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What changed in INTEST CORP's 10-K — 2024 vs 2025

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Paragraph-level year-over-year comparison of INTEST CORP's 2024 and 2025 10-K annual filings, covering the Business, Risk Factors, Legal Proceedings, Cybersecurity, MD&A and Market Risk sections. Every new, removed and edited paragraph is highlighted side-by-side so you can see exactly what management changed in the 2025 report.

+381 added−280 removedSource: 10-K (2026-03-12) vs 10-K (2025-03-13)

Top changes in INTEST CORP's 2025 10-K

381 paragraphs added · 280 removed · 203 edited across 6 sections

Item 1. Business

Business — how the company describes what it does

99 edited+25 added−41 removed67 unchanged
Biggest changeIn addition, we have hosted separate company-wide marketing and engineering summits, where our sales and marketing leadership and engineers, respectively, from across the organization came together to collaborate on a global level and share ideas for growing and expanding the inTEST brand. 5 ACQUISITION On March 12, 2024, we entered into a stock purchase agreement to acquire all of the outstanding capital shares of Alfamation S.p.A., a leading global provider of state-of-the-art test and measurement solutions for the automotive, life sciences and specialty consumer electronics markets.
Biggest changeACQUISITION On March 12, 2024, we entered into a stock purchase agreement to acquire all of the outstanding capital shares of Alfamation S.p.A., a leading global provider of state-of-the-art test and measurement solutions for the Auto/EV, Life Sciences and specialty consumer electronics markets. Alfamation™ was founded in 1991 and is headquartered in Milan, Italy.
We design solutions to overcome the evolving challenges facing the semi market and other markets that we serve, which we believe provide the following advantages: Temperature-Controlled Testing . Our ThermoStream® products are used by manufacturers in a number of markets to stress test a variety of semiconductor and electronic components, printed circuit boards and sub-assemblies.
We design solutions to overcome the evolving challenges facing the Semi market and the other markets that we serve, which we believe provide the following advantages: Temperature-Controlled Testing - Our ThermoStream ® products are used by manufacturers in a number of markets to stress test a variety of semiconductor and electronic components, printed circuit boards and sub-assemblies.
Our Process Technologies segment consists of (i) Ambrell® which has operations in New York, the Netherlands and the U.K. and (ii) Videology®, which has operations in Massachusetts and the Netherlands. Ambrell® provides customers with induction heating solutions for a wide variety of manufacturing processes. Videology® is a designer, developer and manufacturer of digital streaming and image capturing solutions.
Our Process Technologies segment consists of (i) Ambrell ® which has operations in New York, the Netherlands and the U.K. and (ii) Videology ® , which has operations in Massachusetts. Ambrell ® provides customers with induction heating solutions for a wide variety of manufacturing processes. Videology ® is a designer, developer and manufacturer of digital streaming and image capturing solutions.
We believe this integrated approach to ATE facilitates smooth changeover from one tester to another, longer lives for interface components, better test results, increased ATE utilization and lower overall test costs. 8 Robotics-Based Electronic Production Test Equipment. Acculogic adds to our electronic test platform offerings beyond those which exclusively serve the semi market.
We believe this integrated approach to ATE facilitates smooth changeover from one tester to another, longer lives for interface components, better test results, increased ATE utilization and lower overall test costs. Robotics-Based Electronic Production Test Equipment. Acculogic adds to our electronic test platform offerings beyond those which exclusively serve the Semi market.
Each of our Massachusetts, New York, and Canada facilities is ISO 9001:2015 certified. Our New Jersey facility manufactures products only for the semiconductor industry where ISO certification is not required, so we do not maintain any ISO certifications there. However, this location does employ the practices embodied in the ISO 9001:2008.
Each of our Massachusetts, New York, and Canada facilities are ISO 9001:2015 certified. Our New Jersey facility manufactures products only for the semiconductor industry where ISO certification is not required, so we do not maintain any ISO certifications there. However, this location does employ the practices embodied in the ISO 9001:2008.
The liabilities assumed in connection with the acquisition included debt of approximately €10.3 million, or $11.3 million. After all closing adjustments, the total purchase price was $21.9 million. We finalized our allocation of the purchase price to assets acquired and liabilities assumed during the fourth quarter of 2024.
The liabilities assumed in connection with the acquisition included debt of approximately €10.3 million (approximately $11.3 million). After all closing adjustments, the total purchase price was $21.9 million. We finalized our allocation of the purchase price to assets acquired and liabilities assumed during the fourth quarter of 2024.
Our field service engineers, located in the U.S. and Europe, provide service and support globally. Additionally, several distributors in Europe and Asia have factory-trained service technicians. We market our Videology® industrial camera solutions to OEMs and end users both directly and through distributors. We have both manufacturing and service capabilities in the U.S. and the Netherlands.
Our field service engineers, located in the U.S. and Europe, provide service and support globally. Additionally, several distributors in Europe and Asia have factory-trained service technicians. We market our Videology ® industrial camera solutions to OEMs and end users both directly and through distributors. We have both manufacturing and service capabilities in the U.S.
North American sales representatives also coordinate product installation and support with our technical staff and participate in trade shows. 12 Our internal sales account managers handle sales to ATE manufacturers and are responsible for a portfolio of customer accounts and for managing certain independent sales representatives.
North American sales representatives also coordinate product installation and support with our technical staff and participate in trade shows. Our internal sales account managers handle sales to ATE manufacturers and are responsible for a portfolio of customer accounts and for managing certain independent sales representatives.
Our Process Technologies segment provides these solutions across an array of markets including automotive, defense/aerospace, industrial, life sciences, security and semiconductor. On February 25, 2025, we notified employees of our wholly-owned subsidiary, Videology Imaging Corporation, of our intention to consolidate all operations in the Netherlands into our facility located in Mansfield, Massachusetts.
Our Process Technologies segment provides these solutions across an array of industries including automotive, defense/aerospace, industrial, life sciences, security and semiconductor. On February 25, 2025, we notified employees of our wholly-owned subsidiary, Videology Imaging Corporation, of our intention to consolidate all operations in the Netherlands into our facility located in Mansfield, Massachusetts.
As technology advances and ICs become increasingly more complex, we believe the need for increased capabilities in the test process should drive greater demand for our equipment. We expect that more front-end testing is going to be required to ensure maximum yield from the massive capital investments being made in fab expansion.
As technology advances and ICs become increasingly more complex, we believe the need for increased capabilities in the test process should drive greater demand for our equipment. We expect that more front-end testing is going to be required to ensure maximum yield from the massive capital investments being made in fabrication expansion.
While backlog is calculated on the basis of firm purchase orders, a customer may cancel an order or accelerate or postpone currently scheduled delivery dates. Our backlog may be affected by the tendency of customers to rely on shorter lead times available from suppliers, including us, in periods of depressed demand.
While backlog is calculated on the basis of firm purchase orders, a customer may cancel an order or accelerate or postpone currently scheduled delivery dates. Our backlog may be affected by the tendency of customers to rely on short lead times available from suppliers, including us, in periods of depressed demand.
In the defense/aerospace industry, we provide ATE to prime and subcontract manufacturers to ensure quality control is maintained while also providing quicker, more accurate test times of electronic circuit boards. We also provide solutions for thermal testing of equipment to ensure it will function over the specified temperature range.
Defense/Aerospace In the Defense/Aerospace market, we provide ATE to prime and subcontract manufacturers to ensure quality control is maintained while also providing quicker, more accurate test times of electronic circuit boards. We also provide solutions for thermal testing of equipment to ensure it will function over the specified temperature range.
The loss of any one or more of our largest customers, or a reduction in orders by a major customer, could materially reduce our revenue or otherwise materially affect our business, financial condition or results of operations. MANUFACTURING AND SUPPLY At December 31, 2024, our principal manufacturing operations consisted of assembly and testing at our facilities in in the U.S.
The loss of any one or more of our largest customers, or a reduction in orders by a major customer, could materially reduce our revenue or otherwise materially affect our business, financial condition or results of operations. MANUFACTURING AND SUPPLY At December 31, 2025, our principal manufacturing operations consisted of assembly and testing at our facilities in the U.S.
ENGINEERING AND PRODUCT DEVELOPMENT Our success depends on our ability to provide our customers with products and solutions that are well engineered and to design those products and solutions before, or at least no later than, our competitors. At December 31, 2024, we employed approximately 100 engineers engaged in engineering and product development.
ENGINEERING AND PRODUCT DEVELOPMENT Our success depends on our ability to provide our customers with products and solutions that are well engineered and to design those products and solutions before, or at least no later than, our competitors. At December 31, 2025, we employed approximately 100 engineers engaged in engineering and product development.
(New York, Massachusetts and New Jersey), Italy, Canada, Germany and the Netherlands. We assemble most of our products from a combination of standard components and custom parts that have been fabricated to our specifications by either third-party manufacturers or our own facilities. Our practice is to use high quality raw materials and components in our products.
(New York, Massachusetts and New Jersey), Canada and Italy. We assemble most of our products from a combination of standard components and custom parts that have been fabricated to our specifications by either third-party manufacturers or our own facilities. Our practice is to use high quality raw materials and components in our products.
These investments are being driven by the continued growth of the use of electronics, the need for powering an ever-growing number of devices and the continued economic development of less wealthy nations.
These investments are being driven by the continued growth of the use of electronics and artificial intelligence, the need for powering an ever-growing number of devices, and the continued economic development of less wealthy nations.
These systems are capable of controlling temperatures to within +/- 0.1 degree Celsius over a range of -100 degrees Celsius to as high as +300 degrees Celsius within 1.0 degree Celsius of accuracy. As a stand-alone tool, ThermoStreams® provide a temperature-controlled air stream to rapidly change and stabilize the temperature of packaged ICs and other devices.
These systems are capable of controlling temperatures to within +/- 0.1 ° Celsius over a range of -100 ° to +300 ° Celsius within 1.0 ° Celsius of accuracy. As a stand-alone tool, ThermoStreams ® provide a temperature-controlled air stream to rapidly change and stabilize the temperature of packaged ICs and other devices.
We have long recognized the need to maintain a physical presence near our customers’ facilities. At December 31, 2024, we had manufacturing facilities in the U.S. in Massachusetts, New Jersey, and New York as well as outside the U.S. in Canada, Germany, Italy and the Netherlands.
We have long recognized the need to maintain a physical presence near our customers’ facilities. At December 31, 2025, we had manufacturing facilities in the U.S. in Massachusetts, New Jersey, and New York as well as outside the U.S. in Canada, Germany and Italy.
Acculogic designs and manufactures robotics-based electronic production test equipment and provides application support services which are sold to electronic manufacturers including OEM and contract electronic manufacturers as well as battery manufacturers. Functional Test Equipment for Automotive, Life Sciences and Specialty Consumer Electronics Markets.
Acculogic designs and manufactures robotics-based electronic production test equipment and provides application support services which are sold to electronic manufacturers including OEM and contract electronic manufacturers as well as battery manufacturers. Functional Test Equipment for Auto/EV, Life Sciences and Specialty Consumer Electronics Markets .
These ICs include microprocessors, digital signal processing chips, mixed signal devices, micro-electro-mechanical systems (“ MEMS ”), application specific ICs and specialized memory ICs, and are used primarily in the automotive, consumer electronics, industrial, and mobile communication markets.
These ICs include microprocessors, digital signal processing chips, mixed signal devices, micro-electro-mechanical systems (“ MEMS ”), application specific ICs and specialized memory ICs, and are used primarily in the Auto/EV, consumer electronics, Industrial, and mobile communication markets.
Customer support is supplied by a team located throughout North America. In Europe, these products and services are sold through manufacturer representatives and supported with direct employees based in our Hamburg, Germany facility. In Asia, these products and services are sold through a mixture of distributors and manufacturer representatives.
Customer support is supplied by a team located throughout North America. In Europe, these products and services are sold through manufacturer representatives and supported with our employees based in Germany. In Asia, these products and services are sold through a mixture of distributors and manufacturer representatives.
Alfamation™’s product offerings include functional test equipment for production quality control and product development. Our Environmental Technologies segment consists of inTEST Thermal Solutions (“ iTS ”), which manufactures and sells products under the Temptronic®, Sigma, Thermonics® and North Sciences brand names and has operations in Massachusetts, Germany and Singapore.
Alfamation ™ ’s product offerings include functional test equipment for production quality control and product development. Our Environmental Technologies segment consists of ITS, which manufactures and sells products under the Temptronic ® , Sigma, Thermonics ® and North Sciences brand names and has operations in Massachusetts, Germany and Singapore.
Customers use the thermal solutions produced by iTS for product development, characterization and production test. This segment also offers ultra-cold storage solutions for the life sciences cold chain market. Our Environmental Technologies segment provides these solutions across an array of markets including automotive, defense/aerospace, industrial, life sciences and semiconductor.
Customers use the thermal solutions produced by ITS for product development, characterization and production testing. This segment also offers ultra-cold storage solutions for the life sciences cold chain market. Our Environmental Technologies segment provides these solutions across an array of industries including automotive, defense/aerospace, industrial, life sciences and semiconductor.
Our practice in many cases is to assign engineers to work with specific customers, thereby enabling us to develop the relationships and exchange of information that is most conducive to successful product development and enhancement.
Our practice in many cases is to assign engineers to work with specific customers, thereby enabling us to develop the relationships and exchange of 15 Table of Contents information that is most conducive to successful product development and enhancement.
In periods of increased demand, there is a tendency towards longer lead times, which has the effect of increasing backlog. As a result of these factors, our backlog at a particular date is not necessarily indicative of sales for any future period. See also the discussion of backlog in “ Part II, Item 7.
