Core Insights - Orbit International Corp. reported a net loss of $875,000 for Q3 2025, compared to a net income of $558,000 in the same period last year, reflecting a significant decline in profitability [1][6][7] - The adjusted EBITDA for Q3 2025 was a loss of $508,000, down from earnings of $749,000 in Q3 2024, indicating operational challenges [1][6][7] - For the first nine months of 2025, the company experienced a net loss of $4,317,000, compared to a net loss of $394,000 in the prior year [1][2][6] Financial Performance - Q3 2025 net sales were $5,785,000, a decrease from $8,414,000 in Q3 2024, while nine-month sales fell to $15,724,000 from $21,190,000 in the previous year [6][7] - Gross margin for Q3 2025 was 31.9%, down from 36.8% in Q3 2024, and for the nine months ended September 30, 2025, it decreased to 24.4% from 32.8% [6][7] - Selling, general and administrative expenses increased to $7,873,000 for the nine months ended September 30, 2025, compared to $7,698,000 in the prior year [7] Operational Challenges - A supply chain issue at Orbit Power Group (OPG) delayed a significant shipment, resulting in a revenue recognition loss of approximately $1,240,000 and an incremental profitability loss of about $620,000 [5][7] - The backlog at September 30, 2025, was $12.7 million, up from $12.0 million at December 31, 2024, indicating some improvement in order flow despite recent challenges [2][6][7] Management Commentary - The CEO expressed optimism for the second half of 2025 but acknowledged that a single supply chain issue adversely impacted the current quarter's results [5][7] - The company is taking measures to reduce costs, expecting to save approximately $750,000 annually, while also addressing the impact of tariffs on product costs [5][7] Cash Position - As of September 30, 2025, cash and cash equivalents were approximately $159,000, with borrowings under a $4 million line of credit at $3.3 million [8][19] - By November 7, 2025, cash and cash equivalents increased to approximately $1.3 million, and borrowings under the line of credit decreased to $2.475 million [8]

Financial Performance - For the second quarter of 2025, the company reported a net loss of $1,290,000, or $0.39 loss per share, compared to a net loss of $201,000, or $0.06 loss per share in the same period of the prior year [1][7] - Adjusted EBITDA for the second quarter of 2025 was a loss of $1,049,000, or $0.32 loss per share, compared to a loss of $405,000, or $0.12 loss per share in the prior year [1][7] - For the first six months of 2025, the net loss was $3,442,000, or $1.03 loss per share, compared to a net loss of $952,000, or $0.28 loss per share in the same period of the previous year [1][5] - Adjusted EBITDA for the first half of 2025 was a loss of $2,998,000, or $0.90 loss per share, compared to a loss of $965,000, or $0.29 loss per share in the prior year [1][5] Sales and Backlog - Net sales for the second quarter of 2025 were $5,213,000, down from $6,601,000 in the same quarter of 2024 [7] - For the first six months of 2025, net sales decreased to $9,939,000 from $12,776,000 in the prior year [7][8] - The backlog at June 30, 2025, was $12.5 million, an increase from $12.0 million at December 31, 2024 [2][7] Operational Challenges - The company faced challenges due to lower sales from its Orbit Electronics Group, particularly the Simulator Product Solutions subsidiary, which experienced operating losses due to delivery schedule gaps [6][8] - Contract delays in the second half of 2024 negatively impacted bookings and sales in the first half of 2025 [5][8] - The company is implementing cost-cutting measures at the SPS subsidiary, aiming to reduce annual expenses by approximately $750,000 [8] Management Commentary - The President and CEO noted that the second quarter and first half of 2025 were challenging due to lower sales resulting from soft bookings in the previous year [5] - The management expressed optimism about improved bookings in the first half of 2025, which are expected to enhance sales in the second half of 2025 [9][10] Financial Position - As of June 30, 2025, the company had cash and cash equivalents of approximately $0.4 million and a current ratio of 2.1 to 1 [9] - The book value per share at June 30, 2025, was $4.31, down from $5.34 at December 31, 2024 [9]