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SI

SIGMATRON INTERNATIONAL INC (SGMA)·Q1 2025 Earnings Summary

Executive Summary

  • Q1 FY2025 revenue was $84.8M, down 14.4% YoY, with net loss of $3.3M and diluted EPS of $(0.54) .
  • Sequentially, revenue rose 4.4% vs Q4 FY2024 ($84.8M vs $81.1M) as cost reductions and lower manufacturing schedules began to stabilize operations .
  • Gross margin improved sequentially to 7.6% from 5.3% in Q4 FY2024, though remained below prior-year levels (9.8%) given soft demand and component-market normalization effects .
  • Management reiterated focus on inventory reduction (working capital) and balance-sheet de-leveraging with Lincoln International; customers indicated activity should increase in calendar Q4 2024 .
  • Wall Street consensus (S&P Global) for Q1 FY2025 was unavailable, so beat/miss vs estimates cannot be assessed.

What Went Well and What Went Wrong

What Went Well

  • Sequential revenue growth of 4.4% vs Q4 FY2024 as early signs of demand stabilization appeared: “sequentially, the first quarter of fiscal 2025 was up 4.4% over the fourth quarter of fiscal 2024” .
  • Cost actions and right-sizing underway, with continued overhead reductions and reduced manufacturing schedules: “We have continued to react… by reductions in overhead and costs coupled with reduced manufacturing schedules” .
  • Strategic progress on deleveraging and inventory reduction: “one area of focus remains the reduction of inventory… We have also continued our efforts with Lincoln International to de-lever our balance sheet and we have made progress in several areas” .

What Went Wrong

  • Year-over-year revenue fell 14.4% to $84.8M, reflecting persistent softness across customer markets .
  • Operating loss of $(0.2)M and net loss of $(3.3)M highlight margin pressure from lower volume and lingering supply chain normalization impacts .
  • Gross margin compressed versus prior year (7.6% vs 9.8%), signaling continued pricing and mix headwinds as customers work down excess inventories .

Financial Results

MetricQ1 FY2024Q4 FY2024Q1 FY2025
Revenue ($USD Millions)$98.13 $81.14 $84.78
Gross Profit ($USD Millions)$9.65 $4.26 $6.41
Gross Margin (%)9.8% 5.3% 7.6%
Operating Income ($USD Millions)$2.81 $(1.99) $(0.22)
EBIT Margin (%)2.9% -2.5% -0.3%
Net Income ($USD Millions)$0.26 $(3.38) $(3.29)
Net Income Margin (%)0.3% -4.2% -3.9%
Diluted EPS ($USD)$0.04 $(0.55) $(0.54)

Notes:

  • Margins are derived from reported figures (gross profit, operating income, net income divided by net sales) with citations to the underlying financial statements .

Segment breakdown:

  • SigmaTron reports one EMS segment; no disaggregated segment revenue provided .

KPIs (Balance Sheet Snapshot)

Metric ($USD Millions)April 30, 2024 (FY2024)July 31, 2024 (Q1 FY2025)
Current Assets$175.90 $167.89
Current Liabilities$145.89 $145.42
Long-term Obligations$11.83 $10.57
Stockholders’ Equity$66.07 $62.85
Total Assets$223.79 $218.84

Guidance Changes

MetricPeriodPrevious GuidanceCurrent GuidanceChange
Revenue outlookCalendar Q4 2024None providedCustomers “believe activity will start to increase in the fourth quarter of calendar 2024” Narrative raised
Revenue run-rateQ3 FY2025None provided in Q1 PRQ2 PR: “expect the depressed revenue levels to continue for our third fiscal quarter” Narrative lowered
Revenue vs prior quarterQ4 FY2025None provided in Q1 PRQ3 PR: “based on our current backlog, we expect the revenue for the fourth quarter to be higher than the third quarter” Narrative raised
Operating cadenceNear-termNone providedQ2 PR: “reported an operating profit in October,” reflecting restructuring impact Positive operational update
Balance sheetNear-termEngage Lincoln International for deleveraging Q2 PR: Sale/leaseback executed (Dec 13, 2024) with ~$7.2M gain recognized in Q3 FY2025 Balance sheet de-lever progress

No quantitative ranges for revenue, margins, OpEx, OI&E or tax rate were provided in Q1 FY2025 materials .

