Solitron Devices (SODI) Q1 2026 earnings summary

Executive summary

• Net sales for the quarter ended May 31, 2025, declined 32% year-over-year to $2.7 million, mainly due to lower backlog and delayed orders, but net bookings rose 37% to $2.8 million and backlog nearly doubled to $18.3 million.

• Gross profit margin fell to 14% from 42% year-over-year, with gross profit at $390,000, reflecting higher cost of sales and lower sales volume.

• Operating loss was $378,000 compared to operating income of $792,000 in the prior year; net loss was $336,000 versus net income of $589,000.

• Cash and cash equivalents declined to $2.57 million from $4.10 million at the prior fiscal year-end, mainly due to investment activities.

• Revenue weakness attributed to order-to-production lag, with expectations for sales to recover by the end of the fiscal second quarter and stabilize in the third quarter.

Financial highlights

• Net sales: $2.7 million, down from $4.0 million year-over-year.

• Gross profit: $390,000 (14% margin), down from $1.68 million (42% margin) year-over-year.

• Operating loss: $378,000, compared to operating income of $792,000 last year.

• Net loss: $336,000, or $(0.16) per share, versus net income of $589,000, or $0.28 per share, year-over-year.

• Cash from operations: $391,000; net cash used in investing: $1.88 million; net cash used in financing: $37,000.

Outlook and guidance

• Management expects cash from operations and current cash balances to be sufficient to fund capital expenditures of $250,000 over the next twelve months.

• Sales expected to pick up at the end of the fiscal second quarter and reach steadier levels in the third quarter.

• Backlog at record levels, supporting optimism for future revenue growth.

• The company may pursue acquisitions, new product lines, or investments in securities to utilize net operating loss carryforwards.

• Increased interest in new product development, including silicon carbide prototypes.