In periods of increased demand, there is a tendency towards longer lead times that has the effect of increasing backlog. As a result, our backlog at a particular date is not necessarily indicative of sales for any future period. See also the discussion of backlog in “ Part II; Item 7.
MobileTemp Systems are designed specifically for small thermal-mass applications beyond the semi market and have found applications in the automotive, electronic, fiber optic and oil field service markets testing such things as electronic sub-assemblies, sensor assemblies, and printed circuit boards. 11 Traditionally, our customers use ThermoStream® products primarily in engineering, quality assurance and small-run manufacturing environments.
MobileTemp Systems are designed specifically for small thermal-mass 12 Table of Contents applications beyond the Semi market and have found applications in the automotive, electronic, fiber optic and oil field service markets testing such things as electronic sub-assemblies, sensor assemblies and printed circuit boards. Traditionally, our customers use ThermoStream ® products primarily in engineering, quality assurance and small-run manufacturing environments.
Our products provide highly engineered, high quality and cost-effective test and process technology solutions which are delivered with a customer focus that are intended to drive a high level of customer satisfaction. Our strategy is to consistently expand our unique and differentiated test and process technology solutions through innovative new product development and acquisitions.
Our products provide highly engineered, high quality and cost-effective test and process technology solutions which are delivered with a customer focus that are intended to drive a high level of customer satisfaction. We aim to consistently expand our unique and differentiated solutions through innovative new product development and acquisitions.
Likewise, European, Taiwanese, South Korean and Japanese semiconductor manufacturers generally have located their wafer fabrication plants in their respective countries. Electronic Test Products : In North America, we sell our inTEST EMS products to semiconductor manufacturers through internal account representatives and independent, commissioned sales representatives.
Likewise, European, Taiwanese, South Korean and Japanese semiconductor manufacturers generally have located their wafer fabrication plants in their respective countries. 13 Table of Contents Electronic Test Products : In North America, we sell our InTest EMS products to semiconductor manufacturers through internal account representatives and independent, commissioned sales representatives.
Our Electronic Test segment consists of (i) inTEST EMS which has operations in New Jersey and California, and (ii) Acculogic, which has operations in Canada, California and Germany and (iii) Alfamation S.p.A., which has operations in Italy and China.
Our Electronic Test segment consists of (i) InTest EMS which has operations in New Jersey and California, (ii) Acculogic, which has operations in Canada, California and Germany and (iii) Alfamation ™ , which has operations in Italy and China.
We also routinely post press releases, presentations, webcasts and other information regarding the Company on our website. The information posted to our website is not part of this Report.
We also routinely post press releases, 17 Table of Contents presentations, webcasts and other information regarding the Company on our website. The information posted to our website is not part of this Report.
In the absence of intellectual property protection, we may be vulnerable to competitors who attempt to copy or imitate our products or processes. For additional information regarding risks related to our intellectual property, see “ Part I; Item 1A.
In the absence of intellectual property protection, we may be vulnerable to competitors who attempt to copy or imitate our products or processes. For additional information regarding risks related to our intellectual property, see “ Part I; Item 1A. Risk Factors ” in this Report.
We believe the semi market, an historically highly cyclical industry, will experience increased growth in the overall size of the market over the next several years as a result of billions of dollars of investments in new fabrication (“ fab ”) facilities around the world.
Market Trends We believe the Semi market, a historically highly cyclical industry, will experience increased growth in the overall size of the market over the next several years as a result of billions of dollars of investments in new fabrication facilities around the world.
Management ’ s Discussion and Analysis of Financial Condition and Results of Operations .” Although, from time to time, certain components may be in short supply due to high demand or inability of vendors to meet quality or delivery requirements, we believe that all materials and components are available in adequate amounts from other sources, except as noted above.
Management’s Discussion and Analysis of Financial Condition and Results of Operations; Global Supply Chain Constraints .” Although, from time to time, certain components may be in short supply due to high demand or inability of vendors to meet quality or delivery requirements, we believe that all materials and components are available in adequate amounts from other sources, except as noted above.
In addition, all employees and third-party product development consultants agree not to disclose any private or confidential information relating to our technology, trade secrets or intellectual property. At December 31, 2024, we held 21 active U.S. patents and had one pending U.S. patent applications covering various aspects of our technology.
In addition, all employees and third-party product development consultants agree not to disclose any private or confidential information relating to our technology, trade secrets or intellectual property. At December 31, 2025, we held 24 active U.S. patents and had two pending U.S. patent applications covering various aspects of our technology.
Only two of our employees (both outside the United States) are represented by a labor union, and we have never experienced a work stoppage. From time to time, we retain temporary workers or third-party contractors to assist us in manufacturing operations and engineering and product development projects.
Only four of our employees (both outside the U.S.) are represented by a labor union, and we have never experienced a work stoppage. From time to time, we retain temporary workers or third-party contractors to assist us in manufacturing operations and engineering and product development projects.
Risk Factors ” in this Report. 14 While we believe that our patents and other proprietary rights are important to our business, we also believe that, due to the rapid pace of technological change in the markets we serve, the successful manufacture and sale of our products also depends upon our engineering, manufacturing, marketing and servicing skills.
While we believe that our patents and other proprietary rights are important to our business, we also believe that, due to the rapid pace of technological change in the markets we serve, the successful manufacture and sale of our products also depends upon our engineering, manufacturing, marketing and servicing skills.
Our U.S. patents expire at various times beginning in 2025 and extending through 2039. During 2024, no U.S. patents were issued and 9 U.S. patents expired. We do not believe that the upcoming expiration of certain of our patents in 2025 will have a material impact on our business.
Our U.S. patents expire at various times beginning in 2026 and extending through 2039. During 2025, five U.S. patents were issued and two U.S. patents expired. We do not believe that the upcoming expiration of certain of our patents in 2026 will have a material impact on our business.
Our EV solutions include, but are not limited to, induction heating solutions for motor manufacturing, automated test equipment for battery cells, and industrial process chillers and thermal test chambers for inverter and battery testing and automated test solutions for automotive infotainment systems in both production and quality control.
Our EV solutions include, but are not limited to, induction heating solutions for motor manufacturing, automated test equipment for battery cells, and industrial process chillers and thermal test chambers for inverter and battery testing and automated test solutions for automotive infotainment systems (for EVs, Hybrids and internal combustion engine vehicles) in both production and quality control.
The cash portion of the purchase price was subject to customary working capital adjustments which were finalized in June 2024 and resulted in recording an additional €129 thousand (approximately $141 thousand) of cash purchase price for assets delivered at closing in excess of agreed upon thresholds.
The cash portion of the purchase price was subject to customary working capital adjustments which were finalized in June 2024 and resulted in recording an additional €0.1 million (approximately $0.1 million) of cash purchase price for assets delivered at closing in excess of agreed upon thresholds.
Since most of our products are customized, we consider substantially all of our engineering activities to be engineering and product development. In the years ended December 31, 2024 and 2023, we spent approximately $8.5 million and $7.6 million, respectively, on engineering and product development.
Since most of our products are customized, we consider substantially all of our engineering activities to be engineering and product development. In the years ended December 31, 2025 and 2024, we spent approximately $9.4 million and $8.5 million, respectively, on engineering and product development.
Thermonics ® Products: Our Thermonics® temperature conditioning products, which include our process chillers, provide tempered gas or fluid to enable customers to maintain desired thermal conditions within their tool or process. Applications include general industrial, chemical processing, energy, electronics, automotive, defense/aerospace and semiconductor markets. Prices generally range from $25 thousand to $150 thousand.
Thermonics ® Products : Our Thermonics ® temperature conditioning products, which include our process chillers, provide tempered gas or fluid to enable customers to maintain desired thermal conditions within their tool or process. Applications include general industrial, chemical processing, energy, electronics, automotive, defense/aerospace and semiconductor markets.
Chambers can be designed to utilize liquid nitrogen or liquid carbon dioxide cooling or mechanical refrigeration, and sometimes both. These chambers can accommodate large thermal masses and are found in both laboratory and production environments. Chambers are generally priced from $18 thousand to $150 thousand.
Chambers can be designed to utilize liquid nitrogen or liquid carbon dioxide cooling or mechanical refrigeration, and sometimes both. These chambers can accommodate large thermal masses and are found in both laboratory and production environments.
Process Technologies Products EKOHEAT ® Products: Our EKOHEAT® induction heating systems with power ratings from 10kW to 1 MW are manufactured by Ambrell® and are used to conduct fast, efficient, repeatable non-contact heating of metals or other electrically conductive materials in order to transform raw materials into finished parts. Prices generally range from $30 thousand to $250 thousand.
Process Technologies Products EKOHEAT ® Products : Our EKOHEAT ® induction heating systems with power ratings from 10 kW to 1 MW are manufactured by Ambrell ® and are used to conduct fast, efficient, repeatable non-contact heating of metals or other electrically conductive materials in order to transform raw materials into finished parts.
We are committed to becoming recognized as a leader in our targeted markets for engineering and manufacturing capabilities that help solve our customers’ most complex challenges in their manufacturing and quality processes.
We are committed to becoming recognized as a leader in our target markets for engineering and manufacturing capabilities that help solve our customers’ most complex challenges in their production, research and development and quality control processes.
EASYHEAT ™ Products: Our compact EASYHEAT™ induction heating systems with power ratings from 0.5kW to 10kW are manufactured by Ambrell® and used to conduct fast, efficient, repeatable non-contact heating of metals or other electrically conductive materials in order to transform raw materials into finished parts. Prices generally range from $10 thousand to $25 thousand.
EASYHEAT ™ Products : Our compact EASYHEAT ™ induction heating systems with power ratings from 0.5 kW to 10 kW are manufactured by Ambrell ® and used to conduct fast, efficient, repeatable non-contact heating of metals or other electrically conductive materials in order to transform raw materials into finished parts.
Alfamation™ was founded in 1991 and is headquartered in Milan, Italy. Alfamation™ also has a small sales and service subsidiary based in Suzhou City, China. Alfamation™ is a part of our Electronic Test operating segment.
Alfamation™ also has a small sales and service subsidiary based in Suzhou City, China. Alfamation™ is a part of our Electronic Test operating segment.
Thermonics®’ products provide a range of precision temperature forcing systems and have been melded into Temptronic®’s ATS ThermoStream® product line. The Thermonics® brand is now used to market a family of process chillers for test and industrial applications. Induction Heating. Our induction heating products are used in process applications where precision-controlled heating is needed.
Thermonics ® ’ products provide a range of precision temperature forcing systems and have been incorporated into Temptronic ® ’s ATS ThermoStream ® product line. The Thermonics ® brand is now used to market a family of process chillers for test and industrial applications.
These products typically sell for between $150 thousand and $250 thousand. Alfamation Wafer-Level Optical component Tester (WALOT ™ ) : WALOT™ is a fully automated test system designed to test passive optical components at Wafer-level, such as diffractive optical elements (“ DOE ”), meta optical elements (“ MOE ”) and micro lens array (“ MLA ”).
Alfamation Wafer-Level Optical component Tester (WALOT ™ ) : WALOT ™ is a fully automated test system designed to test passive optical components at Wafer-level, such as diffractive optical elements (“ DOE ”), meta optical elements (“ MOE ”) and micro lens array (“ MLA ”).
ThermoStream® and MobileTemp products generally range in price from approximately $15 thousand to $55 thousand. Thermal Chambers: Our thermal chamber products are available in a variety of sizes, from small bench-top units to chambers with internal volumes of twenty-seven cubic feet and greater and with temperature ranges as wide as from -190 degrees Celsius to +500 degrees Celsius.
Thermal Chambers : Our thermal chamber products are available in a variety of sizes, from small bench-top units to chambers with internal volumes of twenty-seven cubic feet and greater and with temperature ranges as wide as from -190 ° to +500 ° Celsius.
Nonetheless, we expect the shifts in demand in the industry from periods of expansion to periods of contraction may be significant, as has been the case for much of the semi market in 2023 and 2024, when the industry was in a period of slowing growth and overall declines as compared to 2021 and 2022.
Nonetheless, we expect the shifts in demand in the industry from periods of expansion to periods of contraction may be significant, as has been the case for the analog mixed-signal and front-end silicon carbide Semi markets in 2023, 2024, and 2025, when the industry was in a period of slowing growth and overall declines as compared to 2021 and 2022.
Ultra-Cold Storage Solutions: Our high-performance biomedical freezers, refrigerators and mobile storage solutions meet versatile applications, including ultra-cold storage solutions for biological sample banks, blood safety, vaccine safety, medical supplies and reagent safety. Prices generally range from $2 thousand to $20 thousand.
Ultra-Cold Storage Solutions : Our high-performance biomedical freezers, refrigerators and mobile storage solutions meet versatile applications, including ultra-cold storage solutions for biological sample banks, blood safety, vaccine safety, medical supplies and reagent safety.
This plan would result in the closure of the Netherlands facility and the termination of certain employees at that location. The consolidation of the Netherlands operations is being undertaken to increase efficiencies and lower operating costs associated with the current operation of Videology®.
This plan resulted in the closure of the Netherlands facility and the termination of certain employees at that location. The consolidation of the Netherlands operations was undertaken to increase efficiencies and lower operating costs associated 10 Table of Contents with the current operation of Videology ® .
We believe that because we do not compete with ATE manufacturers in the sale of probers, handlers or testers, ATE manufacturers are willing to provide us with the information that is integral to the design of plug-compatible products. Our docking hardware products generally range in price from approximately $2 thousand to $25 thousand. Interface Products .
