AstroNova Q4 2025 Earnings Report

AstroNova EPS Results

• Actual EPS: $0.06
• Consensus EPS: N/A
• Beat/Miss: N/A
• One Year Ago EPS: N/A

AstroNova Revenue Results

• Actual Revenue: $37.36 million
• Expected Revenue: N/A
• Beat/Miss: N/A
• YoY Revenue Growth: N/A

AstroNova Announcement Details

• Quarter: Q4 2025
• Date: 4/14/2025
• Time: Before Market Opens
• Conference Call Date: Monday, April 14, 2025
• Conference Call Time: 9:00AM ET

AstroNova (NASDAQ:ALOT) designs, develops, manufactures, and distributes specialty printers, and data acquisition and analysis systems in the United States, Europe, Asia, Canada, Central and South America, and internationally. The company operates in two segments, Product Identification (PI) and Test & Measurement (T&M). The PI segment offers tabletop and production-ready digital color label printers, and OEM printing systems under the QuickLabel brand; digital color label mini-presses and inline printing systems under the TrojanLabel brand; and label materials, tags material, inks, toners, and thermal transfer ribbions under the GetLabels brand. This segment also develops and licenses various specialized software programs to design and manage labels and print images; and provides training and support. This segment serves chemicals, cosmetics, food and beverage, medical products, nutraceuticals, pharmaceuticals, and other industries; and brand owners, label converters, commercial printers, and packaging manufacturers. The T&M segment offers airborne printing solutions, such as ToughWriter used to print hard copies of navigation maps, arrival and departure information, flight itineraries, weather maps, performance data, passenger data, and various air traffic control data; ToughSwitch, an ethernet switches used to connect multiple computers or Ethernet devices; TMX data acquisition systems; Daxus DXS-100 distributed data acquisition platform; SmartCorder DDX100 portable data acquisition systems for facility and field testing; and Everest EV-5000, a digital strip chart recording system used primarily in aerospace and defense. This segment serves aerospace and aerospace and defense, automotive, commercial airline, energy, manufacturing, and transportation industries. The company was formerly known as Astro-Med, Inc. and changed its name to AstroNova, Inc. in May 2016. AstroNova, Inc. was incorporated in 1969 and is headquartered in West Warwick, Rhode Island.

AstroNova Q4 2025 Earnings Call Transcript

Presentation

[Operator]

Good morning, and welcome to the AstroNova Fiscal Fourth Quarter and Full Year twenty twenty five Financial Results Conference Call. Today's call is being recorded. My name is Ezra, and I will be your coordinator on today's call. I would now like to turn the conference call over to Scott Sullivan of the company's Investor Relations firm, Sharon Merrill Advisors. Please go ahead, sir.

[Scott Solomon, SVP - Investor Relations at Sharon Merrill Advisors]

Thank you, Esra, and good morning, everyone. Our Q4 fiscal twenty twenty five earnings release and the slide presentation accompanying management's prepared remarks are posted on the Investor Relations page of our website, www.astronovainc.com. Turning to Slide two of the presentation. Statements made on today's call that are not statements of historical fact are considered forward looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These forward looking statements are based on a number of assumptions that could involve risks and uncertainties.

[Scott Solomon, SVP - Investor Relations at Sharon Merrill Advisors]

Accordingly, actual results could differ materially, except as required by law. Any forward looking statements speak only as of today, 04/14/2025. AstroNova undertakes no obligation to update these forward looking statements. For other information regarding the forward looking statements and the factors that may cause differences, please see the risk factors in AstroNova's annual report on Form 10 ks and other filings that the company makes with the Securities and Exchange Commission. On today's call, management will refer to non GAAP financial measures.

[Scott Solomon, SVP - Investor Relations at Sharon Merrill Advisors]

AstroNova believes that the inclusion of these financial measures help investors gain a meaningful understanding of the changes in the company's core operating results and helps investors who wish to make comparisons between AstroNova and other companies on both a GAAP and a non GAAP basis. The non GAAP financial measures are reconciled to the most directly comparable GAAP measures in today's earnings release. Turning to Slide three. Hosting this morning's call are Greg Woods, AstroNova's President and Chief Executive Officer and Tom DeBaile, AstraNova's VP and Chief Financial Officer. Greg will begin the call with management's an overview of management's strategy to make AstraNova a stronger company.

