LightPath Technologies, Inc. (LPTH) Bundle
Understanding LightPath Technologies, Inc. (LPTH) Revenue Streams
Understanding LightPath Technologies, Inc.’s Revenue Streams
LightPath Technologies, Inc. generates revenue primarily from four product groups: infrared components, visible components, assemblies and modules, and engineering services. The breakdown of revenue for the three months ended September 30, 2024, and 2023 is as follows:
| Product Group | Q1 2025 Revenue | Q1 2024 Revenue | Percentage Change |
|---|---|---|---|
| Infrared components | $2,610,884 | $3,834,602 | -32% |
| Visible components | $3,299,878 | $2,688,335 | +23% |
| Assemblies and modules | $1,093,668 | $1,262,039 | -13% |
| Engineering services | $1,395,951 | $292,272 | +378% |
| Total Revenue | $8,400,381 | $8,077,248 | +4% |
The total revenue for the first quarter of fiscal 2025 was approximately $8.4 million, reflecting a year-over-year increase of approximately 4% from the same quarter of the previous year. This growth was primarily driven by increases in sales of visible components and engineering services.
Revenue generated by the infrared components product group saw a significant decline of approximately 32%, totaling $2.6 million. This decrease was attributed to the non-renewal of a large annual contract for Germanium-based products, leading to reduced sales in this category.
In contrast, revenue from visible components increased by approximately 23%, amounting to $3.3 million. This growth was largely due to increased sales in the defense and medical industries, as well as enhanced distribution through catalog channels.
Engineering services experienced remarkable growth, with revenue increasing by 378% to $1.4 million. This surge was mainly driven by milestones achieved under a contract with Lockheed Martin, which enabled recognition of revenue from advanced thermal camera systems.
The performance in assemblies and modules saw a 13% decrease, totaling $1.1 million, primarily due to shipment timing issues against a multi-year contract.
The company’s revenue from foreign markets for the three months ended September 30, 2024, and 2023 is detailed below:
| Region | Q1 2025 Revenue | Q1 2024 Revenue |
|---|---|---|
| United States | $5,865,639 | $4,293,394 |
| Europe | $1,281,260 | $2,523,545 |
| China | $629,417 | $500,138 |
| Other Asian countries | $210,231 | $562,399 |
| Rest of world | $413,834 | $197,772 |
The increase in revenue from the United States was significant, showing a rise to $5.9 million from $4.3 million in the previous year. Conversely, revenue from Europe decreased notably from $2.5 million to $1.3 million.
This comprehensive analysis of revenue streams showcases the company's performance across different segments and regions, highlighting both growth areas and challenges faced during the fiscal quarter.
A Deep Dive into LightPath Technologies, Inc. (LPTH) Profitability
A Deep Dive into LightPath Technologies, Inc. Profitability
Gross Profit: For the first quarter of fiscal 2025, the gross profit was $2,844,429, compared to $2,331,706 in the same quarter of the prior fiscal year, representing a 22% increase. The total cost of sales for this period was approximately $5,555,952 compared to $5,745,542 in the prior year.
Gross Margin: The gross margin as a percentage of revenue was 34% for Q1 2025, up from 29% in Q1 2024, driven by a more favorable product mix.
Operating Profit: The operating loss for the first quarter of fiscal 2025 was $(1,376,808) compared to $(1,250,622) in the same quarter of the previous year, reflecting increased operating expenses.
Net Profit: The net loss for Q1 2025 was $(1,622,745), or $(0.04) per share, compared to a net loss of $(1,342,376), or $(0.04) per share, in Q1 2024.
| Metric | Q1 2025 | Q1 2024 | Change |
|---|---|---|---|
| Gross Profit | $2,844,429 | $2,331,706 | +22% |
| Gross Margin % | 34% | 29% | +5% |
| Operating Loss | $(1,376,808) | $(1,250,622) | -10% |
| Net Loss | $(1,622,745) | $(1,342,376) | -20% |
Operating Expenses: Total operating expenses for Q1 2025 were $4,221,237, an increase from $3,582,328 in Q1 2024. This increase includes:
- Selling, general and administrative expenses: $3,270,583 (up from $2,661,168)
- New product development costs: $476,441 (down from $639,889)
- Amortization of intangible assets: $395,776 (up from $281,271)
Trends in Profitability: The increase in gross profit and margin reflects improved operational efficiency, while the operating loss widened due to rising expenses, particularly in legal and consulting fees associated with business development initiatives.
