Pro-Dex Reports 14% Revenue Growth in Q3 2026, Acquires Advanced Precision Machining

Pro-Dex, Inc. reported a significant increase in financial performance for the three and nine months ended March 31, 2026, compared to the same periods in the previous fiscal year. The company achieved net sales of $19.9 million for the third quarter, a 14% increase from $17.4 million in the prior year. For the nine-month period, net sales rose to $57.1 million, up 16% from $49.1 million. The gross profit for the quarter was $6.1 million, reflecting a gross margin of 31%, while the nine-month gross profit reached $17.2 million, with a gross margin of 30%. Net income for the third quarter was $3.9 million, or $1.23 per share, compared to $3.3 million, or $1.00 per share, in the prior year. For the nine months, net income increased to $10.8 million, or $3.34 per share, from $7.8 million, or $2.36 per share.

The company experienced notable changes in its operational metrics, particularly in its medical device segment, which saw sales increase by 36% for the quarter and 35% for the nine-month period. This growth was primarily driven by a contract amendment with its largest customer, extending their agreement through 2028 and increasing order volumes. However, repair revenue decreased significantly, dropping 48% for the quarter and 36% for the nine months, attributed to a shift from repairs of legacy products to newer models. Pro-Dex's backlog stood at approximately $39 million as of March 31, 2026, indicating strong future revenue potential.

Strategically, Pro-Dex completed the acquisition of Advanced Precision Machining, LLC (APM) in February 2026 for $8.65 million, enhancing its manufacturing capabilities and customer base in the aerospace and defense sectors. This acquisition is expected to support increased demand from existing contracts and expand the company's operational footprint. The integration of APM is anticipated to contribute positively to Pro-Dex's revenue streams moving forward.

In terms of financial health, Pro-Dex reported a substantial increase in cash and cash equivalents, rising to $10 million from $419,000 at the end of the previous fiscal year. The company generated $7.5 million in net cash from operating activities for the nine months ended March 31, 2026, a significant turnaround from a cash outflow of $1.5 million in the prior year. The increase in cash flow was driven by higher net income and improved working capital management. Pro-Dex's total liabilities increased to $29.8 million, up from $24.6 million, primarily due to the financing associated with the APM acquisition.

Looking ahead, Pro-Dex remains focused on leveraging its recent acquisition and expanding its product offerings, particularly in the medical device sector. The company aims to maintain strong relationships with existing customers while exploring new opportunities for growth. Management anticipates continued revenue growth, although it acknowledges potential variability in order bookings and market conditions. The company is committed to monitoring its operational performance closely and adapting its strategies to ensure sustained profitability and shareholder value.