Tue, May 13, 5:48 PM (34 days ago)
### Summary of Data I/O Corporation (DAIO) Q1 2025 Financial Performance **Financial Health and Performance:** - **Revenue:** Q1 2025 revenue was $6.2 million, a 1.3% increase from Q1 2024 ($6.1 million). The growth was driven by business recovery and backlog deliveries in the Americas and Europe, offset by a 40% decline in Asia due to trade and economic uncertainties. - **Profit Margins:** Gross margin was 51.6% in Q1 2025, slightly down from 52.8% in Q1 2024. Operating expenses decreased, leading to a narrower operating loss of $377,000 compared to $860,000 in Q1 2024. - **Cash Flow:** Net cash provided by operating activities was $109,000 in Q1 2025, a significant improvement from a negative $41,000 in Q1 2024. Cash and cash equivalents increased to $10.5 million. **Earnings and Trends:** - **Net Income:** Net loss narrowed to $382,000 in Q1 2025 from $807,000 in Q1 2024. - **Earnings Per Share:** Basic and diluted earnings per share were $(0.04) in Q1 2025, improving from $(0.09) in Q1 2024. - **Bookings and Backlog:** Q1 2025 bookings were $4.6 million, up from $4.1 million in Q4 2024 but down from $8.1 million in Q1 2024 due to a large contract. Backlog was $2.9 million, down $0.6 million from December 31, 2024. **Operational and Strategic Insights:** - **Market Expansion:** Data I/O is focusing on diversifying its market reach and enhancing its consultative sales process to drive revenue growth. - **Supply Chain Resilience:** The company has implemented a resilient supply chain with dual manufacturing capabilities in the U.S. and China, providing flexibility to manage tariff policies and support global customers. - **Cost Management:** Efficiency improvements and streamlining operations have resulted in a lower cost basis for manufacturing and overhead. **Uncertainties and Future Operations:** - **Economic Uncertainties:** The company remains cautious due to near-term headwinds, including global trade and tariff concerns, which have created additional strain on the economy and stalled capital investments. - **Future Outlook:** Data I/O is focused on sustainable growth through innovation, product enhancement, and improving its value proposition. The company believes it has sufficient cash and working capital to fund operations and capital requirements through the next one-year period. **Financial Metrics:** - **EBITDA:** EBITDA was $(272,000) in Q1 2025, an improvement from $(645,000) in Q1 2024. Adjusted EBITDA, excluding equity compensation, was $(98,000) in Q1 2025, compared to $(364,000) in Q1 2024. **Controls and Procedures:** - **Disclosure Controls:** The company identified a material weakness in its internal controls over financial reporting related to user access and segregation of duties for the information technology system supporting financial reporting. Remedial measures are underway to address this weakness. **Conclusion:** Data I/O Corporation showed signs of recovery and operational efficiency in Q1 2025, with improved revenue, narrowed losses, and better cash flow management. However, the company faces challenges due to global economic uncertainties and trade issues, which may impact future performance. The focus on market diversification, cost management, and supply chain resilience positions Data I/O for potential growth in the coming quarters.