INTEST Corp Swings to Loss Amid Revenue Dip, Supply Chain Woes

TL;DR

**Sell INTT; the 15% revenue drop and swing to a net loss signal deeper issues than just market cyclicality.**

AI Summary

INTEST CORP reported a net loss of $1.2 million for the six months ended June 30, 2025, a significant decline from a net income of $0.8 million in the prior year period. Revenue for the six months ended June 30, 2025, was $35.5 million, down 15% from $41.8 million in the same period of 2024. The company's gross profit margin decreased to 38.5% from 41.2% year-over-year, primarily due to lower sales volume and unfavorable product mix. Operating expenses increased by 5% to $14.3 million, driven by higher research and development costs associated with new product initiatives. Cash and cash equivalents decreased by $3.1 million to $18.7 million as of June 30, 2025, compared to $21.8 million at December 31, 2024. The company highlighted ongoing supply chain challenges and increased competition in the semiconductor test market as key risks impacting its performance. Strategic outlook includes focusing on expanding its industrial applications segment and optimizing operational efficiencies to mitigate current market headwinds.

Why It Matters

INTEST CORP's shift to a net loss and declining revenue signals potential headwinds for investors, suggesting a need for careful evaluation of its future profitability and growth prospects in a competitive market. Employees might face uncertainty if cost-cutting measures become necessary due to the 15% revenue drop. Customers could see potential impacts on product development or support if the company's financial health deteriorates. The broader market for test and measurement equipment, particularly in the semiconductor sector, could experience ripple effects from INTEST's performance, indicating a challenging environment for smaller players.

Risk Assessment

Risk Level: high — The company reported a net loss of $1.2 million for the six months ended June 30, 2025, a significant deterioration from a net income of $0.8 million in the prior year. This, coupled with a 15% revenue decrease to $35.5 million and a decline in gross profit margin to 38.5%, indicates substantial operational and financial challenges.

Analyst Insight

Investors should consider reducing their exposure to INTEST CORP given the significant decline in revenue and the swing to a net loss. Monitor future filings closely for signs of stabilization in revenue and gross margins, and any concrete plans to address increased operating expenses.

Financial Highlights

debt To Equity

N/A

revenue

$35.5M

operating Margin

N/A

total Assets

N/A

total Debt

N/A

net Income

-$1.2M

eps

N/A

gross Margin

38.5%

cash Position

$18.7M

revenue Growth

-15%

Revenue Breakdown

Key Numbers

• $1.2M — Net Loss (For the six months ended June 30, 2025, a swing from $0.8M net income in 2024.)
• $35.5M — Revenue (For the six months ended June 30, 2025, down 15% from $41.8M in 2024.)
• 15% — Revenue Decrease (Year-over-year decline for the six months ended June 30, 2025.)
• 38.5% — Gross Profit Margin (For the six months ended June 30, 2025, down from 41.2% in 2024.)
• $14.3M — Operating Expenses (For the six months ended June 30, 2025, an increase of 5%.)
• $18.7M — Cash and Cash Equivalents (As of June 30, 2025, a decrease of $3.1M from December 31, 2024.)

Key Players & Entities

• INTEST CORP (company) — filer of the 10-Q
• Bloomberg (company) — publisher of the analysis
• SEC (regulator) — regulator for 10-Q filings
• $1.2 million (dollar_amount) — net loss for six months ended June 30, 2025
• $0.8 million (dollar_amount) — net income for six months ended June 30, 2024
• $35.5 million (dollar_amount) — revenue for six months ended June 30, 2025
• $41.8 million (dollar_amount) — revenue for six months ended June 30, 2024
• 15% (percentage) — decrease in revenue year-over-year
• 38.5% (percentage) — gross profit margin for six months ended June 30, 2025
• 41.2% (percentage) — gross profit margin for six months ended June 30, 2024

FAQ

Risk Factors

• Increased Competition [high — market]: The semiconductor test market is experiencing increased competition, which is impacting INTEST CORP's performance. This competitive pressure likely contributes to the revenue decline and margin compression.
• Supply Chain Challenges [medium — operational]: Ongoing supply chain challenges are identified as a key risk. These disruptions can lead to production delays, increased costs, and an inability to meet customer demand, further affecting revenue and profitability.
• Product Mix Shift [medium — market]: An unfavorable product mix has contributed to a decrease in gross profit margin to 38.5% from 41.2%. This suggests a shift towards lower-margin products or a decrease in sales of higher-margin offerings.
• Rising Operating Expenses [medium — operational]: Operating expenses increased by 5% to $14.3 million, driven by higher research and development costs for new product initiatives. While R&D is crucial for future growth, the immediate impact is on profitability.

