InTest Corporation reported third‑quarter 2025 revenue of $26.2 million, a 13.3% decline from the $30.3 million earned in the same period a year earlier. Gross profit fell to $11.0 million, giving a gross margin of 41.9%, down from 46.3% in Q3 2024. The decline was driven by lower volume and an unfavorable product mix, with defense‑aerospace and automotive/EV segments posting the largest revenue drops while life‑sciences and other markets provided modest offsets.
Operating expenses rose to $12.4 million, resulting in an operating loss of $1.2 million. Net loss for the quarter was $0.9 million, or $(0.08) per diluted share, compared with a $0.5 million profit in Q3 2024. Adjusted earnings per share were $(0.02), missing the consensus estimate of $0.04. Cash from operations increased to $3.5 million, and total debt was reduced to $8.9 million, underscoring the company’s ongoing debt‑reduction program.
Orders for the quarter surged 34.2% year‑over‑year to $37.6 million, the highest level since Q2 2022. Backlog at September 30, 2025 stood at $49.3 million, up 30.1% from the prior quarter. The revenue decline was largely attributable to a $1.3 million drop in defense‑aerospace, a $0.9 million decline in automotive/EV, and a $0.4 million fall in semiconductor sales, partially offset by a $0.7 million gain in life‑sciences, safety, security and other markets.
Management highlighted the strength of its diversification strategy. CEO Nick Grant said, “Orders for the third quarter surged to $37.6 million, our highest level since Q2 2022, driven by strong demand from automotive customers associated with 2027 model‑year programs and increased defense‑aerospace spending.” CFO Duncan Gilmour added, “Revenue for the third quarter was $26.2 million compared to $28.1 million for the second quarter, a decrease of $1.9 million.” InTest guided for Q4 revenue of $30–$32 million, a gross margin of about 43%, and operating expenses of $12.3–$12.7 million. The company also confirmed a covenant‑waiver agreement with its U.S. lender covering the first quarter of 2026, reflecting proactive debt management.
Investors reacted negatively to the earnings miss. The company’s consensus EPS estimate of $0.04 was exceeded by a loss of $(0.02), and revenue fell short of the $29.09–$29.7 million range expected by analysts. The market’s focus on the earnings and revenue miss outweighed the positive signals from the order surge and backlog growth.
The results underscore a short‑term challenge: a revenue miss and margin compression amid a sluggish semiconductor market. However, the strong order book, diversified customer base, and debt‑reduction trajectory suggest a potential turnaround. Management’s guidance for Q4 indicates confidence in improving profitability, while the covenant waiver provides financial flexibility as the company navigates the current cycle.
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