Core Insights - Richardson Electronics, Ltd. will release its financial results for the first quarter ended August 30, 2025, on October 8, 2025 [1] - A conference call to discuss the results will be held on October 9, 2025, at 9:00 a.m. Central Time, featuring the CEO and CFO [2] Company Overview - Richardson Electronics is a global manufacturer specializing in engineered solutions, green energy products, power grid and microwave tubes, and related consumables [4] - The company manufactures over 55% of its products in LaFox, Illinois, Marlborough, Massachusetts, and Donaueschingen, Germany, adhering to strict specifications and a Supplier Code of Conduct [5] - The company serves various markets including alternative energy, healthcare, aviation, broadcast, communications, industrial, marine, medical, military, scientific, and semiconductor [5] - Richardson Electronics trades on the NASDAQ Global Select Market under the ticker symbol RELL [6]

Richardson Electronics Conference Summary Company Overview - **Company Name**: Richardson Electronics (Ticker: RELL) - **Headquarters**: Lafox, Illinois, USA - **Employees**: Approximately 430 globally, primarily in sales and engineering roles - **Global Presence**: Over 60 locations and 24 legal entities worldwide, serving more than 20,000 OEM and end-user customers [2][3] Business Units - **Current Business Units**: 1. **Power & Microwave Technologies (PMT)**: Largest and oldest unit, includes Electron Device Group (EDG) focusing on power grid and microwave tubes, and semiconductor wafer fab equipment. 2. **Green Energy Solutions**: Focuses on alternative energy sources like wind and solar, with significant revenue from wind and electric locomotives. 3. **Canvas**: Custom display solutions primarily for medical OEMs [5][6][7][8] Financial Performance - **Debt Status**: The company is debt-free with $35.9 million in cash and cash equivalents [19] - **Growth Metrics**: Achieved a 6.3% year-over-year growth in FY2025, with positive operating cash flow for the past five quarters [18][19] - **Capital Expenditures**: Approximately $3 million last year, expected to increase in FY2026 [19] Market Opportunities - **Wind Energy Market**: Estimated total addressable market (TAM) of $450 million, with growth driven by repowering existing turbines and tax credits [14][15] - **Energy Storage Solutions**: Developing a large energy storage system (BESS) for various applications, including solar and grid energy storage [11][16][34] - **Green Energy Growth**: Anticipated year-over-year growth of 10% to 15%, primarily from green energy initiatives [36] Competitive Landscape - **Market Position**: Significant market share in power grid tube space, with limited competition in engineered solutions due to patented technologies [27][30] - **Niche Focus**: Targeting smaller markets in energy storage and custom displays, leveraging engineering capabilities for competitive advantage [28][30] Strategic Initiatives - **Global Expansion**: Investing in engineering and sales personnel in Europe and other regions to capture market share [15][19] - **Acquisition Strategy**: Open to acquisitions in the power management space that are accretive and enhance technological capabilities [39] Key Challenges - **Tariff Impacts**: Less than 5% of products sourced from China, allowing the company to manage tariff impacts effectively [20] - **Sales Cycle**: Longer sales cycles in the Green Energy Solutions segment, but lower interest rates may stimulate customer spending [31] Conclusion - **Outlook**: The company is well-positioned for growth in the green energy sector, with a strong balance sheet and a focus on innovative solutions in energy storage and power management [39][40]

Core Insights - Richardson Electronics, Ltd. has appointed Daniel Albers to lead business development for its Made-in-USA contract manufacturing initiatives, aiming to enhance partnerships and drive growth in various markets [1][2] - The company emphasizes its commitment to supporting domestic supply chains and providing high-reliability solutions for mission-critical industries, leveraging its 250,000 sq. ft. facility in LaFox, Illinois [3] Company Overview - Richardson Electronics is a global provider of engineered solutions, focusing on green energy, power management, and custom display markets, with over 55% of its products manufactured in the U.S. and Germany [4] - The company offers a range of services including Cable, PCB, Electromechanical Assembly, and Vacuum Tube Production, aimed at delivering quality and speed to market while mitigating supply chain risks [3][4] Leadership and Expertise - Daniel Albers brings extensive experience in lean manufacturing and business development, having previously managed a multi-million-dollar account for a Fortune 500 manufacturer [2] - His role is expected to align with the company's strategy to grow its domestic manufacturing capabilities and strengthen customer relationships [2]

