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Shares of Geospace Technologies Corporation (GEOS - Free Report) have lost 7.6% since the company reported its earnings for the quarter ended Dec. 31, 2024. This compares to the S&P 500 Index’s 0.4% gain over the same period. Over the past month, the stock has lost 12.1% against the S&P 500’s 2.8% rise, reflecting investor concerns surrounding the company’s performance and broader market positioning.
Find the latest EPS estimates and surprises on Zacks Earnings Calendar.
Key Financial Performance Metrics
For the first quarter of fiscal 2025, Geospace reported revenues of $37.2 million, a 25.6% decline from $50 million in the year-ago quarter. Net income for the quarter also declined 33.9% to $8.4 million, or $0.65 per diluted share, from $12.7 million, or $0.94 per diluted share, in the same period last year.
Segmentally, the Smart Water division generated $7.3 million in revenues in first-quarter fiscal 2025, up 72.1% from $4.2 million in the prior-year quarter, driven by increased demand for Hydroconn cable and connector products. Revenues in the Energy Solutions segment declined 39.2% to $24.3 million due to lower utilization of the OBX rental fleet and the absence of a major $30 million Mariner node sale recorded in the prior year. The Intelligent Industrial segment reported $5.6 million in revenues, a 4.1% decrease from $5.8 million a year earlier, primarily due to reduced demand for imaging products.
Geospace Technologies Corporation Price, Consensus and EPS Surprise
Geospace reported a gross profit of $20.1 million, representing a gross margin of 54.1%, down 9.4% from $22.2 million and 44.4% in the year-ago quarter. Operating expenses increased 31% year over year to $12.3 million from $9.4 million in the year-ago quarter, primarily due to higher personnel costs, including wages, benefits, severance, and recruiting fees. Additionally, research and development expenditures rose 35.9% to $4.9 million from $3.6 million in the year-ago quarter, reflecting the company's efforts to drive innovation across its segments.
The company’s balance sheet remains robust with $22.1 million in cash and equivalents and short-term investments and no outstanding debt. Total liquidity, including $12 million in borrowing availability under its credit facility, stood at $34 million. Geospace also owns significant unleveraged real estate assets. Management anticipates capital expenditures of $6 million for fiscal 2025, focused on property, plant, and equipment.
Factors Influencing the Results
The Smart Water segment emerged as a key growth driver, capitalizing on the increased adoption of automated water management solutions in municipal and multifamily markets. Revenue gains were fueled by continued success with the Hydroconn product line and expanding customer interest in Aquana offerings.
The 39.2% year-over-year revenue decline in the Energy Solutions segment was attributed to lower demand for OBX rental fleet utilization and the absence of last year’s one-time $30 million Mariner sale. Despite these headwinds, the company secured a $17 million OBX marine wireless product sale during the quarter, which partially offset the overall decline. Revenues for the Intelligent Industrial segment fell 4.1% year over year , primarily due to reduced demand for imaging products. This decline was somewhat mitigated by increased sales of industrial sensor products, highlighting a potential avenue for future growth.
Guidance
Although no specific guidance was provided, management acknowledged potential revenue variability in the Energy Solutions segment due to ongoing market conditions. The company also anticipates capital expenditures of $6 million for fiscal 2025, focusing on property, plant, and equipment.
Other Developments
Geospace completed a $7 million stock repurchase program early in the second quarter of fiscal 2025. Under this initiative, the company repurchased approximately 716,000 shares at an average price of $9.72 per share. This move underscores management's commitment to returning value to shareholders.
Looking ahead, Geospace continues to evaluate opportunities for acquisitions and organic growth, particularly within the Smart Water segment, where municipal and multifamily markets are seen as promising areas for expansion. Additionally, the company remains optimistic about leveraging its engineering and manufacturing expertise to support future profitability across its restructured business segments.
