Financial Data and Key Metrics Changes - Fiscal Q2 net sales increased by 17% to $18.9 million year over year, with gross profit margin at 31.5%, exceeding the target of 30% [6][21] - Operating profit was $106,000 compared to an operating loss of $415,000 in Q2 2024, and adjusted EBITDA was over $1.1 million with a 6% margin [6][22] - Consolidated net loss was $245,000 or $0.02 per diluted share, while non-GAAP net income was $701,000 or $0.07 per diluted share, a significant improvement from a net loss of $4.3 million or $0.41 per diluted share in the prior year [22] Business Line Data and Key Metrics Changes - The company is diversifying its product offerings, with growth in wireless, aerospace, public safety, and industrial sectors [7][8] - Custom cabling projects from aerospace clients have led to repeat business, enhancing credibility in precision-demanding industries [9] - Direct air cooling (DAC) systems are gaining traction, with innovations aimed at reducing energy consumption and costs compared to traditional HVAC systems [10][11] Market Data and Key Metrics Changes - The company has over 100 opportunities in its sales pipeline for wireless DAS build-outs in stadiums and venues, indicating a recovery in this market post-COVID [12][13] - The DAC systems are expanding into wireline telecom, edge data centers, and energy applications, driven by AI demand for data centers [11][12] - The backlog increased from $15 million to $18.4 million, reflecting strong demand across various product lines [6][25] Company Strategy and Development Direction - The company is transitioning from a product-focused model to an integrated solutions provider, enhancing its market diversity [7][18] - There is a focus on operational efficiency, cost management, and leveraging prior acquisitions to create new opportunities [14][19] - The company is actively working to diversify its supply chain to mitigate tariff impacts, with most production domestically sourced [15][16] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the second half of fiscal 2025, despite uncertainties related to tariffs and supply chain impacts [15][17] - The company anticipates Q3 sales to be in line with Q2, representing a significant increase over the previous year's Q3 sales of $16.8 million [20] - Management highlighted a strong team and platform for growth, with a focus on penetrating new markets and increasing customer engagement [20][18] Other Important Information - The company is managing its working capital effectively, with cash and cash equivalents at $3.6 million and a current ratio of approximately 1.6:1 [23] - Inventory levels decreased to $12.6 million from $14.7 million, reflecting improved procurement and supply chain processes [24] Q&A Session Summary Question: What is credited for the backlog growth? - The backlog growth is spread across several product areas, indicating a healthy mix of short and long-term opportunities [28][30] Question: Can you provide a revenue contribution breakdown for products like small cells and DAS systems? - The company does not disclose specific contributions but notes that small cells and DAS systems are significant growth areas, particularly in wireless applications [34][36] Question: What is the expected contribution timeline for DAS opportunities? - DAS opportunities are contributing continuously, with expectations for increased performance in the second half of the year [40][41] Question: What is the outlook for the wireless provider contributing 11% of revenue? - The company sees potential for growth with multiple customers contributing to sales, indicating a diverse customer base [44][46] Question: Can you elaborate on the credit facility and expected savings? - The company expects to finalize a new credit agreement in Q3, anticipating meaningful interest rate reductions [53][54] Question: How will the company achieve its 10% EBITDA target? - The company aims to improve product mix, reduce costs, and enhance operational efficiency to reach the EBITDA target [56][58] Question: What is the growth outlook for DAC and small cell products? - Both DAC and small cell products are expected to continue driving growth, supported by diverse customer bases and regional budgets [60][61]