Group 1 - Richardson Electronics, Ltd. will present and host one-on-one meetings at the Sidoti & Company Small-Cap Virtual Conference on September 17-18, 2025 [1] - Edward J. Richardson, Chairman and CEO, and Wendy Diddell, COO, will give a formal presentation on September 17 at 2:30 P.M. ET [1] - Registration for the conference is free and open to all participants [2] Group 2 - Richardson Electronics is a global manufacturer of engineered solutions, focusing on green energy products, power management, and custom display solutions [2] - Over 55% of the company's products are manufactured in LaFox, Illinois, Marlborough, Massachusetts, or Donaueschingen, Germany [2] - The company serves various markets including alternative energy, healthcare, aviation, and semiconductor industries [2] Group 3 - Richardson Electronics' common stock trades on the NASDAQ Global Select Market under the ticker symbol RELL [3]

Company Expansion - Richardson Electronics will expand its operations at its manufacturing headquarters in La Fox, Illinois, with a capital investment of over $8.5 million over the next four years [1][4] - The expansion will retain nearly 200 skilled employees and create 54 new full-time jobs in the region [1][4] Clean Energy Commitment - The expansion is supported by the Reimagining Energy and Vehicles in Illinois (REV Illinois) program, which aims to build a clean energy economy and attract investments [2][4] - Richardson Electronics plans to develop next-generation energy storage products to support electric grid stability, addressing issues like brownouts and reducing electricity costs [2][3] Technological Development - The company will invest in equipment and structural upgrades to research, develop, and produce battery energy storage system (BESS) technologies [2][3] - These technologies are targeted for industries such as manufacturing, healthcare, and critical infrastructure operations [2] State Support and Incentives - The REV Illinois program provides targeted support for clean energy production and advanced manufacturing, which includes tax credits for Richardson Electronics' capital investment [4] - The agreement specifies the retention of 190 jobs throughout the agreement period [4] Industry Context - Richardson Electronics' decision to expand aligns with other manufacturing companies establishing or expanding in Illinois, highlighting the state's skilled workforce and commitment to clean energy [3]

