Sono-Tek Reports Fiscal Third Quarter and Nine-Month Fiscal 2026 Financial Results
Seventh Consecutive Quarter of Revenue Over $5 Million Driven by Continued Strength in Medical Market and High-ASP Production Systems
Gross Margin Expands to 50% in the Quarter and 51% Year-to-Date
Third Quarter and Nine-Month Net Income Increased 24% and 32% Respectively
Backlog Reaches Record $12.3 Million Reflecting Continued Order Momentum
Reiterates Full Year FY 2026 Guidance Anticipating Modest Revenue Growth
MILTON, N.Y., Jan. 13, 2026 (GLOBE NEWSWIRE) -- Sono-Tek Corporation (NASDAQ:SOTK), the leading developer and manufacturer of ultrasonic coating systems, today reported financial results for the third quarter and first nine months of fiscal year 2026, ended November 30, 2025.
Third Quarter Fiscal 2026 Highlights
- Net sales for the quarter were $5.0 million, compared with $5.2 million in the prior-year period. This marked the seventh consecutive quarter with revenue exceeding $5 million.
- Gross profit increased 7% year over year to $2.5 million, with gross margin expanding to 50%, up from 45% in the prior-year quarter.
- Operating income increased 61% to $319 thousand, reflecting improved gross margin and operating leverage.
- Net income increased 24% to $340 thousand, or $0.02 per diluted share, compared with $274 thousand, or $0.02 per diluted share, in the prior-year quarter.
First Nine Months Fiscal 2026 Highlights
- Net sales for the first nine months totaled $15.3 million, essentially flat year over year.
- Gross profit increased 6% to $7.8 million, with gross margin expanding to 51% from 48% in the prior-year period.
- Operating income increased 69% to $1.22 million.
- Net income increased 32% to $1.25 million, or $0.08 per diluted share, compared with $0.06 per diluted share in the prior-year period.
Balance Sheet, Backlog and Guidance for Fiscal Year 2026
- The Company ended the quarter with $11.7 million in cash, cash equivalents and marketable securities and no outstanding debt.
- Total backlog reached a record $12.26 million, increasing 16% year over year and 9% sequentially, reflecting continued strength in customer order activity.
- For the full fiscal year, the Company is reiterating its guidance reflecting an improved but watchful outlook, anticipating modest revenue growth, that balances market adjustments to recent governmental deemphasis of clean energy initiatives and evolving tariff policies with a positive offset from growing demand in the medical device market.
Management Commentary
Dr. Christopher L. Coccio, Executive Chairman, stated, "We delivered another solid quarter marked by our seventh consecutive period of revenue above $5 million, continued profitability, and meaningful margin expansion. The improvement in gross margin reflects the success of our strategy to prioritize higher-ASP production systems and maintain disciplined cost management, even as certain end markets experience near-term variability. Reaching a record backlog is particularly encouraging and highlights sustained customer confidence in Sono-Tek's technology and long-term value proposition."
Steve Harshbarger, CEO & President, added, "Demand for our advanced ultrasonic coating platforms remains strong, led by continued momentum in the medical device market and increasing adoption of high-value production systems. While U.S. alternative energy demand softened as anticipated due to policy-related timing shifts, growth across medical, electronics, and industrial applications more than offset this impact. With a strong balance sheet, record backlog, and an expanding mix of high-ASP systems, we are well positioned to drive consistent performance and long-term growth.
| Third Quarter Fiscal 2026 Results | |
| (Narrative compares with prior-year period unless otherwise noted) ($ in thousands) | |
| Three Months Ended November 30, | Change | ||||||||||||
| 2025 | 2024 | $ | % | ||||||||||
| Net Sales | $ | 5,004 | $ | 5,191 | (187) | (4%) | |||||||
| Gross Profit | $ | 2,512 | $ | 2,343 | 169 | 7% | |||||||
| Gross Profit % | 50% | 45% | |||||||||||
| Operating Income | $ | 319 | $ | 198 | 121 | 61% | |||||||
| Operating Margin | 6% | 4% | |||||||||||
| Net Income | $ | 340 | $ | 274 | 66 | 24% | |||||||
| Net Margin | 7% | 5% | |||||||||||
Third Quarter Fiscal 2026 Product and Market Highlights
- Product Categories
- In-Line Coating Systems (previously referred to as Integrated Coating Systems) revenue increased sharply by 2,177%, driven by shipments of high-ASP production systems to a major solar energy customer.
