DATA I/O CORP (NASDAQ:DAIO) Reports Q3 2025 Earnings and Revenue Miss

DATA I/O CORP (NASDAQ:DAIO) reported its financial results for the third quarter of 2025, revealing a performance that fell short of analyst expectations on key profitability and revenue metrics. The market's immediate reaction appeared muted, with the stock showing modest after-hours movement.

Earnings and Revenue Versus Estimates

The company's third-quarter results highlighted a divergence between its operational progress and its bottom-line financial performance.

• Earnings Per Share (EPS): Data I/O reported a net loss of $1.36 million, or a loss of $0.15 per share. This was significantly wider than the analyst estimate for a loss of $0.097 per share.
• Revenue: Net sales for the quarter were $5.4 million, which was flat compared to the third quarter of 2024 but fell short of the analyst consensus estimate of $5.71 million.
• Adjusted EBITDA: The company reported an Adjusted EBITDA loss of $1.15 million. Management noted that this figure would have been a loss of $563,000 when excluding approximately $585,000 in one-time expenses related to a cybersecurity incident, leadership transition, and investments in its technology platform.

Market Reaction and Price Action

Following the earnings release, DATA I/O's stock experienced limited volatility. The after-market trading session showed a gain of approximately 2.9%. This tepid response suggests investors may have anticipated the challenging quarter or are focusing more on the company's forward-looking strategic initiatives and bookings growth rather than the near-term earnings miss.

Strategic Highlights and Operational Performance

Beyond the headline financial figures, the earnings report detailed several strategic developments and operational metrics.

• Bookings Growth: The company reported a 7% year-over-year increase in bookings, reaching $5.1 million. This was primarily driven by demand for its PSV7000 Automated Programming System, with eight systems booked during the quarter.
• Gross Margin: Gross margin as a percentage of sales was 50.7%, an improvement from 49.8% in the prior quarter, attributed to a favorable product mix.
• Balance Sheet: The company maintains a debt-free balance sheet with $9.7 million in cash and cash equivalents as of September 30, 2025.
• Strategic Initiatives: Management emphasized progress in refreshing its core programming platform, expanding into adjacent markets like programming services, and pursuing accretive acquisitions. The appointment of a new CFO and engagement with an investment bank for M&A activities were highlighted as steps to accelerate this growth strategy.
• End-Market Diversification: A key focus remains on diversifying away from the automotive electronics segment, which represented 78% of bookings in the quarter, due to shifting OEM plans for electric vehicle manufacturing.

Outlook and Analyst Estimates

The press release did not provide specific quantitative financial guidance for the coming quarters. Instead, management commentary pointed to potential future demand drivers, including the need for customers to refresh aging PSV systems and the growing demand for programming capacity driven by larger file sizes in UFS flash memory for automotive, AR/VR, and AI applications.

Analysts currently estimate the company's performance for the next quarter and full year as follows:

• Q4 2025 Estimates:
  • EPS Estimate: Loss of $0.082
  • Revenue Estimate: $6.15 million
• Full-Year 2025 Estimates:
  • EPS Estimate: Loss of $0.30
  • Revenue Estimate: $24.22 million

The absence of formal company guidance makes a direct comparison with these analyst projections impossible, leaving investors to weigh management's optimistic commentary against the current estimates.

Conclusion

DATA I/O's third-quarter results paint a picture of a company in transition. While the quarter resulted in an earnings and revenue miss, underlying indicators such as bookings growth, a solid balance sheet, and strategic investments in future platforms provide a mixed but not entirely negative outlook. The market's subdued reaction indicates a wait-and-see approach as investors assess whether the company's strategic initiatives will successfully translate into improved financial performance in the coming periods.

For a detailed look at historical earnings and future analyst estimates for DATA I/O Corp, visit the earnings and estimates page on Chartmill.

Disclaimer: This article is for informational purposes only and does not constitute financial advice or a recommendation to buy or sell any security. Investing carries risks, including the potential loss of principal.