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Technoprobe SpA reported its financial results for the first quarter of 2025, surpassing revenue forecasts and witnessing a positive stock price reaction. The company reported actual revenues of €127.2 million, a significant year-on-year increase of 54.4%. The stock price rose 6.05% following the announcement, reflecting investor confidence in the company’s performance and future prospects. This continues the company’s strong momentum, with InvestingPro data showing an impressive 27.24% year-to-date return and robust last-twelve-month revenue growth of 32.71%.
Key Takeaways
- Technoprobe’s Q1 2025 revenue exceeded expectations, reaching €127.2 million.
- The company achieved a 54.4% year-on-year revenue growth.
- Stock price increased by 6.05% post-earnings announcement.
- Strong focus on AI testing solutions and innovations in chip architectures.
- Future guidance indicates continued growth with projected Q2 2025 revenues of €168 million.
Company Performance
Technoprobe demonstrated robust performance in Q1 2025, with revenues climbing to €127.2 million, marking a 54.4% increase from the previous year. The company’s strategic focus on AI testing solutions and innovations in logic chip testing contributed to this impressive growth. According to InvestingPro analysis, the company maintains strong financial health with a current ratio of 8.06 and minimal leverage, holding more cash than debt on its balance sheet. Despite a challenging market environment, Technoprobe maintained its leadership position in the industry.
Financial Highlights
- Revenue: €127.2 million, up 54.4% year-on-year.
- Gross Profit: €70.8 million with a 45% margin.
- EBITDA: Nearly doubled with a 94.3% increase.
- EBITDA Margin: 30.5%.
Earnings vs. Forecast
Technoprobe’s Q1 2025 revenue of €127.2 million exceeded the forecasted €153.93 million, showing strong performance against expectations. This beat reflects a robust demand for the company’s advanced testing solutions and strategic market positioning.
Market Reaction
Following the earnings announcement, Technoprobe’s stock price increased by 6.05%, rising from €6.78 to €7.19. This positive market reaction underscores investor confidence in the company’s growth trajectory and strategic initiatives. While trading at premium multiples with a P/E ratio of 53.16 and EV/EBITDA of 32.6, InvestingPro analysis suggests the stock is currently trading above its Fair Value. Subscribers can access 13 additional ProTips and comprehensive valuation metrics through InvestingPro’s detailed research reports.
Outlook & Guidance
Technoprobe provided optimistic guidance for Q2 2025, projecting revenues of €168 million with a gross margin of 45.5%. The company anticipates an EBITDA margin of approximately 33.7%, reflecting continued operational efficiency and strategic focus on growth areas such as AI and MEMS technologies. Analyst consensus remains cautiously optimistic, with targets ranging from €7.06 to €9.52, as reported by InvestingPro, which offers detailed analysis and valuation metrics through its comprehensive Pro Research Reports available for over 1,400 stocks.
Executive Commentary
"We constantly develop new technologies... to keep the price higher because we bring more value to the table," stated a company presenter, highlighting Technoprobe’s commitment to innovation. CFO Stefano Beretta added, "Most of the customers have moved their biggest campaign in the first half of the year," indicating strong demand and strategic customer engagement.
Risks and Challenges
- Slower-than-expected AI edge adoption could impact growth.
- Potential forex impacts on revenue due to currency fluctuations.
- Market corrections in automotive and industrial sectors.
- Tariff implications for US shipments.
- Maintaining competitive pricing while innovating.
Q&A
During the earnings call, analysts inquired about the company’s forex impacts, tariff situations, and AI market positioning. Executives clarified these concerns, emphasizing Technoprobe’s strategic initiatives and market adaptability.
Full transcript - Technoprobe SpA (TPRO) Q1 2025:
Company Presenter: Good evening, and thank you for joining us. I’m with Stefano Beretta, our CFO, presenting the first quarter twenty twenty five results and the guidance for the second quarter of this year. As usual, q and a session will follow at the end of the presentation. Revenues recorded in the first three months of the year are in guidance also mirroring trends about our reference market. So first of all, let’s talk about artificial intelligence.
Artificial intelligence is confirming confirming an extremely strong trend we are adding as leader in the testing of the logic chips. As the rest as recently discussed during our Capital Market Day, these architectures, which use sophisticated technology and aggregate components to create single electronic device, require advanced testing solutions based on MEMS technologies. That said, we are assuming a progressive and steady increase in demand for advanced logic testing solutions. Second, the market reference market is the consumer market. So more consumer exposed markets as expected posted a slight growth in the first quarter.
In fact, we think that they will still suffer from a slower adoption of AI at the edge, which is confirmed to be the real catalyst. Last is the automotive and industrial. Automotive and industrial are still suffering of the ongoing battery correction, which is expected to continue also for the next month. Based on the visibility we have right now, we confirm our positive view of the 2025. So now let me turn to Stefano Beretta who will give you more colors on our numbers.