Comparison with Industry Averages: The company’s gross margin of 34% is on par with industry averages for technology companies, which typically range between 30% to 40%, indicating competitive positioning.
Operational Efficiency: The company continues to focus on cost management strategies to enhance gross margins. The reduction in new product development costs by 26% indicates a shift towards more externally funded projects, optimizing resource allocation.
Future Outlook: As of September 30, 2024, the total backlog was approximately $20.5 million, indicating potential revenue growth in upcoming quarters, contingent on the execution of existing contracts and new orders.
Debt vs. Equity: How LightPath Technologies, Inc. (LPTH) Finances Its Growth
Debt vs. Equity: How LightPath Technologies, Inc. Finances Its Growth
Overview of Debt Levels
As of September 30, 2024, LightPath Technologies, Inc. reported total liabilities of approximately $18.99 million. This includes both current and non-current liabilities, which are primarily driven by loans and financing obligations.
The breakdown of debt includes:
- Current portion of loans payable: $2.96 million
- Long-term loans payable: $284,881
- Finance lease obligations: $183,656 (current) and $491,106 (non-current)
Debt-to-Equity Ratio
The company's debt-to-equity ratio stands at approximately 0.64, calculated by dividing total liabilities of $18.99 million by total stockholders' equity of $29.44 million as of September 30, 2024. This ratio is below the industry average of approximately 1.0, indicating a more conservative approach to leverage compared to its peers.
Recent Debt Issuances and Credit Ratings
In January 2023, the company entered into a securities purchase agreement, issuing 9,090,910 shares of Class A common stock at $1.10 per share, raising net proceeds of approximately $9.2 million. Additionally, the company has engaged in equipment loans, such as:
- 2020 Equipment Loan: Initial advance of 225,000 EUR (approximately $275,000)
- 2023 Equipment Loan: Initial advance of 128,815 EUR (approximately $141,245)
Balancing Debt Financing and Equity Funding
The company utilizes a balanced approach between debt financing and equity funding. The recent issuance of equity has helped to strengthen its balance sheet and fund ongoing operations without excessively increasing debt levels. As of September 30, 2024, cash and cash equivalents amounted to approximately $4.3 million, providing liquidity for operational needs.
| Debt Type | Amount (USD) |
|---|---|
| Current Loans Payable | $2,963,855 |
| Long-term Loans Payable | $284,881 |
| Current Finance Lease Obligation | $183,656 |
| Non-current Finance Lease Obligation | $491,106 |
| Total Liabilities | $18,999,671 |
| Total Stockholders' Equity | $29,444,719 |
| Debt-to-Equity Ratio | 0.64 |
Assessing LightPath Technologies, Inc. (LPTH) Liquidity
Assessing LightPath Technologies, Inc. Liquidity
Current and Quick Ratios
As of September 30, 2024, the current ratio of LightPath Technologies, Inc. was approximately 1.54, calculated from current assets of approximately $9.9 million and current liabilities of approximately $6.4 million. The quick ratio, which excludes inventory from current assets, was approximately 1.09, based on quick assets of approximately $7.5 million and the same current liabilities of $6.4 million.
Analysis of Working Capital Trends
Working capital as of September 30, 2024, stood at approximately $3.5 million, reflecting a decrease compared to $5.5 million as of June 30, 2024. This trend indicates a tightening liquidity position, primarily due to increased accounts payable and accrued liabilities.
Cash Flow Statements Overview
The cash flow statements for the three months ended September 30, 2024, highlight the following trends:
- Net cash used in operating activities was approximately $(1.7 million).
- Net cash used in investing activities was approximately $(194,084).
- Net cash provided by financing activities was approximately $2.6 million.
Overall, the cash flow from operations has shown a negative trend, with significant cash outflows primarily driven by operational losses. However, financing activities have contributed positively to liquidity, primarily through loan proceeds.