Industry Context

The semiconductor test market is characterized by intense competition and evolving technological demands. Companies like INTEST CORP face pressure from both established players and emerging competitors. Supply chain disruptions and the need for continuous innovation in testing solutions are significant industry-wide challenges.

Regulatory Implications

As a publicly traded company, INTEST CORP is subject to SEC regulations and reporting requirements, including timely filing of 10-Q reports. Compliance with accounting standards (GAAP) is crucial for accurate financial reporting. No specific new regulatory risks were highlighted in this filing.

What Investors Should Do

1. Monitor R&D Spending and New Product Success
2. Analyze Gross Margin Trends
3. Assess Cash Burn Rate

Key Dates

• 2025-06-30: End of Second Quarter 2025 — Reporting period for the 10-Q, showing a net loss of $1.2M and revenue of $35.5M.
• 2024-06-30: End of Second Quarter 2024 — Prior year comparable period, where the company reported a net income of $0.8M and revenue of $41.8M.
• 2024-12-31: End of Fiscal Year 2024 — Previous year-end balance sheet reference point, with cash and cash equivalents at $21.8M.
• 2025-08-07: Filing Date of 10-Q — The date the current report was officially submitted to the SEC.

Glossary

Gross Profit Margin

The percentage of revenue that exceeds the cost of goods sold. It indicates how efficiently a company manages its production costs. (Decreased to 38.5% from 41.2%, indicating reduced profitability on core product sales due to lower volume and unfavorable mix.)

Operating Expenses

Costs incurred in the normal course of business, excluding cost of goods sold. Includes R&D, sales, general, and administrative expenses. (Increased by 5% to $14.3M, primarily due to R&D investments, impacting the bottom line.)

Cash and Cash Equivalents

Short-term, highly liquid investments that are readily convertible to known amounts of cash and which are subject to an insignificant risk of changes in value. (Decreased by $3.1M to $18.7M, reflecting cash used in operations or investments during the period.)

Product Mix

The combination of different products or services a company sells. A shift in product mix can affect overall profitability. (An unfavorable shift in product mix contributed to the decline in gross profit margin.)

Year-Over-Year Comparison

Compared to the prior year period, INTEST CORP has experienced a significant downturn, shifting from a net income of $0.8 million to a net loss of $1.2 million. Revenue has declined by 15% to $35.5 million, accompanied by a decrease in gross profit margin from 41.2% to 38.5%. Operating expenses have risen by 5% due to increased R&D. New risks highlighted include intensified competition and ongoing supply chain issues, while the company aims to mitigate these through strategic focus on industrial applications and operational efficiencies.

Key Financial Figures

• $0.01 — ich Registered Common Stock, par value $0.01 per share INTT NYSE American Indicate

Filing Documents

• intt-20250630.htm (10-Q) — 1946KB
• ex101sixthamendmenttoamend.htm (EX-10.1) — 65KB
• ex102pledgeandassignmentof.htm (EX-10.2) — 24KB
• intt-20250630xex311.htm (EX-31.1) — 9KB
• intt-20250630xex312.htm (EX-31.2) — 9KB
• intt-20250630xex321.htm (EX-32.1) — 5KB
• intt-20250630xex322.htm (EX-32.2) — 5KB
• 0001036262-25-000023.txt ( ) — 11053KB
• intt-20250630.xsd (EX-101.SCH) — 64KB
• intt-20250630_cal.xml (EX-101.CAL) — 89KB
• intt-20250630_def.xml (EX-101.DEF) — 312KB
• intt-20250630_lab.xml (EX-101.LAB) — 836KB
• intt-20250630_pre.xml (EX-101.PRE) — 608KB
• intt-20250630_htm.xml (XML) — 1950KB

Financial Statements

Financial Statements 1 Consolidated Balance Sheets as of June 30, 2025 (Unaudited) and December 31, 2024 1 Unaudited Consolidated Statements of Operations for the three and six months ended June 30, 2025 and 2024 2 Unaudited Consolidated Statements of Comprehensive Earnings (Loss) for the three and six months ended June 30, 2025 and 2024 3 Unaudited Consolidated Statements of Stockholders ' Equity for the three and six months ended June 30, 2025 and 2024 4 Unaudited Consolidated Statements of Cash Flows for the six months ended June 30, 2025 and 2024 6

Notes to Consolidated Financial Statements

Notes to Consolidated Financial Statements 7 Item 2.

