inTEST (INTT) Q4 2024 earnings summary

Executive summary

• Achieved record Q4 2024 revenue of $36.6M and full-year revenue of $130.7M, up 6% year-over-year, marking the third consecutive year of record sales, driven by Alfamation acquisition and growth in 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, and strong back-end semi and auto/EV demand.

• No order cancellations reported; delays are primarily timing-related.

• Gross margin contracted to 39.7% in Q4, impacted by a $1.6M inventory step-up charge related to the Alfamation acquisition.

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

Financial highlights

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

• Q4 gross margin: 39.7%, down 660 bps sequentially and 490 bps YoY, mainly due to a $1.6M inventory step-up charge.

• Operating cash flow: $2.6M in Q4; free cash flow: $2.4M; year-end cash/equivalents: $19.8M; total debt: $15M.

• Full-year 2024 net earnings: $2.9M; adjusted net earnings: $6.2M.

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.

• Guidance reflects $3M in customer order push-outs and market uncertainty due to tariffs.

• 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.