Pro-Dex (PDEX) Q2 2025 earnings summary

Executive summary

• Net sales for the quarter ended December 31, 2024, were $16.8 million, up 33% year-over-year, driven by shipments of a next-generation orthopedic handpiece and increased repair revenue from the largest customer.

• Six-month net sales reached $31.7 million, up 29% year-over-year, reflecting strong demand for new products and higher repair revenue.

• Net income for the quarter was $2.0 million ($0.61 per diluted share), up from $0.5 million ($0.14 per share) a year ago; six-month net income was $4.5 million ($1.33 per share), compared to a net loss of $0.1 million last year.

• Management is ramping up staff to meet increased backlog and anticipates continued sales growth in the coming quarters.

Financial highlights

• Q2 gross profit increased 81% year-over-year to $5.1 million; gross margin improved to 30% from 22%.

• Six-month gross profit rose 58% to $10.2 million; gross margin up to 32% from 26% year-over-year.

• Q2 operating income surged 247% to $2.7 million; six-month operating income up 119% to $5.7 million.

• Cash and cash equivalents decreased to $66,000 at December 31, 2024, from $2.6 million at June 30, 2024, mainly due to increased accounts receivable and inventory.

• Working capital stood at $27.2 million, supported by $6.3 million in marketable equity investments.

Outlook and guidance

• Management expects Q3 and Q4 revenue to increase year-over-year due to ongoing production shipments of the next-gen handpiece.

• Backlog at December 31, 2024, was $48.1 million, with $36.3 million scheduled for delivery in fiscal 2025.

• The company believes existing receivables and cash flows will meet operational needs for at least the next 12 months.