We believe that because we do not compete with ATE manufacturers in the sale of probers, handlers or testers, ATE manufacturers are willing to provide us with the information that is integral to the design of plug-compatible products. Interface Products .
We believe that our long-term relationships with our customers in the various markets we support and our commitment to, and reputation for, providing high quality products, are important elements in our ability to compete effectively in all of our markets.
We believe that our long-term relationships with our customers in the various markets we support and our commitment to, and reputation for, providing high quality products, are important elements in our ability to compete effectively in all of our markets. Our digital streaming and image capturing solutions compete in a large space with multiple small competitors.
The STINGRAY was the first to market a non-contact probe module in 2024. Using advanced magnetic field measurement techniques to assess the interconnect quality without physical contact, this allows for accurate and complete test coverage for both laser-welded and wire bonded interconnects.
Using advanced magnetic field measurement techniques to assess the interconnect quality without physical contact, this allows for accurate and complete test coverage for both laser-welded and wire bonded interconnects.
Acculogic BRiZ Automated Test and Programming Services : BRiZ is an automated test platform that can consolidate any variety of circuit board test and programming into a single, compact, low-cost test station. These platforms generally sell for between $50 thousand and $250 thousand.
Acculogic BRiZ Automated Test and Programming Services : BRiZ is an automated test platform that can consolidate any variety of circuit board test and programming into a single, compact, low-cost test station.
North American and European semiconductor manufacturers, as well as third-party foundries, test and assembly providers, have located most of their back-end factories in China, Taiwan and Southeast Asia. The front-end wafer fabrication plants of U.S. semiconductor manufacturers are primarily in the U.S.
MARKETING, SALES AND CUSTOMER SUPPORT We market and sell our products globally and across multiple markets. North American and European semiconductor manufacturers, as well as third-party foundries, test and assembly providers, have located most of their back-end factories in China, Taiwan and Southeast Asia. The front-end wafer fabrication plants of U.S. semiconductor manufacturers are primarily in the U.S.
Our customers use our products principally in production testing or process/manufacturing applications, although our ThermoStream® products traditionally have been used largely in engineering development and quality assurance. We believe that we sell to most of the major semiconductor manufacturers in the world. 13 During the year ended December 31, 2024, one customer accounted for 13% of our consolidated revenue.
Our customers use our products principally in production testing or process/manufacturing applications, although our ThermoStream ® products traditionally have been used largely in engineering development and quality assurance. We believe that we sell to most of the major semiconductor manufacturers in the world.
With the LS Series manipulators, the undocking, movement of the test head and redocking can be done automatically through the computer-controlled pendant. Our manipulator products generally range in price from approximately $12 thousand to $100 thousand. Docking Hardware Products . We offer three lines of docking hardware products: fixed manual docking, AERODOCK™ and INTELLIDOCK™ pin and cup docking.
With the LS Series manipulators, the undocking, movement of the test head and redocking can be done automatically through the computer-controlled pendant. Docking Hardware Products . We offer three lines of docking hardware products: fixed manual docking, AERODOCK ™ and INTELLIDOCK ™ pin and cup docking.
Thermal Platforms: Our thermal platforms are available in surface sizes ranging from 7.2 square inches to 616 square inches. They provide a flat, thermally conductive, precisely temperature controllable surface that is ideal for conditioning of testing devices with a flat surface. Platforms are available with temperature ranges as broad as -100 degrees Celsius to +250 degrees Celsius.
Thermal Platforms : Our thermal platforms are available in surface sizes ranging from 7.2 square inches to 616 square inches (approximately 46.5 cm 2 to 3,974.2 cm 2 ). They provide a flat, thermally conductive, precisely temperature controllable surface that is ideal for conditioning of testing devices with a flat surface.
Thermal platforms can be designed to utilize either liquid nitrogen or liquid carbon dioxide cooling or mechanical refrigeration. Platforms offer virtually unimpeded access to the device under test and their easy access and compact size makes them ideal for convenient bench-top use. Platforms are generally priced from $7 thousand to $65 thousand.
Platforms are available with temperature ranges as broad as -100 ° to +250 ° Celsius. Thermal platforms can be designed to utilize either liquid nitrogen or liquid carbon dioxide cooling or mechanical refrigeration. Platforms offer virtually unimpeded access to the device under test and their easy access and compact size makes them ideal for convenient bench-top use.
We expect to expand our portfolio of products, services, and support to drive increased value to our customers to drive revenue and earnings growth.
We expect to drive revenue and earnings growth by creating increased value for our customers through this expansion of our portfolio of products, services and support.
Our Massachusetts facility and our Acculogic office in Canada are International Traffic in Arms Regulations (“ ITAR ”) compliant enabling them to support the specific requirement of the U.S. Department of Defense. Our Canadian facility is compliant with the Canadian Controlled Goods Program, enabling them to support the Canadian Department of Defense.
Our Massachusetts facility is International Traffic in Arms Regulations (“ ITAR ”) compliant enabling them to support the specific requirement of the U.S. Department of Defense.
Using the flying probe configuration, The STINGRAY Battery Tester employs a set of test heads to measure the electrical resistance of each bond in the battery array. By utilizing the four-wire technique, the tester can perform electrical tests on low-resistance interconnects, even as low as 200uΩ. Each test is completed within milliseconds, ensuring rapid testing of each battery array.
By utilizing the four-wire technique, the tester can perform electrical tests on low-resistance interconnects, even as low as 200uΩ. Each test is completed within milliseconds, ensuring rapid testing of each battery array. The STINGRAY was the first to market a non-contact probe module in 2024.
Acculogic designs and manufactures robotics-based electronic test equipment and provides application support services for OEMs, contract electronic manufacturers and battery manufacturers. These systems are used to structurally test an electronic device including printed circuit board assembly (“ PCBA ”) and battery interconnect test. Structural testing provides confirmation that the device was manufactured properly by confirming circuits are functioning properly.
Acculogic Scorpion Flying Probe Test Systems . Acculogic designs and manufactures robotics-based electronic test equipment and provides application support services for OEMs, contract electronic manufacturers and battery manufacturers. These systems are used to structurally test an electronic device including printed circuit board assembly (“ PCBA ”) and battery interconnect test.
BACKLOG At December 31, 2024, our backlog of unfilled orders for all products was $39.5 million compared with $40.1 million at December 31, 2023. Our backlog consists of purchase orders that we have accepted, substantially all of which we expect to deliver in 2025.
BACKLOG At December 31, 2025, our backlog of unfilled orders for all products was $53.9 million compared with $39.5 million at December 31, 2024. Our backlog includes customer orders that we have accepted, substantially all of which we expect to deliver in the next twelve months.
Management ’ s Discussion and Analysis of Financial Condition and Results of Operations; Overview; Orders and Backlog. ” 15 EMPLOYEES At December 31, 2024, we had 425 employees (393 of which were full-time), including 209 based domestically and 216 based outside the United States. Substantially all of our key employees are highly skilled and trained technical personnel.
Management’s Discussion and Analysis of Financial Condition and Results of Operations; Results of Operations; Orders and Backlog . ” EMPLOYEES At December 31, 2025, we had 407 employees (385 of which were full-time), including 214 based domestically and 193 based outside the U.S. Substantially all of our key employees are highly skilled and trained technical personnel.
This revenue was primarily generated by our Electronic Test segment. During the year ended December 31, 2023, this same customer accounted for 13% of our consolidated revenue. An important aspect of our 5-Point Strategy includes broadening and diversifying our customer base.
During the year ended December 31, 2025, no customer accounted for more than 10% of our consolidated revenue. During the year ended December 31, 2024, one customer accounted for 13% of our consolidated revenue. This revenue was primarily generated by our Electronic Test segment. An important aspect of our VISION 2030 includes broadening and diversifying our customer base.
Our universal test head manipulators provide a high degree of positioning flexibility with a minimum amount of effort. As a result, our products can be used in virtually any test setting. Our manipulator products are designed to accommodate the increased size of test heads and can now support test heads weighing up to 1200kg.
As a result, our products can be used in virtually any test setting. Our manipulator products are designed to accommodate the increased size of test heads and can now support test heads weighing up to 1,200kg.
For example, our Centaur® modular interface is designed to provide flexibility and scalability through the use of replaceable signal modules which can be easily changed on the test floor as our customers’ testing requirements change.
For example, our Centaur ® modular interface is designed to provide flexibility and scalability through the use of replaceable signal modules which can be easily changed on the test floor as our customers’ testing requirements change. 11 Table of Contents In addition to the Centaur ® modular interface, we also offer over 200 different types of tester interface models that we custom designed for our customers’ specific applications.
This programming is done with computer-aided design or design data of the device to be tested. Traditional in-circuit testing systems require a dedicated fixture for each board to be tested. Acculogic’s Flying Probe system can test a virtually unlimited number of boards without any hardware modifications. These systems generally sell for between $250 thousand and $800 thousand.
Acculogic’s Scorpion Flying Probe system can be quickly programmed to test almost any printed circuit board. This programming is done with computer-aided design or design data of the device to be tested. Traditional in-circuit testing systems require a dedicated fixture for each board to be tested.
These systems generally sell for between $300 thousand and $450 thousand. Alfamation Flexmedia XM ® Specialty Test Modules : Flexmedia XM® is a modular, robust and cost-effective solution for building flexible, scalable, functional testers for applications that include audio and video generators and analyzers, automotive ethernet and communication interfaces, and analog measurements.
Alfamation Flexmedia XM ® Specialty Test Modules : Flexmedia XM ® is a modular, robust and cost-effective solution for building flexible, scalable, functional testers for applications that include audio and video generators and analyzers, automotive ethernet and communication interfaces, and analog measurements. They address the requirements of many automotive infotainment and wireless telematics functional testing needs.
With our induction heating products, we serve the front-end of the semiconductor manufacturing process including SiC crystal growth and epitaxial reactors. A variety of our electronic test and environmental technologies segments’ products are used in the back-end of the semiconductor manufacturing process, which includes the testing of ICs. IC Testing .
A variety of our electronic test and environmental technologies segments’ products are used in the back-end of the semiconductor manufacturing process, which includes the testing of ICs. 5 Table of Contents IC Testing .
In addition to testing of the basic circuitry of a PCBA, our Acculogic solutions can integrate various functional testing capabilities such as boundary scan and radio frequency measurement to confirm that the device will perform the functions for which it is designed. Acculogic’s Scorpion Flying Probe system can be quickly programmed to test almost any printed circuit board.
Structural testing provides confirmation that the device was manufactured properly by confirming circuits are functioning properly. In addition to testing of the basic circuitry of a PCBA, our Acculogic solutions can integrate various functional testing capabilities such as boundary scan and radio frequency measurement to confirm that the device will perform the functions for which it is designed.
Alfamation Pixelshooter ™ Touch Display Tester : Pixelshooter™ is comprehensive and scalable solution for electrical and optical testing of touch displays, including automotive instrument clusters and touch screens, with integrated robotics for haptic feedback, buttons and knobs assessment. It is conceived for 24/7 high volume manufacturing operations and provides hi-res defective pixel detection, color calibration, brightness uniformity and flicker measurement.
Alfamation Pixelshooter ™ Touch Display Tester : Pixelshooter ™ is comprehensive and scalable solution for electrical and optical testing of touch displays, including automotive instrument clusters and touch screens, with integrated robotics for haptic feedback, buttons and knobs assessment.
We believe there is a strong global growth trend in EVs and that our differentiated solutions can be applied to more customers in more geographic regions. Our automotive electronics testing solutions include functional test platforms that address a broad range of test requirements, from wireless communication telematics through automotive infotainment, computer control units and touch displays and instrument clusters.
Our Auto/EV electronics testing solutions include functional test platforms that address a broad range of test requirements, from wireless communication telematics through automotive infotainment, computer control units and touch displays and instrument clusters.
Our principal competitors for ThermoStream® products are FTS Systems, a part of ATS Corporation, and MPI Corporation. Our principal competitors for environmental chambers are Cincinnati Sub-Zero Products, Inc., Espec Corp. and Thermotron Industries. Our principal competitor for thermal platforms is Environmental Stress Systems Inc.
Flexmedia XM ® products Intrepid Control Systems Inc, GÖPEL electronic GmbH, TZ Electronic Systems GmbH, and Solectrix GmbH ThermoStream ® products FTS Systems, a part of ATS Corporation, and MPI Corporation Environmental chambers Cincinnati Sub-Zero Products, Inc., Espec Corp., and Thermotron Industries Thermal platforms Environmental Stress Systems Inc.
We are a global supplier of innovative test and process technology solutions for use in manufacturing and testing across a wide range of markets including semiconductors, industrial, automotive, life sciences, defense/aerospace, and security. We have three operating segments which are also our reportable segments and reporting units: Electronic Test, Environmental Technologies and Process Technologies.
We are a global supplier of innovative test and process technology solutions for use in manufacturing and testing across a wide range of markets including Semi, Auto/EV, Defense/Aerospace, Industrial, Life Sciences, Safety/Security and Other.
The consolidation is expected to be substantially completed by the end of 2025 at which point we intend to fully vacate the Netherlands facility. 9 As a result of this action, we expect to incur cash charges for severance and other one-time termination benefits of $350 thousand.
The consolidation was substantially completed by the end of 2025 at which point we vacated the Netherlands facility. As a result of this action, through December 31, 2025, we recognized cash charges for severance and other one-time termination benefits of $0.8 million.
Docking hardware mechanically connects the test head to the wafer prober or handler. Tester interface products provide the electrical connection between the test head and the wafer or packaged IC. Market Trends .
Docking hardware mechanically connects the test head to the wafer prober or handler. Tester interface products provide the electrical connection between the test head and the wafer or packaged IC. Auto/EV In the Auto/EV market, we provide solutions that help in the quality and productivity of both internal combustion and EV manufacturing and onboard electronics.

