Executive Summary

Q1 2025 delivered higher volume and margin: revenue $8.316M (10‑Q) with gross margin 32.4%, producing operating income $0.269M and net income $0.360M ($0.05 diluted EPS). Management also cites $8.3M revenue and +12.2% q/q growth; note a disclosure discrepancy where the 8‑K exhibit lists revenue $8.174M—10‑Q shows $8.316M and is used herein .
Mix and execution drove margin expansion: gross margin improved to 32.4% vs 27.3% in Q4 2024 and 22.4% in Q3 2024; management attributes gains to higher volumes, better overhead absorption, and stronger contract margins .
Bookings softness and backlog drawdown: orders were $2.8M in Q1 (vs $7.1M in Q4), reducing backlog from $19.4M (12/31/24) to $13.8M (3/31/25); a $1.2M semiconductor system order arrived in early April .
Macro/tariffs headwinds and cost actions: management flagged recently imposed tariffs as a new uncertainty and reduced the workforce to align OpEx with demand; cash was $10.2M and working capital $14.5M at quarter‑end .
Estimates context: S&P Global showed no published Q1 2025 Wall Street consensus for EPS or revenue; therefore no beat/miss determination. Values retrieved from S&P Global.*

What Went Well and What Went Wrong

What Went Well

Revenue and profitability inflected: “First quarter 2025 revenue was $8.3 million, up 69.0% versus the prior year quarter and up 12.2% from the fourth quarter of 2024… Our net income for the quarter was $360,000” .
Margin execution improved: Gross margin rose to 32.4% (vs 27.3% in Q4 and 22.4% in Q3), driven by higher revenue, overhead absorption, and improved in‑process contract margins .
SDC demand held up; CVD segment drove growth: Strength in gas delivery (SDC) persisted, while CVD Equipment revenue rose on two large contracts (industrial and aerospace) .

What Went Wrong

Orders slowed materially and backlog declined: Q1 bookings were $2.8M (vs $7.1M in Q4 and $4.1M in Q3), reducing backlog from $19.4M to $13.8M .
Tariffs introduced new uncertainty: Management warned tariffs may raise component costs and affect order rates, creating incremental execution risk .
Cash use in operations: Cash fell to $10.2M (from $12.6M) due to increased contract assets (+$3.0M) and lower contract liabilities (‑$1.3M) as revenue was recognized ahead of billings .

Financial Results

P&L vs prior quarters

Metric	Q3 2024	Q4 2024	Q1 2025
Revenue ($M)	$8.194	$7.414	$8.316 (10‑Q)
Gross Margin %	22.4%	27.3%	32.4%
Operating Income ($M)	$0.077	$0.035	$0.269
Net Income ($M)	$0.203	$0.132	$0.360
Diluted EPS ($)	$0.03	$0.02	$0.05

Note: The 8‑K exhibit and press release include a statements‑of‑operations revenue line of $8.174M for Q1 2025; the filed 10‑Q shows $8.316M consolidated revenue and is used herein .

Segment revenue (Q1 2025 vs Q1 2024)

Segment ($M)	Q1 2024	Q1 2025
CVD Equipment	$2.946	$6.314
SDC	$1.932	$2.142
MesoScribe	$0.059	$0.022
Intersegment Elims	$(0.015)$	$(0.162)$
Consolidated Revenue	$4.922	$8.316

KPIs and balance-sheet drivers

KPI	Q3 2024	Q4 2024	Q1 2025
Orders/Bookings ($M)	$4.1	$7.1	$2.8
Backlog ($M)	$19.8	$19.4	$13.8
Cash & Equivalents ($M)	$10.005	$12.598	$10.219
Working Capital ($M)	$13.3	$13.9	$14.5
Contract Assets ($M)	$1.348	$2.226	$5.180
Contract Liabilities ($M)	$3.288	$3.135	$1.832
Post‑Q order (Apr’25)	—	—	$1.2M received

YoY highlights: Q1 revenue +69.0% and gross margin up to 32.4% from 16.2% in Q1 2024; EPS improved to $0.05 from ($0.22) .

Guidance Changes

No formal quantitative guidance was issued; management reiterated variability in orders and revenues and highlighted tariff uncertainty, while executing cost reductions to align with demand.

Metric	Period	Previous Guidance	Current Guidance	Change
Revenue/Bookings	FY/Quarter	None provided	No formal guidance; expect fluctuations given markets served	Maintained (no formal guide)
Gross Margin	FY/Quarter	None provided	No formal target; margins benefited from volume mix; mgmt focused on profitability	Maintained (qualitative)
OpEx/Workforce	FY/Quarter	—	Implemented workforce reduction to reduce operating costs	New cost action
Capex	FY/Quarter	—	Not specified	—
Tax rate	FY/Quarter	—	Q1 tax expense $16K; effective rate ~4.3% (quarter)	Informational
Dividends	FY/Quarter	None	None [10‑Q/PR absence]	No change

