Precision Optics Corporation (NasdaqCM:POCI) Q4 2025 Earnings Call September 29, 2025 05:00 PM ET Speaker4Good day and welcome to the Precision Optics Corporation's Fourth Quarter and Fiscal Year 2025 Financial Results Conference Call. All participants will be in listen-only mode. Should you need assistance, please signal a conference specialist by pressing the star key followed by zero. After today's presentation, there will be an opportunity to ask questions. To ask a question, you may press star, then on ...

Conference Call Scheduled for today, September 29, 2025, at 5:00pm ET Company introduces fiscal year 2026 Revenue and Adjusted EBITDA guidance Company appoints new Chief Operating Officer GARDNER, Mass., Sept. 29, 2025 (GLOBE NEWSWIRE) -- Precision Optics Corporation, Inc. (NASDAQ: POCI), a leading designer and manufacturer of advanced optical instruments for the medical and defense/aerospace industries, announced operating results on an unaudited basis for its fourth quarter and fiscal year 2025 for the pe ...

PART I [Item 1. Business](index=4&type=section&id=Item%201.%20Business) POCI develops and manufactures advanced optical instruments for medical and defense/aerospace markets - POCI operates in two key market segments: medical devices and advanced defense/aerospace products, leveraging proprietary optical and imaging technology[12](index=12&type=chunk) - The company's business operations are conducted in four areas: systems manufacturing, engineering and product development, Ross Optical components and assemblies, and the micro-optics laboratory[13](index=13&type=chunk) - POCI launched its Unity Imaging Platform in January 2025, a standard baseline CMOS endoscopic system with customization options, aiming to accelerate time to market for medical imaging devices[20](index=20&type=chunk) Revenue Contribution by Business Area (FY2025 vs. FY2024) | Business Area | FY2025 (%) | FY2024 (%) | Change (pp) | | :---------------------- | :--------- | :--------- | :---------- | | Systems Manufacturing | 43 | 19 | +24 | | Engineering Services | 26 | 45 | -19 | | Ross Optical | 20 | 22 | -2 | | Micro-Optics Laboratory | 11 | 14 | -3 | [Item 1A. Risk Factors](index=9&type=section&id=Item%201A.%20Risk%20Factors) The company faces financial, operational, intellectual property, and market risks, including historical losses and supply chain - The company has a history of losses and may continue to incur losses, potentially requiring additional funds to support product development and market penetration[42](index=42&type=chunk) - A small number of customers represent a significant portion of total revenues, and the loss of any of these customers could adversely affect revenues[43](index=43&type=chunk) - The company relies on a few sources for key supplies like precision-grade optical glass and CMOS sensors, making it vulnerable to supply chain disruptions[53](index=53&type=chunk) - The company's business and financial performance may be adversely affected by cyber-attacks on IT infrastructure and products, as well as evolving cybersecurity threats and regulations[60](index=60&type=chunk) - Changes in U.S. tariff policy and related trade actions could adversely affect the international supply chain, increase costs, and impact the company's competitive position[84](index=84&type=chunk) [Item 1B. Unresolved Staff Comments](index=17&type=section&id=Item%201B.%20Unresolved%20Staff%20Comments) The company reported no unresolved staff comments from the SEC - There are no unresolved staff comments[88](index=88&type=chunk) [Item 1C. Cybersecurity](index=18&type=section&id=Item%201C.%20Cybersecurity) POCI implements a NIST-aligned cybersecurity program with board oversight to manage cyber threats and protect sensitive data - The company's cybersecurity program aligns with NIST standards and includes measures for identifying, assessing, and managing risks to internal systems, products, services, and the supply chain[91](index=91&type=chunk) - Cybersecurity measures include regular monitoring, vulnerability management, employee data security training, and simulated phishing exercises[92](index=92&type=chunk) - The Board of Directors has primary oversight for enterprise cybersecurity risks, with the Audit Committee considering these risks in its financial and compliance role[96](index=96&type=chunk) [Item 2. Properties](index=19&type=section&id=Item%202.