Earnings release
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Sono-Tek Reports Fiscal Second Quarter and First Half 2027 Results Driven by Strong Medical Sector and Higher Value Production Systems First Half Revenue Increased 6% to $10.9 Million; Gross Margin Expanded to 55%; Operating Income Increased41%; Medical Market Sales Increased 289% Reiterates Expectation of Flat to Modest Revenue Growth for FY 27 Reflecting Timing of Several Large Orders Recent New Record Orders Significantly Increases Revenue Visibility for FY 28 MILTON, N.Y., Oct. 14, 2026 (GLOBE NEWSWIRE) -- Sono-Tek Corporation (Nasdaq: SOTK), a leading developerand manufacturer of precision ultrasonic coating systems, today reported financial results for the second quarter and firsthalf of fiscal year 2027, ended August 31, 2026. Second Quarter Fiscal 2027 Highlights Net sales increased 1% to $5.23 million compared with $5.16 million in the second quarter of fiscal 2026. Gross profit increased 7% to $2.77 million, while gross margin expanded to 53%, compared with 50% in theprior-year period, primarily reflecting an unusually favorable product and geographic mix. Operating income was $382,000 compared with $421,000 in the prior-year period, reflecting higher operatingexpenses that partially offset the increase in gross profit. Net income was $366,000, or $0.02 per diluted share, compared with $424,000, or $0.03 per diluted share, in thesecond quarter of fiscal 2026. Medical market sales increased 209% to $3.11 million, led by shipments of balloon coating systems andspecialty stent-coating systems. First Half Fiscal 2027 Highlights Net sales increased 6% to $10.89 million compared with $10.30 million in the first half of fiscal 2026, consistentwith the Company's first-half growth guidance and driven by strong sales to the medical sector. Gross profit increased 14% to $5.98 million, while gross margin expanded to 55%, compared with 51% in theprior-year period, primarily reflecting an unusually favorable product and geographic mix. Operating income increased 41% to $1.28 million, compared with $905,000 in the first half of fiscal 2026,reflecting increased gross profit and operating leverage. Net income increased 22% to $1.11 million, compared with $909,000 in the prior-year period. Medical market sales increased 289% to $7.05 million, driven by shipments of balloon coating systems andspecialty stent-coating systems. Balance Sheet, Backlog and Guidance for Fiscal Year 2027 Cash, cash equivalents and marketable securities: Totaled $17.7 million at August 31, 2026, compared with$14.8 million at February 28, 2026, with no outstanding debt. Backlog: Combined equipment and service-related backlog was $9.51 million at August 31, 2026, an increase ofapproximately $1.78 million, or 23%, from $7.73 million at the end of the first quarter of fiscal 2027. Thesequential increase reflects improved order momentum during the second quarter. Subsequent Order Activity: Subsequent to quarter end, the Company received three orders totalingapproximately $7.19 million expected to ship during fiscal 2028. The order significantly increases revenuevisibility for fiscal 2028 with the potential to build even further upon this backlog. Guidance: For the full fiscal year 2027, the Company is reiterating its prior guidance for flat to modest revenuegrowth reflecting the timing of several large orders, growing demand in the medical device market and highervalue production systems. Steve Harshbarger, President and Chief Executive Officer of Sono-Tek, stated, “Fiscal 2027 is progressing well, withsolid first-half revenue growth, meaningful gross margin expansion and strong improvement in operating profitability.