PART I This part provides an overview of the company's business operations, risk factors, and legal disclosures [ITEM 1. Business](index=4&type=section&id=Item%201.%20Business) Richardson Electronics manufactures engineered solutions, green energy, and display products; Healthcare assets sold in FY2025 - Richardson Electronics, Ltd. is a global manufacturer of engineered solutions, green energy products, power grid and microwave tubes, and customized display solutions, serving diverse markets including alternative energy, healthcare, and semiconductor[16](index=16&type=chunk) - On January 24, 2025, the Company sold a substantial portion of its Healthcare business assets to DirectMed Imaging, LLC, and entered into an exclusive 10-year global supply agreement for repaired Siemens CT X-ray tubes and manufacturing of ALTA CT X-ray tubes[17](index=17&type=chunk) - The Healthcare asset sale resulted in a total loss of **$5.1 million** recorded for the fiscal year ended May 31, 2025[17](index=17&type=chunk) [General](index=4&type=section&id=General) This section provides general information about the company's business and operations [Government Regulations](index=4&type=section&id=Government%20Regulations) This section outlines the government regulations impacting the company's operations [Geography](index=5&type=section&id=Geography) This section details the geographic scope of the company's business activities [Business Segments](index=5&type=section&id=Business%20Segments) The company operates through distinct business segments, each focusing on specific product lines and markets [Power and Microwave Technologies (PMT)](index=5&type=section&id=Power%20and%20Microwave%20Technologies%20%28%22PMT%22%29) This segment focuses on power grid and microwave tubes and related engineered solutions [Green Energy Solutions (GES)](index=6&type=section&id=Green%20Energy%20Solutions%20%28%22GES%22%29) This segment provides products and solutions for the green energy market [Canvys](index=6&type=section&id=Canvys) This segment specializes in customized display solutions for various applications [Healthcare](index=6&type=section&id=Healthcare) This segment previously offered healthcare products, with significant assets sold in fiscal 2025 [Sales and Product Management](index=7&type=section&id=Sales%20and%20Product%20Management) This section describes the company's sales strategies and product management processes [Distribution](index=7&type=section&id=Distribution) This section details the company's global distribution network and logistics [International Sales](index=7&type=section&id=International%20Sales) This section covers the company's sales activities in international markets [Major Customers](index=7&type=section&id=Major%20Customers) This section identifies the company's significant customer relationships [Human Capital](index=8&type=section&id=Human%20Capital) This section provides an overview of the company's human resources and workforce management [Recruitment & Staffing](index=8&type=section&id=Recruitment%20%26%20Staffing) This section outlines the company's strategies for attracting and retaining talent [Employees](index=8&type=section&id=Employees) This section provides information regarding the company's employee base and structure [Culture](index=8&type=section&id=Culture) This section describes the company's organizational culture and values [Website Access to SEC Reports](index=8&type=section&id=Website%20Access%20to%20SEC%20Reports) This section details how to access the company's SEC filings online [ITEM 1A. Risk Factors](index=9&type=section&id=Item%201A.%20Risk%20Factors) The company faces risks from sales, inventory, competition, supply chain, IT, international operations, finance, legal, and concentrated ownership - Key business and operational risks include failure to achieve sales and margin targets, significant inventory obsolescence charges due to evolving technology, and intense competitive pressures[47](index=47&type=chunk)[48](index=48&type=chunk)[49](index=49&type=chunk) - The Company is dependent on a limited number of vendors, with **two suppliers each representing over 10% of total cost of sales in fiscal 2025**, and faces risks from supply chain disruptions and reliance on information technology systems, including cybersecurity threats[51](index=51&type=chunk)[52](index=52&type=chunk)[53](index=53&type=chunk) - International operations, which account for **56% of sales**, expose the Company to risks such as foreign currency exchange rate fluctuations, unstable political/economic conditions, and tariffs on products manufactured in China[39](index=39&type=chunk)[67](index=67&type=chunk)[69](index=69&type=chunk)[70](index=70&type=chunk) - Legal and regulatory risks include potential intellectual property claims, substantial operational costs to comply with data privacy laws (e.g., GDPR, CCPA), and compliance with trade, export controls, and anti-corruption laws[72](index=72&type=chunk)[75](index=75&type=chunk)[78](index=78&type=chunk) - Edward J. Richardson, Chairman, CEO, and President, beneficially owned approximately **61% of the voting power of outstanding common stock** as of July 28, 2025, allowing him to exert control over stockholder votes[82](index=82&type=chunk) [Business and Operational Risks](index=9&type=section&id=Business%20and%20Operational%20Risks) This section details risks related to the company's core business activities and operational processes [Risks Related to International Operations](index=13&type=section&id=Risks%20Related%20to%20International%20Operations) This section outlines specific risks associated with the company's global business presence [Financial Risks](index=14&type=section&id=Financial%20Risks) This section describes risks pertaining to the company's financial condition and capital structure [Legal and Regulatory Risks](index=14&type=section&id=Legal%20and%20Regulatory%20Risks) This section covers risks arising from legal proceedings and regulatory compliance requirements [Ownership Risks](index=16&type=section&id=Ownership%20Risks) This section addresses risks related to the company's ownership structure and control [General Risk Factors](index=16&type=section&id=General%20Risk%20Factors) This section includes broad risk factors that could generally impact the company's business [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[89](index=89&type=chunk) [ITEM 1C. Cybersecurity](index=18&type=section&id=Item%201C.%20Cybersecurity) The company manages cybersecurity risks via a NIST-based framework and IRP, with Board oversight, and has not experienced material impacts from threats - The Company's cybersecurity risk management program follows the U.S. National Institute of Standards and Technology (NIST) Cyber Security Framework, focusing on identifying, assessing, managing, and remediating material risks[91](index=91&type=chunk)[92](index=92&type=chunk) - An established Incident Response Plan (IRP) is executed by an Incident Response Team (IRT), led by the Information Systems Director, involving internal IT professionals and cross-functional stakeholders, potentially engaging external resources[93](index=93&type=chunk)[94](index=94&type=chunk) - Cybersecurity threats have not materially affected the Company's business strategy, results of operations, or financial condition in the past three fiscal years[95](index=95&type=chunk) - The Board of Directors delegates cybersecurity risk oversight to the Audit Committee, which receives quarterly updates from the CFO on incidents, threats, mitigation strategies, and controls[97](index=97&type=chunk)[98](index=98&type=chunk) [Risk Management and Strategy](index=18&type=section&id=Risk%20Management%20and%20Strategy) This section details the company's approach to managing cybersecurity risks and strategic initiatives [Governance](index=19&type=section&id=Governance) This section outlines the governance structure for cybersecurity oversight within the company [ITEM 2. Properties](index=20&type=section&id=Item%202.%20Properties) The company operates one owned and 24 leased global facilities, including its Illinois headquarters, supporting manufacturing, sales, and distribution across all segments - The Company owns one facility and leases **24 facilities globally**, including its corporate headquarters and largest distribution center in LaFox, Illinois (**224,000 sq ft**)[99](index=99&type=chunk) - Facilities are geographically diverse across North America, Asia/Pacific, Europe, and Latin America, serving PMT, Canvys, GES, and Healthcare segments for corporate, sales, distribution, and manufacturing purposes[99](index=99&type=chunk)[100](index=100&type=chunk) [ITEM 3. Legal Proceedings](index=20&type=section&id=Item%203.%20Legal%20Proceedings) The Company reported no material legal proceedings - There are no legal proceedings to report[101](index=101&type=chunk) [ITEM 4. Mine Safety Disclosure](index=20&type=section&id=Item%204.%20Mine%20Safety%20Disclosure) The Company stated that Mine Safety Disclosure is not applicable to its operations - Mine Safety Disclosure is not applicable[102](index=102&type=chunk) PART II This part covers market information, financial performance, and internal controls [ITEM 5. Market for the Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities](index=21&type=section&id=Item%205.%20Market%20for%20the%20Registrant%27s%20Common%20Equity%2C%20Related%20Stockholder%20Matters%20and%20Issuer%20Purchases%20of%20Equity%20Securities) The company's common stock trades on NASDAQ (RELL), paid $3.4 million in annual dividends, and joined the Russell 3000® Index in 2023 - The Company's common stock is traded on the NASDAQ Global Select Market