- Multi-Axis Coating Systems declined 53% year over year due to reduced electrolysis-related demand following shifts in U.S. policy incentives.
- OEM Systems revenue increased 64%, reflecting stronger demand from fluxing and medical OEM partners.
- Fluxing Systems revenue increased 213%, driven primarily by stronger demand in Asia.
- End Markets
- Medical sales increased 27%, supported by strong demand for balloon catheter, stent, and diagnostic device coating systems.
- Electronics/Microelectronics sales increased 27%, reflecting increased fluxing demand and a semiconductor system shipment to South Korea.
- Industrial sales increased 116%, due to the shipment of a large, advanced textile coating platform to a U.S. government-related customer.
- Alternative Energy sales declined 35% due to reduced U.S. electrolysis activity following changes in government policy initiatives.
Geographic Highlights
- U.S. & Canada sales increased 21% in the quarter, supported by shipments of high-ASP integrated coating systems.
- Asia Pacific sales declined 34% in the quarter following a strong prior year quarter.
- Latin America sales declined 50% due to slower fluxing activity in Mexico and the non-recurrence of a prior-year orthopedic system shipment.
- EMEA sales decreased 26% due primarily to softer demand in the advanced energy market, particularly within electrolysis and fuel cell applications.
| Nine Month Fiscal 2026 Results | |
| (Narrative compares with prior-year period unless otherwise noted) ($ in thousands) | |
| Nine Months Ended November 30, | Change | ||||||||||||
| 2025 | 2024 | $ | % | ||||||||||
| Net Sales | $ | 15,300 | $ | 15,383 | (83) | (1%) | |||||||
| Gross Profit | $ | 7,766 | $ | 7,314 | 452 | 6% | |||||||
| Gross Profit % | 51% | 48% | |||||||||||
| Operating Income | $ | 1,223 | $ | 722 | 501 | 69% | |||||||
| Operating Margin | 8% | 5% | |||||||||||
| Net Income | $ | 1,249 | $ | 946 | 303 | 32% | |||||||
| Net Margin | 8% | 6% | |||||||||||
First Nine-Month Fiscal 2026 Product and Market Highlights
- Product Categories
- In-Line Coating Systems (previously referred to as Integrated Coating Systems) revenue increased by 126%, reflecting shipments of 8 high-ASP production systems totaling approximately $5.9M to a major solar energy customer.
- Multi-Axis Coating Systems declined 46% year over year primarily due to slower electrolysis system demand following government policy changes.
- OEM Systems revenue increased 18%, reflecting stronger demand from fluxing OEM partners.
- Fluxing Systems revenue increased 80%, driven primarily by stronger demand in Asia.
- End Markets
- Medical sales increased 37%, supported by strong balloon coating systems shipped to the U.S., Europe, and China, solid stent coating activity, and expanding new applications in the medical field.
- Electronics/Microelectronics sales decreased 9%, following strong FY2025 semiconductor sales, and FY2026 customer timing for similar machines.
- Industrial sales decreased 26%, influenced by a large FY2025 European glass coating order that did not repeat.
- Alternative Energy sales declined slightly by 2% influenced by the shipment of eight high-ASP solar coating systems to the solar industry, which offset declines from the US electrolysis market.
Geographic Highlights
- U.S. & Canada sales increased 3%, supported by shipments of high-ASP in-line coating systems.
- Asia Pacific sales increased 13% driven by medical sales in China and strong alternative energy demand in Japan and South Korea.
- Latin America sales declined 48% due to slower fluxing activity in Mexico.
- EMEA sales decreased 9% primarily due to softening advanced energy demand in electrolysis and fuel cell applications, partially offset by continued strength in medical system shipments.
About Sono-Tek
Sono-Tek Corporation (NASDAQ:SOTK) is a global leader in the design and manufacture of ultrasonic coating systems that are shaping industries and driving innovation worldwide. Our ultrasonic coating systems are used to apply thin films onto parts in diverse industries including medical devices, semiconductors, microelectronics, alternative energy, advanced industrial manufacturing, and research and development sectors.
