Financial Performance - Net sales for the second quarter ended December 31, 2024, increased by $4.2 million, or 33%, to $16.8 million compared to $12.6 million for the same period in 2023[3] - Gross profit for the second quarter increased by $2.3 million, or 81%, to $5.1 million, with a gross margin improvement of 8 percentage points to 30%[4] - Operating income for the second quarter rose by $1.9 million, or 247%, to $2.7 million compared to $777,000 for the same quarter in the prior year[6] - Net income for the second quarter was $2.0 million, or $0.61 per diluted share, compared to $500,000, or $0.14 per diluted share, for the same quarter in fiscal 2024[6] - For the six months ended December 31, 2024, net sales increased by $7.2 million, or 29%, to $31.7 million from $24.5 million for the same period in 2023[7] - Gross profit for the six months increased by $3.8 million, or 58%, with a gross margin increase of 6 percentage points to 32%[9] - Operating income for the six months rose by $3.1 million, or 119%, to $5.7 million compared to $2.6 million for the same period in the prior year[11] - Net income for the six months was $4.5 million, or $1.33 per diluted share, compared to a net loss of $115,000, or $0.03 per diluted share, for the same period in 2023[12] Operational Capacity - The company is ramping up staff to meet increased backlog commitments, indicating a focus on operational capacity to support sales growth[13] - The company anticipates continued revenue increases in the third and fourth quarters due to ongoing production shipments of the next generation handpiece[3]

Sales Performance - Medical device product sales increased by $3.3 million, or 37%, for the three months ended December 31, 2024, and by $5.4 million, or 32%, for the six months ended December 31, 2024, compared to the prior fiscal year [86]. - Orthopedic sales rose by $3.8 million, or 69%, for the three months ended December 31, 2024, and by $5.7 million, or 55%, for the six months ended December 31, 2024, primarily due to the launch of a next-generation handpiece [86]. - Repair revenue increased by $1.6 million, or 48%, for the three months ended December 31, 2024, and by $2.7 million, or 37%, for the six months ended December 31, 2024, due to an increased number of repairs of orthopedic handpieces [88]. - The proportion of medical device products in total sales was 73% for the three months ended December 31, 2024, compared to 71% in the same period of the prior year [86]. - Recurring revenue from cranio-maxillofacial (CMF) drivers decreased by $920,000, or 33%, for the three months ended December 31, 2024, compared to the prior year [86]. Financial Overview - Total cost of sales for the three months ended December 31, 2024, increased by $1.9 million, or 20%, compared to the same period in 2023, while revenue increased by 33% [90]. - Gross profit for the three months ended December 31, 2024, increased by $2.3 million, or 81%, compared to the same period in 2023, with gross margin rising to 30% from 22% [91]. - Operating expenses for the three months ended December 31, 2024, totaled $2.4 million, representing 14% of net sales, an increase of 18% year-over-year [92]. - Research and development costs for the three months ended December 31, 2024, increased by $154,000, or 20%, compared to the same period in 2023 [94]. - The effective tax rate for the three months ended December 31, 2024, was 21%, compared to 19% for the same period in 2023 [100]. Cash Flow and Working Capital - Cash and cash equivalents decreased to $66,000 as of December 31, 2024, down from $2.6 million at June 30, 2024 [101]. - Net cash used in operating activities for the six months ended December 31, 2024, was $2.3 million, despite a net income of $4.5 million [103]. - Net cash used in investing activities for the six months ended December 31, 2024, was $973,000, primarily for equipment purchases [105]. - Net cash provided by financing activities for the six months ended December 31, 2024, included net borrowings of $4.5 million, offset by a $3.5 million stock repurchase [107]. - Working capital as of December 31, 2024, was $27.2 million, with an estimated fair market value of marketable equity investments at $6.3 million [109]. Backlog and Capacity Expansion - The backlog at December 31, 2024, was approximately $48.1 million, with $36.3 million scheduled for delivery in fiscal 2025 [89]. - The company continues to focus on expanding manufacturing capacity at the newly acquired Franklin Property to support anticipated growth [83]. - The company is investing in research and development to design unique medical devices and leverage its patented torque-limiting software [84]. Product Sales Decline - Revenue from non-recurring engineering (NRE) and prototype projects decreased by $297,000, or 88%, for the three months ended December 31, 2024, due to a reduction in billable contracts [87]. - Sales of compact pneumatic air motors decreased by $72,000, or 30%, for the three months ended December 31, 2024, indicating a decline in legacy product revenue [87].