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Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

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Biggest changeOur businesses are subject to many foreign, federal, state and local environmental, health and safety laws and regulations, particularly with respect to the use, handling, treatment, storage, discharge and disposal of substances and hazardous wastes used or generated in our manufacturing processes. Compliance with these laws and regulations is a significant factor in our business.
Biggest changeWe are subject to significant environmental, health and safety laws and regulations and related compliance expenditures and liabilities. Our businesses are subject to many foreign, federal, state and local environmental, health and safety laws and regulations, particularly with respect to the use, handling, treatment, storage, discharge and disposal of substances and hazardous wastes used or generated in our manufacturing processes.
Our goal is to increase our sales to markets other than the semi market; however, in most cases, the expansion of our product sales into these new markets has occurred in the last several years, and we may experience difficulty in expanding our sales efforts further into these markets.
Our goal is to increase our sales to markets other than Semi; however, in most cases, the expansion of our product sales into these new markets has occurred in the last several years, and we may experience difficulty in expanding our sales efforts further into these markets.
If we acquire additional businesses, technologies or products, we will face the following additional risks: ● acquisitions could divert management’s attention from daily operations or otherwise require additional management, operational and financial resources; ● we might not be able to integrate acquisitions into our business successfully or operate acquired businesses profitably; ● we may realize substantial acquisition-related expenses that would reduce our net earnings in future years; ● we may not realize the expected benefits of such acquisitions; ● our investigation of potential acquisition candidates may not reveal problems and liabilities of the companies and businesses that we acquire; 16 ● any acquisitions may pose risks associated with entry into new geographic markets, including outside the U.S., distribution channels, lines of business or product categories, where we may not have significant or any prior experience and where we may not be as successful or profitable as we are in businesses and geographic regions where we have greater familiarity and brand recognition; ● an acquisition may result in disparate information technology, internal control, financial reporting and record-keeping systems; ● an acquisition may result in employee anxiety, morale and/or engagement issues and employees not familiar with our business; ● an acquisition may result in the loss of our or the acquired company’s key personnel, customers, distributors or suppliers; and ● we may become exposed to litigation or claims associated with an acquisition.
If we acquire additional businesses, technologies or products, we will face the following additional risks: • acquisitions could divert management’s attention from daily operations or otherwise require additional management, operational and financial resources; • we might not be able to integrate acquisitions into our business successfully or operate acquired businesses profitably; • we may realize substantial acquisition-related expenses that would reduce our net earnings in future years; • we may not realize the expected benefits of such acquisitions; • our investigation of potential acquisition candidates may not reveal problems and liabilities of the companies and businesses that we acquire; • any acquisitions may pose risks associated with entry into new geographic markets, including outside the U.S., distribution channels, lines of business or product categories, where we may not have significant or any prior experience and where we may not be as successful or profitable as we are in businesses and geographic regions where we have greater familiarity and brand recognition; • an acquisition may result in disparate information technology, internal control, financial reporting and record-keeping systems; • an acquisition may result in employee anxiety, morale and/or engagement issues and employees not familiar with our business; • an acquisition may result in the loss of our or the acquired company’s key personnel, customers, distributors or suppliers; and 18 Table of Contents • we may become exposed to litigation or claims associated with an acquisition.
The risks and uncertainties described below are not the only risks facing us and we cannot predict every event and circumstance that may adversely affect our business. However, these risks and uncertainties are the most significant factors that we have identified at this time.
Furthermore, the risks and uncertainties described below are not the only risks facing us and we cannot predict every event and circumstance that may adversely affect our business. However, these risks and uncertainties are the most significant factors that we have identified and believe at this time.
The additional payments will be based on a percentage of net invoices for which payments have been received on systems sold to EV battery customers exceeding CAD $2.5 million per year in each of the five years. The maximum payment is capped at CAD $5.0 million, which equates to approximately USD $3.5 million at December 31, 2024.
The additional payments will be based on a percentage of net invoices for which payments have been received on systems sold to EV battery customers exceeding CAD $2.5 million per year in each of the five years. The maximum payment is capped at CAD $5.0 million, which equates to approximately USD $3.7 million at December 31, 2025.
Although we have been and continue to be the target of security breaches, we have not experienced material losses to date related to such incidents. Nevertheless, there can be no assurance that we will not suffer such losses in the future.
Although we have been and continue to be the target of security attacks, we have not experienced material losses to date related to such incidents. Nevertheless, there can be no assurance that we will not suffer such losses in the future.
A key element of our growth strategy is to acquire businesses, technologies or products that are complementary to our current product offerings. We seek to make acquisitions that will further expand our product lines as well as strengthen our positions in served markets and provide expansion into new markets.
A key element of our growth strategy is to acquire businesses, technologies or products that are complementary to our current product offerings. We seek to make acquisitions that will further expand our product lines as well as strengthen our positions in the markets we serve and provide expansion into new markets.
While the global supply chain seems to have returned to a more normalized state as of the end of 2024, ongoing uncertainty from geopolitical events and the global trade environment, including changes in the United States’ or international trade policy, tariffs, export controls, quotas, embargoes, or sanctions may trigger additional retaliatory actions by affected countries resulting in “trade wars” and further increased costs for goods and materials transported globally, which may negatively impact our customers, revenues and earnings.
While the global supply chain seems to have returned to a more normalized state during 2025, ongoing uncertainty from geopolitical events and the global trade environment, including changes in the United States’ or international trade policy, tariffs, export controls, quotas, embargoes, or sanctions may trigger additional retaliatory actions by affected countries resulting in “trade wars” and further increased costs for goods and materials transported globally, which may negatively impact our customers, revenues and earnings.
At December 31, 2024, the total contingent consideration liability on our balance sheet was USD $0.9 million which was its estimated fair value at that date. Any future adjustments to the estimated fair value of the contingent liability will be recorded in our results of operations for the period in which the adjustment occurs.
At December 31, 2025, the total contingent consideration liability on our Consolidated Balance Sheet was USD $0.6 million which was its estimated fair value at that date. Any future adjustments to the estimated fair value of the contingent liability will be recorded in our results of operations for the period in which the adjustment occurs.
If other material weaknesses are identified in the future, we may not be able to report our financial results accurately, prevent fraud or file our periodic reports in a timely manner, which may adversely affect investor confidence in our Company and, as a result, the value of our common stock. As further explained in “
If material weaknesses in our internal control over financial reporting are identified in the future, we may not be able to report our financial results accurately, prevent fraud or file our periodic reports in a timely manner, which may adversely affect investor confidence in our Company and, as a result, the value of our common stock.
Any increase in these costs, or unanticipated liabilities arising from, among other things, discovery of previously unknown conditions or more aggressive enforcement actions, could adversely affect our results of operations, and there is no assurance that they will not exceed our reserves or have a material adverse effect on our financial condition. 19 In prior periods, our management identified material weaknesses in our internal control over financial reporting.
Any increase in these costs, or unanticipated liabilities arising from, among other things, discovery of previously unknown conditions or more aggressive enforcement actions, could adversely affect our results of operations, and there is no assurance that they will not exceed our reserves or have a material adverse effect on our financial condition.
The initial contingent consideration liability is established as part of the accounting for the business combination. In subsequent periods, we are required to estimate the fair value of the contingent consideration associated with any earnout on a quarterly basis and record an adjustment to the contingent consideration liability in our results of operations for the period concerned.
In subsequent periods, we are required to estimate the fair value of the contingent consideration associated with any earnout on a quarterly basis and record an adjustment to the contingent consideration liability in our results of operations for the period concerned.
These adjustments to the contingent consideration liability could cause our results of operations to have increased variability, which may negatively impact our stock ’ s trading price. We may utilize an earnout structure on future acquisitions as we have done in prior transactions we have closed.
These adjustments to the contingent consideration liability could cause our results of operations to have increased variability, which may negatively impact our stock’s trading price. We may utilize an earnout structure on future acquisitions as we have done in prior transactions we have closed. The initial contingent consideration liability is established as part of the accounting for the business combination.
Item 1A. RISK FACTORS The following are some of the factors that could materially and adversely affect our future performance or could cause actual results to differ materially from those expressed or implied in our forward-looking statements.
Item 1A. RISK FACTORS The following disclosures reflect the Company’s beliefs and opinions as to factors that could materially and adversely affect the Company, our future performance and our securities in the future, or could cause actual results to differ materially from those expressed or implied in our forward-looking statements.
We sell certain of our products in markets other than the semi market, including the automotive, defense/aerospace, industrial, life sciences and security markets. During 2024 and 2023, our sales to markets other than the semi market were $82.0 million and $57.6 million, respectively, and represented 63% and 47% of our consolidated revenue, respectively.
We sell certain of our products in markets other than the Semi market, including the Auto/EV, Defense/Aerospace, Industrial, Life Sciences and Safety/Security markets. During 2025 and 2024, our sales to markets other than the Semi market were $77.9 million and $82.0 million, respectively, and represented 68% and 63% of our consolidated 20 Table of Contents revenue, respectively.
Failure to successfully manage our possible growth and development could have a material adverse effect on our business. 17 There is a risk that some or all of the anticipated strategic and financial benefits may fail to materialize, may not continue on their existing terms, or may not occur within the time period anticipated.
There is a risk that some or all of the anticipated strategic and financial benefits may fail to materialize, may not continue on their existing terms, or may not occur within the time period anticipated.
We have incurred and expect to continue to incur significant expenditures to comply with applicable environmental laws and regulations.
Compliance with these laws and regulations is a significant factor in our business. We have incurred and expect to continue to incur significant expenditures to comply with applicable environmental laws and regulations.
The management of this growth will require, among other things, continued development of our financial and management controls and management information systems, stringent control of costs, the ability to attract and retain qualified management personnel and the training of new personnel.
The management of this growth will require, among other things, continued development of our financial and management controls and management information systems, stringent control of costs, the ability to attract and retain qualified management personnel and the training of new personnel. 19 Table of Contents Failure to successfully manage our possible growth and development could have a material adverse effect on our business.
If we are unable to expand these sales, our revenue and results of operations will remain substantially dependent upon the cycles of the semi market. 18 RISKS RELATED TO OUR BUSINESS OPERATIONS If our suppliers do not meet product or delivery requirements, or inflationary pressures continue to increase and we cannot increase our prices to our customers, we could have reduced revenues and earnings.
RISKS RELATED TO OUR BUSINESS OPERATIONS If our suppliers do not meet product or delivery requirements, or inflationary pressures continue to increase and we cannot increase our prices to our customers, we could have reduced revenues and earnings.
In addition, due to the highly specialized nature of certain of our product offerings in these markets, we do not expect broad market penetration in many of these markets.
In addition, due to the highly specialized nature of certain of our product offerings in these markets, we do not expect broad market penetration in many of these markets. If we are unable to expand these sales, our revenue and results of operations will remain substantially dependent upon the cycles of the Semi market.
While we have insurance that may protect us from incurring some of these costs, there is no assurance that such insurance coverage is adequate to cover all costs and damages incurred in connection with a cyberattack. We are subject to significant environmental, health and safety laws and regulations and related compliance expenditures and liabilities.
While we have insurance that may protect us from incurring some of these costs, there is no assurance that such insurance coverage is adequate to cover all costs and damages incurred in connection with a cyberattack. Risks related to artificial intelligence technologies, including generative AI, could adversely affect our products, operations, intellectual property, and reputation.
There were no payments due for the years ended December 31, 2023 or 2022, while an immaterial amount is due for 2024 and is recorded as a component of other current liabilities.
There were no payments due for the years ended December 31, 2022 or 2023. We paid the contractually due amount for 2024 during the first quarter of 2025 and expect to make the payment for the amount due for 2025 in the first quarter of 2026.
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References to past events are provided by way of example only and are not intended to be a complete listing or a representation as to whether or not such factors have occurred in the past or their likelihood of occurring in the future.
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As models improve, we expect to be increasingly incorporating artificial intelligence (“ AI ”), including machine learning and generative AI models, into our electronic test and process control platforms, as well as into our internal engineering, customer support, and business operations tools.
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These technologies are complex and rapidly evolving, and may not perform as intended across all devices, and use cases, which could lead to inaccurate test results, 21 Table of Contents sub‑optimal process recommendations, yield loss, product failures at our customers, and associated warranty, indemnity, or other claims.
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Our use of AI depends on large volumes of manufacturing, design, and test data, much of which is proprietary to us or our customers.
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If our own systems or third‑party AI tools are misconfigured, compromised, or improperly used, AI inputs or outputs could inadvertently expose sensitive product roadmaps, process recipes, customer confidential information, or our trade secrets, increasing the risk of intellectual property theft, competitive harm, or contractual liability.
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Malicious actors may also use AI to develop more sophisticated cyberattacks, including targeted phishing, impersonation, or model‑extraction attacks against our AI‑enabled products and services, which could result in unauthorized access to our or our customers’ environments, disruptions to our solutions, or data loss. We rely in part on third‑party AI infrastructure, models, and data services.
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Defects, outages, policy changes, or security incidents at these third parties, or their failure to comply with emerging AI, data protection, export control, or industry‑specific regulations, could disrupt our offerings, limit our ability to deploy or enhance AI features, or subject us and our customers to additional compliance costs, investigations, or penalties.
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Governments in the United States and other jurisdictions are adopting, or may adopt, new frameworks specific to AI transparency, safety, security, and accountability; these rules may impose constraints on training data, model usage, explainability, or cross‑border data transfers that increase our development costs, delay product introductions, or limit certain AI‑enabled capabilities.
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AI development also intensifies competition for highly skilled technical personnel with expertise in data science, machine learning, and AI safety. If we are unable to attract, train, and retain such personnel, we may be slower than competitors in incorporating AI into our test and process technologies, which could reduce the competitiveness of our solutions.
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In addition, as customers and regulators scrutinize the accuracy, fairness, and transparency of AI‑driven recommendations used in semiconductor manufacturing and reliability screening, any perceived or actual bias, errors, or lack of explainability in our AI features could damage our reputation, lead to reduced adoption of our AI‑enabled products, and expose us to product, contractual, or regulatory claims.
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We cannot be certain that material weaknesses in our internal control over financial reporting will not occur in the future.
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If material weaknesses are identified in the future, or if we are not able to comply with the requirements of Section 404 of the Sarbanes-Oxley Act in a timely manner, our reported financial results could be materially misstated and we could be subject to investigations or sanctions by regulatory authorities, which would require additional financial and management resources, and the value of our common stock could decline. 22 Table of Contents If we are not able to maintain internal controls and procedures in accordance with the requirements of applicable securities laws, rules, and regulations, including, without limitation, Section 404 of the Sarbanes-Oxley Act in a timely manner or with adequate compliance, we may not be able to conclude that our internal control over financial reporting is effective, which may subject us to adverse regulatory consequences and could harm investor confidence and the market price of our Common Shares.
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The existence of material weaknesses in internal control over financial reporting could adversely affect our reputation or investor perceptions of us. Our business may suffer if we are unable to attract and retain key employees or hire personnel at the costs we currently project.
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Our future success will depend largely upon the continued services of our senior management and other key employees or the development of successors with commensurate skills and talents in a timely fashion and at the costs we project.
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If we cannot continue to increase employee salaries and maintain employee benefits commensurate with competitive opportunities, we may not be able to retain our senior management and other key employees. The loss of key personnel could adversely affect our ability to manage our business effectively and could increase our costs in future periods.
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We have recently experienced difficulty in hiring personnel at the costs projected in our forecasts. This has resulted in the need to increase the labor rates offered for certain positions.
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If we cannot find savings in other areas or increase the price for which we sell our products in an amount sufficient to cover these additional labor costs, we may experience reduced margins in future periods.
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We have experienced and may continue to experience significant variability in our effective tax rates and may have exposure to additional tax liabilities and costs. We are subject to income taxes in the U.S. and various other countries in which we operate.
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Our effective tax rate is dependent on where our earnings are generated and the tax regulations and the interpretation and judgment of administrative tax or revenue entities in the U.S. and other countries. We are also subject to tax audits in the countries where we operate.
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Any material assessment resulting from an audit from an administrative tax or revenue entity could negatively affect our financial results. The terms and covenants relating to our credit facility could adversely impact our ability to pursue our strategy and our financial performance and liquidity, and thus we may need additional financial resources to maintain our liquidity.
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Our credit facility (the “ Loan Agreement ”) with M&T Bank (“ M&T ”) contains covenants requiring us to, among other things, provide financial and other information and to provide notice upon the occurrence of certain events affecting us or our business.
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These covenants also place restrictions on our ability to incur additional indebtedness, and enter into certain transactions, including selling assets, engaging in mergers or acquisitions, or engaging in transactions with affiliates.
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If we fail to satisfy one or more of the covenants under our Loan Agreement, we would be in default thereunder and may be required to repay such debt with capital from other sources or otherwise not be able to draw down against our facility.
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Under such circumstances, we may have difficulty in locating another lender that would be willing to extend credit to us, and other sources of capital may not be available to us on reasonable terms or at all.
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At March 31, 2025, we were in compliance with all of the covenants included in the Loan Agreement, except for the fixed charge coverage ratio financial covenant which was 0.99 to 1.0 for the quarter ended March 31, 2025, for which we received a one-time waiver from M&T on May 1, 2025.
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On August 5, 2025, we executed the Sixth Amendment to the Loan Agreement, which formally waives the fixed charge coverage ratio financial covenant for periods ending June 30, 2025 through and including March 31, 2026.
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During the period of this waiver we are required to request consent from M&T if we wish to utilize our revolving facility and we formally pledged a portion of our cash holdings equal to our total open debt with M&T.
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At December 31, 2025, we had total debt of $3.8 million with M&T and were in compliance with all other covenants included in the credit facility including the debt covenants of the Loan Agreement. See “ Part II; Item 7.
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Management’s Discussion and Analysis of Financial Condition and Results of Operations; Liquidity and Capital Resources; Credit Facility ” and “ Part II; Item 8.
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Financial Statements and Supplementary Data; Notes to Consolidated Financial Statements; Note (10) Debt ” in this Report for a discussion of the material terms of our credit facility. 23 Table of Contents We hold our cash and cash equivalents that we use to meet our working capital needs in deposit accounts that could be adversely affected if the financial institutions holding such funds fail.
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We hold our cash and cash equivalents that we use to meet our working capital needs in deposit accounts at multiple financial institutions. We also hold $3.8 million of restricted cash at M&T under the terms of the Sixth Amendment to the Loan Agreement.
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The balance held in these accounts may exceed the Federal Deposit Insurance Corporation (“ FDIC ”), standard deposit insurance limit or similar government guarantee schemes.
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If a financial institution in which we hold such funds fails or is subject to significant adverse conditions in the financial or credit markets, we could be subject to a risk of loss of all or a portion of such uninsured funds or be subject to a delay in accessing all or a portion of such uninsured funds.
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Any such loss or lack of access to these funds could adversely impact our short-term liquidity and ability to meet our obligations. For example, in March 2023, Silicon Valley Bank and Signature Bank were closed by state regulators and the FDIC was appointed receiver for each bank.
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The FDIC created successor bridge banks and all deposits of Silicon Valley Bank and Signature Bank were transferred to the bridge banks under a systemic risk exception approved by the United States Department of the Treasury, the Federal Reserve and the FDIC.
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If financial institutions in which we hold funds for working capital were to fail, we cannot provide any assurances that such governmental agencies would take action to protect our uninsured deposits in a similar manner.
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We also maintain cash equivalent investment accounts with other financial institutions in which we hold our cash equivalent investments and, if access to the funds we use for working capital is impaired, we may not be able to sell these investments or transfer funds from our investment accounts to new accounts on a timely basis sufficient to meet our working capital needs.
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We face risks associated with doing business in China. We conduct sales and other business operations in China, as a result, the economic, political, legal and social conditions in China could harm our business. In recent years, the Chinese economy has experienced periods of rapid expansion and high rates of inflation.
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These factors have led to the adoption by the Chinese government, from time to time, of various corrective measures designed to restrict the availability of credit or regulate growth and contain inflation.
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Various factors may in the future cause the Chinese government to impose controls on credit or prices, or to take other action, which could inhibit economic activity in China, and thereby harm the market for our products.
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In addition, the legal system in China has inherent uncertainties that may limit the legal protections available in the event of any claims or disputes that we have with third parties, including our ability to protect the intellectual property we develop in China or elsewhere.
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As China’s legal system is still evolving, the interpretation of many laws, regulations and rules is not always uniform and enforcement of these laws, regulations and rules involve uncertainties, which may limit the remedies available in the event of any claims or disputes with third parties.
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In addition, any litigation in China may be protracted and result in substantial costs and diversion of resources and management attention.
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Some of the other risks related to doing business in China include: • The Chinese government exerts substantial influence over the manner in which we must conduct our business activities; • Restrictions on currency exchange may limit our ability to receive, transfer and use our cash effectively; • Increased uncertainties related to the enforcement of intellectual property rights including any intellectual property rights that we may license to a Chinese (or other emerging jurisdiction) entity, including any joint ventures we may form; • Increased uncertainties relating to Chinese regulation of exports of products and technology to and from China; • Increased and rapidly changing export and related trade regulations and restrictions imposed by U.S. and Chinese legislation, executive actions and regulations; • Difficulty of travel to and from China (and to and from U.S.) arising from or related to the COVID-19 pandemic or any future pandemic; • The Chinese government may favor its local businesses and make it more difficult for foreign businesses to operate in China on an equal footing, or create generally difficult conditions for foreign headquartered businesses to operate; • Increased uncertainties related to the enforcement of contracts with certain parties; • More restrictive rules on foreign investment could adversely affect our ability to expand our operations in China; and 24 Table of Contents • Geopolitical tensions between China on the one hand and the U.S., Canada and/or the European Union on the other hand, may increase and may lead to increased export sanctions with Chinese entities and sanctions made against China.
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As a result of our growing operations in China, these risks could harm our business. We face political and other risks conducting business in Taiwan particularly due to their tense relationships with China. We have customers located in Taiwan.
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Accordingly, our business, financial condition and results of operations may be affected by changes in governmental and economic policies in Taiwan, social instability and diplomatic and social developments in or affecting Taiwan due to its unique international political status.
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Although significant economic and cultural relations have been established between Taiwan and China, we cannot assure that relations between Taiwan and China will not face political or economic uncertainties in the future.
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Any deterioration in the relations between Taiwan and China, and other factors affecting military, political or economic conditions in Taiwan, could disrupt our business operations and materially and adversely affect our results of operations.
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U.S. tariff policies and potential global retaliatory countermeasures could increase our cost, disrupt our supply chain or affect customer purchasing activities, any of which could negatively impact our results of operations. Changes in U.S. and foreign trade policy, including the imposition of tariffs and other trade barriers, could adversely affect our business, financial condition, and results of operations.
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For example, the continued tariff negotiations have increased our material costs and may force us to seek alternative suppliers or navigate through a period of reduced orders and revenues and/or unprofitability if we are unable to pass cost increases onto customers.
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Approximately 57% of our sales for the year ended December 31, 2025, were shipped to customers outside of the United States and thus potentially exposed to tariffs. Retaliatory tariffs by China and other countries could further disrupt our supply chain, reduce demand for our products, or result in lost sales.
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While certain tariffs have subsequently been suspended, modified or temporarily reduced, we cannot predict the results of the U.S. government’s trade negotiations or the outcome of ongoing legal challenges to specific tariff policies.
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The unpredictable nature of these trade policies and the potential for further escalation may increase uncertainty and volatility in our industry, which could negatively impact our financial performance. RISKS RELATED TO OUR CUSTOMER BASE Changes in the buying patterns of our customers have affected, and may continue to affect, demand for our products and our gross and net operating margins.
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Such changes in patterns are difficult to predict and may not be immediately apparent. In addition to the cyclicality of the Semi market, demand for our products and our gross and net operating margins have also been affected by changes in the buying patterns of our customers.
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Some of the changes in customer buying patterns that have impacted us in the past, and may continue to do so in the future, have included customers placing heightened emphasis on shorter lead times (which places increased demands on our available engineering and production capacity and may result in increasing unit costs) and ordering in smaller quantities (which prevents us from acquiring component materials in larger volumes at lower unit costs).
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We have also experienced customer supply chain management groups demanding lower prices and spreading purchases across multiple vendors. We believe some of the changes in customer buying patterns are the result of changes within the Semi market over the last several years, including, for example, changing product requirements and longer time periods between new product offerings by OEMs.
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Such shifts in market practices have had, and may continue to have, varying degrees of impact on our revenue and our gross and net operating margins. Such shifts are difficult to predict and may not be immediately apparent, and the impact of these practices is difficult to quantify from period to period.
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There can be no assurance that we will be successful in implementing effective strategies to counter these shifts. We generate a large portion of our sales from a small number of customers. If we were to lose one or more of our large customers, our operating results could be materially and adversely affected.

