Impinj Q2 2025 slides: Record margins amid revenue volatility

Introduction & Market Context

Impinj Inc. (NASDAQ:PI) recently presented its Q2 2025 investor presentation, highlighting record gross margins despite mixed revenue performance. The RAIN RFID technology leader continues to pursue a vast market opportunity while navigating macroeconomic headwinds that have impacted year-over-year growth. Following the earnings release, Impinj’s stock declined 4.1% in premarket trading, reflecting investor concerns despite the company’s strong profitability metrics.

With a market capitalization of approximately $5.8 billion, Impinj has established itself as a leader in RAIN RFID technology, which enables wireless connectivity for everyday items without batteries or line-of-sight requirements. The company’s presentation emphasized its long-term growth trajectory while showcasing recent financial performance.

Quarterly Performance Highlights

Impinj reported Q2 2025 revenue of $74.3 million, which included systems revenue of $102.5 million with $16 million in licensing revenue. The company achieved a record non-GAAP gross margin of 60.4%, significantly higher than previous quarters, and delivered adjusted EBITDA of $27.6 million, representing a strong 28.2% margin.

As shown in the following chart of quarterly financial metrics, Impinj has demonstrated improving profitability despite revenue fluctuations:

The company’s non-GAAP earnings per share reached $0.80 in Q2 2025, rebounding strongly from $0.21 in Q1 2025. This performance reflects Impinj’s ability to maintain profitability even during periods of revenue volatility.

Strategic Market Position

Impinj’s presentation emphasized the vast market opportunity ahead, with RAIN RFID currently enabling connectivity for over 52 billion items in 2024, representing only approximately 0.5% of connectable items worldwide. The company identified several major market segments with significant growth potential.

The following chart illustrates the scale of Impinj’s addressable market across various industries:

The company’s strategy focuses on developing whole-platform solutions for lighthouse enterprises, then leveraging these successes through partners to scale. Impinj has established relationships with numerous major brands across retail, automotive, aerospace, and other sectors.

The growth in endpoint IC deployments has been substantial, with a 28% CAGR from 2010 to 2024:

Detailed Financial Analysis

Impinj’s long-term revenue growth remains impressive, with a 27% CAGR from 2020 to 2024, reaching $366.1 million in annual revenue for 2024. The following chart illustrates this growth trajectory alongside quarterly performance:

The company’s gross margin performance has shown significant improvement in recent quarters, reaching a record 60.4% in Q2 2025, compared to 52.7% in Q1 2025:

Impinj maintained a strong balance sheet with $260.5 million in cash and investments as of June 30, 2025, against $287.5 million in convertible debt. The company generated $27.5 million in trailing twelve-month adjusted free cash flow, demonstrating its ability to convert profitability into cash generation.

Free cash flow turned strongly positive in Q2 2025 at $27.3 million, following a negative $13.0 million in Q1 2025, as shown in the detailed reconciliation:

Forward-Looking Statements

Looking ahead, Impinj provided guidance for Q3 2025, projecting revenue between $91 million and $94 million with adjusted EBITDA ranging from $15.6 million to $17.1 million. The company expects sequential growth in endpoint IC product revenue and continues to focus on its M800 and Gen2X technologies.

CEO Chris DiOrio expressed optimism about ongoing pilots in the food sector during the earnings call, stating, "We are using Gen2X to enable enterprise solutions that we couldn’t solve previously," and "We see and we’re guardedly optimistic that these pilots are really going to turn into full-fledged deployments."

The company’s vision centers on extending the Internet of Things to trillions of everyday items, with particular focus on retail general merchandise and supply chain & logistics applications. Impinj’s success strategy involves developing whole-platform solutions for key enterprises, winning the endpoint IC opportunity at those enterprises, engaging partners to repeat successes, and competing aggressively for the broader endpoint IC market.

As shown in the following overview of Impinj’s business, the company has established a solid foundation for future growth:

While macroeconomic headwinds continue to pose challenges affecting year-over-year revenue growth, Impinj’s record margins and strong cash generation demonstrate the company’s operational efficiency and resilience in navigating market volatility. The retail sector’s mixed growth remains a factor to watch, as it represents a significant portion of Impinj’s target market.

Full presentation:

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