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    INTT
    Earnings call· Jun 2026(Q2 FY26)

    INTEST Q2 FY26 earnings call INTT

    Aug 10, 2026 Source

    Executive summary

    InTest Q2 FY26 — Strong Semi Orders and Raised Full-Year Revenue Outlook

    InTest delivered a solid second quarter, driven by broad demand and a significant rebound in semiconductor orders, leading to a raised full-year revenue outlook. While gross margin faced pressure from product mix, the company demonstrated strong operating leverage and cash generation. Management is focused on operational efficiency and cross-collaboration to improve profitability and consistency.

    Highlights

    5

    • Q2 revenue of $35.3 million was up approximately 26% year-over-year, marking the third consecutive quarter of sequential revenue growth and second consecutive quarter of year-over-year growth above 25%.

    • Semi orders increased 56% sequentially and 64% year-over-year, the strongest semi order intake in 6 quarters, converting the anticipated 'semi wave' into orders.

    • Full-year revenue guidance was raised to $135 million to $140 million, representing approximately 21% growth over 2025 at the midpoint, driven by diversified demand and improving semi outlook.

    • Adjusted EBITDA increased approximately 73% year-over-year to $2.2 million, with an adjusted EBITDA margin of 6.2%.

    • Ended Q2 with $22.1 million in cash and cash equivalents, an increase of $6.4 million from Q1, and total liquidity of $62 million.

    Concerns

    4

    • Q2 gross margin declined 280 basis points sequentially to 40.5% due to an unfavorable mix of high-revenue, lower-margin projects in auto EV and a shortfall of higher contribution revenue shifting to Q3.

    • Auto EV orders declined 67% sequentially after four quarters of strong order flow, reflecting normalization from an elevated peak.

    • Backlog decreased 12% sequentially to $45.4 million, reflecting the normalization of auto EV projects.

    • A material weakness in internal control over financial reporting at Alfamation was identified in connection with Q1 revisions, with remediation plans implemented.

    Guidance & targets

    11
    CategoryTargetConfidence
    Q3 Revenue
    $33 million to $35 million
    high materiality
    High
    Q3 Gross Margin
    approximately 44%
    medium materiality
    High
    Q3 Operating Expenses
    $13.8 million to $14.2 million
    medium materiality
    High
    Q3 Amortization
    $0.5 million
    low materiality
    High
    Full-year Revenue
    $135 million to $140 million
    high materiality
    High
    Full-year Gross Margin
    approximately 43%
    medium materiality
    High
    Full-year Operating Expenses
    $55 million to $57 million
    medium materiality
    High
    Full-year Amortization
    $2.6 million
    low materiality
    High
    Full-year Interest Expense
    approximately $0.3 million
    low materiality
    High
    Full-year Effective Tax Rate
    18%
    medium materiality
    High
    Full-year Capital Expenditures
    1% to 2% of revenue
    low materiality
    High

    Segment performance

    5
    SegmentRevenueYoYQoQMargin
    Auto EV
    Revenue increased $6 million sequentially and $7.6 million year-over-year, driven by shipment of high-revenue, lower-margin Alfamation projects from backlog and some pull-ins. Orders declined 67% sequentially, reflecting normalization from an elevated peak, but funnel activity remains healthy.
    		—$7.6 million$6 million—
    Industrial
    Revenue contributed $1.1 million sequentially and $0.6 million year-over-year.
    		—$0.6 million$1.1 million—
    Defense Aerospace
    Revenue declined $2.1 million sequentially following a strong Q1, but increased $7.2 million year-over-year. Orders declined 28% sequentially, but increased 70% year-over-year on higher DoD procurement.
    		—increased $7.2 milliondeclined $2.1 million—
    Life Sciences
    Revenue decreased $1.6 million sequentially but increased $0.6 million year-over-year.
    		—$0.6 milliondecreased $1.6 million—
    Semi
    Revenue declined $1.4 million sequentially and $1.1 million year-over-year. Orders increased 56% sequentially and 64% year-over-year, representing the strongest semi order intake in 6 quarters, converting the 'semi wave' into orders. The pace of activity in back-end markets is picking up. Gross margin profile is in the mid-50s percentage range.
    		—declined $1.1 milliondeclined $1.4 millionmid-50s %

    Operational metrics

    23
    Revenue
    $35.3Mup 4% QoQ from $33.9M; up 26% YoY from $28.1M
    Q2 FY26

    Q2 revenue in line with preannouncement, marking third consecutive quarter of sequential growth and second consecutive quarter of YoY growth above 25%.