Core Viewpoint - Pro-Dex, Inc. (PDEX) has been upgraded to a Zacks Rank 2 (Buy), indicating a positive outlook on its earnings estimates, which significantly influence stock prices [1][3]. Earnings Estimates and Stock Price Impact - The Zacks rating system is based on changes in earnings estimates, which are strongly correlated with near-term stock price movements [4][6]. - An increase in earnings estimates typically leads to higher fair value calculations by institutional investors, resulting in buying or selling actions that affect stock prices [4]. Pro-Dex Earnings Outlook - For the fiscal year ending June 2025, Pro-Dex is expected to earn $2 per share, reflecting a 233.3% increase from the previous year [8]. - Over the past three months, the Zacks Consensus Estimate for Pro-Dex has risen by 40.8%, indicating a positive trend in earnings expectations [8]. Zacks Rank System - The Zacks Rank system classifies stocks into five groups based on earnings estimates, with a strong historical performance, particularly for Zacks Rank 1 stocks, which have averaged a +25% annual return since 1988 [7]. - Pro-Dex's upgrade to Zacks Rank 2 places it in the top 20% of Zacks-covered stocks, suggesting a strong potential for market-beating returns in the near term [10].

Group 1: Pro-Dex, Inc. (PDEX) - PDEX shares increased by 23% to close at $57.78, following a notable trading volume compared to typical sessions, despite a 12.6% loss over the past four weeks [1] - The recent surge in PDEX shares is linked to positive market sentiment due to strong financial performance and a robust business model, with over 200% return in the past six months [2] - The company is expected to report quarterly earnings of $0.38 per share, reflecting a year-over-year increase of 171.4%, with revenues projected at $13.8 million, up 9.6% from the previous year [3] Group 2: Earnings Estimates and Market Position - The consensus EPS estimate for PDEX has remained unchanged over the last 30 days, indicating that stock price movements may not sustain without trends in earnings estimate revisions [4] - PDEX holds a Zacks Rank of 1 (Strong Buy), indicating strong investor interest and confidence in the stock [4] - In comparison, Staar Surgical (STAA), another company in the same medical-dental supplies industry, has a Zacks Rank of 3 (Hold) and has seen a decline of 3% in the past month [4][5]

Company Overview - Pro-Dex, Inc. (PDEX) has experienced rapid growth over the past year, with its valuation reaching an all-time high [1] - Founded in 1978 and headquartered in Irvine, CA, Pro-Dex specializes in tech-based solutions for various markets, including medical, dental, semiconductor, scientific research, and aerospace [2] - The company operates in multiple locations, including Santa Ana, Beaverton, OR, and Carson City, NV [2] Financial Performance - Pro-Dex has achieved a remarkable 239.7% increase in share price over the past five years, with a compound earnings per share growth of 11% per year [4] - In the first quarter of fiscal 2025, Pro-Dex reported earnings of 75 cents per share, significantly surpassing the Zacks Consensus Estimate of 29 cents [5] - The company is expected to report earnings of 38 cents per share for the next release on February 13, 2025, indicating a year-over-year increase of 171.43% [5] Market Position - Pro-Dex holds a Zacks Rank 1 (Strong Buy) and is part of the Zacks Medical – Dental Supplies industry, which is in the top 10% of all industries in the Zacks universe [3][6] - Over the past 12 months, Pro-Dex's stock has surged 193.8%, outperforming its Zacks Peer Group, which saw a rally of 171.8% [3] - The company's shares soared 23% to $57.78 on January 6, reflecting strong market confidence [4]

