inTest Corporation

Good morning, ladies and gentlemen. Thank you for standing by. Welcome to the Intest Corporation Third Quarter 2025 Financial Results Conference Call. At this time, all participants are in listen-only mode. A question and answer session will follow the formal presentation. Should you require operator assistance during the conference, please press star zero to signal an operator. Please note, this conference is being recorded. I will now turn the conference over to your host, Alex Fialta. Thank you. You may begin.

Good morning, everyone, and thank you for joining us. With me on the call are Nick Grant, our President and Chief Executive Officer, and Duncan Gilmore, our Chief Financial Officer and Treasurer. The earnings release was issued this morning, as well as the slides that management will use during the call. Both of these can be found in the Investor Relations section of the Intest.com website. Please turn to slide two for a review of the Safe Harbor Statements. During this call, management may make some forward-looking statements about our current plans, beliefs, and expectations. These statements apply to future events that are subject to risks, uncertainties, and other factors that could cause actual results to differ materially from what is stated here and today. These risks, uncertainties, and other factors are provided in the earnings release as well as in other documents filed by the company with the Securities and Exchange Commission. These documents can be found on our website or at sec.gov. Also, as covered on slide three, management will refer to some non-GAAP financial measures. We believe these will be useful in evaluating our performance. However, you should not consider the presentation of this additional information in isolation or as a substitute for results prepared in accordance with GAAP. You can find reconciliations of non-GAAP measures with comparable GAAP measures in the tables that accompany today's release and slides. With that, I'll turn the call over to Nick.

Thank you, Alex, and good morning, everyone. Thanks for joining us for our third quarter 2025 earnings call. We will begin today's discussion on slide four of the presentation. After several months of order sluggishness as tariff and economic uncertainties complicated customers' capital investment plans, It's refreshing to see some pockets of customers break free and move forward with capital projects. We have always contended that a market recovery is a matter of when, not if. Our funnel of opportunities has been at high levels since Q1, and this quarter the conversion rate picked up, resulting in orders of 37.6 million, our strongest level since Q2 of 2022, leading to a sequential 11.4 million increase in our backlog. Most of this improving demand is coming from customers in the automotive and defense aerospace end markets, a clear testament to the success of our market diversification strategy. These customers are relying on our innovative and differentiated test equipment that enable better quality control and increasingly complex manufacturing processes. While this increase in orders is encouraging, conversion rates do vary by end market, and many customers still remain hesitant to commit to new capital projects. This is especially true in semi. However, based on what we are seeing and hearing, it feels like we may be moving into a period of gradual recovery. Revenue for Q3 was $26.2 million. lower than Q2, and below the guidance range we provided on last quarter's call. During the quarter, our engineers encountered technical challenges in finalizing a few systems, which delayed approximately 2 million in shipments. In one case, the challenges were associated with new capabilities. In the other case, the systems were for a new customer in a new target market. These challenges have since been resolved, and the systems have been shipped. We are excited about the positive impact our steadfast resolve to drive innovations and add new customers will have on our future as we execute on our Vision 2030 strategy. During the quarter, we continued to strengthen our competitive position in preparation for a broader market recovery by making more progress in penetrating target accounts and driving adoption of new products. We believe we have the balance sheet, the financial flexibility, and capacity to support our customers as demand improves. Let me now review orders and backlog on slide five. AutoEV led the climb in orders this quarter, accounting for around three-quarters of the sequential growth and doubling to 14.6 million. Alphamation bookings were at an all-time record level for the business. representing strong demand for test equipment from Tier 1 electronics suppliers as they expand capacity to support 2027 model year programs and start new projects. Defense aerospace orders more than doubled sequentially to 6.4 million, primarily due to the increased test demand for next-generation weapons systems. We continue to see success with our new products. This is especially true at AccuLogic, where they have expanded their flying probe capabilities to include radio frequency and oscilloscope measurement test solutions, thereby enhancing our customers' manufacturing efficiencies. These expanded capabilities drove multiple system orders in the quarter from new customers. In addition, several defense contractors are continuing to qualify our new products. Year over year, orders were up 34.2%. The increase reflects the strength in auto EV, which grew 7.4 million, industrial, which increased 2.4 million, defense aerospace, which increased 1.9 million, life sciences increased 0.9 million, and semi, which was up 0.4 million. These increases outpaced the declines in safety, security, and other markets. Although we saw some pickup in semi-orders, overall, the semi-market remained sluggish, especially in our analog mixed signal business. Backlog at September 30th was 49.3 million, substantially above where it was at the end of the second quarter, and positioning as well for the upcoming quarters. Before turning the call over to Duncan to review the financials and outlook in more detail, I want to thank the entire in-test team for their continued dedication and commitment to our shared vision 2030 goals.