Core Insights - Richardson Electronics, Ltd. has announced a partnership with KEBA Industrial Automation to develop cost-efficient pitch systems for wind turbines in North America, enhancing compatibility and deployment speed in the renewable energy sector [1][4] - KEBA has over 20 years of experience in providing pitch control systems for wind turbines, ensuring reliability and performance in both onshore and offshore installations [2] - The new pitch systems from KEBA are designed to reduce material input and operating costs while providing flexibility and compliance with global grid codes, thus enhancing long-term value for wind turbine operators [3] Company Overview - Richardson Electronics is a global manufacturer of engineered solutions, with over 50% of its products manufactured in the U.S. and Germany, serving various markets including alternative energy and healthcare [5] - KEBA Industrial Automation specializes in high-quality servo drive and automation solutions, with a focus on innovation and seamless integration across multiple industries, including wind energy [10]

Core Insights - Richardson Electronics, Ltd. (RELL) has successfully transformed from a niche parts distributor to a company that designs and builds complex, high-reliability equipment for military systems, clean-energy projects, and large-scale applications [1] Company Overview - The company focuses on producing objective, data-driven research primarily about small- to mid-cap companies, which are often overlooked by many investors [1] - Occasionally, the company also analyzes large-cap names to provide a broader perspective on the equity markets [1]