Financial Performance - Net sales for Q1 FY2025 increased by $3.0 million, or 25%, to $14.9 million compared to $11.9 million in Q1 FY2024[2] - Gross profit for Q1 FY2025 rose by $1.5 million, or 41%, with a gross margin increase of 4 percentage points to 35%[3] - Operating income for Q1 FY2025 increased by $1.2 million, or 64%, to $3.0 million compared to $1.8 million in the prior year[5] - Net income for Q1 FY2025 was $2.5 million, or $0.75 per diluted share, compared to a net loss of $615,000, or $0.17 per diluted share, in Q1 FY2024[6] - Unrealized gains on marketable equity investments contributed $433,000 to net income in Q1 FY2025, contrasting with unrealized losses of $2.6 million in Q1 FY2024[6] Operating Expenses - Operating expenses for Q1 FY2025 increased by $312,000, or 17%, to $2.1 million, primarily due to higher personnel costs and bonus accruals[4] Cash and Assets - Cash and cash equivalents as of September 30, 2024, were $3.1 million, up from $2.6 million at June 30, 2024[9] - Total assets increased to $54.3 million as of September 30, 2024, compared to $52.5 million at June 30, 2024[9] - Total shareholders' equity remained stable at $30.9 million as of September 30, 2024, compared to $30.9 million at June 30, 2024[9] Future Expectations - The company expects to ship production volumes of the new handpiece during the second half of FY2025[7]

Financial Performance - Net sales for the three months ended September 30, 2024, were $14.892 million, a 25% increase from $11.938 million in the same period of 2023[64] - Gross profit increased to $5.150 million, representing 35% of net sales, compared to $3.658 million or 31% of net sales in the prior year[64] - The company reported an operating income of $3.013 million, which is 20% of net sales, compared to $1.833 million or 15% in the previous year[64] - Gross profit increased by approximately $1.5 million, or 41%, for the three months ended September 30, 2024, with gross margin improving by four percentage points[72] - Operating expenses totaled $2.1 million, a 17% increase from $1.8 million in the prior year, with selling expenses rising by 92% to $48,000[73] Sales Breakdown - Medical device sales accounted for $9.912 million, or 67% of total net sales, up 27% from $7.808 million, driven primarily by orthopedic sales which increased by 38%[65][66] - Repair revenue increased by $1.1 million, or 28%, due to a higher number of repairs for orthopedic handpieces[68] - Recurring revenue from distributors of CMF drivers increased by $567,000, or 35%, compared to the same period last year[66] Costs and Expenses - Research and development costs were $843,000, representing 6% of net sales, slightly down from 7% in the prior year[64] - Cost of sales for the three months ended September 30, 2024, increased by $1.5 million, or 18%, compared to the same period in 2023, consistent with a 25% increase in revenue[71] - General and administrative expenses increased by $251,000, or 25%, primarily due to higher payroll and personnel expenses[74] - Research and development costs rose by $38,000, or 5%, driven by increased internal project spending[75] Cash Flow and Working Capital - Cash and cash equivalents increased by $450,000 to $3.1 million as of September 30, 2024, compared to $2.6 million at June 30, 2024[81] - Net cash provided by operating activities for the three months ended September 30, 2024, totaled $1.9 million, compared to $392,000 in the same period of 2023[83] - Net cash used in investing activities was $431,000 for the three months ended September 30, 2024, related to equipment purchases[85] - Net cash used in financing activities included the repurchase of $2.3 million of common stock and proceeds of $5.0 million from a new term loan[86] - Working capital as of September 30, 2024, was $27.2 million, indicating sufficient funds to meet cash requirements for at least the next 12 months[88] Future Outlook - The backlog at September 30, 2024, was approximately $56.8 million, with $45.6 million scheduled for delivery during the remainder of fiscal 2025[70] - The company expects production shipments of the next generation handpiece to ramp up in the third and fourth quarters of fiscal 2025[66] - Discounts and other increased by $126,000 due to volume rebates related to the orthopedic handpiece[69]

