CPS Technologies Swings to Profit on Soaring Sales

TL;DR

CPSH is finally turning the corner with massive sales growth and a return to profitability, making it a compelling buy for growth-oriented investors.

AI Summary

CPS Technologies Corp. reported a significant turnaround in its financial performance for the three and nine months ended September 27, 2025. Product sales for the three months surged to $8,803,695, a 107.3% increase from $4,247,116 in the prior year period. This led to a gross profit of $1,502,566, a substantial improvement from a gross loss of $523,432 in the same quarter last year. Net income for the quarter was $207,964, reversing a net loss of $1,042,839 in Q3 2024. For the nine-month period, product sales reached $24,388,272, up 60.5% from $15,190,063, resulting in a net income of $407,759 compared to a net loss of $2,140,297 previously. The company's total assets increased to $20,436,302 from $18,876,946 at December 28, 2024, driven by higher accounts receivable and inventories. Cash and cash equivalents slightly decreased to $3,234,142 from $3,280,687. Key business changes include the exercise of an option to extend its Norton facility lease until February 2028, and continued investment in property and equipment, with construction in progress increasing to $216,193 from $108,874.

Why It Matters

This strong financial rebound for CPS Technologies Corp. signals a potential turning point for investors, demonstrating effective operational improvements and increased demand for its advanced material solutions. The significant growth in product sales and return to profitability could attract new investment, potentially boosting the stock price (CPSH). For employees, this positive performance suggests greater job security and potential for future growth opportunities within the company. Customers benefit from a more stable and innovative supplier, especially in critical sectors like defense and power generation. In the broader market, CPSH's success in metal-matrix composites and lightweight armor highlights the increasing importance of specialized material science, potentially spurring further innovation and competition in the advanced materials industry.

Risk Assessment

Risk Level: medium — While CPSH shows strong revenue growth and profitability, its cash and cash equivalents decreased by $46,545 for the nine months ended September 27, 2025, and the company still holds an accumulated deficit of $25,482,486. This indicates that while current operations are improving, the company is still working to build a robust cash position and overcome historical losses, posing a medium-term liquidity and profitability risk.

Analyst Insight

Investors should consider initiating a position in CPSH, given the significant revenue growth of 107.3% in Q3 2025 and the swing to net income. Monitor future cash flow statements closely to ensure the company builds its cash reserves and continues to reduce its accumulated deficit, as sustained profitability is key for long-term value.

Financial Highlights

debt To Equity

0.35

revenue

$8,803,695

operating Margin

3.14%

total Assets

$20,436,302

total Debt

$5,303,854

net Income

$207,964

eps

$0.01

gross Margin

17.07%

cash Position

$3,234,142

revenue Growth

+107.3%

Revenue Breakdown

Key Numbers

• $8.8M — Product Sales (Q3 2025) (Increased 107.3% from $4.2M in Q3 2024)
• $207.9K — Net Income (Q3 2025) (Swung from a $1.0M net loss in Q3 2024)
• $24.4M — Product Sales (YTD 2025) (Increased 60.5% from $15.2M in YTD 2024)
• $407.7K — Net Income (YTD 2025) (Swung from a $2.1M net loss in YTD 2024)
• $1.5M — Gross Profit (Q3 2025) (Improved from a $523K gross loss in Q3 2024)
• $20.4M — Total Assets (Sept 27, 2025) (Increased from $18.9M at Dec 28, 2024)
• $3.2M — Cash and Cash Equivalents (Sept 27, 2025) (Slightly decreased from $3.3M at Dec 28, 2024)
• $0.01 — Basic EPS (Q3 2025) (Improved from $(0.07) in Q3 2024)
• $0.03 — Basic EPS (YTD 2025) (Improved from $(0.15) in YTD 2024)
• $25.5M — Accumulated Deficit (Sept 27, 2025) (Reduced from $25.9M at Dec 28, 2024)