Financial Data and Key Metrics Changes - Fiscal second quarter net sales grew 17% to $18.9 million year over year, with gross profit margin at 31.5%, exceeding the target goal of 30% [6][21] - Operating profit was $106,000 compared to an operating loss of $415,000 in the second quarter of 2024, and adjusted EBITDA was over $1.1 million with a 6% margin [6][22] - Consolidated net loss was $245,000 or $0.02 per diluted share, while non-GAAP net income was $701,000 or $0.07 per diluted share, a significant improvement from a net loss of $4.3 million or $0.41 per diluted share in the prior year [22] Business Line Data and Key Metrics Changes - The company is diversifying its revenue sources across various markets, including wireless, aerospace, public safety, and industrial customers [7][10] - The small cell solutions and direct air cooling (DAC) systems are gaining momentum, with DAC systems expected to reduce operating expenses by up to 70% compared to traditional HVAC systems [10][11] - The backlog increased significantly from $15 million to $18.4 million, indicating strong demand across multiple product lines [6][25] Market Data and Key Metrics Changes - The company is seeing growth opportunities in wireless DAS build-outs in stadiums and venues, with over 100 opportunities in the sales pipeline [10][13] - The demand for DAC systems is driven by the need for efficient cooling solutions in data centers and edge applications, particularly influenced by AI [11][12] - The company has successfully penetrated new markets, including energy, transportation, and wireline telecom, contributing to a more diverse customer base [7][14] Company Strategy and Development Direction - The company is transitioning from a products company to an integrated solutions provider, focusing on diversified end markets [7][18] - There is an emphasis on operational efficiency, cost management, and innovation in product development to drive profitability [19][20] - The management is actively working to diversify the supply chain to mitigate risks associated with tariffs and supply chain disruptions [15][16] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in navigating the current economic environment, highlighting the company's ability to adapt to tariff impacts and supply chain challenges [15][17] - The company anticipates third-quarter sales to be in line with the second quarter, representing a significant increase over the previous year [20] - Management believes the company is well-positioned for growth, with a strong team and a robust platform to capitalize on market opportunities [20][19] Other Important Information - The company has a strong balance sheet with $3.6 million in cash and cash equivalents, and a current ratio of approximately 1.6:1 [23] - Inventory levels decreased to $12.6 million, reflecting improvements in procurement and supply chain processes [24] Q&A Session Summary Question: What would you credit for the backlog growth? - The backlog growth is spread across several product areas, indicating a healthy mix of short and long-term opportunities [28][30] Question: Can you provide a refresher on revenue contributions from different product lines? - The company does not disclose specific contributions but notes that small cell and DAS systems are significant growth areas, with increasing contributions from aerospace and industrial markets [34][36] Question: What is the expected contribution from the distributed antenna systems (DAS)? - DAS opportunities are diverse, including various venues, and the company expects continued contributions from this market [40][41] Question: Can you elaborate on the wireless provider making up 11% of revenue? - The top customer varies each quarter, reflecting a project-based nature of sales, with expectations for repeat purchases and a growing list of customers contributing to sales [44][46] Question: Can you provide more details on the credit facility and expected savings? - The company expects to finalize a new credit agreement in Q3, which should result in meaningful interest rate savings [52][53] Question: How will the company achieve its 10% EBITDA target? - The company aims to improve product mix, reduce costs, and enhance operational efficiency to reach the EBITDA target [54][56] Question: What is the growth outlook for DAC and small cell products? - Both product lines are expected to continue contributing significantly to sales, with a diverse customer base supporting growth [58][60]

