Frequency Electronics (FEIM) Q4 2025 earnings summary

Executive summary

• Achieved highest quarterly revenue in 25 years, with Q4 FY25 at $20.0M and annual revenue at $69.8M, both up year-over-year, driven by accelerated program execution and strong growth in space and defense markets.

• Net income reached $23.8M ($2.48/share) for FY25, up from $5.6M ($0.59/share) year-over-year.

• Operating income rose to $11.7M for FY25, compared to $5.0M in FY24.

• Expanding customer base beyond traditional prime contractors, with active bids alongside next-generation defense companies.

• Management remains optimistic about medium- and long-term growth, despite cautioning against expecting similar near-term quarterly results.

Financial highlights

• Fiscal year 2025 revenue was $69.8M, up from $55.3M year-over-year.

• Gross margin for FY25 was $30.1M, up from $18.6M in FY24.

• R&D expenses increased to $6.1M in FY25 from $3.4M in FY24.

• Fully funded backlog at year-end was $70M, down from $78M.

• Net cash used in operating activities was $1.4M in FY25, compared to $8.7M provided in FY24.

Outlook and guidance

• No formal guidance provided due to contract award lumpiness, but medium- and long-term growth is expected, driven by space and defense market trends.

• Short-term results may not match the exceptional Q4 FY25 due to timing of program execution.

• R&D investment expected to remain at or above historical levels to support growth opportunities in quantum sensor and space/defense applications.

• Gross margin targeted at 40% or higher for the coming year.