Key Players & Entities

• CPS TECHNOLOGIES CORP/DE/ (company) — Registrant
• NASDAQ Capital Markets (regulator) — Exchange where common stock is registered
• Norton, MA (location) — Principal executive offices
• $8,803,695 (dollar_amount) — Product sales for three months ended September 27, 2025
• $4,247,116 (dollar_amount) — Product sales for three months ended September 28, 2024
• $207,964 (dollar_amount) — Net income for three months ended September 27, 2025
• $1,042,839 (dollar_amount) — Net loss for three months ended September 28, 2024
• $24,388,272 (dollar_amount) — Product sales for nine months ended September 27, 2025
• $15,190,063 (dollar_amount) — Product sales for nine months ended September 28, 2024
• $407,759 (dollar_amount) — Net income for nine months ended September 27, 2025

FAQ

Risk Factors

• Inventory Management [medium — operational]: Inventories increased to $5,383,680 from $4,331,066, indicating potential for obsolescence or holding costs if sales do not keep pace with production.
• Accumulated Deficit [medium — financial]: The company still carries an accumulated deficit of $25,482,486 as of September 27, 2025, although it has been reduced from $25,890,245 at December 28, 2024. This indicates a history of net losses.
• Lease Commitments [low — operational]: The company has extended its Norton facility lease until February 2028 and has a long-term lease liability of $209,000, increasing from $26,000. This represents ongoing financial obligations.
• Cash Position [low — financial]: Cash and cash equivalents slightly decreased to $3,234,142 from $3,280,687. While not a significant drop, it warrants monitoring given the operational improvements.

Industry Context

CPS Technologies operates in the advanced materials sector, focusing on metal-matrix composites (MMC) for industries like electronics, automotive, and defense. The demand for lightweight, high-performance materials is growing across these sectors, driven by trends in electrification, fuel efficiency, and enhanced protection requirements.

Regulatory Implications

As a publicly traded company, CPS Technologies must adhere to SEC reporting requirements, including timely filing of 10-Q and 10-K reports. Compliance with accounting standards (GAAP) is crucial for accurate financial reporting and investor confidence.

What Investors Should Do

1. Monitor inventory levels and turnover ratios.
2. Analyze the sustainability of revenue growth.
3. Track the reduction of the accumulated deficit.

Key Dates

• 2025-09-27: Quarterly Report Filing (10-Q) — Provides updated financial performance and position for Q3 2025, showing significant revenue and profit turnaround.
• 2024-12-28: Previous Fiscal Year End — Serves as a baseline for year-over-year comparisons of assets and liabilities.
• 2028-02-01: Norton Facility Lease Extension — Secures operational space for the company through February 2028, indicating a commitment to continued operations at this location.

Glossary

Metal-Matrix Composites (MMC)

A composite material composed of a metal matrix reinforced with ceramic particles or fibers, offering enhanced strength, stiffness, and wear resistance. (This is the company's primary advanced material solution, central to its product offerings.)

Accumulated Deficit

The cumulative net losses of a company that have not been offset by net income or other surplus accounts. (Indicates the company's historical profitability, though it is currently decreasing due to recent gains.)

Construction in Progress

Costs incurred for construction or development of fixed assets that are not yet completed and placed into service. (Shows ongoing investment in property and equipment, suggesting future capacity expansion or upgrades.)

Right-of-use lease asset

An asset representing the lessee's right to use an underlying leased asset for the lease term. (Reflects the company's adoption of lease accounting standards and its commitment to leased facilities.)

Year-Over-Year Comparison

CPS Technologies has demonstrated a significant financial turnaround compared to the prior year. Product sales for Q3 2025 surged by 107.3% to $8.8 million, and year-to-date sales increased by 60.5% to $24.4 million. This top-line growth has translated into profitability, with Q3 2025 reporting a net income of $207,964, a substantial improvement from a net loss of $1.0 million in Q3 2024. The gross profit also swung from a loss to a gain of $1.5 million. Total assets have grown to $20.4 million, primarily due to increases in accounts receivable and inventories, while cash reserves saw a slight decrease. The accumulated deficit has been reduced, reflecting the positive shift in operational performance.