Part I. FINANCIAL INFORMATION This section provides the company's unaudited condensed consolidated financial statements and management's discussion and analysis for the recent fiscal periods [Financial Statements](index=3&type=section&id=Item%201%3A%20Financial%20Statements) This section presents the unaudited condensed consolidated financial statements, showing improved net loss, increased assets, and positive operating cash flow for the period ended April 30, 2025 [Condensed Consolidated Balance Sheets](index=3&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) The balance sheet shows an increase in cash and total current assets, leading to a slight rise in total assets and liabilities, while stockholders' equity remained stable Consolidated Balance Sheet Highlights (in thousands) | Account | April 30, 2025 | October 31, 2024 | Change | | :--- | :--- | :--- | :--- | | **Assets** | | | | | Cash and cash equivalents | $3,586 | $839 | +$2,747 | | Trade accounts receivable, net | $15,000 | $12,119 | +$2,881 | | Inventories | $12,574 | $14,725 | -$2,151 | | **Total Current Assets** | **$32,721** | **$29,113** | **+$3,608** | | **Total Assets** | **$72,679** | **$71,046** | **+$1,633** | | **Liabilities & Equity** | | | | | Accounts payable | $4,784 | $3,798 | +$986 | | Line of credit | $7,994 | $8,197 | -$203 | | **Total Current Liabilities** | **$20,595** | **$18,090** | **+$2,505** | | **Total Liabilities** | **$38,509** | **$36,980** | **+$1,529** | | **Total Stockholders' Equity** | **$34,170** | **$34,066** | **+$104** | [Condensed Consolidated Statements of Operations](index=5&type=section&id=Condensed%20Consolidated%20Statements%20of%20Operations) The statement of operations reflects increased net sales and gross profit for both the quarter and six-month period, significantly reducing the consolidated net loss Statement of Operations Summary (in thousands, except per share data) | Metric | Three Months Ended April 30, 2025 | Three Months Ended April 30, 2024 | Six Months Ended April 30, 2025 | Six Months Ended April 30, 2024 | | :--- | :--- | :--- | :--- | :--- | | Net sales | $18,910 | $16,110 | $38,110 | $29,568 | | Gross profit | $5,950 | $4,824 | $11,667 | $8,127 | | Operating income (loss) | $106 | $(415) | $162 | $(2,499) | | Consolidated net loss | $(245) | $(4,294) | $(490) | $(5,656) | | Diluted loss per share | $(0.02) | $(0.41) | $(0.05) | $(0.54) | [Condensed Consolidated Statements of Cash Flows](index=8&type=section&id=Condensed%20Consolidated%20Statements%20of%20Cash%20Flows) The cash flow statement indicates a substantial increase in net cash from operating activities, leading to a positive net increase in cash and cash equivalents Cash Flow Summary for Six Months Ended April 30 (in thousands) | Cash Flow Activity | 2025 | 2024 | | :--- | :--- | :--- | | Net cash provided by operating activities | $2,792 | $1,037 | | Net cash used in investing activities | $(49) | $(312) | | Net cash provided by (used in) financing activities | $4 | $(4,222) | | **Net increase (decrease) in cash** | **$2,747** | **$(3,497)** | | **Cash and cash equivalents, end of period** | **$3,586** | **$1,400** | [Notes to Unaudited Condensed Consolidated Financial Statements](index=9&type=section&id=Notes%20to%20Unaudited%20Condensed%20Consolidated%20Financial%20Statements) These notes provide additional details on the company's financial performance, including cost-cutting measures, debt agreements, customer concentration, segment sales, and dividend policy - The company has implemented cost-cutting measures, including facility consolidation, to reduce operating expenses, drive **positive operating cash flow**, and increase liquidity. These efforts contributed to generating **operating income** in the first six months of 2025, compared to a loss in the same period last year[21](index=21&type=chunk) - In March 2024, the company entered into a new loan and security agreement with Eclipse Business Capital (EBC), replacing its prior facility with Bank of America. As of April 30, 2025, outstanding borrowings under the EBC credit agreement were **$7.994 million**[22](index=22&type=chunk)[61](index=61&type=chunk)[66](index=66&type=chunk) - For the six months ended April 30, 2025, one wireless provider accounted for **11%** of net sales. For the three months ended April 30, 2025, a different wireless provider accounted for **11%** of net sales[30](index=30&type=chunk) Segment Net Sales for Six Months Ended April 30 (in thousands) | Segment | 2025 | 2024 | Change | | :--- | :--- | :--- | :--- | | RF Connector and Cable Assembly | $18,081 | $18,709 | -3.4% | | Custom Cabling Manufacturing and Assembly | $20,029 | $10,859 | +84.5% | | **Total Net Sales** | **$38,110** | **$29,568** | **+28.9%** | - The company **did not pay any dividends** during the three or six-month periods ended April 30, 2025, or in the comparable periods of 2024[67](index=67&type=chunk) [Management's Discussion and Analysis of Financial Condition and Results of