Core Insights - Sono-Tek Corporation reported its fifth consecutive quarter of revenue exceeding $5 million, driven by a significant order completion in the advanced solar market valued at $2.95 million [1][2][3] - The company achieved a gross margin of 52%, an increase from 49% in the previous year, and operating income rose by 103% year-over-year [1][7] - Despite strong performance in the first half of FY 2026, the company maintains a cautious full-year revenue outlook due to uncertainties surrounding governmental clean energy incentives and tariff policies [2][5] Financial Performance - Net sales for the first quarter of FY 2026 reached $5.13 million, a 2% increase from $5.03 million in the same quarter of FY 2025 [7] - Gross profit increased to $2.7 million, up 9% from $2.5 million year-over-year, contributing to a gross margin expansion [7] - Operating income rose to $483 thousand, a 103% increase compared to $238 thousand in the first quarter of FY 2025 [7] - Net income for the quarter was $485 thousand, reflecting a 47% increase from $331 thousand in the prior year [7] Market and Product Insights - Sales in the Alternative/Clean Energy market increased by 42% year-over-year, driven by production-scale system shipments, including a high ASP order of $2.95 million [9] - Integrated Coating Systems sales surged by 309% to $3.05 million, primarily due to a repeat order for high ASP systems [8] - Multi-Axis Coating Systems sales declined by 75% to $677,000, attributed to reduced R&D funding in the clean energy sector following government policy shifts [8] Guidance and Outlook - The company expects continued revenue growth and strong profitability in the first half of FY 2026, supported by a backlog of $7.5 million [5][6] - Full-year revenue growth is anticipated to be relatively flat due to market adjustments in response to recent governmental policy changes [5][6] - The company remains focused on high ASP orders and is well-positioned to navigate potential short-term demand shifts [3][5] Balance Sheet Overview - As of May 31, 2025, Sono-Tek reported cash, cash equivalents, and marketable securities totaling $10.9 million, with no debt on its balance sheet [16] - Stockholders' equity stood at $18.3 million, reflecting a healthy financial position [16]

- Reports Fifth Consecutive Quarter of Revenue above $5 million, Driven by Completion of $2.95 Million Order to Advanced Solar Market - Gross Margins Expand to 52% on Completion of High ASP Order; Operating Income Increases 103% Year over Year - Expects Continued Revenue Growth and Profitability in First Half of FY 2026; Full-Year Revenue Outlook Reflects Measured Expectations Given Potential Customer Response to Policy Shifts in Recently Enacted Budget Legislation MILTON, N.Y., July 10, 2025 (GLOBE NEWSWIR ...

Financial Data and Key Metrics Changes - Net sales for fiscal year 2025 increased by 4% to $20.5 million compared to $19.7 million for fiscal year 2024 [29] - Gross profit increased by 1% year over year to $9.74 million, but gross profit percentage decreased to 47.5% from 50% due to product mix and labor expense reallocations [29][30] - Net income for fiscal year 2025 was $1.2 million or $0.08 per share, down from $1.4 million or $0.09 per share in the prior year [33] Business Line Data and Key Metrics Changes - Integrated coating system sales increased by 28% or $814,000 to $3.7 million, driven by success in the solar energy market [16] - Multi-axis coating systems saw a 6% increase or $603,000 to $10.7 million for the full fiscal year [19] - Medical sales declined by 22% for fiscal year 2025, primarily due to lower demand for stent and balloon coating systems [22] Market Data and Key Metrics Changes - Sales to the alternative clean energy market grew by 64% over the prior fiscal year, significantly impacted by customers transitioning to production scale systems [22] - U.S. and Canadian sales increased by 15% or $1.63 million, representing 61% of total sales compared to 55% in fiscal year 2024 [24] - Latin America sales decreased by 34% or $412,000, while Asian sales declined by 16% or $510,000 due to weak demand from China [25] Company Strategy and Development Direction - The company is focusing on expanding its product offerings in the clean energy sector, medical devices, and semiconductor markets, with a strategic shift towards larger, more complex systems [9][12] - Investments in R&D totaled $2.7 million, aimed at enhancing product capabilities and expanding market reach [27] - The company is optimistic about future growth prospects, particularly in the medical and semiconductor sectors, leveraging its proprietary ultrasonic atomization technology [27][62] Management's Comments on Operating Environment and Future Outlook - Management noted some apprehension in the U.S. clean energy sector regarding order placements, but highlighted strong demand in the EU and Asia [45][46] - The company anticipates continued revenue growth and profitability in the first half of fiscal year 2026, supported by a solid backlog of $8.6 million [13][26] - Visibility into full-year revenue remains limited due to evolving conditions in the clean energy sector and potential tariff impacts [18][20] Other Important Information - The company maintains a strong cash position with cash, cash equivalents, and marketable securities totaling $11.9 million as of February 28, 2025, and has no debt [33] - Capital expenditures for the full year were $496,000, primarily for upgrades to manufacturing and development facilities [34] Q&A Session Summary Question: Clarification on backlog related to Alt Energy - Management confirmed that there are eight systems in backlog from the clean energy sector, all expected to ship in the current fiscal year [40] Question: Visibility on demand and potential pullback - Management acknowledged some apprehension in the U.S. clean energy sector but noted strong demand in other regions [45] Question: Impact of tariffs on business - Management indicated that tariffs have not significantly impacted operations outside of China, with favorable currency exchange rates aiding customer purchases [48] Question: Future growth and order visibility - Management expects to have clearer visibility on full fiscal year performance by the time Q1 earnings are reported [52] Question: Opportunities in medical and semiconductor sectors - Management highlighted strong momentum in both sectors, with a focus on high ASP systems and complex solutions [61][82] Question: Share repurchase program status - Management confirmed an active share repurchase program and stated it is regularly evaluated as part of capital allocation strategy [71]

