Kopin's Q2 Revenue Plunges 34.5% Amid Product & R&D Declines

TL;DR

**Kopin's Q2 numbers are a disaster, showing deep revenue cuts across the board; stay away until they prove they can sell something.**

AI Summary

Kopin Corp (KOPN) reported a significant decline in net product revenues for the three months ended June 28, 2025, falling to $3.5 million from $5.2 million in the prior-year quarter, representing a 32.7% decrease. Research and development revenues also saw a substantial drop, decreasing to $1.9 million from $3.1 million, a 38.7% reduction. License and other revenues remained flat at $0.1 million for both periods. For the six months ended June 28, 2025, net product revenues were $7.2 million, down from $10.5 million, a 31.4% decrease, while R&D revenues were $3.9 million, down from $6.1 million, a 36.1% decrease. The company's overall revenue performance indicates a challenging period, with total revenues for the three months ended June 28, 2025, at $5.5 million compared to $8.4 million in the same period last year. The filing highlights a continued net loss, with retained earnings showing a deficit of $682.0 million as of June 28, 2025, compared to $677.8 million as of December 28, 2024, indicating ongoing operational losses. The strategic outlook remains focused on its core display technologies, but the financial results suggest a need for improved market penetration or cost efficiencies to reverse the negative trends.

Why It Matters

Kopin's substantial revenue decline, with product revenues down 32.7% and R&D revenues down 38.7% year-over-year, signals significant headwinds for investors. This performance raises concerns about the company's ability to commercialize its advanced display technologies and compete effectively in the highly competitive microdisplay market against larger players like Sony and eMagin. For employees, continued losses and declining revenue could lead to job insecurity or reduced investment in future projects. Customers might see slower innovation or less robust product development if financial constraints persist. The broader market for AR/VR and defense applications, where Kopin operates, could be impacted by a struggling key component supplier, potentially slowing the adoption of new technologies.

Risk Assessment

Risk Level: high — The risk level is high due to significant and consistent revenue declines across all segments. Net product revenues decreased by 32.7% to $3.5 million for the quarter, and research and development revenues dropped by 38.7% to $1.9 million. The accumulated deficit in retained earnings grew from $677.8 million to $682.0 million within six months, indicating ongoing operational losses and a lack of profitability.

Analyst Insight

Investors should exercise extreme caution and consider divesting KOPN shares given the substantial and consistent revenue declines. The company's inability to stem losses and grow its core business segments suggests a challenging path to profitability, making it a high-risk investment.

Financial Highlights

debt To Equity

Not Disclosed

revenue

$5.5M

operating Margin

Not Disclosed

total Assets

Not Disclosed

total Debt

Not Disclosed

net Income

Not Disclosed

eps

Not Disclosed

gross Margin

Not Disclosed

cash Position

Not Disclosed

revenue Growth

-34.5%

Revenue Breakdown

Key Numbers

• $3.5M — Net Product Revenues (Q2 2025) (Decreased 32.7% from $5.2M in Q2 2024)
• $1.9M — R&D Revenues (Q2 2025) (Decreased 38.7% from $3.1M in Q2 2024)
• $5.5M — Total Revenues (Q2 2025) (Decreased from $8.4M in Q2 2024)
• $682.0M — Accumulated Deficit (June 28, 2025) (Increased from $677.8M as of December 28, 2024, indicating ongoing losses)
• 32.7% — Product Revenue Decline (Q2 YoY) (Significant drop in core business revenue)
• 38.7% — R&D Revenue Decline (Q2 YoY) (Indicates reduced external funding or project activity)

Key Players & Entities

• KOPIN CORP (company) — filer of the 10-Q
• $3.5 million (dollar_amount) — net product revenues for Q2 2025
• $5.2 million (dollar_amount) — net product revenues for Q2 2024
• $1.9 million (dollar_amount) — research and development revenues for Q2 2025
• $3.1 million (dollar_amount) — research and development revenues for Q2 2024
• $0.1 million (dollar_amount) — license and other revenues for Q2 2025 and Q2 2024
• $682.0 million (dollar_amount) — accumulated deficit in retained earnings as of June 28, 2025
• $677.8 million (dollar_amount) — accumulated deficit in retained earnings as of December 28, 2024
• 32.7% (percentage) — decrease in net product revenues year-over-year for Q2
• 38.7% (percentage) — decrease in research and development revenues year-over-year for Q2