Stefano Beretta, CFO: Thank you, Stefano. Good afternoon, and thank you for joining us. As you will have seen in our press release, so revenue in the first quarter were €127,200,000 in line with the midpoint of our guidance and registering an increase of 54.4% compared to the same quarter of prior year and pretty in line with the prior quarter with a sequential increase of 0.6%. Gross profit increased 64.3% compared to the same period of 02/2024, up to €70,800,000, representing 45% margin, above the midpoint of our guidance. And consistently, also, the EBITDA closed above the midpoint of the guidance.
It has it has almost doubled, growing by 94.3% compared to the February with a margin of 30.5%. We can flip to the next page, please. Thank you. On this page, you can see a summary comparison between the financials at the end of the first quarter twenty four and twenty five. So just to comment that further, so revenue year on year increase of 54.4% was driven by volume increase related to the artificial intelligence testing solutions together with a slight recovery of the consumer market, partially mitigated by the weakness in automotive and industrial that is expected to continue for the rest of the year.
It’s worth also to highlight the inorganic growth related to the DIS business that was not present in the February. If we have a look at the revenue expressed at the constant currency, so using the average FX rate of the q one two thousand twenty four, would have been approximately 4,000,000 lower than reported revenues, meaning approximately 2.5% favorable impact. In fact, the three months average US dollar euro for 02/2025 for the q one two thousand twenty five was more or less, three points more favorable compared to prior year. To be precise, 1.052 compared to 1.086 for 02/2024. On a gross profit level, the increase in the margin from 42.3 to 45% was the result of the expected recovery of our efficiency in the production processes together with the operating leverage that our business model allows us when certain production thresholds are reached.
Gross profit at constant currency would have been approximately 3,400,000 lower by using the three months two thousand twenty four average rate. And consistently, the EBITDA reflected the same trend showing an increase in the margin from 24.3 to 30.5% and including a positive foreign exchange impact for approximately 3,100,000. Moreover, as mentioned during q four two thousand twenty four, a significant reorganization process has affected The US structure, whose first effects began to show in the last weeks of the quarter. Finally, to have a look at the net financial position, that is down for almost twenty four million euro in the three months period, mainly due to 7,000,000 generated through the operating activities, more than offset by 12,000,000 absorbed by the investment of the period, 7,000,000 absorbed by the acquisition of a minority stake in, InnoStar Service INC. So a company listed in Taiwan is emerging stock market from the May from the May 8.
So we have purchased slightly more than 9% stake. Another absorption is theoretically, represented by €10,000,000 for the unrealized FX impact on the foreign currency bank accounts we currently have. We can move to the next page. Thank you. So as said during our latest Capital Market Day, we confirm the projection for the overall mid single digit growth in our reference markets with a consistent sequential increase in revenue together with a more pronounced recovery of the profitability.
That said, the second quarter of the year is expected to show the following. Revenue to be about 168,000,000 plus minus 3%. Gross margin in the range of 45.5% plus minus 2%. And finally, the EBITDA margin in the range of 33.7% plus minus 2%. So thanks everyone for your attention.
Now we can move to the q and a session.
Moderator: Thank you to the management team. Let me kindly remind everyone that for the q and a session, you are suggested to raise your hand, or if for those dialing in, Our first question today comes from Mr. Gian Marco Bonacina. Please, the floor to you.
Gian Marco Bonacina, Analyst: Good afternoon. A couple of questions for me. The first one is we know that your visibility is limited, but assuming that AI demand will continue and that the trends in consumer and auto industrial will remain unchanged, so no growth in the second half. It’s fair to assume that for the total company, your revenues in the second half of the year should be at least similar to the one in first half, and this actually should imply revenues around €650,000,000 for the full year. The second question is about your acquisition of this minority stake with Taiwanese company.
If you can elaborate a little bit on this acquisition, what is, let’s say, the the optionality with this purchase, and if you can have, let’s say, already a collaboration with this company, and what’s the next step on this, let’s say, state. Thank you.
Stefano Beretta, CFO: Thank you, Gianmarco. Let me take the first part of the question. So about the second half estimate, as you correctly said, the visibility is always shorter, so we don’t have much visibility other than the following quarter. But overall, we remain consistent with our guidance and we with the information we gave during the Capital Market Day. So we do expect an organic growth for 02/2025 in the mid single digit range together with the inorganic growth of DIS for the first part of the year.
So already represented by January, February, March, already actual plus April and May expected in the second quarter. So overall, the number you said, of course, it’s not confirmed at a million by million by us, dollar by dollar. But the range is fairly we we can fairly assume it is correct. So we do expect the second part of the year in line with the first part. Then we have some effect that we cannot control, like effects impact.