[Scott Solomon, SVP - Investor Relations at Sharon Merrill Advisors]

Tom will review financial results and pass it back to Greg for concluding comments. We'll follow the formal presentation with time for management to take your questions. Now please turn to Slide four as I hand the call over to Greg.

[Gregory Woods, President and CEO at AstroNova]

Thank you, Scott. Good morning, everyone, and thank you for joining us. We had a challenging year in fiscal twenty twenty five, but have been aggressively making changes at AstroNova to improve our performance. We had a tough integration of the Emtek acquisition, faced lower demand resulting from the Boeing strike and had delays in large defense industry orders. While disappointed in our performance in fiscal twenty twenty five, there were some bright spots.

[Gregory Woods, President and CEO at AstroNova]

For example, our Test and Measurement segment, which will be renamed the Aerospace segment starting in the first quarter of fiscal twenty twenty six, had record revenue. This name change better reflects the end markets we serve with that business segment. I'll be referring to the segment as Aerospace throughout my prepared remarks. Nonetheless, given the situation, our management team and Board took immediate and decisive actions to address the challenges of growth and profitability. This included executing on a restructuring plan that is expected to deliver $3,000,000 in annual cost savings.

[Gregory Woods, President and CEO at AstroNova]

We also are rightsizing our product portfolio to focus on higher margin, higher growth products. I should note that we recently strengthened our board with the appointment of Darius Nevin as director last month. Darius enhances our board's experience and knowledge with significant financial acumen and public company leadership experience. We look forward to his contributions to our future. Emtek has required a lot of work.

[Gregory Woods, President and CEO at AstroNova]

We are reorganizing and and realigning the business and have made solid progress in implementing a new level of accountability and discipline for its operations. We plan to leverage the key technologies and impressive manufacturing facilities of Emtek's while rethinking our operating structure, product portfolio, go to market strategies and how to drive operational excellence. We believe that we are positioned to drive market share gains with new product launches, tangible sales synergies and unique supply sourcing opportunities in fiscal twenty six. We have on fiscal year's product roadmap five next generation products based on Emtek's pre engine technology and also four from our legacy product offerings. As I'll discuss in more detail shortly, we are currently in the initial stages of deploying this print engine technology across the Amtech's product platform.

[Gregory Woods, President and CEO at AstroNova]

In aerospace, we are continuing to transition customers to our advanced ToughReader printers. We remain confident in AstroNova's ability to deliver long term shareholder value and in the promise of Emtek's to expand our application capabilities, strengthen our competitive position and deliver improved printer reliability and print quality to our customers with its game changing technology. Turning to slide five. The driving force behind AstroNova is data visualization technology, the engine that powers the products we manufacture. This technology expertise enables us to develop solutions that process analog and digital data in a fast, efficient, and often proprietary manner.

[Gregory Woods, President and CEO at AstroNova]

Our technologies capture that data and convert it into usable formats such as graphics or text. Our strategy is to leverage our proprietary data visualization technology to provide highly differentiated products that drive a significant recurring revenue model. By recurring revenue, I'm referring to consumables such as ink, labels, paper, and other media, as well as service agreements, repairs, and upgrades to provide us with consistent, more predictable revenue streams. In fiscal twenty twenty five, recurring revenue accounted for 71% of consolidated sales. Let's now turn to our reporting segments, starting with Aerospace on Slide six.

[Gregory Woods, President and CEO at AstroNova]

In fiscal twenty twenty five, Aerospace contributed a record $48,900,000 in revenue, representing approximately one third of our consolidated sales. The segment also posted record full year operating profit of 22.8%, resulting in a five year compound annual growth rate of 17.4%. Aerospace remains a critical driver of our business supported by a robust installed base of flight deck printers currently deployed across more than 30,000 aircraft worldwide. These numbers reflect the significant role we play in the advanced aerospace safety, innovation and reliability. Recurring revenue, which includes parts, specialized thermal paper, service and repairs, accounted for 49% of the Aerospace segment revenue this past year, with hardware contributing the other 51%.

