 49.8% in Q2 2025, compared to 51.6% in Q1 2025 and 54.5% in the prior year period [14] - Operating expenses for Q2 2025 were $3.8 million, up from $3.6 million in Q1 2025 and $3.3 million in the prior year period [17] Business Line Data and Key Metrics Changes - Automotive electronics represented 66% of Q2 2025 bookings, up from 59% for all of 2024 [12] - Consumable adapters and services accounted for 50% of total revenue in Q2 2025, providing a stable base of recurring revenue [12] Market Data and Key Metrics Changes - Asia, particularly China, showed strong performance in the EV sector of automotive electronics, while Europe and The Americas faced pressures from capital equipment spending due to tariff and trade uncertainties [12] - Q2 2025 bookings were $5.8 million, up from $4.6 million in Q1 2025 and $5.6 million in Q2 2024 [13] Company Strategy and Development Direction - The company is focusing on investing in its core programming platform to handle the increasing complexity of programming technology, particularly in memory [5] - A new universal platform is expected to be rolled out by the end of the year, aimed at reducing technical debt and improving product offerings [6] - The company plans to enhance its sales and marketing strategies and expand into new business lines, with a focus on vertical integration [19] Management's Comments on Operating Environment and Future Outlook - Management acknowledged challenges due to tariff and trade negotiations but noted that manufacturing operations have not been significantly impacted due to diversified supply chains [15] - The company expects improved performance in the second half of the year, driven by new product launches and increased customer engagement [10][46] Other Important Information - The company has no debt and reported a cash balance of $10 million as of June 30, 2025 [20] - Significant one-time expenses of approximately $480,000 were incurred in Q2 2025, impacting operating income and adjusted EBITDA [19] Q&A Session Summary Question: How does the $480,000 impact the P&L? - The majority of the $480,000 will hit the G&A category, including IT, finance, and HR spending [23][26] Question: What is being done to improve yield rates for UFS Flash? - The company is investing in new bench equipment and has restructured its engineering team to address technology gaps and improve yield rates [32][36] Question: What are the expectations for gross margins moving forward? - The company anticipates a broader mix of products in the second half, which should help improve margins [43][46] Question: How is the company expanding beyond automotive? - The company is focusing on lead generation from upcoming product launches and enhancing existing customer relationships to diversify its customer base [50][54] Question: What is the market opportunity for UFS and NVMe technologies? - The UFS and NVMe markets are expected to grow at a CAGR of 14%, presenting significant opportunities for the company [6][92]

Core Insights - Data I/O Corporation reported a second consecutive quarter of sequential bookings growth, indicating a positive trend in demand for its programming solutions [1][2] - The company received a significant order for automated programming systems from a leading global automotive EV supplier, valued at over $1.4 million, highlighting its competitive edge in supporting UFS 4.0 technology [2][6] - The UFS memory market is projected to grow at a CAGR of 14% over the next five years, presenting substantial opportunities for Data I/O as it prepares for next-generation high-density memory technology [5] Financial Performance - Net sales for Q2 2025 were $5.9 million, a decrease from $6.2 million in Q1 2025 but an increase from $5.1 million in Q2 2024 [6] - Bookings for Q2 2025 reached $5.8 million, up from $4.6 million in Q1 2025 and $5.6 million in Q2 2024, with a backlog of $2.8 million as of June 30, 2025 [7] - Gross margin for Q2 2025 was 49.8%, down from 51.6% in Q1 2025 and 54.5% in the prior year, attributed to a lower margin product mix [8] Operational Highlights - Operating expenses for Q2 2025 were $3.8 million, an increase from $3.6 million in Q1 2025, reflecting ongoing investments in the core programming platform and other operational needs [10] - The company reported a net loss of $742,000 or $0.08 per share for Q2 2025, compared to a net loss of $797,000 or $0.09 per share in the prior year [10] - Cash at the end of Q2 2025 was $10.0 million, slightly down from $10.3 million at the end of 2024, indicating a solid balance sheet despite one-time expenses [10]

