BK Technologies(BKTI) - 2025 Q2 - Quarterly Results

Q2 2025 Performance Overview This section provides an overview of the company's strong Q2 2025 performance, including CEO commentary and key financial highlights CEO Commentary and Business Update The CEO highlighted strong Q2 2025 operational execution, achieving higher-than-expected gross margins and improved profitability - Delivered strong operational performance in Q2 2025, with gross margins reaching 47.4%[3] - Federal order activity increased significantly after the quarter, highlighted by $12.9 million in purchase orders from the USDA Forest Service, suggesting a strong outlook for the second half of the year[3][5] - Launched RelayONE, a new rapid deployment portable repeater kit, and received the first purchase order from the Latimer County Sheriff's Office in Colorado[3] Q2 2025 Financial Highlights BK Technologies reported strong Q2 2025 financial results, with revenue at $21.2 million and gross margin significantly improving to 47.4% Q2 2025 Key Financial Metrics vs. Q2 2024 | Metric | Q2 2025 | Q2 2024 | | :--- | :--- | :--- | | Revenue | $21.2 million | $20.3 million | | Gross Margin | 47.4% | 37.3% | | GAAP Diluted EPS | $0.96 | $0.47 | | Non-GAAP Adj. Diluted EPS | $1.30 | $0.55 | Financial Performance Analysis This section analyzes the company's Q2 and first-half 2025 financial performance, including balance sheet insights Second Quarter 2025 Financial Review Q2 2025 revenue increased 4.5% to $21.2 million, with gross margin expanding to 47.4% Q2 2025 vs. Q2 2024 Performance | Metric | Q2 2025 | Q2 2024 | Change | | :--- | :--- | :--- | :--- | | Revenue | $21.2M | $20.3M | +4.5% | | Gross Margin | 47.4% | 37.3% | +10.1 p.p. | | Operating Income | $4.0M | $2.0M | +100% | | Net Income | $3.7M | $1.7M | +117.6% | - The improvement in gross margin was driven by a favorable product mix and ongoing cost savings from operational efficiencies and outsourced manufacturing[7] - Selling, General & Administrative (SG&A) expenses rose to $6.0 million from $5.5 million year-over-year, reflecting continued investments in sales, marketing, and engineering[8] Six Months 2025 Financial Review First-half 2025 revenue grew 4.5% to $40.2 million, with gross margin improving to 47.2% First Half 2025 vs. First Half 2024 Performance | Metric | H1 2025 | H1 2024 | Change | | :--- | :--- | :--- | :--- | | Revenue | $40.2M | $38.5M | +4.5% | | Gross Margin | 47.2% | 35.9% | +11.3 p.p. | | Operating Income | $6.9M | $3.0M | +130% | | Net Income | $5.9M | $2.3M | +157.4% | Balance Sheet and Working Capital As of June 30, 2025, working capital increased to $28.9 million, driven by higher cash and receivables - Working capital totaled approximately $28.9 million at June 30, 2025, an increase from $23.0 million at December 31, 2024[11] - Cash, cash equivalents, and trade receivables grew to $23.4 million, up from $14.4 million at the end of 2024[11] Key Balance Sheet Items (in thousands) | Account | June 30, 2025 | Dec 31, 2024 | | :--- | :--- | :--- | | Cash and cash equivalents | $11,853 | $7,075 | | Total current assets | $44,833 | $36,941 | | Total liabilities | $23,663 | $21,668 | | Total stockholders' equity | $36,763 | $29,831 | Full Year 2025 Outlook BK Technologies has raised its full-year 2025 financial guidance due to strong year-to-date performance and robust demand Updated Full Year 2025 Guidance | Metric | New Guidance | Prior Guidance | | :--- | :--- | :--- | | Revenue Growth | High single digits | Single-digit growth | | Gross Margin | > 47% | > 42% | | GAAP Diluted EPS | $3.15 | $2.40 | | Non-GAAP Adj. Diluted EPS | $3.80 | $2.80 | - The upward revision is attributed to strong demand, leverage in the business model, and confidence in sustaining higher performance levels[6] Appendix This section provides supplementary information, including non-GAAP financial measures and detailed financial statements Use of Non-GAAP Measures The company uses non-GAAP financial measures to supplement GAAP statements, offering clearer insight into core operational performance - Adjusted EBITDA is used to help investors understand operational factors by excluding interest, taxes, depreciation, amortization, stock-based compensation, and other infrequent charges[21] - Adjusted EPS adjusts GAAP EPS for items that management does not see as reflective of core operating performance, such as stock-based compensation and one-time charges related to manufacturing transition and tax provisions[22] Financial Statements This section provides unaudited condensed consolidated financial statements for Q2 and H1 2025, including key financial statements and non-GAAP reconciliations Condensed Consolidated Statements of Operations Q2 2025 income statement shows net sales of $21.2 million and net income of $3.7 million Q2 & H1 2025 Income Statement Highlights (in thousands) | Metric | Q2 2025 | Q2 2024 | H1 2025 | H1 2024 | | :--- | :--- | :--- | :--- | :--- | | Sales, net | $21,165 | $20,254 | $40,219 | $38,485 | | Operating income | $3,997 | $2,025 | $6,913 | $3,008 | | Net income | $3,741 | $1,664 | $5,873 | $2,345 | | Diluted EPS | $0.96 | $0.47 | $1.51 | $0.66 | Condensed Consolidated Balance Sheets As of June 30, 2025, the balance sheet indicates total assets of $60.4 million Balance Sheet Summary (in thousands) | Account | June 30, 2025 | Dec 31, 2024 | | :--- | :--- | :--- | | Total current assets | $44,833 | $36,941 | | Total assets | $60,426 | $51,499 | | Total liabilities | $23,663 | $21,668 | | Total stockholders' equity | $36,763 | $29,831 | Reconciliation of Non-GAAP Financial Measures This table reconciles GAAP Net Income to non-GAAP Adjusted EBITDA and Adjusted Earnings for Q2 2025 Q2 2025 GAAP to Non-GAAP Reconciliation (in thousands, except per share data) | Metric | Q2 2025 | Q2 2024 | | :--- | :--- | :--- | | Net Income (GAAP) | $3,741 | $1,664 | | Adjusted EBITDA (Non-GAAP) | $4,417 | $2,489 | | Adjusted Earnings (Non-GAAP) | $5,055 | $1,974 | | Adjusted EPS - diluted (Non-GAAP) | $1.30 | $0.55 |