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Item 1C. Cybersecurity

Cybersecurity — threats and controls disclosure

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Biggest changeItem 1C. CYBERSECURITY Cyber Security Governance Oversight of cybersecurity risks by management is led by our Information Technology (“ IT ”) Committee, which is chaired by our Corporate Vice President of IT and Cybersecurity and comprised of members of senior management including our Chief Executive Officer and Chief Financial Officer.
Biggest changeItem 1C. CYBERSECURITY Cyber Security Governance Oversight of cybersecurity risks by management is led by our Risk and Information Security (“ IT ”) Committee, which is chaired by our Corporate Vice President of IT and Cybersecurity and comprised of members of senior management including our Chief Executive Officer and Chief Financial Officer and our Corporate Vice President of Human Resources.
An investigation will be conducted, with the assistance of third-party consultants if needed, to determine the root cause of the cyber incident, the materiality of the cyber incident, and any disclosure or legal obligations that will stem from the cyber incident.
An investigation will be conducted, with the assistance of third-party consultants if 29 Table of Contents needed, to determine the root cause of the cyber incident, the materiality of the cyber incident, and any disclosure or legal obligations that will stem from the cyber incident.
We also engage a trusted external cybersecurity consultant to review and update our IRP, ensuring it aligns with the latest industry standards and best practices. We have been the victim of cybersecurity incidents and may be the subject of cybersecurity incidents in the future.
We also engage a trusted external cybersecurity consultant to review and update our IRP, ensuring it aligns with the latest industry standards and best practices. We have been the victim of cybersecurity incidents and may be the subject of cybersecurity incidents in the future. See “ Part I; Item 1A.
We are implementing processes that are designed to effectively manage risks from cybersecurity threats. The IT Committee currently has in place an Incident Response Plan (the “ IRP ”). The IRP lays out our guidelines for responding to and handling cyber incidents.
We are implementing processes that are designed to effectively manage risks from cybersecurity threats. The IT Committee currently has in place the IRP which lays out our guidelines for responding to and handling cyber incidents.
See “ Item 1A, Risk Factors ” for more information about the risk posed to us by cybersecurity threats. 25
Risk Factors ” for more information about the risk posed to us by cybersecurity threats.
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Our Vice President of IT and Cyber Security has over 15 years of experience in IT roles and holds a cybersecurity professional certificate and an MBA in information technology management.
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The VP and IT team work with the executive leadership team to implement appropriate cybersecurity controls and to respond to cybersecurity threats in accordance with our Incident Response Plan (the “ IRP ”) and Information Security Policy.

