M-Tron Industries sees 7.2% revenue growth in Q3 2025, driven by defense orders and increased backlog, despite lower margins and net income.
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Summary
- M-Tron Industries reported Q3 2025 revenues of $14.2 million, a 7.2% increase from Q3 2024, driven by growth in avionics, space, and industrial product shipments.
- Gross margins declined to 44.3% from 47.8% in Q3 2024 due to product mix and higher tariff costs, impacting net income which decreased to $1.8 million from $2.3 million year-over-year.
- The company has a strong backlog of $58.8 million, reflecting a 48% increase from the previous year, supported by robust demand in aerospace and defense programs.
- Strategic initiatives include increasing investment in R&D and expanding program business in defense, with significant wins in EW and Radar systems and plans to boost production in precision-guided munitions and UAV programs.
- A partnership with Indiana Microelectronics was highlighted for sales and manufacturing collaboration, expected to lead to significant contract opportunities.
- Challenges with tariffs persist, impacting gross margins by 1-1.5%, with efforts to incorporate tariff charges into pricing and seek tariff relief for defense products.
Thank you for standing by. My name is JL and I will be a conference operator today. At this time I would like to welcome everyone to the Emtron earnings call for the third quarter of 2025. All lines have been placed on mute to prevent any background noise. After the speaker's remarks, there will be a question and answer session. If you would like to ask a question during this time, simply press STAR followed by the number one on your telephone keypad. If you would like to withdraw your question, press Star one again. I would now like to turn the conference over to Linda Biles, EVP of Finance. You may begin.
Good morning everyone. Thank you for joining our 2025 M-Tron Industries Q3 earnings call. Please note that this call will be recorded and we will make the recording available on our investor Relations website IR shortly after the call yesterday afternoon, we released our earnings for the third fiscal quarter of 2025. Before getting underway, we are required to advise you that the following discussion should be taken in conjunction with our most recent financial statements and notes as contained within our 2024 10K which was filed on March 27, 2025 with the SEC. This discussion may contain forward looking statements within the meaning of 27A as of securities act of 1933 and section 21 of the securities and Exchange act of 1934. These forward looking statements contain known and unknown risks and uncertainties which are detailed in our filings within the SEC. Although the Company believes that the forward looking statements are based upon reasonable assumptions regarding its business and future market conditions, there are no assurances that the Company actual results will not differ materially from any result expressed or implied by the Company's forward looking statements. The Company undertakes no obligations to publicly update or revise any forward looking statement, whether as the result of new information, future events or otherwise. Readers are cautioned that any forward looking statements are not guarantees of future performance. With that, I will now turn the call over to our CEO Cameron Foer.