inTEST (NYSEAM:INTT) FY Conference Transcript

Summary of inTEST Corporation FY Conference Call Company Overview - Company: inTEST Corporation (NYSEAM: INTT) - CEO: Nick Grant - CFO: Duncan Gilmour - Current Revenue: Approximately $130 million, up from under $55 million five years ago [2][3] Industry Insights - Market Focus: Primarily serves the semiconductor testing market, with diversification into automotive, aerospace defense, and industrial markets [3][4] - Key Technologies: - Electronic tests for back-end semiconductor applications - Environmental technologies for thermal control and testing - Process technologies including induction heating and image capture systems [5][6][8] Financial Performance - Q3 Orders: Strong performance with orders reaching $37.6 million, particularly in automotive/EV and defense/aerospace sectors [17][18] - Backlog: Ended Q3 with a backlog of just under $50 million, indicating recovery from previous declines [18] - Q3 Revenue: Reported revenue of $26 million, slightly below expectations due to delays in shipments [19][20] - Gross Margin: Q3 gross margin at 41.9%, consistent with previous quarters [20] - Operating Cash Flow: Generated $3.1 million in operating cash flow for Q3, with a total of $7 million for the first nine months of 2025 [22] Growth Strategy - Vision 2030: Aiming for revenue growth to $235 million-$285 million by 2030 through both organic and inorganic means [10] - New Product Revenue: Currently at 17%, with a target of over 25% [26] - Acquisition Strategy: Targeting companies in the $20 million-$40 million range to enhance existing technologies and expand geographic presence [14][15] Market Trends and Challenges - Automotive Sector: Experienced a slump in EV orders as OEMs shifted focus back to hybrids and combustion engines, but new projects for 2027 model years are expected to drive future growth [31][32] - Technological Challenges: Delays in new product shipments due to technical challenges, particularly in the AlphaMation and AstroLogics divisions [27][28] Key Takeaways - Diversification: Successful diversification into multiple markets has reduced reliance on the semiconductor sector, which now constitutes just over a third of total business [3][19] - Innovation Focus: Continuous investment in innovation and new product development is crucial for maintaining competitive advantage [10][11] - Financial Health: Strong balance sheet with $20 million in cash and a plan to be close to debt-free by the end of 2026 [24][23] Conclusion - inTEST Corporation is well-positioned for future growth with a diversified portfolio, strong order backlog, and a clear strategic vision. The company is navigating current market challenges while focusing on innovation and operational excellence to drive long-term success.