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These results reflect disciplined execution across our operations and continued progress with our strategy of focusing onhigher-value production systems in advanced technology markets, particularly medical devices. Medical was again theprimary growth driver, with first-half sales increasing 289%, led by strong demand for balloon coating and specialtystent-coating systems. We are particularly encouraged by the increasing adoption of our technology as customers movefrom development into commercial manufacturing.” “Looking ahead, we remain focused on expanding our installed base of production systems, supporting customers asthey scale, and investing in the engineering, application development and commercial capabilities that will drive ournext phase of growth. We continue to maintain our previously communicated expectation of flat to modest revenuegrowth for the full fiscal year. This outlook reflects the timing of several large, higher-value production platform orders,which can result in increased quarter-to-quarter variability as these systems become a larger portion of our business.With a strong and growing backlog and cash position, we believe we are well positioned to capitalize on theopportunities ahead and continue building long-term value for our shareholders. We are extremely proud of ourperformance and long-term track record of revenue and importantly net income growth.” Dr. Christopher L. Coccio, Executive Chairman, stated, “Our first-half results reinforce the long-term strength of Sono-Tek’s ultrasonic coating technology platform and the strategic direction we have pursued for many years. Theexceptional growth in our medical business demonstrates how our technology and application expertise are enablingcustomers to address increasingly demanding coating requirements in sophisticated medical-device applications. Webelieve this growth also reflects the broader opportunity to expand our role as customers move from development intocommercial manufacturing and increasingly require greater precision, repeatability and process control.” “Over decades, Sono-Tek has built differentiated technology, deep application expertise and lasting customerrelationships that continue to position us for future growth. We see opportunities to build on these strengths byexpanding our presence in existing markets, developing new applications and supporting customers as theirmanufacturing requirements evolve. Together with our strong financial foundation and disciplined approach toinvestment, we believe these enduring strengths provide a solid platform for sustainable long-term growth and continuedvalue creation for our shareholders.” Second Quarter and First Half Fiscal 2027 Financial Results (Narrative compares with prior-year period unless otherwise noted) ($ in thousands) Three Months Ended August 31, Change 2026 2025 $ % Net Sales $ 5,232 $ 5,163 69 1% Gross Profit $ 2,767 $ 2,590 177 7% Gross Margin 53% 50% Operating Income $ 382 $ 421 (39) (9%) Operating Margin 7% 8% Net Income $ 366 $ 424 (58) (14%) Net Margin 7% 8% Six Months Ended August 31, Change 2026 2025 $ % Net Sales $ 10,893 $ 10,295 596 6% Gross Profit $ 5,981 $ 5,254 727 14% Gross Margin 55% 51% Operating Income $ 1,279 $ 905 374 41% Operating Margin 12% 9% Net Income $ 1,107 $ 909 198 22% Net Margin 10% 9% Product Sales
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Three Months EndedAugust 31, Change Six Months EndedAugust 31, Change 2026 2025 $ % 2026 2025 $ % Fluxing Systems $ 27,000 $ 165,000 (138,000) (84%) $ 119,000 $ 317,000 (198,000) (62%) In-Line CoatingSystems 1,778,000 1,530,000 248,000 16% 3,937,000 4,584,000 (647,000) (14%) Multi-Axis CoatingSystems 1,975,000 2,030,000 (55,000) (3%) 4,050,000 2,707,000 1,343,000 50% OEM Systems 642,000 394,000 248,000 63% 873,000 524,000 349,000 67% Spare Parts, Servicesand Other 810,000 1,044,000 (234,000) (22%) 1,914,000 2,164,000 (250,000) (12%) TOTAL $5,232,000 $5,163,000 69,000 1% $10,893,000 $10,296,000 597,000 6% Sales of In-Line Coating Systems increased 16% in the second quarter of fiscal 2027 due to strong medical sales in theUnited States. In-Line Coating Systems sales decreased 14% during the first half of fiscal 2027 primarily attributed to the shipment ofsix high ASP systems valued at $4.42 million that occurred in the first half of fiscal 2026 that did not repeat in fiscal2027. Sales of Multi-Axis Coating Systems decreased by 3% in the second quarter of fiscal 2027. In the first half of fiscal2027, Multi-Axis Coating Systems increased 50% or approximately $1.3 million, driven by strong sales of specialtystent-coating systems to the U.S. medical device market. Sales of OEM Systems increased 63% to $642,000 in the second quarter and 67% to $873,000 in the first half of fiscal2027. The increase in OEM sales in the second quarter and the first half of fiscal 2027 were driven by continued strongfluxing-system sales to a European OEM partner and strong semiconductor sales to an OEM in China. Market Sales Three Months EndedAugust 31, Change Six Months EndedAugust 31, Change 2026 2025 $ % 2026 2025 $ % Electronics/Microelectronics $1,204,000 $1,455,000 (251,000) (17%) $ 2,068,000 $ 2,399,000 (331,000) (14%) Medical 3,105,000 1,004,000 2,101,000 209% 7,050,000 1,812,000 5,238,000 289% Alternative/Clean Energy 535,000 2,433,000 (1,898,000) (78%) 855,000 5,681,000 (4,826,000) (85%) Emerging R&D and Other 3,000 33,000 (30,000) (91%) 