Operations](index=23&type=section&id=Item%202%3A%20Management%27s%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management discusses significant increases in net sales, particularly in the Custom Cabling segment, alongside improved operating income and positive cash flow from operations [Overview](index=23&type=section&id=Overview) This overview details the company's two primary operating segments: RF Connector and Cable Assembly, and Custom Cabling Manufacturing and Assembly - The company operates through **two segments**: RF Connector and Cable Assembly (RF Connector) and Custom Cabling Manufacturing and Assembly (Custom Cabling)[73](index=73&type=chunk) - For the six months ended April 30, 2025, the Custom Cabling segment accounted for **53%** of total sales, while the RF Connector segment accounted for **47%**[74](index=74&type=chunk) [Liquidity and Capital Resources](index=24&type=section&id=Liquidity%20and%20Capital%20Resources) This section analyzes the company's cash position, operating cash flow generation, and changes in order backlog, reflecting improved liquidity - Cash and cash equivalents increased to **$3.6 million** as of April 30, 2025, from **$0.8 million** as of October 31, 2024[77](index=77&type=chunk) - The company generated **$2.8 million** in cash from operating activities during the first six months of fiscal 2025, primarily due to a **$2.2 million** decrease in inventories and non-cash charges like depreciation and amortization[79](index=79&type=chunk) - Order backlog was **$15.0 million** as of April 30, 2025, a decrease from **$19.5 million** as of October 31, 2024, attributed to shipments and timing of new orders[78](index=78&type=chunk) [Results of Operations](index=25&type=section&id=Results%20of%20Operations) This section details the financial performance for the quarter and six-month periods, highlighting significant increases in net sales and gross profit, and a substantial reduction in net loss Q2 2025 vs Q2 2024 Performance Comparison | Metric | Q2 2025 | Q2 2024 | Change | | :--- | :--- | :--- | :--- | | Net Sales | $18.9M | $16.1M | +17.4% | | Gross Profit | $6.0M | $4.8M | +25.0% | | Gross Margin | 31.5% | 29.9% | +1.6pp | | Net Loss | ($0.2M) | ($4.3M) | +95.3% | - The Q2 2025 sales increase was driven by a **54.8%** rise in the Custom Cabling segment, fueled by demand for direct air cooling offerings and new market penetration[83](index=83&type=chunk) Six Months 2025 vs Six Months 2024 Performance Comparison | Metric | 6M 2025 | 6M 2024 | Change | | :--- | :--- | :--- | :--- | | Net Sales | $38.1M | $29.6M | +28.7% | | Gross Profit | $11.7M | $8.1M | +44.4% | | Gross Margin | 30.6% | 27.5% | +3.1pp | | Net Loss | ($0.5M) | ($5.7M) | +91.2% | - The sales increase for the six-month period was mainly due to an **83.5%** increase in the Custom Cabling segment, while the RF Connector segment saw a slight decrease of **3.2%**[90](index=90&type=chunk) [Quantitative and Qualitative Disclosures about Market Risk](index=27&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20about%20Market%20Risk) As a "smaller reporting company," RF Industries is not required to provide the information for this item - The company is **exempt** from providing quantitative and qualitative disclosures about market risk because it qualifies as a "**smaller reporting company**"[97](index=97&type=chunk) [Controls and Procedures](index=27&type=section&id=Item%204.%20Controls%20and%20Procedures) Management, including the CEO and CFO, conducted an evaluation of the company's disclosure controls and procedures and concluded that they were effective at a reasonable assurance level as of April 30, 2025 - The Chief Executive Officer and Chief Financial Officer concluded that the company's disclosure controls and procedures were **effective** as of April 30, 2025[101](index=101&type=chunk) - **No changes** in internal control over financial reporting occurred during the second quarter of fiscal 2025 that materially affected, or are reasonably likely to materially affect, the company's internal controls[102](index=102&type=chunk) Part II. OTHER INFORMATION This section covers legal proceedings, updated risk factors, equity security sales, other disclosures, and a list of exhibits filed with the report [Legal Proceedings](index=29&type=section&id=Item%201.%20Legal%20Proceedings) The company reports that it is not currently subject to any material legal proceedings outside of the ordinary course of business - As of the report date, the company is **not subject to any proceeding** that is not in the ordinary course of business or that is material to its financial condition[103](index=103&type=chunk) [Risk Factors](index=29&type=section&id=Item%201A.