    Gross margin
    40.5%down 280 bps QoQ; down 210 bps YoY from 42.6%
    Q2 FY26

    Gross margin declined sequentially and year-over-year due to an unfavorable mix of high-revenue, lower-margin auto EV projects and a shortfall of higher contribution revenue that shifted to Q3.

    Operating expenses
    $13.9Mdecrease of $0.5M sequentially
    Q2 FY26

    Sequential decrease primarily due to $0.7 million in nonrecurring restructuring costs in Q1 that did not recur.

    Operating expenses as % of revenue
    39.5%
    Q2 FY26

    Reduction in operating expenses as a percentage of revenue, reflecting operating leverage.

    Net income
    $0.5M
    Q2 FY26

    GAAP net income for the quarter.

    Net margin
    1.3%
    Q2 FY26

    Net margin for the quarter.

    Adjusted EBITDA
    $2.2Mup approximately 73% from $1.3M in Q2 2025
    Q2 FY26

    Adjusted EBITDA showing strong year-over-year growth.

    Adjusted EBITDA margin
    6.2%
    Q2 FY26

    Adjusted EBITDA margin for the quarter.

    Net income per diluted share
    $0.04
    Q2 FY26

    GAAP net income per diluted share.

    Adjusted EPS
    $0.09
    Q2 FY26

    Adjusted EPS, which adds back tax-effected acquired intangible amortization and restructuring charges.

    Discrete income tax benefit
    $0.02
    Q2 FY26

    Benefit per diluted share driven by stock option exercises during the quarter, specific to Q2.

    Cash and cash equivalents balance
    $22.1Mincrease of $6.4M from end of Q1
    Q2 FY26

    Cash balance at the end of the second quarter.

    Total liquidity
    $62M
    Q2 FY26

    Total liquidity at June 30, 2026, including cash and available borrowing capacity.

    Available borrowing capacity
    $40M
    Q2 FY26

    Available capacity under delayed draw term loan and revolving credit facilities, extended through August 28, 2026.

    Total debt
    $6.2M
    Q2 FY26

    Total debt at June 30, 2026.

    Leverage ratio
    0.8x
    Q2 FY26

    Leverage ratio at the end of the second quarter.

    Cash from operating activities
    $6.3M
    Q2 FY26

    Cash generated from operating activities during the second quarter.

    Proceeds from stock option exercises
    $2.9M
    Q2 FY26

    Inflows from stock option exercises during the second quarter.

    Net debt repayments
    $2.3M
    Q2 FY26

    Net debt repayments during the second quarter.

    Capital expenditures
    $0.4M
    Q2 FY26

    Capital expenditures during the second quarter.

    Non-semi markets revenue share
    74%
    Q2 FY26

    Percentage of Q2 revenue from non-semi markets, highlighting diversification.

    Delayed shipments
    $2M
    Q3 FY26

    Shipments that moved out of Q2 and were recognized in Q3.

    Back-end semi business margin profile
    mid-50s
    Q2 FY26

    Margin profile for the back-end semi business, noted as one of the higher margin profiles.

    Industry KPIs

    3
    MetricValueDetails
    Backlog order book$45.4 millionUSD
    Bookings net order intake$28.9 millionUSD
    End market segment revenue mixNon-semi markets accounted for approximately 74% of Q2 revenue.%

    Orderbook & backlog

    5
    Total Orders$28.9 millionQ2 FY26

    down 9% sequentially, up 4% year-over-year

    Semi Ordersincreased 56% sequentiallyQ2 FY26

    increased 64% year-over-year

    Strongest semi order intake in 6 quarters, converting the 'semi wave' into orders.

    Auto EV Ordersdeclined 67% sequentiallyQ2 FY26

    Follows 4 quarters of strong order flow, reflecting normalization.

    Defense Aerospace Ordersdeclined 28% sequentiallyQ2 FY26

    increased 70% year-over-year

    Sequential decline reflects nonrecurring orders that drove strong Q1; YoY growth on higher DoD procurement.