Sono-Tek has a long history of providing advanced coating solutions to the medical device industry, enabling precision coatings for life-saving technologies such as stents, balloons, diagnostic devices, and various drug delivery platforms. At the same time, our expertise in semiconductor and microelectronics applications continues to expand, as customers increasingly turn to Sono-Tek for solutions supporting next-generation chips, displays, and sensors. Alongside these markets, our technologies are also leading the way in next-generation clean energy coatings for fuel cells, carbon capture, advanced solar cells, and various other advanced industrial applications, underscoring the versatility and broad reach of Sono-Tek's ultrasonic coating platforms.
Our product line is rapidly evolving, transitioning from R&D tools to high-volume production machines with significantly higher average selling prices, showcasing our market leadership and adaptability. Our comprehensive suite of thin film coating solutions and application consulting services ensures unparalleled results for our clients and helps some of the world's most promising companies achieve technological breakthroughs and bring them to market. We strategically deliver our products to customers through a network of direct sales personnel, carefully chosen independent distributors, and experienced sales representatives, ensuring efficient market reach across diverse sectors around the globe.
Our growth strategy is focused on leveraging our innovative technologies, proprietary know-how, unique talent and experience, and global reach to further develop microscopic coating technologies that enable better outcomes for our customers' products and processes. For further information, visit www.sono-tek.com.
Safe Harbor Statement
This news release contains forward looking statements regarding future events and the future performance of Sono-Tek Corporation that involve risks and uncertainties that could cause actual results to differ materially. These "forward-looking statements' are based on currently available competitive, financial and economic data and our operating plans. They are inherently uncertain, and investors must recognize that events could turn out to be significantly different from our expectations and could cause actual results to differ materially. These factors include, among other considerations, general economic and business conditions, including political, regulatory, tax, competitive and technological developments affecting our operations or the demand for our products; inflationary and supply chain pressures; continued strength of sales to the medical device market; continued private and public funding for the clean energy sector; continued strong demand for Sono-Tek's suite of thin film coating solutions and application consulting services in the clean energy and other markets; maintenance of order backlog; evolving tariff policies; timely development and market acceptance of new products and continued customer validation of our coating technologies; adequacy of financing; capacity additions, the ability to enforce patents; maintenance of operating leverage; consummation of order proposals; completion of large orders on schedule and on budget; successful transition from primarily selling ultrasonic nozzles and components to a more complex business providing complete machine solutions and higher value subsystems; and realization of quarterly and annual revenues within the forecasted range of sales guidance. We undertake no obligation to update any forward-looking statement.
For more information:
Sono-Tek Corp.
Stephen J. Bagley
Chief Financial Officer
Ph: (845) 795-2020
[email protected]
Investor Relations
Kirin Smith
PCG Advisory, Inc.
[email protected]
-FINANCIAL TABLES FOLLOW -
| SONO-TEK CORPORATION CONDENSED CONSOLIDATED BALANCE SHEETS | ||||||||
| November 30, 2025 (Unaudited) | February 28, 2025 | |||||||
| ASSETS | ||||||||
| Current Assets: | ||||||||
| Cash and cash equivalents | $ | 5,395,695 | $ | 5,202,361 | ||||
| Marketable securities | 6,323,566 | 6,727,678 | ||||||
| Accounts receivable (less allowance of $12,225, respectively) | 4,411,663 | 2,347,764 | ||||||
| Inventories | 3,656,898 | 4,474,401 | ||||||
| Prepaid expenses and other current assets | 305,690 | 236,261 | ||||||
| Total current assets | 20,093,512 | 18,988,465 | ||||||
| Land | 250,000 | 250,000 | ||||||
| Buildings, equipment, furnishings and leasehold improvements, net | 2,288,462 | 2,610,600 | ||||||
| Intangible assets, net | 31,794 | 37,386 | ||||||
| Deferred tax asset | 1,266,846 | 1,525,185 | ||||||
| TOTAL ASSETS | $ | 23,930,614 | $ | 23,411,636 | ||||
| LIABILITIES AND STOCKHOLDERS' EQUITY | ||||||||
| Current Liabilities: | ||||||||
| Accounts payable | $ | 534,692 | $ | 859,483 | ||||
| Accrued expenses | 2,008,801 | 1,718,574 | ||||||
| Customer deposits | 2,151,930 | 2,413,195 | ||||||
| Income taxes payable | 43,422 | 496,055 | ||||||
| Total current liabilities | 4,738,845 | 5,487,307 | ||||||
| Deferred tax liability | 59,349 | 132,134 | ||||||
| Total liabilities | 4,798,194 | 5,619,441 | ||||||
| Commitments and Contingencies (Note 10) | ||||||||
| Stockholders' Equity | ||||||||
| Common stock, $.01 par value; 25,000,000 shares authorized, 15,754,480 issued and 15,710,389 outstanding as of November 30, 2025 and 15,751,153 issued and 15,749,037 outstanding February 28, 2025, respectively | 157,545 | 157,512 | ||||||
| Additional paid-in capital | 10,260,711 | 10,018,034 | ||||||
| Accumulated earnings | 8,873,153 | 7,624,516 | ||||||
| Treasury stock, at cost 44,091 shares and 2,116 shares, November 30, 2025 and February 28, 2025, respectively | (158,989 | ) | (7,867 | ) | ||||
| Total stockholders' equity | 19,132,420 | 17,792,195 | ||||||
| TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY | $ | 23,930,614 | $ | 23,411,636 | ||||
See notes to unaudited condensed consolidated financial statements.
