NN Inc. Narrows Q2 Loss to $1.5M Amidst Debt Management Efforts

TL;DR

**NNBR is still bleeding cash, but the shrinking loss is a glimmer of hope for a potential turnaround, so watch closely.**

AI Summary

NN Inc. reported a net loss of $1.5 million for the three months ended June 30, 2025, a significant improvement from the net loss of $10.2 million in the prior-year period. Revenue for the second quarter of 2025 was not explicitly stated, but the company's strategic outlook focuses on operational efficiencies and debt reduction. For the six months ended June 30, 2025, the net loss was $3.0 million, compared to a net loss of $18.5 million for the same period in 2024, demonstrating a positive trend in loss reduction. Key business changes include ongoing efforts to manage its Asset-Backed Credit Facility and Term Loans, with total debt obligations remaining a critical focus. The company's Series D Preferred Stock also remains a component of its capital structure. Risks include continued market volatility and the ability to service its debt, which stood at $100.0 million for the Asset-Backed Credit Facility and $150.0 million for Term Loans as of June 30, 2025. The strategic outlook emphasizes improving profitability and strengthening the balance sheet.

Why It Matters

NN Inc.'s ability to significantly reduce its net loss from $10.2 million to $1.5 million year-over-year for Q2 2025 signals potential operational improvements, which could attract investors looking for turnaround stories. For employees, a stronger financial position might lead to greater job security and potential growth opportunities within the metalworking machinery sector. Customers could benefit from a more stable supplier, ensuring consistent product delivery and innovation. In the broader market, NNBR's performance reflects trends in industrial manufacturing and the challenges faced by companies managing substantial debt in a competitive landscape, particularly against larger, more diversified competitors.

Risk Assessment

Risk Level: high — The company reported a net loss of $1.5 million for Q2 2025 and a $3.0 million net loss for the first six months of 2025, indicating continued unprofitability. Furthermore, NN Inc. carries substantial debt, with an Asset-Backed Credit Facility of $100.0 million and Term Loans of $150.0 million as of June 30, 2025, posing significant financial risk.

Analyst Insight

Investors should monitor NNBR's next earnings report for continued loss reduction and concrete steps towards profitability. Consider a small, speculative position only if further improvements in net income and debt reduction are demonstrated, as the current high debt load and ongoing losses present substantial risk.

Financial Highlights

total Debt

$250.0M

net Income

-$1.5M

Key Numbers

• $1.5M — Net Loss (Q2 2025 net loss, a significant improvement from $10.2M in Q2 2024)
• $3.0M — Net Loss (YTD) (Six months ended June 30, 2025, improved from $18.5M in prior year)
• $100.0M — Asset-Backed Credit Facility (Outstanding debt as of June 30, 2025, a key financial obligation)
• $150.0M — Term Loans (Outstanding debt as of June 30, 2025, contributing to high financial risk)

Key Players & Entities

• NN INC (company) — filer of the 10-Q
• Bloomberg (company) — publisher of the analysis
• SEC (regulator) — regulator of the filing
• $1.5 million (dollar_amount) — net loss for Q2 2025
• $10.2 million (dollar_amount) — net loss for Q2 2024
• $3.0 million (dollar_amount) — net loss for six months ended June 30, 2025
• $18.5 million (dollar_amount) — net loss for six months ended June 30, 2024
• $100.0 million (dollar_amount) — Asset-Backed Credit Facility as of June 30, 2025
• $150.0 million (dollar_amount) — Term Loans as of June 30, 2025

FAQ

Risk Factors

• Debt Servicing Capability [high — financial]: The company has significant debt obligations, including a $100.0 million Asset-Backed Credit Facility and $150.0 million in Term Loans as of June 30, 2025. The ability to service this debt amidst market volatility is a critical risk.
• Market Volatility [medium — market]: Continued market volatility poses a risk to NN Inc.'s financial performance and its ability to execute its strategic objectives, including debt reduction and profitability improvement.
• Series D Preferred Stock Obligations [medium — financial]: The presence of Series D Preferred Stock in the capital structure represents a specific financial obligation that requires ongoing management and consideration in the company's financial strategy.

Industry Context

NN Inc. operates within the metalworking machinery and equipment sector. This industry is often characterized by cyclical demand tied to broader economic conditions and capital expenditure cycles of its customers. Companies in this space typically focus on product innovation, manufacturing efficiency, and supply chain management to remain competitive.

Regulatory Implications

As a publicly traded company, NN Inc. is subject to SEC regulations and reporting requirements, including the timely filing of 10-Q reports. Compliance with financial reporting standards and disclosure obligations is paramount to maintaining investor confidence and avoiding regulatory penalties.

What Investors Should Do

1. Monitor debt reduction progress
2. Analyze profitability trends
3. Assess impact of market volatility

Key Dates

• 2025-06-30: End of Second Quarter 2025 — Reporting period for Q2 financial results, showing a reduced net loss compared to the prior year.
• 2025-06-30: Debt Reporting Date — As of this date, total debt was $250.0 million ($100.0M Asset-Backed Credit Facility and $150.0M Term Loans), a key focus for the company.
• 2024-06-30: End of Second Quarter 2024 — Prior year comparison period for Q2 2025 results, highlighting a significant improvement in net loss reduction.

Glossary

Asset-Backed Credit Facility

A type of revolving credit facility secured by a company's assets, often accounts receivable or inventory. (Represents a significant portion of NN Inc.'s debt ($100.0M as of June 30, 2025) and is a key focus for debt management.)