Item 2. Properties

Properties — owned and leased real estate

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Biggest changeLaurel, NJ April 2031 33,650 Corporate headquarters and Electronic Test segment operations Penang, Malaysia May 2027 25,000 Applications engineering, product development and localized manufacturing for nearly all inTEST brands Markham, Ontario, Canada February 2028 16,437 Electronic Test segment operations (principal facility for Acculogic Inc.) All of our facilities have space to accommodate our needs for the foreseeable future.
Biggest changeLaurel, NJ April 2031 33,650 Corporate headquarters and Electronic Test segment operations Penang, Malaysia June 2027 25,000 Applications engineering, product development and localized manufacturing for nearly all InTest brands Markham, Ontario, Canada February 2028 16,437 Electronic Test segment operations (principal facility for Acculogic Inc.) All of our facilities have space to accommodate our needs for the foreseeable future. Item 3.
Item 2. PROPERTIES As of December 31, 2024, we leased fourteen facilities worldwide. The following chart provides information regarding each of our principal leased facilities as of December 31, 2024: Location Lease Expiration Approx.
Item 2. PROPERTIES As of December 31, 2025, we leased 13 facilities worldwide. The following chart provides information regarding each of our principal leased facilities as of December 31, 2025: Location Lease Expiration Approx.
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LEGAL PROCEEDINGS From time to time we may be a party to legal proceedings occurring in the ordinary course of business. We are not currently involved in any material legal proceedings. Item 4. MINE SAFETY DISCLOSURES Not applicable. 30 Table of Contents PART II

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

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Biggest changeSecurity Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters; Equity Compensation Plan Information. ”
Biggest changeSecurities Authorized for Issuance Under Equity Compensation Plan Information regarding securities authorized for issuance under equity compensation plans is included in “ Part III; Item 12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters; Equity Compensation Plan Information .” Item 6. RESERVED
Through November 17, 2024, we repurchased 141,117 shares of our common stock for $1.0 million. On March 5, 2025, the Board of Directors authorized the renewal of the Repurchase Plan without a fixed expiration date. As of the renewal date, the Company had $8,961,150 available for repurchases under the renewed Repurchase Plan.
Through November 17, 2024, we repurchased 141,117 shares of our common stock for $1.0 million. On March 5, 2025, the Board of Directors authorized the renewal of the Repurchase Plan without a fixed expiration date. As of the renewal date, we had $9.0 million available for repurchases under the renewed Repurchase Plan.
At March 1, we had 12,373,276 shares outstanding that were held by approximately 1,000 beneficial and record holders. No dividends were paid on our common stock in the years ended December 31, 2024 or 2023. We do not currently plan to pay cash dividends in the foreseeable future.
At February 27, 2026, we had 12,495,544 shares outstanding that were held by approximately 1,000 beneficial and record holders. No dividends were paid on our common stock in the years ended December 31, 2025 or 2024. We do not currently plan to pay cash dividends in the foreseeable future.
Item 5. MARKET FOR REGISTRANT ’ S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES Market for Common Stock Our common stock is traded on NYSE American LLC (“ NYSE American ”) under the symbol “INTT.” On March 1, 2025, the closing price for our common stock as reported on the NYSE American was $8.35.
Item 5. MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES Market for Common Stock Our common stock is traded on NYSE American LLC (“ NYSE American ”) under the symbol “INTT.” On February 27, 2026, the closing price for our common stock as reported on the NYSE American was $11.65.
The Company is not obligated to purchase any common stock under the Repurchase Plan. Further, the Repurchase Plan may be suspended or discontinued at any time without prior notice. 26 Securities Authorized for Issuance Under Equity Compensation Plan Information regarding securities authorized for issuance under equity compensation plans is included in “ Part III; Item 12.
We are not obligated to purchase any common stock under the Repurchase Plan. Further, the Repurchase Plan may be suspended or discontinued at any time without prior notice. There were no repurchases since the renewal.