FAQ

Risk Factors

• Persistent Net Losses and Accumulated Deficit [high — financial]: The company continues to report net losses, with its accumulated deficit increasing from $677.8 million as of December 28, 2024, to $682.0 million as of June 28, 2025. This trend indicates ongoing operational challenges and a need for improved profitability.
• Declining Product Revenues [high — market]: Net product revenues for the three months ended June 28, 2025, fell by 32.7% to $3.5 million from $5.2 million in the prior year. This significant drop in the core business revenue signals potential issues with market penetration or product demand.
• Reduced R&D Revenue [medium — market]: Research and development revenues decreased by 38.7% to $1.9 million for the quarter. This could suggest a slowdown in innovation, reduced customer engagement in R&D projects, or a shift in strategic focus away from externally funded research.
• Dependence on Key Technologies [medium — operational]: While the company's strategic outlook focuses on core display technologies, the current financial performance suggests that market adoption or competitive pressures may be hindering revenue growth. Success is heavily reliant on the market acceptance of these specialized technologies.

Industry Context

Kopin Corp operates in the semiconductor industry, specifically focusing on advanced display technologies. This sector is characterized by rapid technological advancements, high R&D investment, and intense competition from both established players and emerging companies. Market demand is often driven by innovation in consumer electronics, automotive, and defense sectors.

Regulatory Implications

As a publicly traded company, Kopin Corp is subject to SEC regulations and reporting requirements, including timely filing of 10-Q and 10-K reports. Compliance with accounting standards (GAAP) and disclosure rules is critical to maintain investor confidence and avoid penalties.

What Investors Should Do

1. Monitor future 10-Q filings for any signs of revenue stabilization or recovery in product sales.
2. Analyze management's commentary for strategies to address the declining revenues and persistent net losses.
3. Evaluate the company's cash burn rate and runway given the ongoing operational losses.
4. Assess the competitive landscape and Kopin's ability to differentiate its specialized display technologies in the market.

Key Dates

• 2025-06-28: Quarter End Date for 10-Q Filing — Represents the period for which financial results are reported, showing significant revenue declines and an increased accumulated deficit.
• 2025-08-12: Filing Date of 10-Q — Indicates the official release of the company's financial performance and disclosures for the period ending June 28, 2025.
• 2024-12-28: Prior Fiscal Year End — Provides a comparison point for the accumulated deficit, which stood at $677.8 million, highlighting the continued losses in the subsequent period.

Glossary

Accumulated Deficit

The cumulative net losses of a company that have not been offset by net profits. It represents a negative balance in retained earnings. (Indicates that Kopin Corp has consistently incurred losses over its operating history, with the deficit widening in the reported period.)

Net Product Revenues

Revenue generated from the sale of the company's manufactured products. (Represents the core business performance of Kopin Corp, which has seen a significant year-over-year decline.)

R&D Revenues

Revenue generated from research and development activities, often from contracts or collaborations with other entities. (A key indicator of external engagement in the company's technological development, which has also decreased substantially.)

Year-Over-Year Comparison

Compared to the previous reporting period, Kopin Corp's 10-Q filing for the quarter ended June 28, 2025, reveals a significant downturn in financial performance. Total revenues have decreased from $8.4 million in the prior year's quarter to $5.5 million, driven by substantial declines in both net product revenues (down 32.7%) and R&D revenues (down 38.7%). The accumulated deficit has also widened, indicating continued net losses and a worsening financial position year-over-year.

