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• Fourth Quarter Revenue: $36.6 million, including $8.5 million from Alfamation.

• Full-Year Revenue: $130.7 million, marking the third consecutive year of record revenue.

• Full-Year Sales Growth: 6%, driven by a $25 million contribution from the Alfamation acquisition.

• Gross Profit: $14.5 million in Q4, with a $1.6 million charge impacting gross margin.

• Gross Margin: 39.7% for Q4, impacted by a 430-basis-point charge related to inventory step-up.

• Net Earnings: $1.5 million or $0.12 per diluted share for Q4.

• Adjusted Net Earnings: $2.8 million or $0.23 per diluted share for Q4.

• Adjusted EBITDA: $4.4 million for Q4, representing a 12.1% margin.

• Operating Cash Flow: $2.6 million generated in Q4.

• Free Cash Flow: $2.4 million in Q4.

• Total Debt: $15 million at the end of Q4, with a leverage ratio of 1.4x.

• Cash and Equivalents: $19.8 million at the end of Q4, up $1.8 million from the previous quarter.

• Backlog: $39.5 million at the end of 2024, including $7.4 million from Alfamation.

• 2025 Revenue Outlook: $125 million to $135 million, with gradual profitability improvement expected.

• Q1 2025 Revenue Forecast: $27 million to $29 million, with a gross margin of approximately 41%.

• Warning! GuruFocus has detected 6 Warning Signs with INTT.

Release Date: March 07, 2025

For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Positive Points

• inTest Corp (INTT) reported record fourth quarter revenue of $36.6 million and a third consecutive year of record revenue at $130.7 million for 2024.

• The company's strategy of market and customer diversification, along with a focus on innovation, has proven effective, particularly in the auto/EV and defense aerospace markets.

• The acquisition of Alfamation contributed significantly to revenue growth, particularly in the auto/EV sector, with advanced testing technologies for infotainment systems and battery packs.

• Fourth quarter orders increased by 11% year over year, with notable growth in semi-orders and life sciences demand more than doubling to a record $2.3 million.

• The company has a strong cash position with $19.8 million in cash and equivalents and a total debt leverage ratio of 1.4x, providing financial flexibility for future investments and acquisitions.

Negative Points

• The company experienced a 26% decline in the semiconductor market, which remains a significant headwind.

• Gross profit in the fourth quarter decreased sequentially due to a $1.6 million charge related to the Alfamation acquisition, impacting gross margin negatively.

• Backlog at the end of 2024 was $39.5 million, down $600,000 from the prior year period and $6 million sequentially, reflecting shipment timing issues.

• The outlook for 2025 is cautious, with expected full-year revenue of $125 million to $135 million, indicating potential stagnation compared to 2024.

• The company faces uncertainty related to tariffs and customer spending, which could impact market competitiveness and delay customer investments.