Ultralife Corporation Reports First Quarter Results

Core Insights - Ultralife Corporation reported a strong first quarter for 2025, with a 21% year-over-year revenue increase driven by robust growth in Battery & Energy Products, particularly in government/defense sales, and the contribution from the Electrochem acquisition [1][2] - The company is focused on improving gross margins and has successfully reduced inventory by 7%, which has freed up cash for strategic investments [1] - Ultralife is actively implementing a tariff mitigation plan to manage operational impacts from tariffs across its supply chains [1] Financial Performance - Revenue for the first quarter of 2025 was $50.7 million, an increase of $8.8 million or 21% compared to $41.9 million in the same quarter of 2024 [2][6] - Battery & Energy Products sales increased by 32.4% to $46.3 million, while Communications Systems sales decreased by 36.2% to $4.4 million [2][6] - Gross profit was $12.7 million, representing 25.1% of revenue, compared to $11.5 million or 27.4% of revenue in the prior year [3][6] Operating Metrics - Operating expenses rose to $9.3 million from $7.4 million in the previous year, reflecting the inclusion of Electrochem and increased costs for new product development [4][6] - Operating income decreased to $3.4 million, with an operating margin of 6.7%, down from 9.7% in the prior year [5][6] - Net income attributable to Ultralife Corporation was $1.9 million or $0.11 per diluted share, compared to $2.9 million or $0.18 per diluted share in the first quarter of 2024 [7][6] Backlog and Future Outlook - The total backlog and high-confidence orders at the end of the first quarter stood at $95.0 million, down from $102.2 million at the end of the fourth quarter of 2024, indicating a strong replenishment rate [2][6] - The company is confident in its ability to sustain profitable growth and generate incremental cash flow to reduce acquisition-related debt while continuing to invest in strategic product development [1]