[Gregory Woods, President and CEO at AstroNova]

As shown in Slide seven, there are two important growth catalysts for our Aerospace segment. The first is the ongoing transition to our advanced and higher margin ToughRider branded family of printers away from the legacy brands. We estimate that ToughRater printer as a percentage of total printer deliveries will more than double to 86% by the end of the fiscal year. Our ToughRider printers have a strong value proposition for our customers. They are lighter in weight for better fuel savings and improved aircraft efficiency.

[Gregory Woods, President and CEO at AstroNova]

They also provide a significant increase in consistent reliable performance, enhancing safety during flight operations. And finally, the much higher print resolution improves readability for pilots, allowing for faster decision making when reviewing flight plans and other critical updates. The strategic shift to Tough Riders enhances margins and will drive an estimated $4,000,000 reduction in royalty obligations on legacy products. It's worth noting that these royalty obligations are set to roll off in the fourth quarter of fiscal 'twenty eight, incrementally contributing to a stronger margin profile for the company. Another catalyst for growth is the opportunity to grow our service and supplies business in aerospace.

[Gregory Woods, President and CEO at AstroNova]

We expect to increase our market share in the highly regulated aerospace printer paper business and expand our international affiliate repair business. Our aerospace segment also offers data acquisition products for the defense industry. These include specialized telemetry products used primarily in rocket and missile testing and portable ultra high precision data acquisition systems used in markets including defense and nuclear power. This summer, we plan to release a new flagship data acquisition unit, the TMX200, an integrated hardware and software solution that expands our addressable market. Looking at Slide eight, our PI segment provides digital labeling and product marketing solutions, including printers, software and supplies used across packaging, labeling and mailing applications.

[Gregory Woods, President and CEO at AstroNova]

We have an installed base of more than 10,000 printers, which collectively drive recurring revenue of 82%. From a financial standpoint, the segment was down year over year primarily due to softer demand for hardware and supplies along with continued integration challenges at Emtek. TI reported a loss for the quarter due to the goodwill impairment and acquisition accounting adjustments. On a non GAAP basis, operating profit for the segment was about 9% of sales. Excluding Demetex, margins were consistent with historic levels reflecting the strength of our legacy business.

[Gregory Woods, President and CEO at AstroNova]

We are revamping the PI sales organization to streamline operations, strengthen our global channel strategy and drive greater alignment across teams. In addition, we are expanding the portfolio of Astra Machine, which was acquired in 2022 with new mail handling equipment, further enhancing our product lineup and opening new market opportunities. Turning to Slide nine. Let me dive a little deeper into the changes we are making at MTEX. We have a history of bringing cohesion and organizational excellence to past acquisitions.

[Gregory Woods, President and CEO at AstroNova]

And while Emtek's has presented its own set of hurdles, we are executing our standard integration processes. We quickly identify what is not working and address it aggressively. In Emtek's case, we identified several key areas for improvement to elevate Emtek's public company standards. Many organizational details have had to be addressed such as formalizing employment agreements, centralizing management structures, and providing direction, focus, and prioritization. We are aligning leadership and driving accountability across the organization.

[Gregory Woods, President and CEO at AstroNova]

This is a large cultural change as we create a unified vision and develop stronger team dynamics. We've overhauled the finance and accounting processes. We've addressed gaps in accounting practices to US GAAP standards. This includes changes in accounts for accounting for consignment sales, accounts receivable management, inventory oversight and reserve recognition. Additionally, we've implemented a formalized structure to ensure compliance.

[Gregory Woods, President and CEO at AstroNova]

We believe we have established a solid foundation from which we can build. Finally, there are many operational enhancements we have been executing to take a private company mentality to a more proactive, fact based approach. By incorporating the tools and management practices of the AstroNova operating system within Emtek, there is now a more disciplined product development process, strengthened quality controls and more formalized contract terms and conditions for our customers. We have also strategically refocused the product portfolio to prioritize high margin opportunities. We're excited about the technology, the synergies we can capture and the strong vertical manufacturing capabilities and footprint.