Key Financial Figures

• $0.01 — nge on which registered Common Stock, $0.01 par value CPSH NASDAQ Capital Marke

Filing Documents

• cpsh20250927_10q.htm (10-Q) — 860KB
• ex_879354.htm (EX-31.1) — 6KB
• ex_879355.htm (EX-31.2) — 6KB
• ex_879356.htm (EX-32.1) — 3KB
• 0001437749-25-032553.txt ( ) — 4732KB
• cpsh-20250927.xsd (EX-101.SCH) — 39KB
• cpsh-20250927_cal.xml (EX-101.CAL) — 58KB
• cpsh-20250927_def.xml (EX-101.DEF) — 270KB
• cpsh-20250927_lab.xml (EX-101.LAB) — 224KB
• cpsh-20250927_pre.xml (EX-101.PRE) — 302KB
• cpsh20250927_10q_htm.xml (XML) — 737KB

FINANCIAL INFORMATION

PART I FINANCIAL INFORMATION

FINANCIAL STATEMENTS (Unaudited)

ITEM 1 FINANCIAL STATEMENTS (Unaudited) CPS TECHNOLOGIES CORP. Balance Sheets (Unaudited) September 27, 2025 December 28, 2024 ASSETS Current assets: Cash and cash equivalents $ 3,234,142 $ 3,280,687 Marketable securities, at fair value 1,054,079 1,031,001 Accounts receivable-trade 5,400,080 4,858,208 Accounts receivable-other 376,652 177,068 Inventories, net 5,383,680 4,331,066 Prepaid expenses and other current assets 328,249 480,986 Total current assets 15,776,882 14,159,016 Property and equipment: Production equipment 10,599,479 10,382,379 Furniture and office equipment 910,310 891,921 Leasehold improvements 997,830 997,830 Total cost 12,507,619 12,272,130 Accumulated depreciation and amortization ( 10,737,391 ) ( 10,377,756 ) Construction in progress 216,193 108,874 Net property and equipment 1,986,421 2,003,248 Net intangible assets 23,746 - Right-of-use lease asset 370,000 186,000 Deferred taxes, net 2,279,253 2,528,682 Total Assets $ 20,436,302 18,876,946 LIABILITIES AND STOCKHOLDERS' EQUITY Current liabilities: Note payable, current portion - 8,130 Accounts payable 3,530,052 3,053,712 Accrued expenses 1,298,268 913,279 Deferred revenue 74,257 172,429 Lease liability, current portion 161,000 160,000 Total current liabilities 5,063,577 4,307,550 Deferred revenue – long term 31,277 31,277 Long term lease liability 209,000 26,000 Total liabilities 5,303,854 4,364,827 Commitments & Contingencies Stockholders' equity: Common stock, $ 0.01 par value, authorized 20,000,000 shares; issued 14,666,987 and 14,661,487 shares; outstanding 14,529,277 and 14,525,960 shares at September 27, 2025 and December 28, 2024, respectively 146,670 146,615 Additional paid-in capital 40,809,151 40,580,387 Accumulated other comprehensive income 7,176 15,500 Accumulated deficit ( 25,482,486 ) ( 25,890,245 ) Les

Notes to Financial Statements

Notes to Financial Statements (Unaudited) ( 1 ) Nature of Business CPS Technologies Corporation (the "Company" or "CPS") provides advanced material solutions to the electronics, power generation, automotive, defense and other industries. The Company's primary advanced material solution is metal-matrix composites ("MMC") which are a combination of metal and ceramic. CPS also assembles housings and packages for hybrid circuits. These housings and packages may include components made of metal-matrix composites or they may include components made of more traditional materials such as aluminum. Using its proprietary MMC technology, the Company also produces light-weight armor, particularly for extreme environments and heavy threat levels. The Company also engages in research and development, in some cases government funded and in others internally funded, focused on developing new products in response to customer requirements. These products expand our offerings in existing markets and enable penetration into new markets. ( 2 ) Summary of Significant Accounting Policies As permitted by the rules of the Securities and Exchange Commission applicable to quarterly reports on Form 10 -Q, these notes are condensed and do not contain all disclosures required by generally accepted accounting principles. The accompanying financial statements are unaudited. In the opinion of management, the unaudited financial statements of CPS reflect all normal recurring adjustments which are necessary to present fairly the financial position and results of operations for such periods. The Company's balance sheet at December 28, 2024 has been derived from the audited financial statements at that date, but does not include all of the information and footnotes required by accounting principles generally accepted in the United States of America for complete financial statements. For further information, refer to the financial statements and footnotes thereto included in the Registra

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