Financial Data and Key Metrics Changes - In Q4 FY 2025, total sales increased to $51.9 million, up from $47.4 million in Q4 FY 2024, marking a 9.5% year-over-year growth [10][6] - Gross margin improved by 50 basis points to 31.6% compared to 31.1% in the same quarter last year [11][7] - Operating income for Q4 was $600,000, a turnaround from an operating loss of $100,000 in Q4 FY 2024 [13] - Net income for Q4 was $1.1 million, compared to a net loss of $100,000 in the prior year [13] - For FY 2025, net sales were $208.9 million, a 6.3% increase from $196.5 million in FY 2024 [14] Business Line Data and Key Metrics Changes - PMT sales grew by 17.8% year-over-year in Q4, driven by demand from semiconductor wafer fab customers [11] - GES sales increased by 14.1% in Q4, attributed to higher demand for wind turbine modules [11] - Canvas reported Q4 revenue of $9.5 million, up from $8.7 million in the same quarter last year [31] Market Data and Key Metrics Changes - The company faced elevated inflation and supply chain pressures, particularly in Europe and Asia, but managed to achieve growth across all business units [5][6] - GES backlog grew to $42.5 million in Q4, contributing to a combined backlog of over $99 million for GES and PMT [23] Company Strategy and Development Direction - The company is focused on expanding its green energy products and enhancing its manufacturing capabilities in the U.S. [41][40] - Strategic initiatives include faster design-to-production cycles and the establishment of a new design center in Texas [22] - The company aims to leverage technology partnerships to fill gaps and reduce tariff risks [24][27] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in navigating a challenging global environment and highlighted the importance of maintaining operational agility [5][6] - The company anticipates continued growth in FY 2026, supported by a strong backlog and strategic initiatives [29][30] - Management acknowledged the potential impact of new tariffs but emphasized their ability to adapt and mitigate risks [27][24] Other Important Information - The company reported a strong cash position of $35.9 million at the end of FY 2025, providing flexibility for operations and growth opportunities [16] - The Board declared a quarterly cash dividend of $0.06 per common share, reflecting confidence in financial stability [18] Q&A Session Summary Question: Update on selling ultracapacitor products to GE turbines - The company is in discussions with GE regarding final testing and paperwork, which is currently pending [48][49] Question: Potential customer list after GE agreement - The agreement could increase the serviceable available market by approximately 35%, opening up significant opportunities [51] Question: Product wins in green energy solutions - The company highlighted market share gains and several key agreements, including those with RWE and TransAlta, contributing to growth [55][56] Question: Competitive advantages in PMT - The company noted that its main competitors include industrial distributors and highlighted its unique demand creation and design capabilities [62][68] Question: Strategic opportunities and acquisitions - The company is focusing on expanding green energy products and is open to future acquisition opportunities that align with its strategic goals [69]

Financial Performance - FY2025 net sales increased by 63% year-over-year to $2089 million, driven by higher sales in the company's three continuing business segments[58] - Non-GAAP net income for fiscal year 2025 was $32 million, compared to $05 million in fiscal year 2024[59] - The company's cash and cash equivalents stand at $359 million with no debt[61] Strategic Initiatives - Richardson Electronics sold most of its Healthcare assets to DirectMed Imaging in January 2025 for $82 million, retaining CT tube engineering and manufacturing under an exclusive supply agreement[15] - The company intends to use proceeds from the Healthcare asset sale to invest in growth initiatives, primarily within its GES reportable segment[15] - Total backlog at the end of Q4 FY2025 was $1342 million, up more than 125% since FY2019[70] Business Segments - Power & Microwave Technology (PMT) revenue for FY2025 was $1378 million[19] - Green Energy Solutions (GES) revenue for FY2025 was $287 million[19] - Canvys revenue for FY2025 was $331 million[19] Market Opportunities - The company sees a $454 million global Total Addressable Market (TAM) opportunity in wind turbine pitch energy modules[39] - The global market for battery deployments is projected to grow to $114 billion by 2032, reflecting a CAGR of 21% over 8 years[46]