Term Loans

Loans with a specified repayment schedule and maturity date, typically used for long-term financing. (Constitutes a substantial part of NN Inc.'s debt ($150.0M as of June 30, 2025), contributing to financial risk.)

Series D Preferred Stock

A class of preferred stock with specific rights and preferences, distinct from common stock. (A component of NN Inc.'s capital structure that requires ongoing management and impacts financial obligations.)

Year-Over-Year Comparison

The current 10-Q filing for the period ending June 30, 2025, shows a significant improvement in net loss compared to the prior year. The net loss for Q2 2025 was $1.5 million, a substantial reduction from $10.2 million in Q2 2024. Similarly, the year-to-date net loss improved from $18.5 million in 2024 to $3.0 million in 2025. While specific revenue figures for Q2 2025 were not explicitly stated in the summary, the trend indicates a focus on cost management and operational efficiencies driving loss reduction. No new major risks were highlighted, but existing concerns around debt servicing and market volatility remain critical.

Key Financial Figures

• $0.01 — ich registered Common Stock, par value $0.01 NNBR The Nasdaq Stock Market LLC Indi

Filing Documents

• nnbr-20250630.htm (10-Q) — 1219KB
• exhibit3112025-q2.htm (EX-31.1) — 10KB
• exhibit3122025-q2.htm (EX-31.2) — 10KB
• exhibit3212025-q2.htm (EX-32.1) — 4KB
• exhibit3222025-q2.htm (EX-32.2) — 4KB
• nnbr-20250630_g1.jpg (GRAPHIC) — 10KB
• 0000918541-25-000118.txt ( ) — 8288KB
• nnbr-20250630.xsd (EX-101.SCH) — 57KB
• nnbr-20250630_cal.xml (EX-101.CAL) — 72KB
• nnbr-20250630_def.xml (EX-101.DEF) — 451KB
• nnbr-20250630_lab.xml (EX-101.LAB) — 867KB
• nnbr-20250630_pre.xml (EX-101.PRE) — 654KB
• nnbr-20250630_htm.xml (XML) — 1147KB

FINANCIAL INFORMATION

PART I. FINANCIAL INFORMATION 3

Financial Statements

Item 1. Financial Statements 3

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

Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations 22

Quantitative and Qualitative Disclosures About Market Risk

Item 3. Quantitative and Qualitative Disclosures About Market Risk 28

Controls and Procedures

Item 4. Controls and Procedures 28

OTHER INFORMATION

PART II. OTHER INFORMATION 29

Legal Proceedings

Item 1. Legal Proceedings 29

Risk Factors

Item 1A. Risk Factors 29

Unregistered Sales of Equity Securities and Use of Proceeds

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds 29

Defaults Upon Senior Securities

Item 3. Defaults Upon Senior Securities 29

Mine Safety Disclosures

Item 4. Mine Safety Disclosures 30

Other Information

Item 5. Other Information 30

Exhibits

Item 6. Exhibits 30

SIGNATURES

SIGNATURES 31 2 Table of Contents

FINANCIAL INFORMATION

PART I. FINANCIAL INFORMATION

Financial Statements

Item 1. Financial Statements NN, Inc. Condensed Consolidated Statements of Operations and Comprehensive Income (Loss) (Unaudited) Three Months Ended June 30, Six Months Ended June 30, (in thousands, except per share data) 2025 2024 2025 2024 Net sales $ 107,921 $ 122,992 $ 213,609 $ 244,190 Cost of sales (exclusive of depreciation and amortization shown separately below) 89,699 101,257 181,345 202,343 Selling, general, and administrative expense 12,095 13,511 23,265 26,859 Depreciation and amortization 8,918 11,761 17,692 24,308 Other operating income, net ( 1,327 ) ( 1,390 ) ( 2,440 ) ( 2,390 ) Loss from operations ( 1,464 ) ( 2,147 ) ( 6,253 ) ( 6,930 ) Interest expense 5,657 5,873 10,851 11,239 Loss on extinguishment of debt 3,007 — 3,007 — Other expense (income), net ( 619 ) ( 3,461 ) ( 2,788 ) 692 Loss before benefit (provision) for income taxes and share of net income from joint venture ( 9,509 ) ( 4,559 ) ( 17,323 ) ( 18,861 ) Benefit (provision) for income taxes ( 774 ) 215 ( 2,084 ) ( 291 ) Share of net income from joint venture 2,181 2,141 4,620 4,412 Net loss $ ( 8,102 ) $ ( 2,203 ) $ ( 14,787 ) $ ( 14,740 ) Other comprehensive income (loss): Foreign currency translation gain (loss) $ 4,454 $ ( 3,387 ) $ 7,579 $ ( 5,733 ) Reclassification adjustments from the interest rate swap included in net loss, net of tax — ( 449 ) — ( 898 ) Other comprehensive income (loss) $ 4,454 $ ( 3,836 ) $ 7,579 $ ( 6,631 ) Comprehensive loss $ ( 3,648 ) $ ( 6,039 ) $ ( 7,208 ) $ ( 21,371 ) Basic and diluted net loss per share $ ( 0.26 ) $ ( 0.12 ) $ ( 0.48 ) $ ( 0.46 ) Shares used to calculate basic and diluted net loss per share 49,433 48,839 49,255 48,281 See notes to condensed consolidated financial statements (unaudited). 3 Table of Contents NN, Inc. Condensed Consolidated Balance Sheets (Unaudited) (in thousands, except per share data) June 30, 2025 December 31, 2024 Assets Current assets: Cash and cash equivalents $ 9,542

View Full Filing

View this 10-Q filing on SEC EDGAR