INTT · inTEST Corporation

inTEST Corporation reported robust Q1 2026 results, with revenue climbing 27.2% to $33.9 million from $26.6 million in the prior-year quarter. This acceleration stems from heightened demand for the company's thermal management and testing solutions, as semiconductor manufacturers and IC testing specialists ramp up ATE and wafer production equipment needs—core dependencies of the business as noted in management discussion. Gross profit expanded even more sharply, up 39.4% to $15.4 million from $11.1 million, lifting the gross margin to 45.5%. Management attributes varying gross margins to product-specific factors, with higher volumes and potentially favorable mix contributing to this improvement over the prior period's lower base.

Operating income flipped to a $954 thousand profit from a $2.9 million loss, delivering a 2.8% operating margin on elevated revenue. This turnaround reflects the leverage from gross profit gains outpacing operating expenses, restoring profitability after prior challenges. Net income followed suit at $789 thousand positive versus a $2.3 million loss, with diluted EPS of $0.06 compared to -$0.19—a 131.6% swing that underscores earnings recovery for investors.

Liquidity dynamics shifted, with net cash from operating activities at -$3.3 million versus +$5.5 million last year. This outflow arises because receivables growth outpaced revenue and inventory builds support production planning and staffing, as the company tracks orders to allocate resources effectively. Management's supply chain actions—qualifying alternate vendors, stocking more raw materials, and advancing orders—address ongoing risks like price hikes, shortages, and logistics delays expected to persist. Free cash flow stood at -$4.0 million after $644 thousand in capital expenditures, up from $229 thousand prior, signaling investments aligned with operational scaling.