Earnings Call Themes & Trends

Topic	Previous Mentions (Q3 2024, Q4 2024)	Current Period (Q1 2025)	Trend
Aerospace/CMC demand	Recovery noted; $3.5M follow‑on CVI order in Nov’24; Q3/Q4 revenues supported by aerospace contracts	Q1 revenue driven by two CVD contracts (industrial and aerospace)	Positive/stable
SiC (PVT150/PVT200) market	Overcapacity and price declines; $1.0M + $0.3M inventory write‑downs; PVT200 shipped and under eval	No new PVT orders; tariffs and EV/SiC uncertainty persist (macro commentary)	Mixed/negative demand
Bookings/backlog	Q3 bookings $4.1M; backlog $19.8M; Q4 bookings $7.1M; backlog $19.4M	Q1 orders $2.8M; backlog down to $13.8M; +$1.2M order in early April	Softening near term
Margins/Execution	Q3 GM 22.4%; Q4 GM 27.3%; Q4 Q&A discussed path to >30% GM with volume/first‑article learnings	Q1 GM 32.4% on higher volume and improved contract margins	Improving
Tariffs/Macro	Potential tariff impacts highlighted in Q4	“Recent imposition of tariffs” a new headwind for costs and demand	Deteriorating external backdrop
SDC demand	Strong in Q3/Q4	SDC demand remained strong in Q1	Stable

Management Commentary

“First quarter 2025 revenue was $8.3 million, up 69.0% versus the prior year quarter and up 12.2% from the fourth quarter of 2024… Our SDC segment continued to see strong demand for its gas delivery equipment.” — Emmanuel (Manny) Lakios, CEO .
“Backlog declined… from $19.4 million at December 31, 2024 to $13.8 million at March 31, 2025… In addition, the recent imposition of tariffs has presented us with new challenges and uncertainty…” — Emmanuel (Manny) Lakios, CEO .
“Gross profit… 32.4% vs. 16.2% a year ago… primarily the result of higher overall revenues, improved absorption of overhead, as well as improved margins on contracts in progress.” — Richard Catalano, CFO .
“Working capital at March 31, 2025, was $14.5 million… Cash and cash equivalents… $10.2 million… decrease… due to increase in contract assets and decrease in contract liabilities as revenue was recognized.” — Richard Catalano, CFO .

Q&A Highlights

The Q1 2025 call had no analyst questions; management concluded after prepared remarks .
For context, the prior quarter’s Q&A discussed margin trajectory “north of 30%” contingent on volume and reduced first‑article cost drag, and continued aerospace penetration (3 of 4 major engine OEMs have CVV systems), while SiC demand remains pressured by overcapacity and pricing in China .

Estimates Context

S&P Global (no Wall Street consensus found for Q1 2025; coverage limited). Values retrieved from S&P Global.*

Metric (Q1 2025)	Consensus	Actual
Revenue ($M)	N/A*	$8.316*
Primary EPS ($)	N/A*	$0.05 (company‑reported)
EBITDA ($M)	N/A*	$0.454*

Note: Where company actuals are available, they are cited to filings; S&P Global fields shown with asterisks reflect data availability, not consensus. Values retrieved from S&P Global.*

Key Takeaways for Investors

Mix and execution are improving margins: GM stepped up to 32.4% on higher volume and better in‑process margins; if volumes hold and first‑article costs are contained (as discussed last quarter), elevated margins are sustainable near term .
Near‑term revenue visibility softened: Q1 bookings fell to $2.8M and backlog declined to $13.8M; April’s $1.2M order offers some offset but order cadence is the swing factor for the stock .
Aerospace remains the anchor growth vector: multiple CVI/CVD wins and follow‑on demand underpin the thesis while SiC PVT remains challenged by overcapacity/pricing—watch for additional aerospace orders to refuel backlog .
Balance sheet provides runway: $10.2M cash and $14.5M working capital support operations despite working capital swings from contract timing; contract assets rose with revenue recognition ahead of billings .
Tariff risk is real but manageable: Management is evaluating sourcing and safety stocks; tariffs may pressure costs and order timing—expect volatility in bookings as customers digest macro changes .
Stock reaction drivers: order announcements (esp. aerospace or industrial multi‑system deals), margin durability at/above ~30% gross, and any signs of SiC market normalization could catalyze shares; conversely, prolonged bookings weakness would weigh on estimates and sentiment .

Additional source detail:

Q1 2025 results press release and 8‑K exhibit: revenue/margin, bookings/backlog, tariff commentary, cost reductions .
Q1 2025 10‑Q: consolidated revenue $8.316M, margin detail, segment revenue, geography, balance sheet and contract asset/liability figures .
Prior quarters for trend: Q4 2024 PR and call (revenue $7.4M; GM 27.3%; bookings $7.1M; backlog $19.4M) ; Q3 2024 10‑Q and call (revenue $8.194M; GM 22.4%; bookings $4.1M; backlog $19.8M) .

*Values retrieved from S&P Global.

CVD EQUIPMENT CORP (CVV)·Q1 2025 Earnings Summary