%20Properties) The company operates six facilities across Massachusetts, Texas, and Maine, with recent lease extensions and new agreements - The company conducts domestic operations at four facilities in Gardner, Massachusetts, one in El Paso, Texas, and one in Windham, Maine[98](index=98&type=chunk) - A First Lease Extension Agreement for the El Paso, Texas facility was entered into on May 13, 2025, extending the lease for 36 months until May 31, 2028[99](index=99&type=chunk) - New lease agreements were signed in May and June 2025 for commercial spaces in South Portland, Maine (8,750 sq ft, 7-year term from Aug 2025) and Littleton, Massachusetts (19,590 sq ft, 7.5-year term from Sep 2025)[100](index=100&type=chunk)[102](index=102&type=chunk) [Item 3. Legal Proceedings](index=20&type=section&id=Item%203.%20Legal%20Proceedings) The company is not currently aware of any pending or threatened material litigation - The company is not currently aware of any pending or threatened litigation that could have a material adverse effect on its business, financial condition, or results of operations[105](index=105&type=chunk) [Item 4. Mine Safety Disclosures](index=20&type=section&id=Item%204.%20Mine%20Safety%20Disclosures) This item is not applicable to the company - Mine Safety Disclosures are not applicable to the company[106](index=106&type=chunk) PART II [Item 5. Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities](index=21&type=section&id=Item%205.%20Market%20for%20Registrant%27s%20Common%20Equity%2C%20Related%20Stockholder%20Matters%20and%20Issuer%20Purchases%20of%20Equity%20Securities) POCI common stock trades on Nasdaq, with 121 holders, no dividends declared, and no equity repurchases in FY2025 - The common stock is quoted on the Nasdaq Stock Market under the symbol POCI[108](index=108&type=chunk) - As of September 25, 2025, there were approximately **121 holders of record** of common stock[109](index=109&type=chunk) - The company has not declared any dividends during the last two fiscal years and plans to retain earnings for research, development, and business expansion[110](index=110&type=chunk) - No equity securities were repurchased by the issuer during the year ended June 30, 2025[112](index=112&type=chunk) [Item 6. [Reserved]](index=21&type=section&id=Item%206.%20%5BReserved%5D) This item is reserved and contains no information [Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations](index=21&type=section&id=Item%207.%20Management%27s%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) FY2025 revenues were flat, gross profit declined to **17.8%**, operating loss widened, and net cash used in operations increased Total Revenues (FY2025 vs. FY2024) | Metric | FY2025 | FY2024 | Change ($) | Change (%) | | :------------- | :------------ | :------------ | :------------ | :--------- | | Total Revenues | $19,091,269 | $19,104,350 | $(13,081) | (0.1)% | Gross Profit and Margin (FY2025 vs. FY2024) | Metric | FY2025 | FY2024 | Change ($) | Change (%) | | :----------- | :------------ | :------------ | :------------ | :--------- | | Gross Profit | $3,404,433 | $5,797,777 | $(2,393,344) | (41.3)% | | Gross Margin | 17.8% | 30.3% | -12.5 pp | | Operating Loss (FY2025 vs. FY2024) | Metric | FY2025 | FY2024 | Change ($) | Change (%) | | :------------- | :------------ | :------------ | :------------ | :--------- | | Operating Loss | $(5,551,291) | $(2,724,333) | $(2,826,958) | 103.8% | - Net cash used in operating activities increased to **$3,547,400** in FY2025 from **$2,683,012** in FY2024, primarily due to increased net loss, accounts receivable, and inventory[125](index=125&type=chunk) - The company raised a net of **$6,270,136** from two registered direct offerings in August 2024 and February 2025[127](index=127&type=chunk) [Item 7A. Quantitative and Qualitative Disclosures About Market Risk](index=24&type=section&id=Item%207A.