[Gregory Woods, President and CEO at AstroNova]

As I noted on our Q3 call, the path to fully realizing the benefits of the Emtek acquisition is longer and more complex than anticipated. However, we believe the strategic upside is significant. In fact, together with Emtek, we have developed new highly disruptive print engine technology. This technology allows our products to use a broader range of inks that can be multisource, which we believe will dramatically lower our ink costs and reduce our dependence on the limited set of suppliers on which we have had to rely. Moving to Slide 10, the next generation products incorporating the new print engine technology will give users flexibility to use either dye or pigment inks, provide live over the air software updates, and allow for real time equipment monitoring.

[Gregory Woods, President and CEO at AstroNova]

Between now and the end of the year, we plan to introduce five next generation products based on the Emtek's print engine technology. Enhanced versions of the Emtek's ATOM2 and ATOM3 label printers will be launched as the QuickLabel four twenty five and four thirty five respectively. The Multi 800 and the Multi 1,300 industrial packaging printers will be launched this summer under the new VersaPrint brand. And in the fall, we will introduce the VersaPrint 1,200, the next generation of our Emtek's AquaFlex flexible packaging system. The charts on slide 11 depict how these next generation products can increase consumables revenue through increased usage of label media and supplies.

[Gregory Woods, President and CEO at AstroNova]

We anticipate a meaningful increase in average annual label media and revenue on a per installed unit basis for our next gen mid market printers. Ink consumption is also projected to rise, reflecting both increased utilization and the flexibility of our new print engine technology. In our packaging printer lineup, the next generation systems feature wider formats and higher throughput, which naturally lead to greater ink usage per installed unit, further supporting our consumables driven growth model. I'll now hand the call over to Tom for the financial review. Tom?

[Thomas DeByle, VP, Treasurer & CFO at AstroNova]

Thank you, Greg, and good morning, everyone. I'll begin with an overview of our financial performance on Slide 13. Net revenue for the fourth quarter was down 5.6% to $37,400,000 on lower sales in both segments. Gross profit was $12,700,000 for the quarter, resulting in a gross profit margin of 34.1%, down from the prior year period compared with the gross profit of $14,700,000 and a gross profit of 37.2% for the same period in fiscal twenty twenty four, reflecting lower revenue and less favorable product mix in the 2025 period. Q4 FY twenty twenty five showed operating expenses of 25,000,000 versus $10,800,000 in Q4 of FY twenty twenty four.

[Thomas DeByle, VP, Treasurer & CFO at AstroNova]

As noted in our earnings release, our GAAP results included a 13,400,000 non cash goodwill impairment charge related to the PI segment, largely associated with the company's Emtek's business. Unless otherwise noted, I'll be discussing our non GAAP results, which we believe help investors gain a meaningful understanding of the changes in the company's core operating results. Non GAAP operating expenses for the fourth quarter were $11,400,000 up 4.8% or $500,000 from the prior year. Excluding MTEX, operating expenses were down. Non GAAP operating income came in at $1,400,000 for the fourth quarter versus $3,600,000 in the year earlier period, primarily due to lower sales volume and a loss at Amtechs.

[Thomas DeByle, VP, Treasurer & CFO at AstroNova]

Adjusted EBITDA was CAD2.8 million for the fourth quarter of fiscal twenty twenty five compared with adjusted EBITDA of CAD5.2 million for the fourth quarter of fiscal twenty twenty four. Order backlog was $28,300,000 as of 01/31/2025, compared with $31,400,000 at the end of fiscal twenty twenty four. Turning to our PI segment results on Slide 14. Revenue was down 3.6% from the prior year period to $25,700,000 Excluding Amtech, sales in PI were down 9.8%, primarily due to lower sales of hardware and supplies. On a GAAP basis, our PI segment reported a loss of $11,200,000 primarily driven by Emtek and a lower unit volume.

[Thomas DeByle, VP, Treasurer & CFO at AstroNova]

On a non GAAP basis, the PI segment recorded an operating profit of $2,300,000 or 8.9% of revenue compared with the segment operating profit of $3,000,000 or 11.1% of segment revenue for the fourth quarter of fiscal twenty twenty four. This segment is not expected to perform strongly out of the gate in fiscal twenty twenty six, but we expect that these actions we are taking on cost reductions and portfolio realignment will be demonstrated as we move through the second half of the fiscal year. Moving to Slide 15, Test and Measurement, or now known to be as Aerospace segment, revenue was down 9.9% in the quarter from the prior year period to $11,700,000 The decline was primarily due to a delayed defense order and to a lesser extent deferred deliveries associated with the Boeing strike. Segment operating profit was $2,300,000 for Q4 twenty twenty five versus $3,700,000 in the prior year. We have some benefits for the Aerospace segment as we advance through the fiscal twenty twenty six to include the release of the $2,200,000 military transport contract, a major OEM transition to the Tough Raider and easier comps as we lap the Boeing strike.

