Interlink Electronics Reports 66% Revenue Growth to $3.1 Million in Q3 2023

Interlink Electronics, Inc. reported a significant increase in financial performance for the third quarter of 2023, with net revenue reaching $3.1 million, a 66% increase from $1.9 million in the same period last year. For the nine months ending September 30, 2023, the company generated $10.4 million in revenue, up 76.8% from $5.9 million in the prior year. The gross profit for the quarter was $1.5 million, yielding a gross margin of 47.4%, slightly up from 47.1% in the previous year. However, the company recorded a net loss of $125,000 for the quarter, compared to a net income of $6,000 in Q3 2022.

The financial results reflect the impact of recent acquisitions, including SPEC Sensors and KWJ Engineering in December 2022, and Calman Technology Limited in March 2023. These acquisitions contributed to increased revenues in the industrial and medical markets, which saw growth of 84.7% and 118% respectively. However, revenue from the consumer market declined significantly, primarily due to fluctuations in order timing from larger customers. The company’s operating expenses also rose, totaling $1.6 million for the quarter, driven by increased headcount and operational costs associated with the acquisitions.

Operationally, Interlink Electronics has expanded its global footprint, with significant revenue contributions from the United States, Asia, and Europe. The company reported that its customer base has grown, with notable increases in accounts receivable and inventory levels, reflecting higher shipment volumes and the integration of Calman’s operations. As of September 30, 2023, the company had cash and cash equivalents of $5.2 million, down from $10.1 million at the end of 2022, primarily due to cash used in acquisitions and operational expenses.

Looking ahead, Interlink Electronics anticipates continued growth driven by its expanded product offerings and customer base resulting from recent acquisitions. The company plans to leverage its enhanced capabilities in sensor technology to capture additional market share in the industrial and medical sectors. However, management has acknowledged potential challenges, including market fluctuations and the need for ongoing investment in research and development to maintain competitive advantages.

In summary, Interlink Electronics has demonstrated strong revenue growth in Q3 2023, bolstered by strategic acquisitions, although it faces challenges in profitability and cash management. The company remains focused on leveraging its expanded capabilities to drive future growth while navigating the complexities of the market landscape.