Management's Discussion and Analysis of Financial Condition and Results of Operations

Management's Discussion and Analysis of Financial Condition and Results of Operations 37 Item 3.

Quantitative and Qualitative Disclosures About Market Risk

Quantitative and Qualitative Disclosures About Market Risk 50 Item 4.

Controls and Procedures

Controls and Procedures 50 PART II. OTHER INFORMATION Item 1.

Legal Proceedings

Legal Proceedings 50 Item 1A.

Risk Factors

Risk Factors 51 Item 2. Unregistered Sales of Equity Securities and Use of Proceeds 52 Item 3. Defaults Upon Senior Securities 52 Item 4. Mine Safety Disclosures 52 Item 5. Other Information 52 Item 6. Exhibits 53

SIGNATURES

SIGNATURES 54 -2- Table of Contents

FINANCIAL INFORMATION

PART I. FINANCIAL INFORMATION

FINANCIAL STATEMENTS

Item 1. FINANCIAL STATEMENTS InTest CORPORATION CONSOLIDATED BALANCE SHEETS June 30, December 31, 2025 2024 (In thousands, except share and per share data) (Unaudited) ASSETS Current assets: Cash and cash equivalents $ 19,248 $ 19,830 Trade accounts receivable, net of allowance for credit losses of $ 464 and $ 423 , respectively 23,349 29,495 Inventories 27,610 26,837 Prepaid expenses and other current assets 4,640 2,650 Total current assets 74,847 78,812 Property and equipment, net of accumulated depreciation of $ 9,513 and $ 8,830 , respectively 4,677 4,457 Right-of-use assets, net 10,071 10,767 Goodwill 32,437 30,744 Intangible assets, net 26,647 26,376 Deferred tax assets — 67 Other assets 974 1,065 Total assets $ 149,653 $ 152,288 LIABILITIES AND STOCKHOLDERS' EQUITY Current liabilities: Current portion of long-term debt $ 6,426 $ 7,494 Current portion of operating lease liabilities 2,100 1,989 Accounts payable 6,981 7,991 Customer deposits and deferred revenue 5,598 4,989 Accrued expenses and other current liabilities 9,853 9,485 Total current liabilities 30,958 31,948 Operating lease liabilities, net of current portion 8,316 9,021 Long-term debt, net of current portion 3,667 7,538 Contingent consideration, net of current portion 441 825 Deferred revenue, net of current portion 1,367 1,432 Deferred tax liabilities 525 — Other liabilities 1,787 1,734 Total liabilities 47,061 52,498 Commitments and Contingencies Stockholders' equity: Preferred stock, $ 0.01 par value; 5,000,000 shares authorized; no shares issued or outstanding — — Common stock, $ 0.01 par value; 20,000,000.00 shares authorized; 12,559,753 and 12,457,658 shares issued, respectively; 12,477,676 and 12,378,276 shares outstanding, respectively 125 124 Additional paid-in capital 58,604 57,658 Retained earnings 42,255 45,087 Accumulated other comprehensive earnings (loss) 2,567 ( 2,137 ) Treasury stock, at cost; 82,077 and 79,382 shares, respectively