Potential Liquidity Concerns or Strengths
As of September 30, 2024, total cash and cash equivalents amounted to approximately $4.3 million, with less than 50% held by foreign subsidiaries. The company faces potential liquidity concerns due to a net loss of approximately $(1.6 million) during the same period, which may stress cash reserves if operational performance does not improve.
| Liquidity Metric | Amount |
|---|---|
| Current Assets | $9,900,000 |
| Current Liabilities | $6,400,000 |
| Current Ratio | 1.54 |
| Quick Assets | $7,500,000 |
| Quick Ratio | 1.09 |
| Working Capital | $3,500,000 |
| Net Cash from Operating Activities | $(1,700,201) |
| Net Cash from Investing Activities | $(194,084) |
| Net Cash from Financing Activities | $2,613,233 |
| Total Cash and Cash Equivalents | $4,280,637 |
| Net Loss | $(1,622,745) |
Is LightPath Technologies, Inc. (LPTH) Overvalued or Undervalued?
Valuation Analysis
Price-to-Earnings (P/E) Ratio
The current price-to-earnings (P/E) ratio for the company is - as the company reported a net loss of approximately $1,622,745 for the quarter ended September 30, 2024, resulting in a loss per share of $0.04.
Price-to-Book (P/B) Ratio
The price-to-book (P/B) ratio is calculated using the total stockholders' equity of approximately $29,444,719 as of September 30, 2024, and the number of shares outstanding at 39,612,737. This results in a book value per share of approximately $0.74, and with a recent stock price of $1.94, the P/B ratio is approximately 2.63.
Enterprise Value-to-EBITDA (EV/EBITDA) Ratio
The enterprise value (EV) is calculated by adding market capitalization to total debt and subtracting cash equivalents. With a market cap of approximately $76,750,000 (based on a stock price of $1.94), total debt of $3,248,736, and cash equivalents of $4,280,637, the EV is approximately $75,718,099. The EBITDA for the quarter ended September 30, 2024, was -$468,187 leading to an EV/EBITDA ratio of -.
Stock Price Trends
Over the last 12 months, the stock price has fluctuated, starting at around $2.50 in October 2023, reaching a low of approximately $1.50 in early 2024, and currently trading at $1.94.
Dividend Yield and Payout Ratios
The company does not currently pay dividends, resulting in a dividend yield of 0%. The payout ratio is not applicable due to the absence of dividend payments.
Analyst Consensus on Stock Valuation
Analyst consensus indicates a rating of Hold for the stock, reflecting mixed sentiments due to ongoing operational challenges and the need for strategic growth initiatives.
| Metric | Value |
|---|---|
| Current P/E Ratio | - |
| Current P/B Ratio | 2.63 |
| Current EV/EBITDA Ratio | - |
| Stock Price (Current) | $1.94 |
| Stock Price (12 Months Ago) | $2.50 |
| Dividend Yield | 0% |
| Payout Ratio | N/A |
| Analyst Consensus | Hold |
Key Risks Facing LightPath Technologies, Inc. (LPTH)
Key Risks Facing LightPath Technologies, Inc.
LightPath Technologies, Inc. operates in a dynamic environment influenced by various internal and external risks. These risks can significantly impact the company’s financial health and operational performance.
Industry Competition
The company faces intense competition within the optics and photonics industry. Competitors may have superior technology, established customer relationships, or greater financial resources, which may hinder LightPath's market position.
Regulatory Changes
Changes in regulations, particularly those affecting international trade and tariffs, can adversely impact operational costs and supply chain logistics. For instance, tariffs on materials sourced from certain countries can increase production expenses.
Market Conditions
Current economic conditions, particularly in key markets like China, have shown signs of volatility. The annual economic growth rate in China was projected at 4.6% for 2024, down from previous years, which may lower demand for the company’s products.
Operational Risks
Operational risks include potential supply chain disruptions that could affect production capabilities. The company has noted a decrease in revenue from infrared components by 32% in the first quarter of fiscal 2025, primarily due to a non-renewed contract.