    Total Backlog$45.4 millionQ2 FY26

    sequential decrease of 12%, year-over-year increase of 20%

    Approximately 45% of the backlog is expected to ship beyond the third quarter, reflecting normalization of an elevated peak in auto EV projects.

    Product announcements

    4
    ProductTypeDetails
    eco heat (next-generation)milestone
    Robotic docking and intelligent interface solutionsupdate
    Advanced high-powered chillersroadmap
    Test solutions for high power, high-voltage devicesroadmap

    Risks & headwinds

    3
    Unfavorable mix of high-revenue, low-margin projectsQ2 FY26

    Q2 gross margin declined 280 basis points sequentially to 40.5%

    Mitigation: Expected shift in revenue mix towards higher-margin semi sales in the second half of the year.

    Material weakness in internal control over financial reportingIdentified in Q1 FY26, expected remediation by FY26 year-end

    Controlled efficiencies underlying the Q1 revision at Alfamation constituted a material weakness.

    Mitigation: Remediation plans have been implemented and are fully expected to demonstrate effective operation by fiscal year-end.

    Macroeconomic conditionsThrough the end of FY26

    Guidance assumes macroeconomic conditions remain unchanged.

    Mitigation: Ongoing operational review to improve cost efficiencies and productivity across the cost structure.

    What to watch in Q3 FY26

    4

    Gross margin trajectory

    Q3 FY26
    Current40.5% (Q2 FY26)
    Target~44% (Q3 FY26 guidance)

    Why it matters

    Gross margin was impacted by mix in Q2; improvement is guided for Q3 and critical for overall profitability.

    For Q3, we project revenue of $33 million to $35 million. gross margin of approximately 44%...

    Q&A highlights

    7

    Was the Q2 semi order intake in line with internal expectations, and how are orders expected to trend throughout Q3 and Q4?

    The Q2 semi order intake was as expected, confirming the strong second-half outlook. Management anticipates continued strong order intake for the next one to two quarters, barring macroeconomic changes.

    “As we see it now, the order intake through the next quarter to quarter, maybe 2 will be as expected. There's unless something changes in the market space as we see it, things are looking strong.”

    asked by Maxwell Michaelis · answered by Richard Rogoff

    2 min read5 chapters

    Detailed Narrative

    01

    Q2 Performance Overview

    InTest reported Q2 revenue of $35.3 million, gross margin of 40.5%, and operating expenses of $13.9 million, aligning with its pre-announcement. Revenue was up 26% year-over-year, marking the third consecutive quarter of sequential growth and second consecutive quarter of over 25% YoY growth, driven by strong project delivery in auto EV and a building semiconductor funnel.

    02

    Order and Backlog Dynamics

    Q2 orders were $28.9 million, down 9% sequentially but up 4% YoY. Semiconductor orders were a standout, increasing 56% sequentially and 64% YoY, converting the previously referenced 'semi wave' into actual orders. Auto EV orders declined 67% sequentially after four strong quarters, while Defense Aerospace orders decreased 28% sequentially but were up 70% YoY. Backlog stood at $45.4 million, a 12% sequential decrease, with approximately 45% expected to ship beyond Q3.

    03

    End Market Trends and Growth Drivers

    The company sees expanding opportunities in higher-margin end markets. In semi, activity in back-end markets is picking up due to demand for testing high-power devices in the electrified economy. Defense and Aerospace benefits from higher DoD spending and capacity expansion. Auto EV demand remains healthy, supported by increasing electronic content in vehicles, with order activity following multi-year automotive programs.

    04

    Strategic Initiatives and Product Development

    InTest is deepening its position with existing strategic accounts, cross-selling its broader portfolio, and expanding channel coverage. New products like the next-generation eco heat are progressing towards customer shipments. The company is also developing advanced high-powered chillers to meet demand for higher power conversion and focusing test solutions on high-power, high-voltage devices like silicon carbide and gallium nitride.

    05

    Operational Efficiency and Internal Controls

    Management is undertaking an operational review to improve cost efficiencies and productivity, including examining the manufacturing footprint and business unit cost structure. This aims to build consistency in adjusted EBITDA performance. The company also disclosed a material weakness in internal controls at Alfamation related to Q1 revisions, with remediation plans in place expected to be effective by year-end.

    AI-generated summary of the company’s earnings call. Not investment advice.