Core Insights - Pro-Dex, Inc. reported strong financial results for Q4 fiscal 2024, with net income of $1.6 million or 46 cents per share, an increase from 42 cents per share year-over-year [1][3] - Quarterly net sales surged by 41% to $15 million, up from $10.6 million in the same quarter last year, driven by a $3.4 million revenue increase from the largest customer [2][8] - The company faced challenges in maintaining gross margin levels, which contracted from 32% to 27%, attributed to price pressures and rising indirect labor costs [4][9] Quarterly Performance Overview - Operating expenses remained stable at $1.7 million, with a strategic reduction in general and administrative costs and a slight increase in engineering expenses [5] - Operating income rose by 46% year-over-year to $2.4 million, reflecting effective operational adjustments and sales initiatives [5] - The financial health of Pro-Dex indicates a strategic enhancement in operational execution, despite the impact of unrealized gains and losses on investments [3][9] Balance Sheet Update - As of June 30, 2024, Pro-Dex's cash and cash equivalents decreased to $2.6 million from $2.9 million at the end of the previous fiscal year [6] - Total assets increased slightly from $51.8 million to $52.5 million, while shareholders' equity decreased from $31.6 million to $30.9 million [6] Cash Flows - Pro-Dex generated $6.2 million in operating cash flows for fiscal 2024, an increase from $5.5 million in the prior year [7] Fiscal 2024 Update - Annual net sales increased by 17% to $53.8 million, primarily driven by recurring increases in repair and new unit sales to the primary customer [8] - Annual net income declined to $2.1 million or 60 cents per share, down from $1.95 per share in the previous year, largely due to a $4.1 million unrealized loss on marketable equity investments [9] - The year also saw a steady increase in research and development expenditures, reflecting the company's commitment to technology and product development [10]

Financial Performance - Net sales for Q4 2024 increased by $4.4 million, or 41%, to $15.0 million compared to $10.6 million in Q4 2023, driven primarily by a $3.4 million revenue increase from the largest customer[2] - Gross profit for Q4 2024 rose by $729,000, or 22%, but gross margin decreased from 32% in Q4 2023 to 27% in Q4 2024 due to price pressures and increased indirect labor costs[2] - Operating income for Q4 2024 increased by $742,000, or 46%, to $2.4 million compared to $1.6 million in Q4 2023[4] - Net income for Q4 2024 was $1.6 million, or $0.46 per diluted share, a slight increase from $1.5 million, or $0.42 per diluted share, in Q4 2023[4] - For the fiscal year 2024, net sales increased by $7.8 million, or 17%, to $53.8 million from $46.0 million in fiscal 2023, primarily due to revenue increases from the largest customer[5] - Gross profit for the fiscal year 2024 increased by $1.8 million, or 14%, to $14.5 million compared to $12.7 million in fiscal 2023[5] - Net income for the fiscal year 2024 was $2.1 million, or $0.60 per diluted share, down from $7.1 million, or $1.95 per diluted share, in fiscal 2023, impacted by unrealized losses on marketable equity investments of $4.1 million[7] - Net income for the year ended June 30, 2024, was $2,127,000, a decrease of 70% compared to $7,074,000 in 2023[11] Operating Expenses and Investments - Operating expenses for the fiscal year 2024 rose by 6% to $7.4 million from $7.0 million in the prior fiscal year, mainly due to increased research and development costs[6] - Depreciation and amortization increased to $1,160,000 from $857,000, reflecting a rise of 35%[11] - The company made an investment of $1,250,000 in Monogram during the year[11] Cash Flow and Financial Position - Net cash provided by operating activities was $6,199,000, up from $5,462,000, indicating an increase of 13.5%[11] - Net cash used in investing activities was $2,233,000, compared to $885,000 in the previous year, representing a significant increase of 152%[11] - Net cash used in financing activities totaled $4,271,000, an increase from $2,490,000, marking a rise of 71.7%[11] - Cash and cash equivalents at the end of the year were $2,631,000, down from $2,936,000, reflecting a decrease of 10.4%[11] - Accounts receivable decreased by $3,935,000, compared to an increase of $5,432,000 in the previous year[11] - Inventory increased by $898,000, contrasting with a decrease of $3,489,000 in the prior year[11] - Principal payments on notes payable were $4,816,000, down from $6,093,000, indicating a decrease of 21%[11] Strategic Focus - The company hired a new Director of Operations in Q1 fiscal 2025 to support growth, indicating a focus on operational efficiency and expansion[8] - The company continues to focus on developing new products and technologies, particularly in the orthopedic market, leveraging patented software and proprietary solutions[8]

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, DC 20549 Title of each class Trading Symbol(s) Name of each exchange on which registered Common Stock, no par value PDEX NASDAQ Capital Market FORM 10-K ☒ ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the fiscal year ended June 30, 2024 OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES ACT OF 1934 For the transition period from ____________ to ____________ Commission File Number: 00 ...