%20Risk%20Factors) This section updates the risk factors from the company's Annual Report, highlighting a new significant risk related to changes in trade policies - A **new risk factor** has been added regarding changes to trade policies, tariffs, and import/export regulations of the U.S. and foreign governments[106](index=106&type=chunk) - The company notes that recent and potential future tariffs could pose a significant risk by **increasing product costs**, which may lead to **lower gross profit and margins** if costs are not passed on to customers[107](index=107&type=chunk) [Unregistered Sales of Equity Securities and Use of Proceeds](index=31&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) The company reported no unregistered sales of its equity securities and no issuer purchases of its equity securities during the period - There were **no unregistered sales** of equity securities or **no issuer purchases** of equity securities during the reporting period[109](index=109&type=chunk)[110](index=110&type=chunk) [Other Information](index=31&type=section&id=Item%205.%20Other%20Information) The company disclosed that no director or officer adopted or terminated a Rule 10b5-1 trading arrangement during the quarter, and announced a salary increase for Ray Bibisi following his promotion - **No director or officer adopted or terminated** any Rule 10b5-1 trading arrangement during the quarterly period ended April 30, 2025[113](index=113&type=chunk) - Effective May 1, 2025, Ray Bibisi's **salary was increased from $275,000 to $300,000** in connection with his promotion to the Company's President and Chief Operating Officer[114](index=114&type=chunk) [Exhibits](index=31&type=section&id=Item%206.%20Exhibits) This section provides a list of exhibits filed with the quarterly report, including certifications by the CEO and CFO and Inline XBRL financial data files - The report includes **certifications** from the Chief Executive Officer and Chief Financial Officer pursuant to Sections 302 and 906 of the Sarbanes-Oxley Act of 2002[116](index=116&type=chunk) - **Inline XBRL documents** (Instance, Schema, Calculation, Definition, Label, Presentation) are included as exhibits[116](index=116&type=chunk)[117](index=117&type=chunk)

Second Quarter Fiscal Year 2025 Financial Results [Q2 Fiscal 2025 Highlights and Operating Results](index=1&type=section&id=Second%20Quarter%20Fiscal%202025%20Highlights%20and%20Operating%20Results) The company reported a 17.4% year-over-year net sales increase to $18.9 million and a return to operating profitability Q2 FY2025 Key Financial Metrics | Metric | Q2 FY2025 | Q2 FY2024 | Change (YoY) | | :--- | :--- | :--- | :--- | | Net Sales | $18.9 million | $16.1 million | +17.4% | | Gross Profit Margin | 31.5% | 29.9% | +1.6 p.p. | | Operating Income (Loss) | $106,000 | ($415,000) | Improvement | | Consolidated Net Loss | ($245,000) | ($4.3 million) | Improvement | | Non-GAAP Net Income | $701,000 | $132,000 | +431% | | Adjusted EBITDA | $1.1 million | $572,000 | +92.5% | - The company's backlog was **$15.0 million** at quarter-end and subsequently increased to **$18.4 million**[6](index=6&type=chunk) [Management Commentary](index=1&type=section&id=Management%20Commentary) Management highlighted the successful strategic shift to technology-driven solutions and progress towards profitability goals - The company is evolving from a cable and connector supplier to a provider of data and technology-driven solutions[5](index=5&type=chunk) - Strategic execution focuses on operational streamlining, portfolio expansion, and disciplined R&D and capex spending[7](index=7&type=chunk) - Business diversification is progressing with repeat orders from marquee customers and a strong sales pipeline for Wireless DAS buildouts[7](index=7&type=chunk) Financial Statements [Condensed Consolidated Balance Sheets](index=5&type=section&id=CONDENSED%20CONSOLIDATED%20BALANCE%20SHEETS) Total assets increased to $72.7 million as of April 30, 2025, driven by higher cash and accounts receivable Selected Balance Sheet Data (in thousands) | Account | Apr. 30, 2025 (unaudited) | Oct. 31, 2024 (audited) | | :--- | :--- | :--- | | Cash and cash equivalents | $3,586 | $839 | | Trade accounts receivable, net | $15,000 | $12,119 | | Inventories | $12,574 | $14,725 | | **TOTAL ASSETS** | **$72,679** | **$71,046** | | Accounts payable and accrued expenses | $10,673 | $8,045 | | **TOTAL LIABILITIES** | **$38,509** | **$36,980** | | **TOTAL STOCKHOLDERS' EQUITY** | **$34,170** | **$34,066** | [Condensed