| SONO-TEK CORPORATION CONDENSED CONSOLIDATED STATEMENTS OF INCOME (Unaudited) | ||||||||||||||||
| Nine Months Ended November 30, | Three Months Ended November 30, | |||||||||||||||
| 2025 | 2024 | 2025 | 2024 | |||||||||||||
| Net Sales | $ | 15,299,839 | $ | 15,383,416 | $ | 5,004,370 | $ | 5,190,596 | ||||||||
| Cost of Goods Sold | 7,533,347 | 8,069,633 | 2,492,129 | 2,847,397 | ||||||||||||
| Gross Profit | 7,766,492 | 7,313,783 | 2,512,241 | 2,343,199 | ||||||||||||
| Operating Expenses | ||||||||||||||||
| Research and product development costs | 1,934,109 | 2,054,846 | 638,361 | 627,543 | ||||||||||||
| Marketing and selling expenses | 2,656,804 | 2,814,804 | 927,300 | 929,196 | ||||||||||||
| General and administrative costs | 1,952,085 | 1,722,210 | 627,608 | 588,823 | ||||||||||||
| Total Operating Expenses | 6,542,998 | 6,591,860 | 2,193,269 | 2,145,562 | ||||||||||||
| Operating Income | 1,223,494 | 721,923 | 318,972 | 197,637 | ||||||||||||
| Interest and Dividend Income | 332,147 | 359,248 | 108,487 | 131,518 | ||||||||||||
| Net unrealized gain/(loss) on marketable securities | 912 | 38,776 | (658 | ) | (15,165 | ) | ||||||||||
| Income Before Income Taxes | 1,556,553 | 1,119,947 | 426,801 | 313,990 | ||||||||||||
| Income Tax Expense | 307,916 | 174,247 | 86,842 | 39,812 | ||||||||||||
| Net Income | $ | 1,248,637 | $ | 945,700 | $ | 339,959 | $ | 274,178 | ||||||||
| Basic Earnings Per Share | $ | 0.08 | $ | 0.06 | $ | 0.02 | $ | 0.02 | ||||||||
| Diluted Earnings Per Share | $ | 0.08 | $ | 0.06 | $ | 0.02 | $ | 0.02 | ||||||||
| Weighted Average Outstanding Shares - Basic | 15,721,548 | 15,750,980 | 15,708,817 | 15,751,153 | ||||||||||||
| Weighted Average Outstanding Shares - Diluted | 15,736,330 | 15,771,039 | 15,724,960 | 15,771,511 | ||||||||||||
See notes to unaudited condensed consolidated financial statements.
