Sono-Tek (SOTK) Q4 2026 earnings summary

Executive summary

• Achieved third consecutive year of annual revenue growth and sixteenth year of profitability, with FY 2026 revenue at $20.9 million and eight straight quarters above $5 million revenue.

• Significant profitability expansion, with gross margin reaching 51% for FY 2026, driven by favorable product mix and higher U.S. sales.

• Strategic focus on high-value, high ASP production systems and transition from R&D to high-volume production drove revenue quality and margin expansion.

• Medical sector led growth, up 54% year-over-year, with strong demand for advanced medical device coating systems.

• U.S. market grew 12%, now representing 67% of total revenue, benefiting margins and reducing international costs.

Financial highlights

• FY 2026 revenue increased 2% to $20.9 million; gross profit up 8% to $10.56 million; gross margin expanded to 51%.

• Operating income rose 81% to $1.82 million; operating margin improved to 9% from 5%.

• Net income grew 42% to $1.8 million; cash, equivalents, and marketable securities rose to $14.8 million with no outstanding debt.

• Fourth quarter net sales reached $5.6 million, up 10% year-over-year; net income for the quarter rose 70% to $557,043.

• Backlog at year-end was $9.12 million, near historic highs and up 5% year-over-year.

Outlook and guidance

• Expect continued revenue growth and profitability in the first half of FY 2027, led by medical and microelectronics sectors and high-ASP systems.

• Full-year FY 2027 revenue expected to be flat to modestly higher than FY 2026; visibility beyond H1 limited due to clean energy sector uncertainty and timing of large orders.

• Pipeline and quoting activity remain strong, with high ASP, complex production systems driving future growth.