Financial Data and Key Metrics Changes - Net sales for fiscal year 2025 increased by 4% to $20.5 million compared to $19.7 million for fiscal year 2024 [29] - Gross profit increased by 1% year over year to $9.74 million, but gross profit percentage decreased to 47.5% from 50% in the prior year [29] - Net income for fiscal year 2025 was $1.2 million or $0.08 per share, down from $1.4 million or $0.09 per share in the prior year [33] Business Line Data and Key Metrics Changes - Integrated coating system sales increased by 28% or $814,000 to $3.7 million, driven by success in the clean energy market [15] - Multi-axis coating systems saw sales grow by 6% or $603,000 to $10.7 million for the full fiscal year [18] - Medical sales declined by 22% for fiscal year 2025, primarily due to lower demand for stent and balloon coating systems [21] Market Data and Key Metrics Changes - Sales to the alternative clean energy market grew by 64% over the prior fiscal year [20] - U.S. and Canadian sales increased by 15% or $1.63 million, driven by the delivery of high ASP systems [23] - Latin America sales decreased by 34% or $412,000, influenced by a prior year float glass coating system sale that did not repeat [24] Company Strategy and Development Direction - The company is focusing on expanding into the clean energy sector, with significant growth in advanced solar cells and carbon capture applications [8] - A strategic shift to larger, more complex systems has broadened the addressable market and increased average unit selling prices [7] - The company is optimistic about future demand in the medical and semiconductor markets, leveraging expertise developed in clean energy [61] Management's Comments on Operating Environment and Future Outlook - Management noted some apprehension in the U.S. clean energy sector regarding order placements, but emphasized strong demand in the EU and Asia [45][47] - The company expects continued revenue growth and profitability in the first half of fiscal year 2026, supported by a solid backlog of $8.6 million [12][26] - Visibility into full-year revenue remains limited due to evolving conditions in the clean energy sector and potential tariff impacts [16] Other Important Information - The company invested $2.7 million in R&D for the fiscal year, down from $2.9 million in the prior year [27] - The company maintains a strong cash position with $11.9 million in cash, cash equivalents, and marketable securities, and no debt on the balance sheet [34] Q&A Session Summary Question: Clarification on backlog related to Alt Energy - Management confirmed that there are eight systems in backlog from the clean energy sector, all expected to ship in the current fiscal year [40] Question: Visibility on demand and potential pullback - Management acknowledged some apprehension in the U.S. clean energy sector but noted that the majority of their customers are financially stable [45][46] Question: Opportunities driving backlog in upcoming months - Management highlighted strong momentum in the medical and semiconductor sectors, with ongoing demand for high ASP products [60] Question: Medical market growth and geographical expansion - Management indicated that growth in the medical market is primarily coming from the U.S. and EU, with a shift towards more complex systems [78] Question: Semiconductor market commentary - Management noted that they are offering unique solutions that competitors cannot provide, which is driving progress in the semiconductor sector [83]