Ultralife (ULBI) Q2 2025 earnings summary

Executive summary

• Q2 2025 sales rose 13.0% year-over-year to $48.6 million, driven by the Electrochem acquisition and higher government/defense sales, but offset by a 57.2% drop in Communications Systems and weaker commercial sales.

• Net income attributable to shareholders was $0.9 million ($0.05 per share), down from $3.0 million ($0.18 per share) in Q2 2024, reflecting higher operating expenses, interest costs, and non-recurring items.

• Adjusted EBITDA for Q2 2025 was $4.1 million (8.5% of sales), down from $5.4 million (12.6%) year-over-year.

• Gross profit was $11.6 million, flat year-over-year, but gross margin declined to 23.9% from 26.9% due to tariffs, product mix, and order timing.

• Backlog at quarter-end was $89 million, down from $95 million in the previous quarter, reflecting order timing.

Financial highlights

• Q2 2025 revenue: $48.6 million (+13.0% YoY); six-month revenue: $99.3 million (+17.0% YoY).

• Battery & Energy Products sales increased 25.0% to $45.9 million, with government/defense sales up 61.1% and commercial sales down 20.4%.

• Communications Systems sales fell 57.2% to $2.7 million, mainly due to prior-year shipments and order delays.

• Operating expenses rose to $9.3 million (19.2% of revenue), up from $7.6 million (17.8%), reflecting Electrochem inclusion and higher R&D.

• Q2 2025 adjusted EPS: $0.07 (diluted), down from $0.22 YoY; six-month adjusted EPS: $0.20, down from $0.44.

Outlook and guidance

• Management expects improved results in the second half of 2025 and into 2026, with a rebound in Communications Systems and new product-driven growth in Battery & Energy Products.

• Anticipates increased demand from medical, oil & gas, and global defense sectors, with a focus on operational efficiency and vertical integration.

• Communication Systems expected to rebound in the second half of 2025; early purchase orders and pipeline growth noted.

• Management remains optimistic for the second half of 2025 and into 2026, despite ongoing challenges.