Consolidated Statements of Operations](index=6&type=section&id=CONDENSED%20CONSOLIDATED%20STATEMENTS%20OF%20OPERATIONS) The company reported higher net sales and gross profit, achieving operating income of $106,000 versus a prior-year loss Statement of Operations Highlights - Three Months Ended April 30 (in thousands) | Metric | 2025 (unaudited) | 2024 (unaudited) | | :--- | :--- | :--- | | Net sales | $18,910 | $16,110 | | Gross profit | $5,950 | $4,824 | | Operating income (loss) | $106 | ($415) | | Consolidated net loss | ($245) | ($4,294) | | Loss per share - Diluted | ($0.02) | ($0.41) | Statement of Operations Highlights - Six Months Ended April 30 (in thousands) | Metric | 2025 (unaudited) | 2024 (unaudited) | | :--- | :--- | :--- | | Net sales | $38,110 | $29,568 | | Gross profit | $11,667 | $8,127 | | Operating income (loss) | $162 | ($2,499) | | Consolidated net loss | ($490) | ($5,656) | Non-GAAP Financial Measures [Reconciliation of GAAP to Non-GAAP Net Income (Loss)](index=7&type=section&id=Unaudited%20Reconciliation%20of%20GAAP%20to%20Non-GAAP%20Net%20Income%20(Loss)) Adjustments to the GAAP net loss resulted in a non-GAAP net income of $701,000 for the second quarter of 2025 Non-GAAP Net Income Reconciliation - Three Months Ended April 30, 2025 (in thousands) | Description | Amount | | :--- | :--- | | Consolidated net loss (GAAP) | ($245) | | Provision from income taxes | $135 | | Stock-based compensation expense | $226 | | Non-cash and other one-time charges | $123 | | Severance | $51 | | Amortization expense | $411 | | **Non-GAAP net income** | **$701** | [Reconciliation of Net Loss to Adjusted EBITDA](index=7&type=section&id=Unaudited%20Reconciliation%20of%20Net%20Loss%20to%20Adjusted%20EBITDA) The company reported Adjusted EBITDA of $1.1 million, a substantial increase from $572,000 in the prior-year quarter Adjusted EBITDA Reconciliation - Three Months Ended April 30, 2025 (in thousands) | Description | Amount | | :--- | :--- | | Consolidated net loss (GAAP) | ($245) | | Stock-based compensation expense | $226 | | Non-cash and other one-time charges | $123 | | Severance | $51 | | Amortization expense | $411 | | Depreciation expense | $204 | | Other expense | $216 | | Provision from income taxes | $135 | | **Adjusted EBITDA** | **$1,121** | Company Information and Disclosures [About RF Industries](index=2&type=section&id=About%20RF%20Industries) The company designs and manufactures a wide array of interconnect products for diverse telecommunications and industrial markets - The company manufactures interconnect products for growing markets including telecom, data communications, and industrial[9](index=9&type=chunk) - Products include RF components, coaxial and fiber optic cables, custom cabling, cooling systems, and small cell enclosures[9](index=9&type=chunk) [Forward-Looking Statements](index=3&type=section&id=Forward-Looking%20Statements) The report contains forward-looking statements subject to risks and uncertainties detailed in the company's SEC filings - The report includes forward-looking statements concerning profitability, revenues, industry trends, and growth opportunities[10](index=10&type=chunk) - Actual results may differ due to various factors, and readers should consult SEC filings for a full list of risks[10](index=10&type=chunk)

Core Viewpoint - The article highlights RF Industries, Ltd. (RFIL) as a promising growth stock, supported by its strong earnings growth, efficient asset utilization, and positive earnings estimate revisions, making it a solid choice for growth investors [2][10]. Earnings Growth - RF Industries has a historical EPS growth rate of 79.7%, with projected EPS growth of 355.6% this year, significantly outperforming the industry average of 4.2% [5]. Asset Utilization Ratio - The company has an asset utilization ratio (sales-to-total-assets ratio) of 0.99, indicating it generates $0.99 in sales for every dollar in assets, compared to the industry average of 0.49, showcasing superior efficiency [6]. Sales Growth - RF Industries is expected to achieve a sales growth of 13.9% this year, while the industry average is projected at -0.1%, indicating strong sales performance [7]. Earnings Estimate Revisions - The current-year earnings estimates for RF Industries have been revised upward, with the Zacks Consensus Estimate increasing by 18.2% over the past month, reflecting positive sentiment [8]. Overall Assessment - RF Industries has earned a Growth Score of B and a Zacks Rank 1 (Strong Buy), indicating its potential as an outperformer in the growth stock category [10].

