CPS Technologies Reports Y/Y Earnings & Revenue Declines in Q3

Core Insights - CPS Technologies Corporation faced significant challenges in Q3 2024, including contract completions and high operational expenses, which negatively impacted revenues and profitability [1][8] - Despite these challenges, the company is optimistic about future growth, particularly in government projects and the semiconductor industry, supported by new contracts [1][6] Q3 Results - The company reported a loss per diluted share of 7 cents, a decline of 800% from earnings of 1 cent per diluted share in the same quarter last year [2] - Total revenues for the quarter were $4.2 million, down 33.3% from $6.3 million in the prior-year period, primarily due to the end of the HybridTech Armor contract and reduced orders from a major client [2] Profitability Metrics - CPS Technologies experienced a gross loss of $0.5 million, compared to a gross profit of $1.2 million in Q3 2023, driven by lower manufacturing efficiencies and increased staffing costs for a new production shift [3] - The company recorded an operating loss of $1.5 million, contrasting with an operating profit of $0.1 million in the prior-year period, reflecting reduced revenues and increased production expenses [4] Costs - Increased costs in Q3 2024 were primarily due to additional staffing and training for the third production shift, which did not generate corresponding revenues, leading to a significant decline in gross margin [5] Management View - Management expressed optimism for a recovery in Q4 and beyond, anticipating higher deliveries to positively impact revenues, supported by a favorable book-to-bill ratio of 1.22, indicating demand growth [6] Other Developments - CPS Technologies secured several significant contracts, including a $1.1 million contract from the U.S. Department of Energy and a $12 million contract from a global semiconductor customer, indicating growth potential in key sectors [7]