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) As a smaller reporting company, POCI is not required to provide market risk disclosures - As a smaller reporting company, the registrant is not required to provide quantitative and qualitative disclosures about market risk[133](index=133&type=chunk) [Item 8. Financial Statements and Supplementary Data](index=25&type=section&id=Item%208.%20Financial%20Statements%20and%20Supplementary%20Data) This section presents audited financial statements for FY2025 and FY2024, with an unqualified opinion - The financial statements for the years ended June 30, 2025 and 2024 were audited by Stowe & Degon LLC, who issued an unqualified opinion[138](index=138&type=chunk) - The company's revenue recognition policies are detailed, disaggregating revenue by product and service types: Engineering Design Services, Systems Manufacturing, Micro Optics Lab, and Ross Optical Industries[158](index=158&type=chunk)[159](index=159&type=chunk) Key Financial Highlights (FY2025 vs. FY2024) | Metric | FY2025 | FY2024 | Change ($) | Change (%) | | :-------------------------------------- | :-------------- | :-------------- | :-------------- | :--------- | | Total Revenues | $19,091,269 | $19,104,350 | $(13,081) | (0.1)% | | Gross Profit | $3,404,433 | $5,797,777 | $(2,393,344) | (41.3)% | | Net Loss | $(5,780,246) | $(2,951,377) | $(2,828,869) | 95.8% | | Basic and Fully Diluted Loss per Share | $(0.85) | $(0.49) | $(0.36) | 73.5% | | Cash and Cash Equivalents (End of Year) | $1,773,735 | $405,278 | $1,368,457 | 337.7% | | Total Assets | $19,790,287 | $16,912,574 | $2,877,713 | 17.0% | | Total Liabilities | $7,531,453 | $6,844,786 | $686,667 | 10.0% | | Total Stockholders' Equity | $12,258,834 | $10,067,788 | $2,191,046 | 21.8% | [Item 9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosure](index=42&type=section&id=Item%209.%20Changes%20in%20and%20Disagreements%20with%20Accountants%20on%20Accounting%20and%20Financial%20Disclosure) The company reported no changes in or disagreements with accountants on accounting and financial disclosure - There were no changes in or disagreements with accountants on accounting and financial disclosure[208](index=208&type=chunk) [Item 9A. Controls and Procedures](index=42&type=section&id=Item%209A.%20Controls%20and%20Procedures) Management concluded disclosure controls and internal control over financial reporting were effective as of June 30, 2025 - The CEO and CFO concluded that disclosure controls and procedures were effective as of June 30, 2025[209](index=209&type=chunk) - Management assessed and concluded that internal control over financial reporting was effective as of June 30, 2025, using the COSO framework[211](index=211&type=chunk) - No material changes in internal control over financial reporting occurred during the fiscal year[212](index=212&type=chunk) [Item 9B. Other Information](index=42&type=section&id=Item%209B.%20Other%20Information) No director or officer adopted or terminated a Rule 10b5-1 or non-Rule 10b5-1 trading arrangement during Q4 FY2025 - No director or officer adopted or terminated a Rule 10b5-1 or non-Rule 10b5-1 trading arrangement during the three months ended June 30, 2025[213](index=213&type=chunk) [Item 9C. Disclosure Regarding Foreign Jurisdictions that Prevent Inspections](index=42&type=section&id=Item%209C.%20Disclosure%20Regarding%20Foreign%20Jurisdictions%20that%20Prevent%20Inspections) This item is not applicable to the company - Disclosure regarding foreign jurisdictions that prevent inspections is not applicable to the company[214](index=214&type=chunk) PART III [Item 10. Directors, Executive Officers and Corporate Governance](index=43&type=section&id=Item%2010.