Item 7. Management's Discussion & Analysis

Management's Discussion & Analysis (MD&A) — revenue / margin commentary

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Biggest changeIncome Tax Expense. For the year ended December 31, 2024, we recorded income tax expense of $0.6 million compared to $1.7 million for 2023, a decrease of $1.1 million. This decrease was primarily driven by the decrease in our pre-tax earnings. Our effective tax rate was 16% for 2024 compared to 15% for 2023.
Biggest changeIncome Tax (Benefit) Expense Year Ended December 31, Change (in thousands except percentages) 2025 2024 $ % Income tax (benefit) expense $ (695) $ 563 $ (1,258) (223.4%) Effective tax rate 21.6 % 16.3 % For the year ended December 31, 2025, we recorded an income tax benefit primarily as a result of the net loss before income tax, as compared to income tax expense in the prior year where we had net income before income tax.
On a quarterly basis, we record income tax expense or benefit based on the expected annualized effective tax rate for the various taxing jurisdictions in which we operate our businesses. See “ Part II; Item 8.
On a quarterly basis, we record income tax expense or benefit based on the expected annualized effective tax rate for the various tax jurisdictions in which we operate our businesses. See “ Part II; Item 8.
We did not enter into an interest rate swap agreement with M&T related to this draw. The annual interest rate we expect to pay for this draw under the Term Note is variable. At December 31, 2024, it was approximately 6.6% based on current leverage. In connection with our acquisition of Alfamation as discussed in “ Part II; Item 8.
We did not enter into an interest rate swap agreement with M&T related to this draw. The annual interest rate we expect to pay for this draw under the Term Note is variable. At December 31, 2025, it was approximately 6.0% based on current leverage. In connection with our acquisition of Alfamation as discussed in “ Part II; Item 8.
Acquisition On March 12, 2024, we entered into a stock purchase agreement to acquire all of the outstanding capital shares of Alfamation S.p.A., a leading global provider of state-of-the-art test and measurement solutions for the automotive, life sciences and specialty consumer electronics markets. Alfamation™ was founded in 1991 and is headquartered in Milan, Italy.
ACQUISITION On March 12, 2024, we entered into a stock purchase agreement to acquire all of the outstanding capital shares of Alfamation S.p.A., a leading global provider of state-of-the-art test and measurement solutions for the Auto/EV, Life Sciences and specialty consumer electronics markets. Alfamation™ was founded in 1991 and is headquartered in Milan, Italy.
Management ’ s Discussion and Analysis of Financial Condition and Results of Operations contains a number of forward-looking statements that reflect our plans, estimates, and beliefs, all of which are based on our current expectations and could be affected by certain uncertainties, risks, and other factors described under “ Cautionary Statement Regarding Forward-Looking Statements ” and “ Part I; Item 1A.
Management’s Discussion and Analysis of Financial Condition and Results of Operations contains a number of forward-looking statements that reflect our plans, estimates, and beliefs, all of which are based on our current expectations and could be affected by certain uncertainties, risks, and other factors described under “ Cautionary Statement Regarding Forward-Looking Statements ” and “ Part I; Item 1A.
In certain cases, additional excess and obsolete inventory charges are recorded based upon current market conditions, anticipated product life cycles, new product introductions and expected future use of the inventory. The excess and obsolete inventory charges we record establish a new cost basis for the related inventories.
In 34 Table of Contents certain cases, additional excess and obsolete inventory charges are recorded based upon current market conditions, anticipated product life cycles, new product introductions and expected future use of the inventory. The excess and obsolete inventory charges we record establish a new cost basis for the related inventories.
We believe backlog is useful and use this information for similar reasons to those detailed above for orders. The majority of our backlog at any given time is expected to be fulfilled within the next twelve months.
We believe backlog is useful and use this information for similar reasons to those detailed above for orders. The majority of our backlog at any given time is expected to be fulfilled 37 Table of Contents within the next twelve months.
Off-Balance Sheet Arrangements There were no off-balance sheet arrangements during the year ended December 31, 2024 that have or are reasonably likely to have, a material current or future effect on our financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity, cash requirements or capital resources.
OFF-BALANCE SHEET ARRANGEMENTS There were no off-balance sheet arrangements during the year ended December 31, 2025 that have or are reasonably likely to have, a material current or future effect on our financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity, cash requirements or capital resources. Item 7A.
The Credit Agreement includes customary affirmative, negative and financial covenants, including a maximum ratio of consolidated funded debt to consolidated EBITDA of not more than 3.0 to 1.0 and a fixed charge coverage ratio of not less than 1.25 to 1.0.
The Amended Loan Agreement includes customary affirmative, negative and financial covenants, including a maximum ratio of consolidated funded debt to consolidated EBITDA of not more than 3.0 to 1.0 and a fixed charge coverage ratio of not less than 1.25 to 1.0.
As discussed “ Part I; Item 1.; Strategy, ” although the semi market remains our largest market, as part of our strategy to grow our business, we are focused on several other key target markets where we believe our products address test and process requirements and where we believe there is significant potential for growth.
Business; Strategy ,” although the Semi market remains our largest market, as part of our strategy to grow our business, we are focused on several other key target markets where we believe our products address test and process requirements and where we believe there is significant potential for growth.
Our backlog includes customer orders that we have accepted, substantially all of which we expect to deliver in 2025. While backlog is calculated on the basis of firm purchase orders, a customer may cancel an order or accelerate or postpone currently scheduled delivery dates.
Our backlog includes customer orders that we have accepted, substantially all of which we expect to deliver in the next twelve months. While backlog is calculated on the basis of firm purchase orders, a customer may cancel an order or accelerate or postpone currently scheduled delivery dates.
There were no payments due to the seller for the years ended December 31, 2023 or 2022, while an immaterial amount is due for 2024 and is recorded as a component of other current liabilities. The maximum payment over the five-year period is capped at CAD $5.0 million, which equates to approximately $3.5 million at December 31, 2024.
There were no payments due to the seller for the years ended December 31, 2023 or 2022, while immaterial amounts were due for 2025 and 2024 and were recorded as a component of other current liabilities. The maximum payment over the five-year period is capped at CAD $5.0 million, which equates to approximately $3.7 million at December 31, 2025.
During 2024 and 2023, we recorded inventory obsolescence charges for excess and obsolete inventory of $0.7 million and $0.5 million, respectively. Goodwill, Intangible and Long-Lived Assets We account for goodwill and intangible assets in accordance with Accounting Standards Codification (“ ASC ”) Topic 350 – Intangibles - Goodwill and Other .
During 2025 and 2024, we recorded inventory obsolescence charges for excess and obsolete inventory of $0.8 million and $0.7 million, respectively. Goodwill, Intangible and Long-Lived Assets We account for goodwill and intangible assets in accordance with Accounting Standards Codification (“ ASC ”) Topic 350 – Intangibles - Goodwill and Other .
We did not record any impairment charges related to our goodwill during 2024 or 2023. Indefinite-lived intangible assets are assessed for impairment at least annually in the fourth quarter, or more frequently if events or changes in circumstances indicate that the asset might be impaired.
We did not record any impairment charges related to our goodwill during 2025 or 2024. Indefinite-lived intangible assets are assessed for impairment annually at the beginning of the fourth quarter, or more frequently if events or changes in circumstances indicate that the asset might be impaired.
Changes in assumptions concerning future financial results or other underlying assumptions could have a significant impact on either the fair value of the reporting unit or the amount of the goodwill impairment charge. At December 31, 2024 and 2023, goodwill was $30.7 million and $21.7 million, respectively.
Changes in assumptions concerning future financial results or other underlying assumptions could have a significant impact on either the fair value of the reporting unit or the amount of the goodwill impairment charge. At December 31, 2025 and 2024, goodwill was $32.4 million and $30.7 million, respectively.
Such market demand can be the result of market expansion, development of new technologies or redesigned products to incorporate new features, or the replacement of aging equipment. 27 In the past, the semi market has been highly cyclical with recurring periods of oversupply, which often severely impact the semi market’s demand for the products we manufacture and sell into the market.
Such market demand can be the result of market expansion, development of new technologies or redesigned products to incorporate new features, or the replacement of aging equipment. The Semi market is highly cyclical with recurring periods of oversupply, which often severely impact the Semi market’s demand for the products we manufacture and sell into the market.
The borrowing availability under the Term Note was expanded in September 2022 as discussed above and in “ Part II; Item 8. Financial Statements and Supplementary Data; Notes to Consolidated Financial Statements; Note (10) Debt ” of this Report. 33 Cash Flows Operating Activities.
The borrowing availability under the Term Note was expanded in September 2022 as discussed above and in “ Part II; Item 8. Financial Statements and Supplementary Data; Notes to Consolidated Financial Statements; Note (10) Debt ” of this Report.
Overview We are a global supplier of innovative test and process technology solutions for use in manufacturing and testing across a wide range of markets including semi, industrial, automotive, life sciences, defense/aerospace and security.
OVERVIEW We are a global supplier of innovative test and process technology solutions for use in manufacturing and testing across a wide range of markets including Semi, Auto/EV, Defense/Aerospace, Industrial, Life Sciences, Safety/Security and Other.
Our indefinite-lived intangible assets were trademarks and trade names carried at $10.2 million and $8.4 million at December 31, 2024 and 2023, respectively. We did not record any impairment charges related to our indefinite-lived intangible assets during 2024 or 2023.
Our indefinite-lived intangible assets were trademarks and trade names carried at $10.5 million and $10.2 million at December 31, 2025 and 2024, respectively. We did not record any impairment charges related to our indefinite-lived intangible assets during 2025 or 2024.
Item 7. MANAGEMENT ’ S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS The following discussion and analysis of our financial condition and results of operations and quantitative and qualitative disclosures should be read in conjunction with our audited consolidated financial statements and related notes included in this Report for the year ended December 31, 2024.
Item 7. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS The following discussion and analysis of our financial condition and results of operations and quantitative and qualitative disclosures should be read in conjunction with our audited consolidated financial statements and related notes included in this Report for the year ended December 31, 2025.
The cash portion of the purchase price was subject to customary working capital adjustments which were finalized in June 2024 and resulted in recording an additional €129 thousand (approximately $141 thousand) of cash purchase price for assets delivered at closing in excess of agreed upon thresholds.
The cash portion of the purchase price was subject to customary working capital adjustments which were finalized in June 2024 and resulted in recording an additional €0.1 million (approximately $0.1 million) of cash purchase price for assets delivered at closing in excess of agreed upon thresholds.
Markets As discussed in “ Part I; Item 1.; Markets, ” we are focused on specific target markets which include both the front-end and back-end of the semiconductor manufacturing, industrial, automotive, life sciences, defense/aerospace and security.
MARKETS As discussed in “ Part I; Item 1. Business; Markets ,” we are focused on specific target markets which include both the front-end and back-end of the semiconductor manufacturing, Auto/EV, Defense/Aerospace, Industrial, Life Sciences, Safety/Security and Other.
These key target markets include the industrial, automotive, life sciences, defense/aerospace and security. We believe that these markets are usually less cyclical than the semi market.
These key target markets include Auto/EV, Defense/Aerospace, Industrial, Life Sciences, Safety/Security and Other. We believe that these markets are usually less cyclical than the Semi market.
If the fair value of a reporting unit exceeds its carrying amount, goodwill of the reporting unit is considered not impaired. If the carrying amount of a reporting unit exceeds its fair value, an impairment loss shall be recognized in an amount equal to that excess, limited to the total amount of goodwill allocated to that reporting unit.
If the carrying amount of a reporting unit exceeds its fair value, an impairment loss will be recognized in an amount equal to that excess, limited to the total amount of goodwill allocated to that reporting unit.
If any of the significant assumptions were changed, materially different results could occur, which could significantly change the amount of the deferred tax valuation allowance established. At December 31, 2024 and 2023, we had a deferred tax asset of $0.5 million and $1.4 million, respectively.
If any of the significant assumptions were changed, materially different results could occur, which could significantly change the amount of the deferred tax valuation allowance established. At December 31, 2025 and 2024, we had a net deferred tax 36 Table of Contents asset of $0.8 million and $0.1 million, respectively.
We currently anticipate that any additional long-term cash requirements related to our strategy would be funded through a combination of our cash and cash equivalents, our Credit Facility or by issuing equity.
We currently anticipate that any additional long-term cash requirements related to our strategy would be funded through a combination of our cash and cash equivalents, our Credit Facility or by issuing equity. Credit Facility As discussed in “ Part II; Item 8.
Therefore, the mix of products sold in a given period can change significantly when compared against the prior period. As a result, our consolidated gross margin may be significantly impacted by a change in the mix of products sold in a particular period.
The needs of our customers ultimately determine the products that we sell in a given time period. Therefore, the mix of products sold in a given period can change significantly when compared against the prior period. As a result, our consolidated gross margin may be significantly impacted by a change in the mix of products sold in a particular period.
Orders and Backlog We use orders and backlog as key performance metrics to analyze and measure our financial performance and results of operations. We define orders as purchase orders that we have accepted from our customers. Orders are recorded based on the date received and accepted by us.
These decreases were partially offset by increases in Industrial and Life Sciences. Orders and Backlog We use orders and backlog as key performance metrics to analyze and measure our financial performance and results of operations. We define orders as purchase orders that we have accepted from our customers. Orders are recorded based on the date received and accepted by us.
Ambrell® has a sole source supplier of capacitors used in certain of our induction heating products that is located in Israel. This supplier is the sole source supplier of capacitors for numerous induction companies, and currently there are no viable alternatives available. We have been in frequent contact with our supplier since the conflict with Hamas began.
Ambrell ® has a sole source supplier of capacitors used in certain of our induction heating products that is located in Israel. This supplier is the sole source supplier of capacitors for numerous induction companies, and currently there are no viable alternatives available.
Our current strategy for growth includes pursuing acquisition opportunities for complementary businesses, technologies or products. As previously discussed, we currently anticipate that any additional long-term cash requirements related to our strategy would be funded through a combination of our cash and cash equivalents, the remaining availability under the Term Note or by issuing equity.
As previously discussed, we currently anticipate that any additional long-term cash requirements related to our strategy would be funded through a combination of our cash and cash equivalents, the remaining availability under the Term Note or by issuing equity.
The discussion and analysis that follows, therefore, is presented on a consolidated basis and includes discussion of factors unique to a particular operating segment where significant to an understanding of that segment. Year Ended December 31, 2024 Compared to Year Ended December 31, 2023 Revenue.
The discussion and analysis that follows, therefore, is presented on a consolidated basis and includes discussion of factors unique to a particular operating segment where significant to an understanding of that segment.
The Loan Agreement included a $25 million non-revolving delayed draw term note (the “ Term Note ”) and a $10 million revolving credit facility (the “ Revolving Facility ” and together with the Term Note, the “ Credit Facility ”).
The Loan Agreement includes a $50.5 million non-revolving delayed draw term note (the “ Term Note ”) and a $10.0 million revolving credit facility (the “ Revolving Facility ” and together with the Term Note, the “ Credit Facility ”).
Management has taken, and will continue to take, such actions it deems appropriate to adjust our strategies, products and operations to counter such shifts in market practices as they become evident.
Management has taken, and will continue to take, such actions it deems appropriate to adjust our strategies, products and operations to counter such shifts in market practices as they become evident. 32 Table of Contents As discussed “ Part I; Item 1.
We continue to monitor the situation closely and are staying in close contact with our supplier. However, there can be no assurance that the situation will not worsen which could impact our ability to ship certain of our induction heating products which could have a material impact on our future results of operations.
However, there can be no assurance that the situation will not worsen which could impact our ability to ship certain of our induction heating products which could have a material impact on our future results of operations.
If, as a result of our qualitative assessment, we determine that it is more-likely-than-not that the fair value of the reporting unit is greater than its carrying amounts, the goodwill impairment test is not required. 34 The quantitative goodwill impairment test, used to identify both the existence of impairment and the amount of impairment loss, compares the fair value of a reporting unit with its carrying amount, including goodwill.
If, as a result of our qualitative assessment, we determine that it is more-likely-than-not that the fair value of the reporting unit is greater than its carrying amount, a quantitative goodwill impairment test is not required.
As the related inventory was sold in 2024, this increase was charged to cost of goods sold in the fourth quarter of 2024 which negatively impacted gross margin for the fourth quarter and year ended December 31, 2024.
As the related inventory was sold in 2024, this increase was charged to cost of goods sold in the fourth quarter of 2024 which negatively impacted gross margin for the fourth quarter and year ended December 31, 2024. The full year 2024 gross margin included the negative 120 basis point impact from the acquisition inventory step-up.
In the fourth quarter of 2024, we refined and finalized our purchase price allocation for the Alfamation™ acquisition. Adjustments recorded included a $1.6 million increase in the cost of inventory acquired (“inventory step-up”), to reflect the fair value of work in process and finished goods at the acquisition date.
Adjustments recorded included a $1.6 million increase in the cost of inventory acquired (“inventory step-up”), to reflect the fair value of work in process and finished goods at the acquisition date.
Financial Statements and Supplementary Data; Notes to Consolidated Financial Statements; Note (10) Debt ” of this Report, on October 15, 2021, we entered into an Amended and Restated Loan and Security Agreement with M&T which, on October 28, 2021, was amended by the Joinder and Amendment to Amended and Restated Loan and Security Agreement and which, on December 30, 2021, was further amended by the Joinder and Second Amendment to Amended and Restated Loan and Security Agreement (as amended, the “ Loan Agreement ”).
Financial Statements and Supplementary Data; Notes to Consolidated Financial Statements; Note (10) Debt ” of this Report, on October 15, 2021 (the “ Closing Date ”), we entered into an Amended and Restated Loan and Security Agreement with M&T Bank which, was subsequently amended on October 28, 2021, December 30, 2021, September 20, 2022, May 2, 2024, and December 18, 2024 (together as amended, the “ Loan Agreement ”).
These factors include, for example, the amount of engineering time required to develop the product, the market or customer to which we sell the product and the level of competing products available from other suppliers. The needs of our customers ultimately determine the products that we sell in a given time period.
