PDEX PRO DEX INC

Price Chart

Executive Summary

Pro-Dex reported record Q3 FY2026 revenue of $19.9M (+15% YoY), driven by next-gen handpiece shipments to its largest customer. However, operating income fell 15% to $3.1M due to a 41% surge in SG&A from the APM acquisition and non-recurring legal fees, while gross margin contracted 200bps to 31% on unfavorable product mix. Net income benefited from a $2.3M realized gain on Monogram CVRs, masking underlying operational pressure.

Key Financial Metrics

Actionable Insight

Key Facts

• Q3 FY2026 revenue of $19.9M, a record quarterly high, up 15% YoY from $17.4M
• Operating income declined 15% to $3.1M from $3.6M YoY due to 41% increase in operating expenses
• Gross margin fell 200bps to 31% from 33% YoY, attributed to unfavorable product mix
• Net income of $3.9M ($1.20 diluted) included a $2.3M realized gain from Monogram CVRs; adjusted net income would be ~$1.6M
• Completed acquisition of Advanced Precision Machining (APM) during the quarter, adding $6.5M in goodwill and $712K in intangibles
• Total debt increased to $18.5M from $15.4M at June 30, 2025, reflecting APM acquisition financing

Financial Impact

Revenue grew $2.5M YoY to a record $19.9M, but operating profit fell $546K. Net income was boosted by a $2.3M non-operating gain.

Risk Factors

• Customer concentration risk — largest customer drives majority of revenue; legacy handpiece and repair revenue declining
• Integration risk from APM acquisition — operating expenses rose 41% with non-recurring fees and continuing G&A costs
• Gross margin compression — down 200bps YoY on product mix shift; may persist if next-gen handpiece carries lower margins
• Elevated debt levels — total notes payable increased to $18.5M from $15.4M, increasing interest expense

Market Snapshot

Documents Analyzed

This report is based on 6 SEC documents filed with EDGAR.

US Market Status

Related Tickers