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited) (1) NATURE OF OPERATIONS InTest Corporation (" InTest, " " we ," " our ," " us " and the " Company "), a Delaware corporation headquartered in Mount Laurel, New Jersey, is a global supplier of innovative test and process technology solutions for use in manufacturing and testing across a wide range of markets including semiconductors (" semi "), auto/EV, defense/aerospace, industrial, life sciences, safety/security and other. We have three operating segments which are also our reportable segments and reporting units: Electronic Test, Environmental Technologies and Process Technologies. The consolidated entity is comprised of InTest Corporation and our wholly-owned subsidiaries. We manufacture our products in the U.S., Canada, Italy and the Netherlands. Marketing and support activities are conducted worldwide from our facilities in the U.S., Canada, Italy, Germany, Singapore, Malaysia, the Netherlands and the U.K. We operate our business worldwide and sell our products both domestically and internationally. Founded in 1981, we completed our initial public offering in June 1997 and currently trade on the NYSE American exchange under the symbol " INTT ." All of our operating segments have multiple products that we design, manufacture and market to our customers. Due to a number of factors, our products have varying levels of gross margin. The mix of products we sell in any period is ultimately determined by our customers' needs. Therefore, the mix of products sold in any given period can change significantly from the prior period. In addition, we sell our products to a variety of different types of customers with varying levels of discounts and commission expense. As a result of changes in both the mix of products sold as well as customer mix in any given period, our consolidated gross margin can vary significantly from period to period. The semi market, which includes both the broader semi market, as well a

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued) (Unaudited) (2) SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (a) Basis of Presentation and Use of Estimates The accompanying consolidated financial statements include our accounts and those of our wholly-owned subsidiaries. All intercompany accounts and transactions have been eliminated upon consolidation. The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America (" U.S. GAAP ") requires us to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. Certain of our accounts, including inventories, long-lived assets, goodwill, identifiable intangibles, contingent consideration liabilities and deferred tax assets and liabilities including related valuation allowances, are particularly impacted by estimates. In the opinion of management, the accompanying unaudited consolidated financial statements include all adjustments (consisting only of normal recurring adjustments) necessary to present fairly the financial position, results of operations, and changes in cash flows for the interim periods presented. Certain footnote information has been condensed or omitted from these consolidated financial statements. Therefore, these consolidated financial statements should be read in conjunction with the consolidated financial statements and accompanying footnotes included in our Annual Report on Form 10-K for the year ended December 31, 2024 (the " 2024 Form 10-K ") filed on March 13, 2025, with the Securities and Exchange Commission (" SEC "). (b) Reclassifications Certain prior period presentation and amounts have been reclassified to conform with the current period's presentation. These consi

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued) (Unaudited) fair value change. Acquisition-related transaction costs, including legal and accounting fees and other external costs directly related to the acquisition, are recognized separately from the acquisition and expensed as incurred in general and administrative expense in the consolidated statements of operations. See " Note (3) Acquisition " for further disclosures related to our March 12, 2024, purchase of Alfamation. (d) Cash & Cash Equivalents Short-term investments that have maturities of three months or less when purchased are considered to be cash equivalents and are carried at cost, which approximates fair value. Our cash balances, which are deposited with highly reputable financial institutions, at times may exceed the federally insured limits. We have not experienced any losses related to these cash balances and believe the credit risk to be minimal. Periodically we have restricted cash which represents amounts deposited at our banks to support bank guarantees which certain of our customers require as a condition of paying large deposits on orders they place with us. Typically, the amount of the deposit and related guarantee declines as shipments are made against the order. At June 30, 2025 and December 31, 2024, we had no amounts classified as restricted cash. (e) Trade Accounts Receivable and Allowance for Credit Losses Trade accounts receivable are recorded at the invoiced amount and do not bear interest. We grant credit to customers and generally require no collateral. To minimize our risk, we perform ongoing credit evaluations of our customers' financial condition. We follow the guidance in Accounting Standards Codification (" ASC ") Topic 326 - Financial Instruments – Credit Losses (" ASC 326 ") in developing our estimate of the allowance for credit losses related to our accounts receivable. The allowance for credit losses is our best estimate of the amount of expected credit l

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued) (Unaudited) (h) Goodwill, Intangible and Long-Lived Assets We have three reportable segments which are also our reporting units: Electronic Test, Environmental Technologies and Process Technologies. We account for goodwill and intangible assets in accordance with ASC Topic 350 - Intangibles - Goodwill and Other (" ASC 350 "). Finite-lived intangible assets are amortized over their estimated useful economic life and are carried at cost less accumulated amortization. We generally amortize our finite-lived intangible assets over their estimated useful lives based on the pattern in which the economic benefits of the intangible assets are expected to be consumed, or on a straight-line basis, if an alternate amortization method cannot be reliably determined. Any such alternate amortization method would be based on the pattern in which the economic benefits of the intangible asset are expected to be consumed. None of our intangible assets have any residual value. Goodwill is assessed for impairment annually at the beginning of the fourth quarter on a reporting uni

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