Summary of Data I/O (DAIO) Conference Call Company Overview - **Company Name**: Data I/O Corporation - **Industry**: Semiconductor technology and programming solutions - **Founded**: 1972 - **CEO**: Bill Wentworth since October 31, 2024 - **Market Presence**: Significant market share in automotive, IoT, industrial controls, and service providers globally [3][5][6] Core Business and Technology - **Core Function**: Data I/O specializes in embedding data into programmable semiconductor technology, primarily for Fortune 500 companies [5][19] - **Technology Platforms**: - **FlashCore 3** and **Luminex** are the main platforms used for programming and embedding data into silicon [8][11] - Transitioning from the older Luminex platform to a newer version to address UFS flash technology, which is expected to grow at a CAGR of 14% over the next five years [34][35] Market Dynamics - **Automotive Sector**: - Accounts for nearly 60% of revenue, driven by increasing complexity in automotive technology [19][39] - Demand for programmable technology in vehicles is expected to grow due to advancements in autonomous driving and infotainment systems [39] - **Service Provider Network**: - Identified as a significant growth area, potentially twice the size of the automotive market [21] - Focus on global distribution companies and contract manufacturers to expand market reach [22][32] Financial Performance and Strategy - **Current Financial Status**: Approximately $10 million in cash, cash flow neutral, with expectations for growth in the second half of the year [24] - **Gross Margins**: Historically between 52-58%, with potential to reach the low 60s through improved efficiencies and service offerings [30] - **Revenue Diversification**: Plans to diversify revenue streams beyond automotive, including entering the services market, which is larger and offers recurring revenue opportunities [27][50] Product Development and Innovation - **New Product Launches**: - Two new versions of products to be released in September and November 2025, aimed at enhancing capabilities in the engineering community [16][34] - Focus on UFS flash technology to meet growing market demands [34][36] - **Use of AI**: Implementing AI to streamline engineering processes and improve operational efficiencies [25][26] Market Trends and Future Outlook - **Growth Opportunities**: - Anticipated growth in automotive and IoT sectors, with increasing demand for programmable technology [44] - Exploring organic and inorganic growth opportunities, including potential M&A [27][28] - **Service Market Potential**: The independent programming service market is estimated to be worth $200-300 million globally, presenting a significant opportunity for Data I/O [50][51] Conclusion - Data I/O is positioned to leverage its technological advancements and market presence to capture growth in the semiconductor programming industry, with a strategic focus on diversifying revenue streams and enhancing product offerings to meet evolving customer needs [51]

Group 1 - Data I/O Corporation will participate in the Singular Research Summer Solstice Conference on June 18, 2025, with a presentation scheduled for 3:00 PM ET in New York [1] - The company will also present at the iAccess Alpha Virtual Best Ideas Summer Investment Conference on June 24, 2025, at 11:30 AM ET, followed by one-on-one meetings on June 25 [2] - Data I/O has been providing innovative solutions since 1972, focusing on electronic products for various sectors including automotive, IoT, medical, and consumer electronics [3] Group 2 - The company's data provisioning solutions allow OEMs to manage device intellectual property from inception to deployment, ensuring reliable and cost-effective product development [3] - Data I/O's offerings are supported by a portfolio of patents and a global network of support professionals, enhancing customer success [3]

Financial Performance - Data I/O reported net sales of $6.2 million for Q1 2025, a 1.3% increase from $6.1 million in Q1 2024, driven by business recovery and backlog deliveries in the Americas and Europe[87]. - The company experienced a significant increase in U.S. sales, which rose by 234.5% to $756,000, while international sales decreased by 7.7% to $5.42 million, representing 88% of total net sales[86][89]. - Gross margin for Q1 2025 was $3.19 million, accounting for 51.6% of net sales, down from 52.8% in Q1 2024, primarily due to a higher mix of system sales revenue[90]. - New bookings for Q1 2025 were $4.6 million, an increase from $4.1 million in Q4 2024 but a decrease from $8.1 million in Q1 2024, influenced by delays in customer purchase decisions[88]. - The backlog as of March 31, 2025, was $2.9 million, a decrease of $0.6 million from December 31, 2024, with deferred revenue at approximately $1.5 million[88]. Operational Strategy - The company is focusing on diversifying its end markets and enhancing its consultative sales process to drive revenue growth[66]. - Data I/O has implemented a resilient supply chain with dual manufacturing capabilities in the U.S. and China, positioning itself to manage emerging tariff policies effectively[67]. - The company is considering additional manufacturing locations in Europe to further enhance its operational capabilities[67]. Economic Outlook - Despite economic uncertainties, Data I/O remains focused on sustainable growth through innovation and improving its value proposition[68]. Expenses and Income - Research and development (R&D) expenses decreased to $1,515,000 in Q1 2025, a 4.2% decline from $1,582,000 in Q1 2024, representing 24.5% of net sales compared to 25.9% in the prior year[91]. - Selling, general and administrative (SG&A) expenses fell to $2,050,000 in Q1 2025, down 17.9% from $2,498,000 in Q1 2024, accounting for 33.2% of net sales versus 41.0% previously[92]. - Interest income dropped to $38,000 in Q1 2025, a 52.5% decrease from $80,000 in Q1 2024, attributed to lower interest rates and invested balances[94]. - The income tax expense for Q1 2025 was $21,000, down 48.8% from $41,000 in Q1 2024, primarily related to foreign and state taxes[96]. Cash and Working Capital - Working capital as of March 31, 2025, was approximately $16,014,000, a slight decrease of $71,000 from $16,085,000 at the end of 2024[98]. - Cash increased to $10,500,000, up $159,000 from December 31, 2024, due to higher sales and improved cost structure[98]. EBITDA and Valuation - EBITDA for Q1 2025 was ($272,000), an improvement from ($645,000) in Q1 2024, while adjusted EBITDA was ($98,000) compared to ($364,000) in the prior year[104]. - The company maintains a valuation allowance of $8,900,000 as of March 31, 2025, due to uncertainties related to loss history and economic outlook[97]. Capital Expenditure and Debt - The company has no significant capital expenditure plans but will continue to manage expenditures to support business development and new product releases[99]. - The company has no debt and believes it has sufficient cash and working capital to fund operations and capital requirements for the next year and beyond[101].