5,000 47,000 (42,000) (89%) Industrial 385,000 238,000 147,000 62% 915,000 357,000 558,000 156% TOTAL $5,232,000 $5,163,000 69,000 1% $10,893,000 $10,296,000 597,000 6% Medical sales increased 209% to $3,105,000 in the second quarter of fiscal 2027 and 289% to $7,050,000 in the first halfof fiscal 2027, led by shipments of balloon coating systems and specialty stent-coating systems. Industrial sales increased 62% to $385,000 in the second quarter of fiscal 2027 and 156% to $915,000 in the first half offiscal 2027, influenced by a system sold to the defense sector for an optics-related application. Alternative Energy sales decreased 78% to $535,000 in the second quarter of fiscal 2027 and 85% to $855,000 in thefirst half of fiscal 2027. The decrease in the Alternative Energy market reflects the significant shifts in U.S. governmentpolicy and spending within the clean energy sector, particularly in green-hydrogen, electrolysis and fuel-cellapplications. Electronics/Microelectronics sales decreased 17% to $1,204,000 in the second quarter of fiscal 2027 and 14% to$2,068,000 in the first half of fiscal 2027. Geographic Sales Three Months EndedAugust 31, Change Six Months EndedAugust 31, Change 2026 2025 $ % 2026 2025 $ % U.S. & Canada $3,682,000 $2,720,000 962,000 35% $ 7,212,000 $ 6,263,000 949,000 15%
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Asia Pacific (APAC) 507,000 930,000 (423,000) (45%) 1,244,000 1,527,000 (283,000) (19%) Europe, Middle East,Africa (EMEA) 952,000 1,424,000 (472,000) (33%) 1,883,000 2,321,000 (438,000) (19%) Latin America 91,000 89,000 2,000 2% 554,000 185,000 369,000 199% TOTAL $5,232,000 $5,163,000 69,000 1% $10,893,000 $10,296,000 597,000 6% In the second quarter of fiscal 2027, approximately 30% of sales originated outside of the United States and Canadacompared with 47% in the second quarter of fiscal 2026. In the first half of fiscal 2027, approximately 34% of sales originated outside of the United States and Canada comparedwith 39% in the first half of fiscal 2026. U.S. and Canada sales increased 35% in the second quarter of fiscal 2027 and 15% in the first half of fiscal 2027, drivenby strong sales to the U.S. medical-device market, including the stent and drug-coated balloon markets. Asia Pacific sales decreased approximately 45% in the second quarter and 19% in the first half of fiscal 2027, reflectinglower sales in South Korea, Taiwan and Japan. These decreases were partially offset by increased sales in China,including strong first-half medical and semiconductor sales. Latin America sales increased 2% in the second quarter of fiscal 2027 and were essentially flat with the prior-yearquarter. Sales increased 199% in the first half of fiscal 2027, including a $242,000 medical system shipped to Costa Rica. EMEA sales decreased 33% in the second quarter and 19% in the first half of fiscal 2027, primarily reflecting softerclean-energy sales in the region. The first-half decrease was partially offset by strong sales to a European fluxing OEMpartner and steady medical-sector sales. Conference Call Information The Company will hold a conference call to discuss its fiscal second quarter and first half 2027 financial results, endedAugust 31, 2026, today, October 14, 2026, at 10:30 am ET. To participate, please dial 1-844-481-2752 or 1-412-317-0668 for international callers at least 10 minutes prior to thestart of the call and ask to join the Sono-Tek call. Webcast Information A simultaneous webcast of the call may be accessed through the Company's website, Events & Presentations | Sono-Tekor at: https://event.choruscall.com/mediaframe/webcast.html?webcastid=XwOIJQ1z A replay of the call will be available at 1-855-669-9658 or 1-412-317-0088 for international callers, access code9211789, through October 28, 2026. A replay of the call will also be available on the Company’s website for one year atwww.sono-tek.com. About Sono-Tek Sono-Tek Corporation is the global leader in the design and manufacture of ultrasonic coating systems that are shapingindustries and driving innovation worldwide. Our ultrasonic coating systems are used to apply thin films onto parts usedin diverse industries including microelectronics, alternative energy, medical devices, advanced industrial manufacturing,and research and development sectors worldwide. Sono-Tek's inroads into the clean energy sector are showingtransformative results in next-gen solar cells, fuel cells, green hydrogen generation, and carbon capture applications. Our product line is rapidly evolving, transitioning from R&D to high-volume production machines with significantlyhigher average selling prices, showcasing our market leadership and adaptability. Our comprehensive suite of thin filmcoating solutions and application consulting services are expected to generate unparalleled results for our clients andhelp some of the world's most promising companies achieve technological breakthroughs and bring them to the market.We strategically deliver our products to customers through a network of direct sales personnel, carefully chosenindependent distributors, and experienced sales representatives, ensuring efficient market reach across diverse sectorsaround the globe. Our solutions are environmentally friendly, efficient and highly reliable, and enable dramatic reductions in overspray,savings in raw material, water and energy usage and provide improved process repeatability, transfer efficiency, highuniformity and reduced emissions.
