Executive Summary

Q1 2025 net revenue was $5.27M, modestly above the prior quarter’s guidance and Street consensus, with GAAP gross margin at 2.5% and non-GAAP gross margin at 10.8%; GAAP EPS from continuing operations was ($0.21) . Versus S&P Global consensus, revenue beat ($5.27M vs $4.95M*), EPS was slightly better than consensus (GAAP ($0.21) vs consensus ($0.22)), and S&P normalized EPS came in at ($0.12) (a larger beat) .
The YoY revenue decline (-21% YoY to $5.27M) and margin compression were driven by exiting low-margin business and dual-site transition costs (Singapore to Thailand), partially offset by progress on Thailand qualifications; over 75% of volume had transitioned by Q1 .
Q2 2025 revenue guidance was set at $4.9M–$5.3M; prior Q4 call’s Q4 2025 gross margin target (26%–28%) was effectively withdrawn pending tariff outcomes, introducing margin uncertainty .
Strategic catalysts: execution of the Perform-Accelerate-Transform plan, cold-chain and BLE partnerships (Tag‑N‑Trac; InPlay), NFC anti-counterfeiting initiative in luxury wine, and new board director (Mick Lopez) to bolster M&A and governance .

What Went Well and What Went Wrong

What Went Well

“We began executing our Perform-Accelerate-Transform (P‑A‑T) strategic framework as a pure-play IoT solutions provider,” positioning for long-term growth via partnerships and innovation .
Operational progress: Thailand transition advanced with audits and qualifications complete for remaining customers; >75% of volume transitioned, with yields and efficiency “very close” to Singapore .
Strategic partnerships expanded: Tag‑N‑Trac (pharma cold chain), InPlay (BLE smart labels), and ZATAP/Genuine‑Analytics (wine authentication), broadening high-value applications and potential revenue funnels .
Balance sheet strength preserved: cash and restricted cash of ~$132.7M; working capital ~$141.5M supports organic and inorganic growth under P‑A‑T .

What Went Wrong

YoY revenue down to $5.27M (from $6.66M) due to exit of low-margin business; gross margin compressed amid dual manufacturing overhead and lower utilization .
Non-GAAP adjusted EBITDA loss widened QoQ (-$3.92M in Q1 vs -$4.46M in Q4, but worse YoY vs -$3.16M), reflecting lower volumes and transition costs .
Tariff uncertainty: ~25% of finished goods imported into the U.S. may face surcharges; margin guidance for Q4 2025 was pulled pending outcome of tariff review (90-day pause through July), elevating risk to margin trajectory .
Stock repurchase program paused in Q1 due to macroeconomic uncertainty, reducing near-term shareholder return actions .

Financial Results

Summary Financials (Company-reported)

Metric	Q1 2024	Q4 2024	Q1 2025
Net Revenue ($USD Millions)	$6.66	$6.70	$5.27
GAAP Gross Margin %	7.3%	(14.9%)	2.5%
Non-GAAP Gross Margin %	13.4%	(5.2%)	10.8%
GAAP Operating Expenses ($USD Millions)	$5.55	$5.63	$5.60
Non-GAAP Operating Expenses ($USD Millions)	$4.06	$4.11	$4.49
Adjusted EBITDA ($USD Millions)	($3.16)	($4.46)	($3.92)
GAAP Net Loss – Continuing Ops ($USD Millions)	($5.38)	($4.28)	($4.79)
Diluted EPS – Continuing Ops ($USD)	($0.24)	($0.19)	($0.21)
Cash & Equivalents ($USD Millions)	—	$135.65	$132.38
Working Capital ($USD Millions)	—	$142.8	$141.5

Notes: Non-GAAP definitions and reconciliations provided in press releases/8‑K exhibits .

Actual vs S&P Global Consensus – Q1 2025

Metric	Consensus	Actual (S&P Normalized)*	Actual (Company GAAP)
Revenue ($USD Millions)	$4.95*	$5.27*	$5.27
Primary EPS ($USD)	($0.22)*	($0.12)*	($0.21)
EBITDA ($USD Millions)	($4.08)*	($4.72)*	($3.92)

Values retrieved from S&P Global.
Company-reported figures per press release/8‑K reconcile GAAP vs non‑GAAP .

Segment Breakdown

Segment	Q1 2025 Revenue
IoT (RFID/BLE) Solutions	$5.27M (single-segment disclosure)

KPIs (Q1 2025)

KPI	Q1 2025
New sales pipeline opportunities	74
Conversion rate (quarter)	10%
Active NPD projects	21 (13 customer-driven; 8 internal)
BLE-based NPD projects (customer-driven)	5
NPD transitions to commercialization	1 (home water filtration consumables inlay)
Thailand production transition	>75% of volume; remaining 3 customers qualified
Cash & restricted cash	~$132.7M
Expected net operating cash usage (12 months post 9/30/24)	$14M–$16M (reaffirmed)
Working capital	~$141.5M

Guidance Changes

Metric	Period	Previous Guidance	Current Guidance	Change
Net Revenue	Q1 2025	$4.8M–$5.1M (given on 3/5/25)	Actual $5.27M	Beat vs guidance midpoint
Net Revenue	Q2 2025	—	$4.9M–$5.3M	New guidance
Non-GAAP Gross Margin	Q4 2025	Target 26%–28% (communicated pre‑tariffs)	Withdrawn pending tariff outcome	Withdrawn
Stock Repurchase	2025	$10M program announced Nov’24	Paused in Q1 due to macro uncertainty	Paused
Net Operating Cash Usage	Next 12 months from 9/30/24	$14M–$16M	Reaffirmed	Maintained