Due to a number of factors, our products have varying levels of gross margin. These factors include, for example, the amount of engineering time required to develop the product, the market or customer to which we sell the product and the level of competing products available from other suppliers.
Results of Operations The results of operations for our three operating segments are generally affected by the same factors described in the Overview section above. Separate discussions and analyses for each segment would be repetitive.
Our deferred tax valuation allowance at December 31, 2025 and 2024 was $0.8 million and $0.3 million, respectively. RESULTS OF OPERATIONS The results of operations for our three operating segments are generally affected by the same factors described in the Overview section above. Separate discussions and analyses for each segment would be repetitive.
Financial Statements and Supplementary Data; Notes to Consolidated Financial Statements; Note (2) Summary of Significant Accounting Policies ” for information concerning the implementation and impact of new or recently adopted accounting standards. Critical Accounting Estimates The preparation of consolidated financial statements in conformity with U.S.
Financial Statements and Supplementary Data; Notes to Consolidated Financial Statements; Note (2) Summary of Significant Accounting Policies; (u) Effect of Recently Adopted Amendments to Authoritative Accounting Guidance and (v) Effect of Recently Issued Amendments to Authoritative Accounting Guidance Not Yet Adopted ” for information concerning the implementation and impact of new or recently adopted accounting standards.
Our contingent consideration liabilities are measured at fair value on a recurring basis using Level 3 inputs which are inputs that are unobservable and significant to the overall fair value measurement.
ASC 820 establishes a fair value hierarchy for instruments measured at fair value that distinguishes between assumptions based on market data (observable inputs) and our own assumptions (unobservable inputs). Our contingent consideration liabilities are measured at fair value on a recurring basis using Level 3 inputs which are inputs that are unobservable and significant to the overall fair value measurement.
At December 31, 2024, we had not borrowed any amounts under the $10 million Revolving Facility. Our borrowings under the Term Note are discussed below and occurred prior to entering into the Amended Loan Agreement. Our available funding under the Term Note at December 31, 2024 was $30 million.
At December 31, 2025, we had total debt of $3.8 million with M&T and held $3.8 million of restricted cash with M&T. At December 31, 2025, we had not borrowed any amounts under the $10 million Revolving Facility. Our borrowings under the Term Note are discussed below and occurred prior to entering into the Amended Loan Agreement.
However, the environment in which we operate is dynamic and shifts rapidly at times, and the success of our efforts to mitigate and address the impacts on our business may not be successful.
However, the environment in which we operate is dynamic and shifts rapidly at times, and the success of our efforts to mitigate and address the impacts on our business may not be successful. As a result, we could see increases in our costs or reduced revenues which would impact the level of our earnings in future periods.
Properties ” and “ Part II; Item 8. Financial Statements and Supplementary Data; Notes to Consolidated Financial Statements; Note (3) Acquisition, ” in connection with the acquisition, we have entered into a lease agreement with the former owner of Alfamation™. 28 Revenue The following table sets forth, for the periods indicated, a breakdown of the revenue by market (in thousands).
Properties ” and “ Part II; Item 8. Financial Statements and Supplementary Data; Notes to Consolidated Financial Statements; Note (3) Acquisition; Note (9) Leases ,” in connection with the acquisition, we entered into a related-party lease agreement with the former owner of Alfamation ™ .
Financial Statements and Supplementary Data; Notes to Consolidated Financial Statements; Note (3) Acquisition ,” we assumed debt which totaled $11.3 million as of the acquisition date (the “ Alfamation Debt ”).
Financial Statements and Supplementary Data; Notes to Consolidated Financial Statements; Note (3) Acquisition, ” we assumed debt which totaled $11.3 million as of the acquisition date (the “ Alfamation ™ Debt ”). As of December 31, 2025, the Alfamation ™ Debt was $3.6 million, including $1.0 million that is backed by Alfamation ™ ’s accounts receivable.
Non-cash adjustments to net earnings increased primarily due to increased depreciation and amortization and a decreased impact from the change in deferred tax benefit. Investing Activities. Net cash used in investing activities for the year ended December 31, 2024 was $20.1 million compared to $1.3 million for the year ended December 31, 2023.
Non-cash adjustments to net (loss) earnings increased primarily due to increased depreciation and amortization resulting from the full year impact of Alfamation ™ . Investing Activities : Net cash used in investing activities for the year December 31, 2025, was $1.6 million, a decreased usage of $18.4 million compared to the prior year.
We maintain a two-to-three month safety stock on these items. Our supplier has indicated that they have large stock available at more than one facility in Israel, so they believe they have redundancies in place that will help ensure that the supply chain to their customers is uninterrupted.
Our supplier has indicated that they have large stock available at more than one facility in Israel, so they believe they have redundancies in place that will help ensure that the supply chain to their customers is uninterrupted. We continue to monitor the situation closely and are 33 Table of Contents staying in close contact with our supplier.
Each impairment test is based on a comparison of the estimated undiscounted cash flows to the recorded value of the asset. If impairment is indicated, the asset is written down to its estimated fair value. The cash flow estimates used to determine the impairment, if any, contain management’s best estimates using appropriate assumptions and projections at that time.
Each impairment test is based on a comparison of the estimated undiscounted cash flows to the recorded value of the asset group. If impairment is indicated, the asset group is written down to its estimated fair value.
The Amended Loan Agreement also allows us to enter into hedging contracts with M&T, including interest rate swap agreements, interest rate cap agreements, interest rate collar agreements, or any other agreements or that are designed to protect us against fluctuations in interest rates or currency exchange rates. 32 The Credit Agreement contains customary default provisions, including but not limited to the failure by us to repay obligations when due, violation of provisions or representations provided in the Credit Agreement, bankruptcy by us, suspension of our business or any of our subsidiaries and certain material judgments.
The Amended Loan Agreement contains customary default provisions, including but not limited to the failure by us to repay obligations when due, violation of provisions or representations provided in the Amended Loan Agreement, bankruptcy by us, suspension of our business or any of our subsidiaries and certain material judgments.
If, as a result of our qualitative assessment, we determine this is the case, we are required to perform a goodwill impairment test to identify potential goodwill impairment and measure the amount of goodwill impairment loss to be recognized. The test is discussed below.
However, if, as a result of our qualitative assessment, we determine it is more-likely-than-not that the fair value of a reporting unit is less than its carrying amount, or, if we choose not to perform a qualitative assessment, we are required to perform a quantitative goodwill impairment test to identify potential goodwill impairment and measure the amount of goodwill impairment loss to be recognized.
Financial Statements and Supplementary Data; Notes to Consolidated Financial Statements; Note (11) Income Taxes ” for further detail of the difference between our effective tax rates in 2024 and 2023 and the statutory tax rate of 21%. 31 Liquidity and Capital Resources As discussed more fully in the Overview, our business and results of operations are substantially dependent upon the demand for ATE by semiconductor manufacturers and companies that specialize in the testing of ICs.
LIQUIDITY AND CAPITAL RESOURCES As discussed more fully in the “ Overview ” section above, our business and results of operations are substantially dependent upon the demand for ATE by semiconductor manufacturers and companies that specialize in the testing of ICs.
Finite-lived intangible assets are amortized over their estimated useful economic life and are carried at cost less accumulated amortization. Goodwill is assessed for impairment at least annually in the fourth quarter, on a reporting unit basis, or more frequently when events and circumstances occur indicating that the recorded goodwill may be impaired.
Goodwill is assessed for impairment at least annually in the fourth quarter, on a reporting unit basis, or more frequently when events and circumstances occur indicating that the recorded goodwill may be impaired. Goodwill is considered to be impaired if the fair value of a reporting unit is less than its carrying amount.
The short-term financing variable rate at December 31, 2024 was 3.9%. At December 31, 2024, the weighted average interest rate payable was 1.18% for fixed rate debt, 4.35% for variable rate debt, and the overall weighted average interest rate for the Alfamation Debt was 3.47%.
At December 31, 2025, the weighted average interest rate payable on the bank issued term loans was 1.0% for fixed rate debt and 3.8% for variable rate debt and the overall weighted average interest rate for the bank issued term loans was 3.3%.
Acculogic purchases certain parts from a key sole-source supplier in Belarus, which is bordered by Russia to the east and northeast and Ukraine to the south. In August 2024, the United States, Canada and the European Union added additional sanctions on Belarus. We have not received materials from this supplier since the issuance of Executive Order 14038.
As a result of the ongoing war between Russia and Ukraine, in August 2024, the U.S., Canada and the European Union added additional sanctions on Belarus, which included adding this supplier to a list of prohibited entities. We have not received materials from this supplier since the issuance of Executive Order 14038.
The effect on deferred tax assets and liabilities of a change in tax rates is recognized in the results of operations in the period that includes the enactment date. 35 Deferred tax assets are analyzed to determine if there will be sufficient taxable income in the future in order to realize such assets.
The effect on deferred tax assets and liabilities of a change in tax rates is recognized in the results of operations in the period that includes the enactment date. A valuation allowance is recorded to reduce the carrying amounts of deferred tax assets if it is more likely than not that such assets will not be realized.
Inventory Valuation Inventories are valued at cost on a first-in, first-out basis, not in excess of market value. Cash flows from the sale of inventories are recorded in operating cash flows. On a quarterly basis, we review our inventories and record excess and obsolete inventory charges based upon our established objective excess and obsolete inventory criteria.
Inventory Valuation Inventories are generally valued at cost on a first-in, first-out basis, not in excess of net realizable value except inventory acquired in a business combination, which is recorded at fair value. Cash flows from the sale of inventories are recorded in operating cash flows.
At December 31, 2024 and 2023, the total contingent consideration liability on our balance sheet was $0.9 million and $1.1 million, respectively. The entire contingent consideration at December 31, 2023 was long-term. Income Taxes The asset and liability method is used in accounting for income taxes.
At December 31, 2025 and 2024, the total contingent consideration liability on our Consolidated Balance Sheets were $0.6 million and $0.9 million, respectively. Income Taxes We account for income taxes using the asset and liability method, as described in ASC Topic 740 – Income Taxes .
Liquidity Our cash and cash equivalents and working capital were as follows: December 31, (in thousands) 2024 2023 Cash and cash equivalents $ 19,830 $ 45,260 Working capital $ 46,864 $ 61,479 At December 31, 2024, $8.6 million, or 44%, of our cash and cash equivalents was held by our foreign subsidiaries.
Interest expense for the years ended December 31, 2025 and 2024 was $0.5 million and $0.8 million, respectively. 41 Table of Contents Liquidity Our cash, cash equivalents, restricted cash and working capital were as follows: December 31, (in thousands) 2025 2024 Cash and cash equivalents $ 14,216 $ 19,830 Restricted cash 3,842 — Working capital $ 42,883 $ 46,864 At December 31, 2025, $10.2 million, or 72%, of our cash and cash equivalents was held by our foreign subsidiaries.
We have three operating segments which are also our reportable segments and reporting units: Electronic Test (which includes our semiconductor test equipment, robotics-based electronic test equipment and application support services and functional test equipment for production quality control and product development), Environmental Technologies (which includes our thermal test, process and storage products) and Process Technologies (which includes our induction heating and video imaging products).
We have three operating segments which are also our reportable segments and reporting units: Electronic Test (which includes our semiconductor test equipment, flying probe and in-circuit testers), Environmental Technologies (which includes our thermal test, process and storage products) and Process Technologies (which includes our induction heating and video imaging products). 31 Table of Contents All of our operating segments have multiple products that we design, manufacture and market to our customers.
The Credit Facility had a five-year contract period (the “ Contract Period ”) that began on October 15, 2021 (the “ Closing Date ”) and expired on October 15, 2026, and draws under the Term Note were permissible for two years.
The Credit Facility has a five-year contract period that began on 40 Table of Contents October 15, 2021, and, as amended, expires on May 2, 2031, and draws under the Term Note, as amended, are permissible until May 2, 2026.
Net cash provided by operations for the year ended December 31, 2024 was $3.8 million compared to $16.2 million for the year ended December 31, 2023.
Cash Flows Operating Activities : Net cash provided by operating activities for the year ended December 31, 2025, was $7.3 million, an increase of $3.5 million compared to the prior year.
Our obligations under the Credit Agreement are secured by liens on substantially all of our tangible and intangible assets that are owned as of the Closing Date or acquired thereafter. At December 31, 2024, we were in compliance with all of the covenants included in the Credit Facility including the debt covenants of the Credit Agreement.
Our obligations under the Amended Loan Agreement are secured by liens on substantially all of our tangible and intangible assets that are owned as of the Closing Date or acquired thereafter. As noted above, the Sixth Amendment waives the fixed charge coverage ratio financial covenant through and including March 31, 2026.
As a result, we could see increases in our costs or reduced revenues which would impact the level of our earnings in future periods. 30 Please refer to “ Part I, Item 1A. Risk Factors ” in this Report for further discussion of the risks associated with our business operations, including risks associated with foreign operations.
Please refer to “ Part I; Item 1A. Risk Factors ” in this Report for further discussion of the risks associated with our business operations, including risks associated with foreign operations. CRITICAL ACCOUNTING POLICIES / ESTIMATES The preparation of consolidated financial statements in conformity with U.S.
The difference is primarily the result of the Alfamation™ acquisition. Capital expenditures for property and equipment was consistent with the prior year. Financing Activities . Net cash used in financing activities for the year ended December 31, 2024 was $8.6 million compared to cash provided of $15.6 million in the prior year.
Financing Activities: Net cash used in financing activities for the year ended December 31, 2025, was $8.2 million, a decreased usage of $0.4 million compared to the prior year.
Engineering and product development expense was $8.5 million for the year ended December 31, 2024 compared to $7.6 million in 2023, an increase of $0.9 million, or 12%. This increase is due to the increased payroll and related costs from the additional headcount acquired with Alfamation™.
Engineering and Product Development Expense Year Ended December 31, Change (in thousands except percentages) 2025 2024 $ % Engineering and product development expense $ 9,440 $ 8,548 $ 892 10.4 % Percentage of revenue 8.3 % 6.5 % Engineering and product development expense for the year ended December 31, 2025, increased compared to the prior year period due to payroll and payroll related cost increases along with the full year impact of Alfamation ™ .
As a result, our backlog at a particular date is not necessarily indicative of sales for any future period. Global Supply Chain Constraints In October 2023, Hamas attacked Israel and Israel formally declared war in response to the attack. The conflict is ongoing, and it is unclear when it might end.
As a result, our backlog at a particular date is not necessarily indicative of sales for any future period.
Contingent Consideration Liabilities The contingent consideration liabilities on our balance sheet are accounted for in accordance with the guidance in ASC Topic 820 - Fair Value Measurement (“ ASC 820 ”). ASC 820 establishes a fair value hierarchy for instruments measured at fair value that distinguishes between assumptions based on market data (observable inputs) and our own assumptions (unobservable inputs).
Financial Statements and Supplementary Data; Notes to Consolidated Financial Statements; Note (16) Restructuring ” for further discussion related to the Videology impairment. Contingent Consideration Liabilities The contingent consideration liabilities on our Consolidated Balance Sheets are accounted for in accordance with the guidance in ASC Topic 820 - Fair Value Measurement (“ ASC 820 ”).
Our remaining supply of these materials is expected to be sufficient to fulfill our orders for the first quarter of 2025. We have been working to qualify a new supplier for these materials and believe that these efforts are proceeding well.
We have qualified a new supplier for these materials and have a supply of these materials on hand to support new production. Our first system incorporating these new materials shipped to one of our customers at the end of the second quarter 2025.
At December 31, 2024, our backlog of unfilled orders for all products was approximately $39.5 million compared with approximately $40.1 million at December 31, 2023. The decrease in our backlog reflects reduced demand for our products and, to a lesser extent, lead times returning to a more normalized pattern.
Within Semi, orders from both front and back-end were down compared to the prior year period as demand remains low. At December 31, 2025, our backlog of unfilled orders for all products was $53.9 million compared to $39.5 million at December 31, 2024.
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All of our operating segments have multiple products that we design, manufacture and market to our customers. Due to a number of factors, our products have varying levels of gross margin.
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KNOWN TRENDS We continue to monitor recent macroeconomic factors, including but not limited to changes in global trade policy, tariffs and related reciprocal or retaliatory trade actions announced by the U.S., China and other countries.
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(in thousands except percentages) Years Ended December 31, Change 2024 2023 $ % Revenue Semi $ 48,708 37.3 % $ 65,735 53.3 % $ (17,027 ) -25.9 % Industrial 13,382 10.2 % 14,310 11.6 % (928 ) -6.5 % Automotive/EV 32,871 25.2 % 9,895 8.0 % 22,976 232.2 % Life Sciences 5,400 4.1 % 4,856 3.9 % 544 11.2 % Defense/Aerospace 15,317 11.7 % 12,537 10.2 % 2,780 22.2 % Security 2,946 2.3 % 3,688 3.0 % (742 ) -20.1 % Other 12,066 9.2 % 12,281 10.0 % (215 ) -1.8 % $ 130,690 100.0 % $ 123,302 100.0 % $ 7,388 6.0 % During 2024 our consolidated revenue grew $7.4 million or 6% year over year.
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The degree to which changes in global trade policy, tariffs and other related actions will impact our business, financial condition and results of operations depends on future developments, which are uncertain.
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Alfamation™ contributed $25.0 million in revenue from the date of acquisition, with a significant majority of that in the automotive market and to a lesser extent life sciences. We also experienced increased customer demand in the defense/aerospace market in 2024 compared to 2023. These increases were offset by continued softness in the semi market in 2024.
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Changes in global trade policies, tariffs and other related actions may negatively impact demand, pricing and cost for our products and technologies, contribute to the inherent uncertainties in estimating future customer demand and increase our material costs, any of which could negatively impacting our results of operations and cash flows.
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This reduction in demand, which we began to experience in the fourth quarter of 2023, has been particularly notable with regard to our customers in the front-end market who purchase our induction heating solutions for SiC crystal growth and epitaxial reactors.
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GLOBAL SUPPLY CHAIN CONSTRAINTS In early October 2023, Hamas attacked Israel and Israel formally declared war in response to the attack. Although a cease-fire was declared in October 2025, hostilities continue.
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The semi market is highly cyclical resulting in significant swings in demand when period to period comparisons are to different points in a given cycle. The current period of weakened demand began in the fourth quarter of 2023 resulting in significantly reduced revenue levels from our customers in this market during 2024.
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On February 28, 2026, the U.S. and Israel launched a coordinated military operation against Iran, and Iran has responded with attacks affecting certain Persian Gulf states as well as Israel.

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