[Thomas DeByle, VP, Treasurer & CFO at AstroNova]

Looking at our balance sheet and leverage on Slide 16, cash and cash equivalents at the end of the quarter were $5,100,000 up $700,000 from the end of Q3. Funded debt decreased by $2,200,000 to $46,700,000 from $48,900,000 at the end of Q3. Liquidity was $9,700,000 at the end of the quarter, down from Q3 by CAD5 million. The revolver in our fourth quarter was reduced from CAD30 million to CAD25 million on the existing bank agreement with Bank of America causing a drop in liquidity by CAD5 million. Turning to cash flow on Slide 17.

[Thomas DeByle, VP, Treasurer & CFO at AstroNova]

In fiscal twenty twenty five, we generated cash from operations of $4,800,000 compared with $12,400,000 for fiscal twenty twenty four. Free cash flow was $3,700,000 versus $11,500,000 in the year earlier period. Free cash flow for the fourth quarter was $2,400,000 compared with $6,900,000 in Q4 of fiscal twenty twenty four. This reflected lower net income from our legacy business, operating losses at Amtech and higher inventory in the 2025 period. Turning to guidance on Slide 18.

[Thomas DeByle, VP, Treasurer & CFO at AstroNova]

As we stated in our preannouncement of April 7, for fiscal twenty twenty six, we are anticipating net revenue in the range of 160,000,000 to $165,000,000 representing a year over year growth of 7.4% at the midpoint from fiscal twenty twenty five. For the adjusted EBITDA margin, we are anticipating a range of 8.5% to 9.5%, representing a year over year growth of 60 basis points from fiscal twenty twenty five at the midpoint. There are two key drivers behind our growth assumptions. First, the successful integration of our new print engine and ink technology in PI, which should begin to contribute to our results in the latter part of the fiscal year. Second is our new aerospace segment, the continued transition of the OEMs and airline direct customers to our ToughRider branded family of printers from the other brands in our portfolio.

[Thomas DeByle, VP, Treasurer & CFO at AstroNova]

Now please turn to Slide 19 as I hand the call back to Greg for his closing comments.

[Gregory Woods, President and CEO at AstroNova]

Thanks, Tom. In summary, we are laser focused on integrating Emtek's transformative technologies across multiple printer platforms, accelerating growth in supplies and service revenue and working to unlock new market synergies. By leveraging the proven AstroNova operating system, we are seeking to expand customer offerings, achieve operational excellence and drive strong returns on investment. In Aerospace, we're advancing the transition of the ToughRater printer line. In the quarters ahead, we also plan to grow the service and supplies portion of the Aerospace product line and drive sales of our new TMX200 data acquisition recorder.

[Gregory Woods, President and CEO at AstroNova]

Profitability remains the priority. We aim to increase sales of higher margin hardware and supplies while completing restructuring efforts to streamline operations, take out costs and position us for sustainable growth. Finally, we're taking decisive action to reduce debt and improve cash flow through an inventory reduction program. These initiatives reflect our commitment, the financial discipline and delivering value to our shareholders. We made solid progress this quarter, but still have work to be done and are excited about the opportunities ahead.

[Gregory Woods, President and CEO at AstroNova]

Now Tom and I would be happy to take your questions.

[Operator]

Thank you very much. I will now hand back over to Mr. Woods for any closing remarks.

[Gregory Woods, President and CEO at AstroNova]

Thanks everyone for joining the call today and we look forward to keeping you updated on our progress. Have a good day.

[Operator]

Thank you very much. That concludes today's conference call. You may now disconnect your lines.

Participants

Executives

• Gregory Woods, President and CEO
• Thomas DeByle, VP, Treasurer & CFO

Analysts

• Scott Solomon, SVP - Investor Relations at Sharon Merrill Advisors