Earnings Call Themes & Trends

Topic	Q3 2024 (Q-2)	Q4 2024 (Q-1)	Q1 2025 (Current)	Trend
Thailand manufacturing transition	~75% by YE’24; last 3 customers into H1’25; one low-margin customer exit considered	Q4 margins deeply negative amid ramp/underutilization	Audits/qualifications complete; >75% transitioned; yields near Singapore	Operational progress; margin recovery deferred pending tariffs
Gross margin trajectory	Expect 26%–28% once Thailand fully ramped	Q4 GM (GAAP) -14.9%; target reiterated for Q4’25	Q4’25 margin target pulled pending tariff review	Uncertain; tariff-dependent
Tariffs/macro	Not highlighted	No material risk flagged	~25% finished goods U.S. import exposure; surcharge/passthrough strategy; 90‑day pause until July	Elevated macro risk; monitoring customer caution
BLE/IoT initiatives	InPlay partnership announced focus cold-chain/logistics	Novanta partnership for medical device authentication	Tag‑N‑Trac partnership (pharma cold chain); co‑develop BLE smart labels with InPlay (late 2025 launch)	Expanding ecosystem; pipeline building
Health care applications	Identified three high-value use cases; team build-out	Pipeline advancing; HIMSS outreach	Continued focus; NPD projects (BLE, NFC)	Sustained execution
Capital allocation/governance	$10M buyback; governance review planned	Q4 buybacks executed (~$1.9M)	Buybacks paused; board appoints Mick Lopez; de-staggering proposal	Governance strengthened; shareholder-friendly governance actions
Sales pipeline metrics	Intention to disclose in Q1’25	–	74 opportunities; 10% conversion; baseline building	New disclosure; early traction

Management Commentary

“We began executing our Perform‑Accelerate‑Transform (P‑A‑T) strategic framework as a pure‑play IoT solutions provider… we believe we are well‑positioned to drive long‑term growth.” — CEO Kirsten Newquist .
“Operationally, we made solid progress on the transition … we expect to conclude Singapore‑based production by the end of quarter 2 or shortly thereafter.” .
“We exited Q1 2025 with $132.7 million in cash… our balance sheet position remains strong, enabling us to pursue our organic and inorganic growth initiatives within the P‑A‑T framework.” — CFO Justin Scarpulla .
“As of today’s call, for Q2 2025, we currently expect net revenue in the range of $4.9 million to $5.3 million.” — CFO .
“We have developed financial models for a variety of tariff scenarios… we expect to pass along the tariffs… as a surcharge.” — CFO .

Q&A Highlights

Tariffs: ~25% direct exposure to U.S. import tariffs; management developing pass‑through strategy; indirect impact on customer demand uncertain but caution noted during 90‑day pause .
Grocery logistics BLE device: trials end‑2025; potential go‑live mid‑2026; harsh environment requires iterative design; ASPs above typical RFID inlays .
Thailand transition status: >75% volume in Thailand; yields/efficiency nearing Singapore; final orders being completed in Singapore .
Margin guidance: prior Q4’25 margin target pulled due to tariff uncertainty; operational transition on track, but margins now contingent on tariff outcomes .
Demand/booking tone: minor order holds; overall Q2 caution but guidance reflects anticipated slowdown; no Q1 pull‑ins reported .

Estimates Context

Revenue beat: Actual $5.27M vs consensus $4.95M*; beat driven by exiting low-margin business (lower YoY) yet slightly above prior guidance, with dual-site transition costs impacting margin .
EPS: GAAP EPS (cont. ops) ($0.21) vs consensus ($0.22); S&P normalized EPS actual ($0.12) suggests a larger beat, reflecting normalization differences vs GAAP .
EBITDA: Company adjusted EBITDA ($3.92M) vs S&P consensus EBITDA ($4.08M)* (loss), with S&P normalized EBITDA actual ($4.72M)* indicating underperformance on a normalized basis relative to consensus.

Values retrieved from S&P Global.

Key Takeaways for Investors

Near-term setup: modest top-line outperformance vs Q1 consensus, but margin recovery timing now depends on tariff outcomes; expect volatile gross margin trajectory through Q2–Q3 .
Execution progress: Thailand transition and new commercial leadership underpin medium-term margin potential once dual-site costs end; watch formal completion timelines (late Q2) .
Pipeline health: 74 new opportunities with a 10% quarter conversion; multiple high-value BLE/NFC initiatives (pharma cold chain, logistics, luxury authentication) build optionality for 2026 revenue .
Balance sheet strength: ~$132.7M cash and ~$141.5M working capital provide ample runway for organic investment and tuck‑in M&A; buybacks paused; governance changes positive (de‑staggering, new director) .
Watch Q2 guide and tariff developments: Management guided $4.9M–$5.3M for Q2; tariff policy resolution (post‑pause in July) is the key stock catalyst for re‑instating margin targets .
Estimate revisions: Street likely nudges up near‑term revenue, reduces margin assumptions until tariff clarity; monitor consensus EPS normalization vs GAAP for comparability (normalized actual EPS ($0.12)*) .

Appendix Citations

Q1 2025 press release/8‑K (financials, margins, guidance, reconciliations): .
Q1 2025 earnings call transcript (operational updates, cash/working capital, tariffs, Q&A): .
Prior quarters: Q4 2024 press release/8‑K and call (financials, guidance, buybacks, margin target): .
Q3 2024 press release and call (strategy, transition, capital allocation): .
Other Q1 2025 press releases (partnerships): Tag‑N‑Trac ; InPlay BLE smart labels ; ZATAP/Genuine‑Analytics wine authentication ; Q1 call date ; Board appointment .