Industry Overview - Semiconductor sales have been steadily increasing, driven by enthusiasm for artificial intelligence (AI), particularly generative AI, leading to a surge in revenues across multiple industries [1][3] - The semiconductor industry was a major contributor to last year's stock market rally, indicating its integral role in the broader tech sector [1] Sales Performance - Global semiconductor sales reached $54.9 billion in February, marking a 17.1% increase from $46.9 billion in February 2024 [3] - This represents the 10th consecutive month of over 17% year-over-year growth, although there was a month-over-month decline of 2.9% [4] - The total global semiconductor sales for 2024 are projected to be $627.6 billion, a 19.1% increase from $526.8 billion in 2023 [5] Market Outlook - The semiconductor market is expected to continue expanding, with predictions of double-digit growth in 2025 [6] - A report estimates the global semiconductor market size will reach $627.76 billion by 2025 and $1,207.51 billion by 2034 [7] Key Companies - **NVIDIA Corporation**: A leading designer of graphic processing units (GPUs) with an expected earnings growth rate of 48% for the current year, currently holding a Zacks Rank 2 [8][9] - **RF Industries, Ltd.**: Engaged in the design and manufacture of coaxial connectors, with an expected earnings growth rate of over 100% for the current year, holding a Zacks Rank 1 [10][11] - **ASML Holding N.V.**: A world leader in advanced technology systems for the semiconductor industry, with an expected earnings growth rate of 21.9% for the current year, holding a Zacks Rank 2 [12][13] - **Magnachip Semiconductor Corporation**: Designs and manufactures analog and mixed-signal semiconductor products, operating through three key segments [14]

Core Viewpoint - Growth stocks are appealing due to their potential for above-average financial growth, but identifying stocks that can fulfill this potential is challenging [1] Group 1: Company Overview - RF Industries, Ltd. (RFIL) is highlighted as a recommended growth stock with a favorable Growth Score and a top Zacks Rank [2] - The company has a historical EPS growth rate of 46%, with projected EPS growth of 355.6% this year, significantly outperforming the industry average of -14% [4] Group 2: Financial Metrics - The asset utilization ratio for RF Industries is 0.99, indicating that the company generates $0.99 in sales for every dollar in assets, compared to the industry average of 0.49 [6] - RF Industries is expected to achieve a sales growth of 13.9% this year, while the industry average is projected at -0.9% [6] Group 3: Earnings Estimates - There has been a positive trend in earnings estimate revisions for RF Industries, with the Zacks Consensus Estimate for the current year increasing by 18.2% over the past month [8] - The combination of strong earnings estimate revisions and a Growth Score of A positions RF Industries favorably for potential outperformance [10]

Financial Data and Key Metrics Changes - Net sales for Q1 2025 were $19.2 million, a significant increase of 42.7% compared to $13.5 million in Q1 2024 [8] - Gross profit margin for Q1 2025 was 29.8%, up from 24.5% year-over-year, reflecting a 530 basis points improvement [29] - Adjusted EBITDA for Q1 2025 was $867,000, a significant improvement from an adjusted EBITDA loss of $1.1 million in Q1 2024 [30] Business Line Data and Key Metrics Changes - The sales mix in Q1 2025 skewed towards higher value offerings, including increased shipments of DAC thermal cooling systems and integrated small cell solutions [11] - Custom cables, wire harnesses, and core distribution-centric RF products also contributed solidly to the quarter [11] Market Data and Key Metrics Changes - Approximately 6% of revenue in Q1 2025 came from export sales, with all production facilities based in the United States [19] - The company is seeing a growing portion of product revenue coming from customers outside of the large Tier 1 wireless carriers [12] Company Strategy and Development Direction - The company is transitioning from a product-centric model to a solutions provider, focusing on comprehensive solutions that address customer needs [24][26] - There is a strategic emphasis on diversifying the customer base and increasing exposure to new end markets, such as aerospace [13][15] - The company anticipates increased spending on wireless network densification and stadium projects throughout 2025 [15][16] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the momentum and visibility for future sales, expecting fiscal 2025 revenue to be significantly higher than fiscal 2024 [21][22] - The company is closely monitoring tariff impacts but does not anticipate significant effects on procurement and supply chain activities [19][20] Other Important Information - The company ended Q1 2025 with a backlog of $15.2 million, with bookings of $14.9 million [33] - The current inventory level was $13.5 million, down from $18 million last year, reflecting improvements in procurement and supply chain processes [32] Q&A Session Summary Question: Update on lower margin hybrid product - Management noted that the backlog has maintained around $15 million, with older hybrid fiber products being replaced by newer product lines [38][39] Question: Reason for sequential increase during a slow quarter - The increase was attributed to new product lines