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GEOS Stock Declines Despite Q1 Earnings Uptick Y/Y, Gross Margin Down
Shares of Geospace Technologies Corporation (GEOS - Free Report) have lost 7.6% since the company reported its earnings for the quarter ended Dec. 31, 2024. This compares to the S&P 500 Index’s 0.4% gain over the same period. Over the past month, the stock has lost 12.1% against the S&P 500’s 2.8% rise, reflecting investor concerns surrounding the company’s performance and broader market positioning.
Find the latest EPS estimates and surprises on Zacks Earnings Calendar.
Key Financial Performance Metrics
For the first quarter of fiscal 2025, Geospace reported revenues of $37.2 million, a 25.6% decline from $50 million in the year-ago quarter. Net income for the quarter also declined 33.9% to $8.4 million, or $0.65 per diluted share, from $12.7 million, or $0.94 per diluted share, in the same period last year.
Segmentally, the Smart Water division generated $7.3 million in revenues in first-quarter fiscal 2025, up 72.1% from $4.2 million in the prior-year quarter, driven by increased demand for Hydroconn cable and connector products. Revenues in the Energy Solutions segment declined 39.2% to $24.3 million due to lower utilization of the OBX rental fleet and the absence of a major $30 million Mariner node sale recorded in the prior year. The Intelligent Industrial segment reported $5.6 million in revenues, a 4.1% decrease from $5.8 million a year earlier, primarily due to reduced demand for imaging products.
Geospace Technologies Corporation Price, Consensus and EPS Surprise
Geospace Technologies Corporation price-consensus-eps-surprise-chart | Geospace Technologies Corporation Quote
Operational and Management Commentary
Geospace reported a gross profit of $20.1 million, representing a gross margin of 54.1%, down 9.4% from $22.2 million and 44.4% in the year-ago quarter. Operating expenses increased 31% year over year to $12.3 million from $9.4 million in the year-ago quarter, primarily due to higher personnel costs, including wages, benefits, severance, and recruiting fees. Additionally, research and development expenditures rose 35.9% to $4.9 million from $3.6 million in the year-ago quarter, reflecting the company's efforts to drive innovation across its segments.
The company’s balance sheet remains robust with $22.1 million in cash and equivalents and short-term investments and no outstanding debt. Total liquidity, including $12 million in borrowing availability under its credit facility, stood at $34 million. Geospace also owns significant unleveraged real estate assets. Management anticipates capital expenditures of $6 million for fiscal 2025, focused on property, plant, and equipment.
Factors Influencing the Results
The Smart Water segment emerged as a key growth driver, capitalizing on the increased adoption of automated water management solutions in municipal and multifamily markets. Revenue gains were fueled by continued success with the Hydroconn product line and expanding customer interest in Aquana offerings.
The 39.2% year-over-year revenue decline in the Energy Solutions segment was attributed to lower demand for OBX rental fleet utilization and the absence of last year’s one-time $30 million Mariner sale. Despite these headwinds, the company secured a $17 million OBX marine wireless product sale during the quarter, which partially offset the overall decline. Revenues for the Intelligent Industrial segment fell 4.1% year over year , primarily due to reduced demand for imaging products. This decline was somewhat mitigated by increased sales of industrial sensor products, highlighting a potential avenue for future growth.
Guidance
Although no specific guidance was provided, management acknowledged potential revenue variability in the Energy Solutions segment due to ongoing market conditions. The company also anticipates capital expenditures of $6 million for fiscal 2025, focusing on property, plant, and equipment.
Other Developments
Geospace completed a $7 million stock repurchase program early in the second quarter of fiscal 2025. Under this initiative, the company repurchased approximately 716,000 shares at an average price of $9.72 per share. This move underscores management's commitment to returning value to shareholders.
Looking ahead, Geospace continues to evaluate opportunities for acquisitions and organic growth, particularly within the Smart Water segment, where municipal and multifamily markets are seen as promising areas for expansion. Additionally, the company remains optimistic about leveraging its engineering and manufacturing expertise to support future profitability across its restructured business segments.