Geospace Technologies (GEOS) Q3 Earnings and Revenues Decline Y/Y

Core Viewpoint - Geospace Technologies Corporation reported a net loss of $2.1 million in Q3 fiscal 2024, a significant decline from a net income of $3.2 million in the same period last year, primarily driven by lower revenues in the Oil and Gas Markets segment [10][12]. Revenue Summary - Total revenues for Geospace Technologies in Q3 fiscal 2024 were $25.9 million, reflecting a decrease of 20.9% year over year [2]. - The Oil and Gas Markets segment generated revenues of $9.2 million, down 48.1% from the previous year, attributed to lower utilization of the wireless seismic rental fleet due to weather-related delays, competition, and product availability [3]. - Adjacent Markets segment revenues increased by 7.5% year over year to $15.9 million, driven by growth in water meter and industrial sensor products, despite lower demand for contract manufacturing services and thermal film products [5]. - Emerging Markets segment revenues from border and perimeter security products surged by 487.2% year over year to $0.6 million [6]. Segment Performance - Within the Oil and Gas Markets segment, traditional seismic exploration revenues were $2 million (down 40.4%), wireless seismic exploration revenues were $6.9 million (down 49.4%), and reservoir product revenues were $0.2 million (down 63.5%) [4]. - In the Adjacent Markets segment, industrial product revenues were $13 million (up 11.5%), while imaging product revenues were $2.9 million (down 7.5%) [6]. Profitability Analysis - Gross profit for the quarter declined by 39% to $8.5 million, with the gross margin contracting by 976 basis points to 32.9% [8]. - Adjusted operating loss totaled $2.4 million, contrasting with an adjusted operating profit of $2.9 million in the prior year [9]. Liquidity and Debt Management - At the end of Q3 fiscal 2024, Geospace Technologies had cash and cash equivalents of $42.5 million, down from $51.2 million at the end of the previous quarter, and ended the quarter with no debt [11]. - Cumulative net cash used in operating activities was $7.5 million, compared to a net cash provided of $3.1 million a year ago [11]. Outlook - Despite the disappointing overall results, the growth in Adjacent Markets and Emerging Markets segments is viewed positively, with expectations for substantial revenue contributions from new products in the Adjacent Markets segment [12][13].