and some contribution from operating expenditures, particularly in DAC thermal cooling [44][46] Question: Insights on gross margin changes throughout the year - Management is targeting a gross margin around 30% but sees potential for improvement as production optimization continues [48][50] Question: Impact of new sales team on growth - The performance is partly credited to the new sales team, with expectations for minimal additional spending while capitalizing on recent wins [56][57] Question: Cash flow and debt paydown expectations - Management indicated that cash flow is positive, and they expect to take a chunk out of debt this year as performance improves [76][77] Question: Status of Microlab products - Microlab products have experienced variable performance but are positioned well within the carrier market, contributing positively to the overall strategy [80][82]

Financial Data and Key Metrics Changes - Net sales for the first quarter were $19.2 million, a significant increase of 42.7% compared to $13.5 million in the same quarter last year [8] - Gross profit margin for the first quarter was 29.8%, in line with the target of 30% [9] - Adjusted EBITDA for the quarter was $867,000, a significant improvement from an adjusted EBITDA loss of $1.1 million in Q1 2024 [30] - The company ended the quarter with a backlog of $15.2 million [10] Business Line Data and Key Metrics Changes - Sales increased by $5.7 million compared to Q1 last year, with a favorable mix towards higher value offerings, including DAC thermal cooling systems and integrated small cell solutions [11] - Custom cables, wire harnesses, and core distribution-centric RF products also contributed solidly to the quarter [11] - The company is diversifying its customer base, with a growing portion of product revenue coming from customers outside the large Tier 1 wireless carriers [12] Market Data and Key Metrics Changes - The company anticipates an increase in stadium and venue projects, positioning itself to benefit from these trends [15] - The aerospace industry is identified as a high-growth area, with a significant interconnect opportunity won from a leading aerospace company [14] Company Strategy and Development Direction - The company is transforming from a product company to a solutions provider, focusing on comprehensive solutions that address customer needs [24][26] - Strategic investments have been made to expand the sales team and enhance customer engagement [27] - The company aims to achieve an adjusted EBITDA goal of 10% of sales or greater [18] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's ability to capitalize on opportunities ahead, with expectations for fiscal 2025 revenue to be significantly higher than fiscal 2024 [22] - The company is closely monitoring tariff proposals and does not anticipate a significant impact from new tariffs on its operations [19][20] Other Important Information - The company has a current ratio of approximately 1.7:1, with current assets of $29.5 million and current liabilities of $17.8 million [31] - Inventory decreased to $13.5 million from $18 million last year, reflecting improvements in procurement and supply chain processes [32] Q&A Session Summary Question: Update on the lower margin hybrid product - Management noted that the backlog has maintained around $15 million, with older hybrid fiber products being replaced by newer product lines [37][39] Question: Reason for sequential increase during a slow quarter - The increase was attributed to new product lines and some contribution from operating expenditures [42][46] Question: Insights on gross margin changes throughout the year - Management is optimistic about maintaining around a 30% gross margin, with potential for improvement as production optimization continues [48][50] Question: Impact of the new sales team on recent growth - The performance is partly credited to the new sales team, with expectations for minimal additional spending on resources [51][56] Question: Expectations for cash flow and debt paydown - Management indicated that cash flow is positive and they expect to take a chunk out of debt this year [76] Question: Performance of Microlab products - Microlab products have shown variable performance, but the acquisition has positioned the company well within the market [80][82]

分组1 - RF Industries, Ltd. reported quarterly earnings of $0.04 per share, exceeding the Zacks Consensus Estimate of $0.03 per share, compared to a loss of $0.06 per share a year ago, representing an earnings surprise of 33.33% [1] - The company posted revenues of $19.2 million for the quarter ended January 2025, surpassing the Zacks Consensus Estimate by 4.07%, and compared to year-ago revenues of $13.46 million [2] - Over the last four quarters, RF Industries has surpassed consensus EPS estimates two times and topped consensus revenue estimates two times [2] 分组2 - The current consensus EPS estimate for the coming quarter is $0.04 on revenues of $16.92 million, and for the current fiscal year, it is $0.21 on revenues of $72.46 million [7] - The estimate revisions trend for RF Industries is favorable, leading to a Zacks Rank 2 (Buy) for the stock, indicating expected outperformance in the near future [6] - The Semiconductors - Radio Frequency industry, to which RF Industries belongs, is currently in the bottom 25% of the Zacks Industry Rank, which may impact stock performance [8]