Interlink Electronics (LINK) Q3 2024 earnings summary

Executive summary

• Revenue for Q3 2024 was $2.67 million, down 13% year-over-year, with a net loss of $523,000 compared to a net loss of $125,000 in Q3 2023.

• Nine-month revenue was $8.69 million, a 16% decrease from $10.40 million in the prior year period, with a net loss of $1.57 million versus net income of $65,000 last year.

• Gross margin for Q3 2024 declined to 41.4% from 47.4% in Q3 2023, reflecting lower revenue and product mix changes.

• Lower demand from major force-sensor customers in medical and industrial markets, as well as lower shipments in traditional force-sensor and printed electronics, impacted results, partially offset by higher gas-sensor sales.

Financial highlights

• Gross margin for Q3 2024 was 41.4%, down from 47.4% in Q3 2023; nine-month gross margin was 42.1%, down from 49.1%.

• Operating expenses for Q3 2024 were $1.58 million, up slightly from $1.55 million in Q3 2023, driven by higher intangible asset amortization.

• Adjusted EBITDA for Q3 2024 was negative $260,000, compared to negative $4,000 in Q3 2023.

• Cash and cash equivalents at September 30, 2024 were $3.8 million, with $2.5 million held by foreign subsidiaries.

• No debt outstanding; working capital was $6.5 million at quarter-end.

Outlook and guidance

• Management expects to continue paying monthly dividends on preferred stock and believes current cash balances are sufficient for ongoing operations.

• Pipeline includes several large force-sensor and gas-sensor opportunities, with expansion in air quality solutions expected to drive organic revenue growth in 2025.

• If circumstances change, additional capital may be sought through equity or debt financing.