Key Financial Figures

• $0.01 K — ch registered Common Stock, par value $0.01 KOPN Nasdaq Capital Market Indicate

Filing Documents

• form10-q.htm (10-Q) — 1020KB
• ex31-1.htm (EX-31.1) — 21KB
• ex31-2.htm (EX-31.2) — 21KB
• ex32-1.htm (EX-32.1) — 8KB
• ex32-2.htm (EX-32.2) — 8KB
• 0001493152-25-011854.txt ( ) — 5815KB
• kopn-20250628.xsd (EX-101.SCH) — 43KB
• kopn-20250628_cal.xml (EX-101.CAL) — 68KB
• kopn-20250628_def.xml (EX-101.DEF) — 154KB
• kopn-20250628_lab.xml (EX-101.LAB) — 370KB
• kopn-20250628_pre.xml (EX-101.PRE) — 290KB
• form10-q_htm.xml (XML) — 925KB

– Financial Information

Part I – Financial Information Item 1. Condensed Consolidated Financial Statements (Unaudited) 3 Condensed Consolidated Balance Sheets at June 28, 2025 (Unaudited) and December 28, 2024 3 Condensed Consolidated Statements of Operations (Unaudited) for the three and six months ended June 28, 2025 and June 29, 2024 4 Condensed Consolidated Statements of Comprehensive Loss (Unaudited) for the three and six months ended June 28, 2025 and June 29, 2024 5 Condensed Consolidated Statements of Stockholders' Equity (Unaudited) for the three and six months ended June 28, 2025 and June 29, 2024 6 Condensed Consolidated Statements of Cash Flows (Unaudited) for the six months ended June 28, 2025 and June 29, 2024 7 Notes to Unaudited Condensed Consolidated Financial Statements 8 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 20 Item 3.

Quantitative and Qualitative Disclosures About Market Risk

Quantitative and Qualitative Disclosures About Market Risk 25 Item 4.

Controls and Procedures

Controls and Procedures 25

– Other Information

Part II – Other Information Item 1.

Legal Proceedings

Legal Proceedings 26 Item 1A.

Risk Factors

Risk Factors 27 Item 2. Unregistered Sales of Equity Securities and Use of Proceeds 27 Item 6. Exhibits 27

Signatures

Signatures 28 2 Part 1. FINANCIAL INFORMATION Item 1. Condensed Consolidated Financial Statements (Unaudited) KOPIN CORPORATION CONDENSED CONSOLIDATED BALANCE SHEETS June 28, 2025 December 28, 2024 (unaudited) ASSETS Current assets: Cash and cash equivalents $ 24,369,310 $ 14,160,120 Restricted cash 1,050,000 1,050,000 Marketable securities, at fair value 2,417,877 21,419,658 Accounts receivable, net of allowance of $ 1,024,000 and $ 1,075,000 in 2025 and 2024, respectively 9,481,332 11,850,654 Contract assets 6,840,887 7,074,020 Inventory 6,685,225 6,134,096 Prepaid expenses and other current assets 1,795,521 1,153,852 Total current assets 52,640,152 62,842,400 Property, plant and equipment, net 2,684,545 2,099,708 Operating lease right-of-use assets 2,212,679 2,134,898 Other assets 123,822 123,822 Equity investments 3,523,632 3,564,938 Total assets $ 61,184,830 $ 70,765,766 LIABILITIES AND STOCKHOLDERS' EQUITY Current liabilities: Accounts payable $ 4,129,863 $ 5,941,470 Accrued payroll and expenses 2,345,847 2,409,468 Accrued warranty 2,016,000 2,557,000 Contract liabilities 275,053 87,752 Operating lease liabilities 765,559 639,642 Accrued post-retirement benefits 40,000 40,000 Other accrued liabilities 648,287 685,946 Accrued legal expenses 5,961,506 6,367,900 Deferred tax liabilities 447,498 414,118 Accrued litigation damages 24,800,000 24,800,000 Total current liabilities 41,429,613 43,943,296 Noncurrent contract liabilities and asset retirement obligations 388,240 358,292 Operating lease liabilities, net of current portion 1,436,276 1,479,976 Accrued post-retirement benefits, net of current portion 190,646 230,646 Other long-term liabilities, net of current portion 1,700,221 1,471,994 Total liabilities 45,144,996 47,484,204 Commitments and contingencies (Note 13) and Litigation (Note 14) - - Stockholders' equity:

View Full Filing

View this 10-Q filing on SEC EDGAR