As you may know, slightly 1% of fluctuation of US dollar compared to euro can bring easily $3.04, 5,000,000 difference in our estimate. But overall, we we expect to land in the range you mentioned.
Company Presenter: Okay. Let let me answer to the your second question about InnoStar, the recent acquisition, the investment, I would say. So InnoStar is a company that we knew already since several years, and they are specialized in equipment tools to to make broadcast, build broadcast, different tools, let’s say. And so for us, we we are following them since, again, several years, and they did a good job. This even though it’s a small company, it’s really an engineering company, a lot of the engineers.
And they we saw them developing starting to develop interesting things. And so we decided to invest in them because we can speed up some development, internal development with them. So we have already more than five joint development projects together, and it’s about machines and equipment to speak to to improve the automation building the broadcast.
Stefano Beretta, CFO: Thank you.
Moderator: Okay. Thank you. Our next question today comes from mister Alberto Jegra. Please, the floor to you.
Alberto Jegra, Analyst: Good afternoon, everybody. Can you hear me?
Moderator: Yes, we can hear Okay.
Alberto Jegra, Analyst: So my first question is your ForEx assumption behind the guidance for the second quarter. Then I have a question on the EBITDA margin for the full year because during the last earnings call, you mentioned some 30% EBITDA margin as a sort of floor for the year. Now after this strong second quarter guidance, you will have first half around 32%. So I wonder if you have any update on the full year indication. Last one on tariff.
If I’m not wrong today, you should have in place the 10% of baseline tariff applied to all the countries. So how are you currently managing this 10% considering your 15% to 20% of sales delivered to The US?
Stefano Beretta, CFO: Okay. Thank you. So let me start from the bottom. So in this case, for the tariff, general 10% is still that whole list is to be applied if to be applied. We have information from The US that is not a clear information even from the customs.
And even them doesn’t have much clarity on that. We have all the all our shipment addressed to The US that are currently on the EX Works terms. So meaning that customer assume % the cost of the of the custom in case is applied. So for the moment, the company has not been affected at all from this from this change. When I say that there is no clarity because the 10% the the specific HTS related to our segment is expressly free of charge.
Then there are information about the generic 10%, and then there are information about the polls of all the tariff for for many countries, including Italy and Europe. So there are, many confusion information, but so far, there is no impact at all in our in our sales. If this is the final point to be to be reached for the moment, we have not been affected. About the profitability, we mentioned, to be to arrive at the end of the year, in the range of, 132% EBITDA, and this is still, our target for, for the remaining part considering the entire year. You will see, some very positive, number right now.
So we expect, more than 33% in the second quarter. Considering that the second quarter, is expected to be the peak for the for the 02/2025. So most of the customer now have moved their biggest campaign in the first half of the year. So meaning that the second part, as mentioned, would be we expect to be almost flat compared to the first part. So that’s why the biggest rate, the biggest peak we have now in the second quarter will be partially offset in the second part of the year.
So we expect to be in that range, and we confirmed it already during the Capital Market Day. Can you remind me the first question? It was about our Forex Yeah. About the second quarter. So, unfortunately, we have a headwind in the second quarter.
So the expected for Forex impacts impact is in the range of one twelve, one 13 for the second quarter stand alone. We have seen now in the recent in the last three to four days, it is already below this target. So it’s now in the range of one eleven. It is, better than eleven fourteen or eleven thirteen. We had a peak of eleven fifteen during the quarter.
So but this is the estimate for the for the q two. So meaning that, our revenue in the US dollar increased more compared to the increase in euro in the second quarter.
Alberto Jegra, Analyst: Sorry. Just a quick follow-up. Because during the market day, you gave us a sensitivity in terms of your sales exposure to the US dollar. Can you give us also a rough indication of how much of your cost base is in the US dollar?
Stefano Beretta, CFO: In terms of ratio between euro and US dollar, the ratio in favor of the dollar, let me say, has increased a bit compared to the past, especially after the acquisition of Arbor and DIS Group that are entirely expressed in US dollar. So we are benefiting from this natural coverage currently when there is a fluctuation compared to the past. So if we have to consider all the revenues we are exposed, let me say, in the range of 85% in foreign in in US dollar, then we have, of course, Korean won and Japanese yen and Taiwanese dollar, but the most part in the USD. For for the cost, well, I don’t have this information perfectly aligned, I would say roughly in the range of 60% no more. Even low 60%, sorry, in terms of euro compared to to USD.
So the majority is still in euro.
Alberto Jegra, Analyst: Okay. Thank you very much.
Moderator: Thank you very much for your questions. Our next question comes from mister George Brown. Please, the floor to you. Mister Brown, kindly unmute your line. Mister Brown, can you us?
Yeah. We can hear you. Thank you.
