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BK Technologies (NYSE American:BKTI) shares surged 13.84% in premarket trading after the company presented strong second quarter 2025 results on Thursday, August 14th, showing significant margin expansion and raised full-year guidance.
Quarterly Performance Highlights
BK Technologies reported Q2 2025 revenue of $21.2 million, a 4.5% increase compared to the same period last year. More impressively, the company achieved a gross margin of 47.4%, up from 37.3% in Q2 2024. This margin expansion helped drive fully diluted GAAP EPS to $0.96, more than doubling the $0.47 reported in the prior-year quarter. On a non-GAAP adjusted basis, EPS reached $1.30, compared to $0.55 in Q2 2024.
The company also highlighted the launch of its RelayONE rapid deployment portable repeater kit during the quarter and noted that following the close of Q2, it received several purchase orders from the USDA Forest Service totaling $12.9 million.
As shown in the following summary of second quarter highlights:
Dramatic Gross Margin Expansion
One of the most impressive aspects of BK Technologies’ performance has been its consistent gross margin improvement over the past three years. From a challenging 2022 when global supply chain disruptions kept margins below 20%, the company has executed a remarkable turnaround, with first-half 2025 gross margins reaching 47.2%.
This dramatic improvement reflects the company’s successful cost reduction initiatives, manufacturing strategy changes, and shift to higher-margin products. Based on this performance, BK Technologies has increased its full-year gross margin target to 47+%, up from the previous target of 42+%.
The following chart illustrates this impressive margin expansion trajectory:
Revenue Growth and Federal Order Momentum
BK Technologies’ revenue growth has been driven by increasing demand for its BKR Series radios. The company reported both year-over-year and sequential revenue growth, with particular strength in federal customer orders.
The company expects continued momentum in federal order activity in the third quarter, citing heightened wildfire activity and historical purchase patterns. The $12.9 million order from the USDA Forest Service received after the quarter closed provides further evidence of this trend.
The quarterly revenue comparison is illustrated in the following chart:
Strong Financial Results
BK Technologies’ improved margins and revenue growth translated into substantial bottom-line improvements. For Q2 2025, the company reported operating income of $4.0 million, representing an operating margin of 18.9%, compared to 10.0% in the prior-year period. Net income reached $3.7 million, more than doubling the $1.7 million reported in Q2 2024.
The company’s adjusted EBITDA for the quarter was $4.4 million, up from $2.5 million in Q2 2024, reflecting the significant improvement in operational efficiency and profitability.
The comprehensive financial results are detailed in the following table:
The trend of growing profitability is clearly visible in the company’s quarterly adjusted EBITDA and adjusted net income figures, which show consistent improvement over the past six quarters:
Strengthened Balance Sheet
BK Technologies has significantly strengthened its financial position, ending the quarter with $11.9 million in cash and cash equivalents, up from $7.1 million at the end of 2024. Working capital improved to $28.9 million as of June 30, 2025, compared to $23.0 million at year-end 2024.
The company remains debt-free, providing financial flexibility for future growth initiatives. Shareholders’ equity increased to $36.8 million, up from $29.8 million at the end of 2024, reflecting the company’s strong profitability.
Updated 2025 Outlook
Based on its strong first-half performance, BK Technologies has significantly raised its full-year 2025 financial targets. The company now expects single-digit revenue growth at the high end of its range, with gross margins of 47+% (previously 42+%). GAAP diluted EPS is now projected at $3.15, up from the previous target of $2.40, while non-GAAP diluted adjusted EPS is expected to reach $3.80, compared to the previous target of $2.80.
The company also outlined its strategic initiatives, including continued investments in sales and marketing to enhance BKR 9000 adoption, building R&D and engineering capabilities to strengthen software expertise, and ramping up development of the BKR 9500 mobile radio, which is expected to begin generating revenue in 2027.
Market Response and Context
The market has responded positively to BK Technologies’ results, with the stock rising 13.84% in premarket trading to $49.45, building on a 4.15% gain from the previous session. This continues the strong performance trend seen throughout the year, with the stock trading near its 52-week high of $58.00, well above its 52-week low of $16.61.
The Q2 results represent a continuation and acceleration of the positive trends reported in Q1 2025, when the company achieved a 4.5% year-over-year revenue increase and a gross margin of 47%. The raised guidance suggests management’s increasing confidence in the company’s growth trajectory and operational efficiency improvements.
BK Technologies’ consistent margin expansion and strong order flow from federal customers position the company well for continued growth in the second half of 2025, particularly as wildfire season activity typically drives increased demand for the company’s communication equipment.
Full presentation:
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