%20Directors%2C%20Executive%20Officers%20and%20Corporate%20Governance) Information on directors, executive officers, and corporate governance is incorporated by reference from the 2025 Proxy Statement - Information for this item is incorporated by reference from the Proxy Statement for the 2025 Annual Meeting of Stockholders[217](index=217&type=chunk) - The Board of Directors has adopted a written Code of Business Conduct and Ethics applicable to all officers, directors, and employees[217](index=217&type=chunk) [Item 11. Executive Compensation](index=43&type=section&id=Item%2011.%20Executive%20Compensation) Executive compensation information is incorporated by reference from the 2025 Proxy Statement - Information for this item is incorporated by reference from the Proxy Statement for the 2025 Annual Meeting of Stockholders[218](index=218&type=chunk) [Item 12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters](index=43&type=section&id=Item%2012.%20Security%20Ownership%20of%20Certain%20Beneficial%20Owners%20and%20Management%20and%20Related%20Stockholder%20Matters) Security ownership information for beneficial owners and management is incorporated by reference from the 2025 Proxy Statement - Information for this item is incorporated by reference from the Proxy Statement for the 2025 Annual Meeting of Stockholders[219](index=219&type=chunk) [Item 13. Certain Relationships and Related Transactions, and Director Independence](index=43&type=section&id=Item%2013.%20Certain%20Relationships%20and%20Related%20Transactions%2C%20and%20Director%20Independence) Information on related transactions and director independence is incorporated by reference from the 2025 Proxy Statement - Information for this item is incorporated by reference from the Proxy Statement for the 2025 Annual Meeting of Stockholders[220](index=220&type=chunk) [Item 14. Principal Accounting Fees and Services](index=43&type=section&id=Item%2014.%20Principal%20Accounting%20Fees%20and%20Services) Principal accounting fees and services information is incorporated by reference from the 2025 Proxy Statement - Information for this item is incorporated by reference from the Proxy Statement for the 2025 Annual Meeting of Stockholders[221](index=221&type=chunk) PART IV [Item 15. Exhibits, Financial Statement Schedules](index=44&type=section&id=Item%2015.%20Exhibits%2C%20Financial%20Statement%20Schedules) This section lists all documents and exhibits filed as part of the 10-K report, with schedules omitted - The section lists financial statements, including the Report of Independent Registered Public Accounting Firm, Balance Sheets, Statements of Operations, Stockholders' Equity, and Cash Flows, and Notes to Financial Statements[223](index=223&type=chunk) - All financial statement schedules have been omitted as they are not required, not applicable, or the required information is otherwise included[224](index=224&type=chunk) - A comprehensive list of exhibits, including organizational documents, compensation agreements, lease agreements, and various SEC filings, is provided[225](index=225&type=chunk)[226](index=226&type=chunk)[227](index=227&type=chunk)[228](index=228&type=chunk) [Item 16. Form 10-K Summary](index=47&type=section&id=Item%2016.%20Form%2010-K%20Summary) The company has not provided a Form 10-K Summary - No Form 10-K Summary is provided[229](index=229&type=chunk) [Signatures](index=49&type=section&id=Signatures) The Annual Report on Form 10-K was signed on September 29, 2025, by the CEO, CFO, and directors - The report was signed on September 29, 2025, by Joseph N. Forkey (President and CEO) and Wayne M. Coll (CFO), along with other directors[232](index=232&type=chunk)

GARDNER, Mass., Sept. 24, 2025 (GLOBE NEWSWIRE) -- Precision Optics Corporation, Inc. (Nasdaq: POCI) (the "Company"), a leading designer and manufacturer of advanced optical instruments for the medical and defense/aerospace industries, today announced that it has scheduled a conference call to discuss the Company’s fourth quarter and fiscal year 2025 financial results on Monday, September 29, 2025, at 5:00 p.m. ET. The Company intends to release its financial results and to file its 10-K after the close of ...

