inTEST (INTT) Q4 2024 earnings summary

Executive summary

• Achieved record 2024 revenue of $130.7M, up 6% year-over-year, with Q4 revenue at $36.6M, driven by the Alfamation acquisition and strong demand in auto/EV, defense/aerospace, and life sciences, offsetting a 26% decline in semi.

• Orders increased 11% year-over-year in Q4, with backlog at $39.5M, including $7.4M from Alfamation.

• Gross margin contracted to 39.7% in Q4 due to a $1.6M inventory step-up charge from the Alfamation acquisition.

• Market diversification and acquisitions offset softness in semi and industrial markets.

• Cautious 2025 outlook due to customer investment slowdowns, tariff uncertainty, and market headwinds.

Financial highlights

• Q4 revenue: $36.6M (up $8.7M YoY), including $8.5M from Alfamation; Q4 gross profit: $14.5M.

• Q4 net earnings: $1.5M ($0.12/diluted share); adjusted net earnings: $2.8M ($0.23/diluted share).

• Q4 adjusted EBITDA: $4.4M (12.1% margin); full-year adjusted EBITDA: $10.8M (8.3% margin).

• Operating cash flow in Q4: $2.6M; free cash flow: $2.4M; year-end cash and equivalents: $19.8M.

• Total debt at year-end: $15M; paid down $7.8M in 2024; $30M available under delayed draw term loan.

Outlook and guidance

• 2025 revenue expected at $125–$135M, with gradual profitability improvement.

• Q1 2025 revenue forecast: $27–$29M; gross margin ~41%; operating expenses $13.6–$14M.

• Capital expenditures for 2025 planned at 1–2% of revenue; effective tax rate expected at 18%.

• $0.6M in restructuring costs expected in 2025, with $0.5M annualized savings starting 2026.

• Cautious outlook due to customer order push-outs, tariff-related uncertainty, and market softness.