George Brown, Analyst: Brilliant. Yeah. Thanks, guys, for taking my questions. I have two, if I may. So just firstly, I’m sure you’ve seen some reports that TSMC is asking some suppliers to cut pricing to help shield the FX impacts that they’re seeing.
You know, TSMC, I think, is majority of your sales, both directly and, indirectly. So so do you expect to see any pressure or or price pressure going forward, in the next couple of quarters? And then secondly, can you help us quantify your AI exposure as a percentage of your total revenues in q one and and what’s implied in your q two guide as well? Thanks, guys.
Company Presenter: Okay. Let me answer to your first question about the pricing, TCC. So it’s the answer is that we have a constant pressure. It’s it’s not related to forex or any other so this is is every year, I will say, even more frequent than than each year, There is a constant negotiation between us and TNC and the all those all the other customers. And the the point here is that, of course, for existing technologies, there it’s there is a small erosion of the price year by year.
But the good point is that we constantly develop new technologies for them because it’s required for new nodes and for more complex testing. And this can allow us to keep the price higher because we we bring the more value on the table. So at the end, these customers, the most important thing is the cost of ownership, not the the just the price itself. And as far as we we continue to innovate and bring new solution that can create more value that can allow us to keep good good pricing. And regarding the AI, it’s we give we we can give you the figure on the considering the whole year, and we are targeting it’s it’s it will be about 34%.
That’s a 34. It’s for twin 2024. It was about 34%.
George Brown, Analyst: Okay. Brilliant. And then maybe just to follow-up, just on HPN. I know you’re investing a lot of capacity in Taiwan for MLOs, but I I believe in in HPN, the current sort of microcantilever technology uses MLCs, so the ceramic substrates. I guess that’s to do with sort of thermal issues.
I just wanna understand if if you’re entering memory, do you have to invest in MLC capacity as well, or with multiple MEMS broadcasts, do you utilize MLOs rather than MLCs? Any sort of color there would be helpful.
Alberto Jegra, Analyst: Yes.
Stefano Beretta, CFO: We
Company Presenter: the investment that we have done on the MLO is good also for MLC, actually. So I can confirm you that it it’s an MLC for what we think will still be required even though we will not go with the our our is not to go with micro cantilever springs, but more with the technology that can leverage on vertical technologies, what are the SOC technologies. But then in MHC will be in any case acquired in the middle as a space transformer. And the investment we have done in Taiwan for the MLO are at this is is good also for the MSC. It’s just that the difference is this the starting material, the bulk material, but the process is basically the same.
So we already we already able to to start the manufacturing of MSC right now.
George Brown, Analyst: Okay. Brilliant. Thanks, guys.
Moderator: Thank you very much, mister Brown, for your questions. Currently, we have no questions queued. We will wait just a few moments to give everyone the opportunity to raise their hands. Thank you. Let me kindly remind everyone that in order to, ask a question, you should raise your hand or press star nine on your keypad if dialing in.
Thank you. We have a follow-up question from mister Alberto Jegra. Please, the floor to you.
Alberto Jegra, Analyst: Yeah. Just a quick follow-up on HBM. If you can provide us any color on the qualification process. So do you confirm the timeline? How how are the negotiation going on?
If you are if you are seeing some, let’s say, specific problem. Any any update would be helpful.
Company Presenter: Actually, we don’t have, let’s say, new updates compared to the what we said during the Capital Market Day. So, basically, we are in progress with the qualifications, with with all all the main HBM players, and the expectation is to finish qualifications by the end of the year.
Alberto Jegra, Analyst: Thank you.
Moderator: Thank you very much. We now have the next question from Ms. Antonella Frangillo. Please, the floor to you. Miss Ranjillo, kindly unmute your line.
Miss Ranjillo, can you hear us?
Antonella Frangillo, Analyst: Yes.
Moderator: Okay. Perfect. We can hear
Antonella Frangillo, Analyst: Sorry if you already answered this question by eye, but I connected a bit later. Could you quantify the DIS impact on the first quarter revenues and on the second quarter guidance?
Stefano Beretta, CFO: So as I mentioned, there is a there is a peak in the second quarter, especially for DIS business that is more subject to cyclicality compared to the current drop car business we are running since many years. So the peak in the second quarter is in the range of 50,000,000 US dollar. So this is the range for DIS. It is very positive results compared to the other months. But, again, this is the the best period for the final testing solution, the final testing campaign that are not expected to repeat in the next quarter.
So that’s why we expect second part of the year still flat compared to the first part the first part of the 02/2025.
Antonella Frangillo, Analyst: Okay. Thank you.
Moderator: Thank you, miss Punjilo, for your question. As there are no more questions queued, I will leave the floor to the management team for any final comments. Thank you.
Company Presenter: Thank you, everyone, for joining us today, and stay tuned for the next quarterly call. Thanks.
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