Summary of Precision Optics Corporation (POCI) Conference Call Company Overview - Precision Optics Corporation (POCI) is an optics technology company founded in 1982, with a focus on developing next-generation technological solutions in various fields, primarily in medical devices and defense aerospace [6][7][8]. - The company has made two acquisitions in the last five to six years: Ross Optical and Lighthouse Imaging, both established in the 1980s [6][7]. Revenue Breakdown - Approximately 60% to 70% of POCI's revenue comes from the medical device market, while 30% to 40% is derived from defense and aerospace sectors [8]. - The company is experiencing adjustments in revenue streams based on near-term demand for its technologies [8]. Core Technologies - POCI specializes in three main areas: 1. **Micro Optics**: Producing extremely small optics, including a right-angle prism measuring 50 microns, which is about the width of a human hair [15][16]. 2. **Ultra Precision Optics**: Developing high-resolution imaging systems, particularly for medical devices [19]. 3. **Digital Imaging**: Utilizing advancements from consumer electronics to create imaging systems for medical devices and defense applications [22]. Product Development Process - The product development process typically takes two to three years, starting from the conception phase to full-scale manufacturing [31]. - POCI has introduced a new product development approach called the Unity platform, which aims to accelerate development time by 6 to 12 months and reduce costs significantly [35][36]. Market Trends - The minimally invasive surgery market, particularly the endoscope market, is projected to grow at an annual rate of 5% to 10% [46]. - The single-use endoscope market is growing at a rate of 20% or higher, driven by safety benefits and reduced sterilization requirements [50][51]. Defense and Aerospace Applications - Approximately 40% of POCI's revenue comes from defense and aerospace, with applications in imaging systems for drones and satellite communications [52][55]. - The company is also exploring opportunities in laser weapons technology [57]. Manufacturing Expansion - POCI is consolidating its manufacturing operations in Massachusetts to meet growing demand and improve recruitment of technical talent [61][62]. Customer Retention and IP - POCI's embedded IP in products creates a barrier for customers to switch manufacturers, fostering long-term relationships [41][42]. - The company has maintained long-term contracts with major medical device companies, with some products in production for over 20 years [43][44]. Financial Outlook - POCI expects substantial growth in the coming years, with plans to move two to three programs into production annually [14]. - The company is focused on maintaining a robust product development pipeline to support this growth [37]. Conclusion - Precision Optics Corporation is well-positioned to capitalize on growth in the medical device and defense sectors, leveraging its core technologies and expanding manufacturing capabilities to meet increasing demand [8][61].

Summary of Conference Call Insights Industry Overview - The conference primarily focused on the **crypto and digital assets** sector, discussing regulatory changes and their implications for institutional investment in cryptocurrencies [6][12][23]. - The **medical device** and **defense aerospace** sectors were also highlighted, particularly through the lens of **Precision Optics**, which specializes in optics technology [40][82]. Key Points on Crypto and Digital Assets - **Regulatory Changes**: The shift in the U.S. government stance towards crypto, particularly with the SEC under new leadership, is seen as a positive development for institutional investment [6][7]. - **Legislative Frameworks**: The enactment of the **Genius Act** and the anticipated **Clarity Act** are crucial for establishing a regulatory framework that will facilitate institutional participation in the crypto market [7][12]. - **Institutional Adoption**: The potential for significant institutional investment in cryptocurrencies is expected to increase, particularly with the clarity provided by new regulations [12][23]. - **Beneficiaries**: Companies like **Coinbase** and **Galaxy Digital** are positioned to benefit from these regulatory changes, with Coinbase set to gain from stablecoin economics and Galaxy Digital from institutional trading volumes [10][14][18]. - **Exodus Movement**: This smaller company is viewed as a "bank shot" play on institutional adoption, benefiting indirectly from rising altcoin prices driven by institutional interest [19][25]. Key Points on Precision Optics - **Company Overview**: Precision Optics has been in operation for over 40 years, focusing on optics technology, with 60-70% of revenue derived from the medical device market [38][40]. - **Core Technologies**: The company specializes in **micro optics**, **ultra precision optics**, and **digital imaging**, which are critical for applications in medical devices and defense [41][46]. - **Product Development Process**: The development timeline for new products typically spans 2-3 years, with a focus on creating prototypes and moving them into production [65][70]. - **Market Trends**: The minimally invasive surgery market, particularly single-use endoscopes, is experiencing significant growth, with annual growth rates projected at 20% or higher [80][81]. - **Defense Applications**: Precision Optics is also targeting the defense sector, focusing on applications where size and weight are critical, such as satellite communications and laser weapons [84][86]. Additional Insights - **Institutional Hesitance**: Historically, institutions have been cautious about entering the crypto space due to regulatory uncertainty, but recent developments are expected to change this dynamic [12][23]. - **Market Dynamics**: The rise in altcoin prices is anticipated to attract retail investors, further driving engagement in the crypto market [24][25]. - **Manufacturing Expansion**: Precision Optics is consolidating its manufacturing capabilities to meet growing demand, particularly in Massachusetts [88]. This summary encapsulates the critical insights from the conference, highlighting the evolving landscape of both the crypto and medical device industries, along with the strategic positioning of key companies within these sectors.