Earnings Call Themes & Trends

(Company did not provide an earnings call transcript; themes derived from press releases.)

TopicPrevious Mentions (Q-2 and Q-1)Current Period (Q1 FY2025)Trend
Demand softnessQ4 FY2024: “industry-wide slowdown… softness continued through Q1 FY2025” “softness… continued through the first quarter of fiscal 2025” Q2 FY2025: softness persisted; holidays impacted Q3
Inventory destockingQ4 FY2024 focus on reducing inventory/working capital “reduction of inventory… remained a focus during the first quarter” Q2 FY2025: modest progress; expect significant gains in Q3
Cost reduction/right-sizingQ4 FY2024: layoffs, shortened schedules, consolidation “reductions in overhead and costs coupled with reduced manufacturing schedules” Q2 FY2025: restructuring showing impact; operating profit in October
Supply chain normalizationQ4 FY2024: component marketplace returning to normal lead times Continued monitoring and inventory reduction Q3 FY2025: “marketplace… normalize… shorter lead times and stable pricing”
Tariffs/macroQ4 FY2024: macro/geopolitical volatility Softness pervasive across customers/markets Q3 FY2025: highlighted tariff volatility and potential new policy impacts
De-lever strategyInitiated Lincoln International engagement “continued efforts… to de-lever our balance sheet” Q2/Q3 FY2025: sale/leaseback completed; ~$7.2M gain recorded in Q3

Management Commentary

  • “Revenue is down 14.4% year over year… However, sequentially, the first quarter of fiscal 2025 was up 4.4% over the fourth quarter of fiscal 2024.” – Gary R. Fairhead, CEO .
  • “We have continued to react to these market conditions… by reductions in overhead and costs coupled with reduced manufacturing schedules.” .
  • “One area of focus remains the reduction of inventory to reduce working capital requirements… It will remain a focus for the balance of this calendar year.” .
  • “We have… continued our efforts with Lincoln International to de-lever our balance sheet and we have made progress in several areas.” .

Q&A Highlights

  • No earnings call transcript was located in company filings or our document catalog; analysis is based on press releases [ListDocuments returned no transcript; SearchDocuments found none].

Estimates Context

  • S&P Global consensus estimates for Q1 FY2025 could not be retrieved due to missing CIQ mapping for SGMA; therefore, we cannot assess beats/misses vs Street for revenue or EPS this quarter.
  • Given the absence of numerical guidance and unavailable consensus, analysts may need to reassess near-term models using sequential improvements and management’s qualitative outlook (calendar Q4 2024 demand uptick; Q4 FY2025 revenue expected higher than Q3) .

Key Takeaways for Investors

  • Sequential stabilization: Revenue up 4.4% vs Q4 FY2024 and gross margin improved to 7.6% despite YoY decline; cost actions are starting to show impact .
  • Demand trough likely: Management views calendar Q4 2024 as an inflection as customers indicate stronger activity; Q4 FY2025 revenue guided higher than Q3 in backlog commentary .
  • Balance sheet work progressing: Sale/leaseback completed (Dec 2024) with ~$7.2M gain contributing to Q3 profitability; ongoing de-leveraging via Lincoln International .
  • Inventory/working capital: Continued focus expected to unlock cash and reduce balance-sheet intensity through FY2025 .
  • Margin path: With component-market normalization and right-sizing, operating performance should improve as volumes recover; monitor quarterly gross/EBIT margin trajectory .
  • Near-term modeling: Without Street consensus, use company-reported sequential trends and qualitative demand signals; assume holiday and tariff/macro volatility near term .
  • Trading setup: Stock moves likely tied to confirmation of demand rebound (calendar Q4 2024/Q4 FY2025), evidence of sustained margin improvement, and additional balance-sheet de-lever actions .

Sources: Q1 FY2025 8-K and press release -; FY2024 results press release -; Q2 FY2025 8-K -; Q3 FY2025 8-K -.