CPS Technologies Q2 Earnings & Revenues Rise Y/Y, Stock Jumps 26%

Shares of CPS Technologies Corporation CPSH have risen 19.5% since reporting second-quarter 2025 results, far outpacing the S&P 500’s 1.4% growth in the same period. Over the past month, CPSH has climbed 26.1%, again handily beating the broader market’s 2.6% growth. The sharp rally underscores investor enthusiasm around the company’s improving fundamentals and strong revenue growth trajectory.Revenue & EPS PerformanceFor the quarter ended June 28, 2025, CPSH reported revenues of $8.1 million, a record high and surging 61% from $5 million in the year-ago quarter. Gross profit improved to $1.3 million, or 16.5% of sales, from a gross loss of $0.2 million (-5% margin) last year.The company generated net income of $0.1 million, or 1 cent per diluted share, against a net loss of $0.9 million, or 7 cents per share, in the prior-year period. On a year-to-date basis, revenues were $15.6 million, 42% higher than the $10.9 million posted in the first half of 2024. Net income for the first six months was $0.2 million versus a $1.1-million loss a year ago.CPS Technologies Corp. Price, Consensus and EPS Surprise  CPS Technologies Corp. price-consensus-eps-surprise-chart | CPS Technologies Corp. QuoteOther Key Business MetricsOperating profit was modest at $0.1 million, but this marked a sharp reversal from the $1.3-million operating loss in the same quarter of 2024. Selling, general and administrative (SG&A) expenses ticked up slightly to $1.2 million from $1.1 million a year earlier, reflecting higher commissions and variable compensation tied to stronger sales.On the balance sheet, CPSH ended the quarter with $2.4 million in cash and $1 million in marketable securities compared with $3.3 million and $1 million, respectively, at the end of 2024. Inventories rose to $5.2 million from $4.3 million at the start of the year, as the company increased production to meet growing demand. Accounts receivable were $5.6 million, up from $4.9 million at the end of 2024.Management CommentaryCEO Brian Mackey highlighted that second-quarter 2025 marked the company’s second straight profitable quarter, with sequential growth of 8% from first-quarter 2025. He emphasized robust demand across core product lines, growing defense-related contracts and the company’s progress in commercializing new materials. Management also reiterated its focus on improving the bottom-line performance by expanding the gross margin through increased manufacturing efficiencies and better capacity utilization.Factors Influencing ResultsSeveral factors contributed to the strong year-over-year turnaround. The company benefited from higher volumes after adding a third production shift in late 2024, enabling it to meet growing demand. CPSH secured greater funding under the federal Small Business Innovation Research (SBIR) program, which boosted revenues. Additionally, unfavorable production yields that hurt the results in 2024 were not repeated this year, improving the margins.On the cost side, inflationary pressures and tariffs did affect input pricing. While CPSH sources many raw materials domestically, management noted that domestic suppliers have raised prices due to tariffs affecting foreign competitors, which, in turn, pressured margins. Nonetheless, the company has so far been able to pass most cost increases on to customers.GuidanceManagement expressed confidence that 2025 will be its best revenue year ever. Executives expect strong revenue momentum in the second half, coupled with improved profitability as efficiency gains flow through operations. CEO Mackey pointed to a 4-6-month visibility window on orders, noting continued robust demand across customer categories.Other DevelopmentsCPSH announced its fourth SBIR contract of 2025 after quarter-end, focused on reducing the weight of the Amphibious Combat Vehicle for the U.S. Marine Corps. The award, initially valued at $140,000 with a potential $100,000 extension, underscores the company’s growing role in defense innovation.Additionally, CPSH received its first purchase order for its AlMax fiber-reinforced aluminum composite, a material offering superior strength and wear resistance compared with aluminum. Management also disclosed that CPSH recently filed a non-provisional patent application related to radiation shielding materials, broadening its innovation pipeline.In summary, CPS Technologies delivered record revenues and returned to profitability in second-quarter 2025, with meaningful year-over-year improvements across revenues, margins and earnings. While challenges from tariffs and input costs remain, management’s commentary points to strong demand trends, a growing defense contract portfolio and promising new product commercialization. Together, these factors have bolstered investor sentiment and propelled the stock higher in recent weeks.Free Report: Profiting from the 2nd Wave of AI ExplosionThe next phase of the AI explosion is poised to create significant wealth for investors, especially those who get in early. It will add literally trillion of dollars to the economy and revolutionize nearly every part of our lives.Investors who bought shares like Nvidia at the right time have had a shot at huge gains.But the rocket ride in the "first wave" of AI stocks may soon come to an end. The sharp upward trajectory of these stocks will begin to level off, leaving exponential growth to a new wave of cutting-edge companies.Zacks' AI Boom 2.0: The Second Wave report reveals 4 under-the-radar companies that may soon be shining stars of AI’s next leap forward.Access AI Boom 2.0 now, absolutely free >>Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report CPS Technologies Corp. (CPSH): Get Free ReportThis article originally published on Zacks Investment Research (zacks.com).Zacks Investment ResearchWeiter zum vollständigen Artikel bei Zacks Weiter zum vollständigen Artikel bei Zacks