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Sono-Tek’s growth strategy is focused on leveraging its innovative technologies, proprietary know-how, unique talentand experience, and global reach to further develop thin film coating technologies that enable better outcomes for itscustomers’ products and processes. For further information, visit www.sono-tek.com. Safe Harbor Statement This news release contains forward looking statements regarding future events and the future performance of Sono-TekCorporation that involve risks and uncertainties that could cause actual results to differ materially. These “forward-looking statements’ are based on currently available competitive, financial and economic data and our operating plans. They are inherently uncertain, and investors must recognize that events could turn out to be significantly different fromour expectations and could cause actual results to differ materially. These factors include, among other considerations,general economic and business conditions, including political, regulatory, tax, competitive and technologicaldevelopments affecting our operations or the demand for our products; inflationary and supply chain pressures;continued strength of sales to the medical device market; continued private and public funding for the clean energysector and continued strong demand for Sono-Tek’s suite of thin film coating solutions and application consultingservices in the clean energy and other markets; maintenance of order backlog; the imposition of tariffs; timelydevelopment and market acceptance of new products and continued customer validation of our coating technologies;adequacy of financing; capacity additions, the ability to enforce patents; maintenance of operating leverage;consummation of order proposals; completion of large orders on schedule and on budget; successful transition fromprimarily selling ultrasonic nozzles and components to a more complex business providing complete machine solutionsand higher value subsystems; and realization of quarterly and annual revenues within the forecasted range of salesguidance. We undertake no obligation to update any forward-looking statement. For more information, contact: Sono-Tek Corp.Stephen J. BagleyChief Financial OfficerPh: (845) 795-2020info@sono-tek.com Investor Relations:Kirin SmithPCG Advisory, Inc.ksmith@pcgadvisory.com SONO-TEK CORPORATIONCONDENSED CONSOLIDATED BALANCE SHEETS August 31,2026 February 28,2026 (Unaudited) ASSETS Current Assets: Cash and cash equivalents $ 10,249,779 $ 7,339,403 Marketable securities 7,505,420 7,469,649 Accounts receivable (less allowance of $12,225, respectively) 1,230,260 3,350,953 Inventories 3,833,809 3,923,350 Prepaid expenses and other current assets 535,491 743,295 Total current assets 23,354,759 22,826,650 Land 250,000 250,000 Buildings, equipment, furnishings and leasehold improvements, net 2,036,827 2,173,443 Intangible assets, net 26,316 29,791 Deferred tax asset 731,673 1,141,611 TOTAL ASSETS $ 26,399,575 $ 26,421,495
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LIABILITIES AND STOCKHOLDERS’ EQUITY Current Liabilities: Accounts payable $ 779,158 $ 1,038,885 Accrued expenses 1,988,412 2,227,401 Customer deposits 2,324,246 3,069,743 Income taxes payable 188,503 255,398 Total current liabilities 5,280,319 6,591,427 Deferred tax liability 54,324 55,909 Total liabilities 5,334,643 6,647,336 Commitments and Contingencies (Note 10) Stockholders’ Equity Common stock, $.01 par value; 25,000,000 shares authorized, 15,716,723 and15,710,389 issued and outstanding as of August 31, 2026 and February 28,2026 157,167 157,104 Additional paid-in capital 10,370,106 10,186,858 Accumulated earnings 10,537,659 9,430,197 Total stockholders’ equity 21,064,932 19,774,159 TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY $ 26,399,575 $ 26,421,495 See notes to unaudited condensed consolidated financial statements. SONO-TEK CORPORATIONCONDENSED CONSOLIDATED STATEMENTS OF INCOME(Unaudited) Six Months EndedAugust 31, Three Months EndedAugust 31, 2026 2025 2026 2025 Net Sales $10,893,312 $10,295,469 $ 5,232,153 $ 5,162,696 Cost of Goods Sold 4,912,537 5,041,218 2,465,298 2,572,959 Gross Profit 5,980,775 5,254,251 2,766,855 2,589,737 Operating Expenses Research and product development costs 1,296,143 1,295,748 679,160 627,278 Marketing and selling expenses 2,025,731 1,729,504 1,000,747 871,353 General and administrative costs 1,380,209 1,324,477 705,417 669,952 Total Operating Expenses 4,702,083 4,349,729 2,385,324 2,168,583 Operating Income 1,278,692 904,522 381,531 421,154 Interest and Dividend Income 268,559 223,660 153,936 81,562 Net unrealized (loss)/gain on marketable securities (63,704) 1,570 (37,433) 23,493 Income Before Income Taxes 1,483,547 1,129,752 498,034 526,209 Income Tax Expense 376,085 221,074 131,740 102,516 Net Income $ 1,107,462 $ 908,678 $ 366,294 $ 423,693
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Basic Earnings Per Share $ 0.07 $ 0.06 $ 0.02 $ 0.03 Diluted Earnings Per Share $ 0.07 $ 0.06 $ 0.02 $ 0.03 Weighted Average Shares - Basic 15,714,954 15,727,844 15,716,723 15,721,162 Weighted Average Shares - Diluted 15,789,915 15,740,384 15,806,121 15,731,571 See notes to unaudited condensed consolidated financial statements. News Provided by GlobeNewswire via QuoteMedia