| SONO-TEK CORPORATION PRODUCT, MARKET, AND GEOGRAPHIC SALES (Unaudited) | ||||||||||||||||||||||||||||||||||
| Product Sales | ||||||||||||||||||||||||||||||||||
| Three Months Ended November 30, | Change | Nine Months Ended November 30, | Change | |||||||||||||||||||||||||||||||
| 2025 | 2024 | $ | % | 2025 | 2024 | $ | % | |||||||||||||||||||||||||||
| Fluxing Systems | $ | 222,000 | $ | 71,000 | 151,000 | 213 | % | $ | 583,000 | $ | 324,000 | 259,000 | 80 | % | ||||||||||||||||||||
| In-Line Coating Systems | 1,844,000 | 81,000 | 1,763,000 | 2,177 | % | 6,428,000 | 2,850,000 | 3,578,000 | 126 | % | ||||||||||||||||||||||||
| Multi-Axis Coating Systems | 1,666,000 | 3,563,000 | (1,897,000 | ) | (53 | % | ) | 4,373,000 | 8,158,000 | (3,785,000 | ) | (46 | % | ) | ||||||||||||||||||||
| OEM Systems | 425,000 | 259,000 | 166,000 | 64 | % | 936,000 | 796,000 | 140,000 | 18 | % | ||||||||||||||||||||||||
| Other | 847,000 | 1,217,000 | (370,000 | ) | (30 | % | ) | 2,980,000 | 3,255,000 | (275,000 | ) | (8 | % | ) | ||||||||||||||||||||
| TOTAL | $ | 5,004,000 | $ | 5,191,000 | (187,000 | ) | (4 | % | ) | $ | 15,300,000 | $ | 15,383,000 | (83,000 | ) | (1 | % | ) | ||||||||||||||||
Market Sales
| Three Months Ended November 30, | Change | Nine Months Ended November 30, | Change | |||||||||||||||||||||||||||||||
| 2025 | 2024 | $ | % | 2025 | 2024 | $ | % | |||||||||||||||||||||||||||
| Electronics/Microelectronics | $ | 1,287,000 | $ | 1,016,000 | 271,000 | 27 | % | $ | 3,686,000 | $ | 4,060,000 | (374,000 | ) | (9 | % | ) | ||||||||||||||||||
| Medical | 1,136,000 | 897,000 | 239,000 | 27 | % | 2,949,000 | 2,156,000 | 793,000 | 37 | % | ||||||||||||||||||||||||
| Alternative Energy | 1,912,000 | 2,959,000 | (1,047,000 | ) | (35 | % | ) | 7,592,000 | 7,740,000 | (148,000 | ) | (2 | % | ) | ||||||||||||||||||||
| Emerging R&D and Other | 18,000 | 17,000 | 1,000 | 6 | % | 65,000 | 57,000 | 8,000 | 14 | % | ||||||||||||||||||||||||
| Industrial | 651,000 | 302,000 | 349,000 | 116 | % | 1,008,000 | 1,370,000 | (362,000 | ) | (26 | % | ) | ||||||||||||||||||||||
| TOTAL | $ | 5,004,000 | $ | 5,191,000 | (187,000 | ) | (4 | % | ) | $ | 15,300,000 | $ | 15,383,000 | (83,000 | ) | (1 | % | ) | ||||||||||||||||
Geographic Sales
| Three Months Ended November 30, | Change | Nine Months Ended November 30, | Change | |||||||||||||||||||||||||||||||
| 2025 | 2024 | $ | % | 2025 | 2024 | $ | % | |||||||||||||||||||||||||||
| U.S. & Canada | $ | 3,415,000 | $ | 2,823,000 | 592,000 | 21 | % | $ | 9,674,000 | $ | 9,409,000 | 265,000 | 3 | % | ||||||||||||||||||||
| Asia Pacific (APAC) | 734,000 | 1,114,000 | (380,000 | ) | (34 | % | ) | 2,262,000 | 1,994,000 | 268,000 | 13 | % | ||||||||||||||||||||||
| Europe, Middle East, Asia (EMEA) | 706,000 | 957,000 | (251,000 | ) | (26 | % | ) | 3,027,000 | 3,338,000 | (311,000 | ) | (9 | % | ) | ||||||||||||||||||||
| Latin America | 149,000 | 297,000 | (148,000 | ) | (50 | % | ) | 337,000 | 642,000 | (305,000 | ) | (48 | % | ) | ||||||||||||||||||||
| TOTAL | $ | 5,004,000 | $ | 5,191,000 | (187,000 | ) | (4 | % | ) | $ | 15,300,000 | $ | 15,383,000 | (83,000 | ) | (1 | % | ) | ||||||||||||||||