Core Insights - Precision Optics Corporation will participate in the Lytham Partners 2025 Consumer & Technology Investor Summit on August 19, 2025 [1][2] - The company specializes in advanced optical instruments for the medical and defense/aerospace industries, leveraging proprietary technologies [3] Company Overview - Founded in 1982, Precision Optics is a vertically integrated optics company focused on micro-optics, 3D imaging, and digital imaging technologies [3] - The company provides services from product concept to mass manufacture, utilizing in-house design, prototype, regulatory, and fabrication capabilities [3] - In healthcare, Precision Optics supports the demand for enhanced imaging systems for minimally invasive surgery and 3D endoscopy systems [3] - The company has a long history of supplying optical products, including complex endocouplers and specialized endoscopes, to top-tier medical device companies [3] - In defense/aerospace, Precision Optics applies its micro-optics expertise to meet high-quality standards and optimize size, weight, and power [3]

Company Overview - Precision Optics (POCI) is a vertically integrated optics company focused on micro-optics and imaging technologies for the healthcare and defense/aerospace industries[7] - The company's business model involves close collaboration with medical device and defense companies from the early design stages through manufacturing[13, 14] - The company has launched Unity CMOS Imaging Platform to drive growth in development pipeline[11] Financial Performance - The company's revenue has grown from $3.9 million in 2016 to $19.1 million in 2024[51] - The company's gross margin was 30.3% in 2024[54] - The company's adjusted EBITDA was -$1.55 million in 2024[57] Recent Orders and Backlog - The company announced a $9 million production order in May 2024 for a single-use cystoscopy program[47] - The company has minimum purchase commitments of nearly $4 million per year through calendar year 2026 for a top tier aerospace program[47] - The company's current customer program backlog is $6.6 million, expected to be delivered over the next 12 months (as of April 2025)[47] Growth Strategy - The company aims to continue and expand production lines for record backlog, especially for two recent large programs[48] - The company intends to advance pipeline projects to commercialization and expand the pipeline with new development programs leveraging the Unity Platform[48]

Company Expansion - LaCroix Precision Optics is expanding its manufacturing operations in Batesville, Arkansas, creating 107 new jobs over five years with an investment of $13.8 million [1][2] - The expansion is driven by a multi-year military contract aimed at restoring a critical supply chain to the United States, which will enhance the company's capabilities with advanced equipment and additional manufacturing space of 18,750 square feet [2][4] Economic Impact - The expansion is seen as a significant win for the Batesville community, contributing to local job creation and economic growth [5][6] - Arkansas officials highlight the pro-business climate, low costs, and experienced workforce as key factors attracting investments like that of LaCroix Precision Optics [4][3] Company Background - LaCroix Precision Optics has been a family-run business for nearly 60 years, originally founded in Chicago in 1947 and fully relocating to Batesville in 1976 [3][7] - The company specializes in high precision optics, producing a range of custom optics including spherical lenses, achromats, and prisms [3][7] Future Prospects - Construction for the expansion has already commenced, with operations expected to start in December 2025 [5] - Applications for new positions are currently open, indicating ongoing growth and opportunities within the company [6]

Core Insights - Precision Optics Corporation is relocating its corporate offices and engineering development from Gardner, MA to Littleton, MA to enhance production capabilities and address a growing backlog [1][2] - The move is part of a strategic initiative to consolidate production at existing facilities in Gardner and to tap into a broader engineering talent pool in Massachusetts and Maine [1][2] - The new corporate headquarters will be located at 550 King St, Building A, Suite 100, Littleton, MA, effective August 1, 2025 [2] Company Overview - Founded in 1982, Precision Optics is a vertically integrated optics company focused on advanced optical instruments for the medical and defense/aerospace industries [3] - The company leverages proprietary micro-optics, 3D imaging, and digital imaging technologies, providing services from product concept to mass manufacture [3] - Precision Optics supports next-generation medical device companies by providing enhanced imaging systems for minimally invasive surgery and 3D endoscopy systems [3] - The company also applies its micro-optics expertise to defense/aerospace applications, emphasizing high quality and optimization of size, weight, and power [3]