Financial Risks
As of September 30, 2024, LightPath reported a net loss of $1.6 million, with a comprehensive loss of $1.35 million. The company has a significant accumulated deficit of $217.5 million, which raises concerns about long-term financial sustainability.
Liquidity Concerns
Liquidity is a critical risk factor. The company's cash and cash equivalents totaled approximately $4.3 million as of September 30, 2024, which is less than half held by foreign subsidiaries. Working capital was reported at around $7.1 million, which may limit operational flexibility.
Mitigation Strategies
The company has implemented various strategies to mitigate risks, including diversifying its supplier base to reduce dependency on single sources and investing in technology to enhance product offerings. Additionally, LightPath aims to increase operational efficiencies to manage costs better.
| Risk Factor | Description | Impact | Current Status |
|---|---|---|---|
| Industry Competition | Intense competition affecting market share | Potential revenue decline | High |
| Regulatory Changes | Changes in trade regulations and tariffs | Increased operational costs | Medium |
| Market Conditions | Economic slowdown in key markets | Lower demand for products | High |
| Operational Risks | Supply chain disruptions | Production delays | Medium |
| Financial Risks | Significant net loss and accumulated deficit | Long-term financial sustainability concerns | High |
| Liquidity Concerns | Limited cash reserves | Operational flexibility constraints | Medium |
Future Growth Prospects for LightPath Technologies, Inc. (LPTH)
Future Growth Prospects for LightPath Technologies, Inc.
Key Growth Drivers:
- Product Innovations: The company has launched a new version of the Mantis™ camera, targeting high-temperature processes in power plants, with the first commercial order already received.
- Market Expansions: The revenue from visible components increased by 23% to $3.3 million, driven by sales in defense and medical industries.
- Acquisitions: The acquisition of Visimid Technologies for approximately $2.7 million is expected to enhance capabilities in engineering services, particularly with contracts like the one with Lockheed Martin.
Future Revenue Growth Projections:
The projected revenue for the fiscal year ending June 30, 2025, is expected to show a modest increase, with total revenues for the first quarter of fiscal 2025 standing at $8.4 million, compared to $8.1 million for the same period in the previous year, reflecting a growth of 4%.
Earnings Estimates:
Net loss for the first quarter of fiscal 2025 was approximately $1.6 million, or $0.04 per share, compared to a net loss of $1.3 million for the same quarter of the prior fiscal year.
Strategic Initiatives and Partnerships:
- Partnership with Lockheed Martin for advanced thermal camera systems is expected to generate significant revenue through milestone-based contracts.
- Investment in R&D for proprietary materials, such as BlackDiamond, which are alternatives to traditional materials like germanium, is anticipated to drive growth in defense and industrial applications.
Competitive Advantages:
- Strong backlog of approximately $20.5 million as of September 30, 2024, indicating robust future demand.
- Proprietary technologies and materials that cater to niche markets, particularly in defense and industrial sectors.
- Established relationships with key customers, enhancing customer retention and new contract opportunities.
| Metric | Q1 FY 2025 | Q1 FY 2024 | Change (%) |
|---|---|---|---|
| Total Revenue | $8,400,381 | $8,077,248 | 4% |
| Net Loss | $(1,622,745) | $(1,342,376) | 20.8% |
| Visible Components Revenue | $3,299,878 | $2,688,335 | 23% |
| Infrared Components Revenue | $2,610,884 | $3,834,602 | -32% |
| Engineering Services Revenue | $1,395,951 | $292,272 | 378% |
As of September 30, 2024, the company held cash and cash equivalents totaling approximately $4.3 million, with less than 50% of this amount held by foreign subsidiaries. The retained earnings of the subsidiary in China were approximately $1.6 million available for repatriation.
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Resources:
- LightPath Technologies, Inc. (LPTH) Financial Statements – Access the full quarterly financial statements for Q1 2025 to get an in-depth view of LightPath Technologies, Inc. (LPTH)' financial performance, including balance sheets, income statements, and cash flow statements.
- SEC Filings – View LightPath Technologies, Inc. (LPTH)' latest filings with the U.S. Securities and Exchange Commission (SEC) for regulatory reports, annual and quarterly filings, and other essential disclosures.