Data I/O Corporation Reports 1.3% Increase in Net Sales to $6.2 Million in Q1 2025

Data I/O Corporation reported its financial results for the first quarter of 2025, revealing a modest increase in net sales to $6.2 million, up 1.3% from $6.1 million in the same period last year. The company attributed this growth to improved business recovery and backlog deliveries, particularly in the Americas and Europe, which saw increases of 32% and 44%, respectively. However, revenue from Asia declined by 40% due to strong prior year performance and delays in bookings linked to trade and economic uncertainties. The company’s gross margin for the quarter was 51.6%, slightly down from 52.8% in the prior year, reflecting a higher mix of system sales revenue.

In terms of profitability, Data I/O reported a net loss of $382,000 for the first quarter, an improvement from a loss of $807,000 in the same quarter of 2024. The company’s operating loss also narrowed to $377,000 from $860,000 year-over-year. Operating expenses decreased significantly, with research and development costs falling to $1.5 million from $1.6 million, and selling, general, and administrative expenses dropping to $2.1 million from $2.5 million. This reduction in expenses was primarily due to lower sales commissions and compensation costs following headcount reductions in late 2024.

Operationally, Data I/O's customer engagement metrics showed a positive trend, with increased utilization of existing systems leading to heightened demand for engineering and maintenance services. The company reported a backlog of $2.9 million as of March 31, 2025, down from $3.5 million at the end of 2024. Additionally, the company’s deferred revenue stood at approximately $1.5 million, indicating ongoing commitments for future services. The geographic distribution of sales showed that international sales accounted for 88% of total net sales, a decrease from 96% in the prior year, highlighting a shift in market dynamics.

Looking ahead, Data I/O remains cautious about the near-term economic environment, particularly regarding global trade and tariff issues that may impact customer purchasing decisions. The company is focused on diversifying its market reach beyond the automotive sector and enhancing its consultative sales process. Management expressed optimism about future growth driven by strategic partnerships and product development initiatives, while also emphasizing the importance of maintaining a resilient supply chain to navigate ongoing economic challenges. The company believes it has sufficient liquidity to support operations and capital requirements in the coming year, despite the potential for additional financing needs if business conditions do not improve.