Earnings call transcript: Optical Cable Q1 2025 shows stock dip
Access earnings results, analyst expectations, report, slides, earnings call, and transcript.
Overview
The earnings call reflects positive financial performance with a 6% revenue growth and improved gross profit margins. While there is a net loss, it has decreased compared to the previous year, and the sales order backlog has increased by 16%. The Q&A session reveals optimism about market opportunities, particularly in AI data centers, despite some unclear responses. The lack of a share repurchase program is a neutral factor. Overall, the sentiment leans positive due to growth strategies, operational efficiencies, and market improvement signs.
Key Financial Performance
Net Sales $15,700,000 (6% increase year-over-year from $14,900,000) due to increases in both enterprise and specialty markets, with a notable 21.3% increase in sales to customers outside the U.S.
Gross Profit $4,600,000 (24.6% increase year-over-year from $3,700,000) driven by production efficiencies from higher volumes and operating leverage.
Gross Profit Margin 29.4% (increase from 25% year-over-year) positively impacted by production efficiencies and product mix.
SG&A Expenses $5,500,000 (increase from $5,100,000 year-over-year) primarily due to increases in employee and contracted sales personnel costs.
Net Loss $1,100,000 or $0.14 per share (improvement from a net loss of $1,400,000 or $0.18 per share year-over-year) indicating a reduction in losses.
Sales Order Backlog $6,600,000 (16% increase from $5,700,000 as of 10/31/2024) reflecting growth in sales order backlog and forward load.
You have reached the limit. Sign up to access full content
Get started
Operating Highlights
Net Sales Growth: Consolidated net sales for Q1 FY2025 increased 6% to $15,700,000 compared to $14,900,000 for the same period last year.
International Sales Growth: Net sales to customers outside of the U.S. increased 21.3%.
Sales Order Backlog: Sales order backlog and forward load increased approximately 16% to $6,600,000 compared to $5,700,000 as of 10/31/2024.
Gross Profit Increase: Gross profit increased 24.6% to $4,600,000 in Q1 FY2025 compared to $3,700,000 for the same period last year.
Gross Profit Margin: Gross profit margin was 29.4% in Q1 FY2025 compared to 25% in Q1 FY2024.
SG&A Expenses: SG&A expenses increased to $5,500,000 in Q1 FY2025 from $5,100,000 in Q1 FY2024.
Market Positioning: OCC is monitoring tariffs and believes being U.S.-based may provide a competitive advantage.
Growth Strategy: OCC is focused on executing growth strategies and operational efficiencies to drive results.
You have reached the limit. Sign up to access full content
Get started
Risk or Challenges
Tariffs Impact: OCC is monitoring proposed and enacted tariffs by the U.S. and others, which may impact purchases of raw materials and sales of products exported to approximately 50 countries. While no significant impact is anticipated currently, the situation remains fluid.
Supply Chain Challenges: The company acknowledges that U.S. manufacturers face long supply chains, which can affect raw material availability and costs.
Competitive Pressures: OCC's manufacturing is based in the U.S., providing a potential advantage over foreign competitors, particularly in light of government initiatives like BABA (Buy America, Build America). However, the company is cautious and not solely relying on this for increased sales.
Market Outlook: The company has not changed its outlook despite recent economic changes and continues to monitor various factors affecting business positively or negatively. Seasonality impacts are noted, particularly in the first half of the fiscal year.
Economic Factors: The overall industry has experienced a downturn since fiscal year 2023, but OCC is seeing signs of improvement and is optimistic about growth opportunities.
You have reached the limit. Sign up to access full content
Get started
Guidance & Outlook
Sales Order Backlog: Sales order backlog and forward load increased approximately 16% to $6,600,000 compared to $5,700,000 as of 10/31/2024.
Market Improvement: OCC is beginning to see market improvement as the weakness experienced across the industry since fiscal 2023 has begun to subside.
Growth Strategies: OCC's focus on executing growth strategies and operating efficiently is expected to drive results this year, including gross profit margin expansion.
AI Data Center Opportunities: OCC believes it has opportunities to benefit and expand business from the significant demand in data centers, including those generated by AI.
Revenue Growth: Consolidated net sales for Q1 FY 2025 increased 6% to $15,700,000 compared to $14,900,000 for the same period last year.
Gross Profit Margin: Gross profit margin for Q1 FY 2025 was 29.4%, up from 25% in Q1 FY 2024.
Net Loss: OCC recorded a net loss of $1,100,000 or $0.14 per share for Q1 FY 2025, an improvement from a net loss of $1,400,000 or $0.18 per share in Q1 FY 2024.
Outlook for FY 2025: The outlook for FY 2025 remains positive despite seasonality impacts in the first quarter.
You have reached the limit. Sign up to access full content
Get started
Shareholder Return Plan
Share Repurchase Program: None
You have reached the limit. Sign up to access full content
Get started
Key Q&A
Q:Can you have a pricing advantage or cost advantage due to tariffs?
A:We could have some positive impacts as well as negative impacts and we’re going to continue to monitor that situation.
Q:Can you explain if you are benefiting or will benefit from AI data center demand?
A:OCC does have some regular business in the data center market and we believe we have opportunities to benefit and expand that business from the significant data center demand.
Q:What new products do you plan to launch to market?
A:For competitive reasons, we tend not to discuss new product launches prior to their official loss.
Q:How do you characterize the outlook for the company going forward?
A:We haven’t changed our outlook since what we’ve stated in the annual report.
Q:Have you seen any fundamental changes in your industry that could allow you to pass your highest historical revenue mark?
A:I believe that our prospects are strong. The need for more communication bandwidth is continuing and that demand is increasing.
Q:Review of Unclear Management Responses
A:Management's responses lacked clarity on the potential positive impacts of tariffs and the specifics of new product launches.
You have reached the limit. Sign up to access full content
Get started
Earnings Word Cloud
The most frequently occurring keywords in this quarter's earning call
AI center
America
Analyst Eden
Asaf Nathan
Cable outlook
Cable question
Conference Moderator
Discovery question
Eden Discovery
Moderator Optical
Nathan Analyst
OCC leverage
OCC product
Officer Optical
SG
advantage
attention
center demand
center market
closing
communication
demand AI
graph
impact
letter
leverage respect
material
middle
others
outlook seasonality
prospect
respect manufacturing
scenario
sensitivity
situation
tariff
topic
year
OCC Transcript
Optical Cable Corporation (OCC) Q4 2025 Earnings Call Transcript
Unknown12-18
The earnings call summary indicates optimism about future growth, particularly with the Lightera collaboration and data center markets. However, management's reluctance to provide guidance and specific financial metrics, coupled with no immediate impact from the collaboration, tempers the positive outlook. The Q&A section revealed no major negative trends but highlighted uncertainties in financial impact and project timelines. These mixed signals suggest a balanced market reaction, leading to a neutral sentiment rating for the stock price movement.
Optical Cable Corporation (OCC) Q3 2025 Earnings Call Transcript
Positive9-11
The earnings call summary highlights strong financial performance with an increase in net sales and gross profit, along with a reduced net loss. The Lightera partnership, despite limited details, is seen as a positive strategic move that could expand market opportunities and sales growth. The Q&A section did not uncover significant negative sentiment or risks. Overall, the financial improvements, partnership potential, and optimistic outlook suggest a positive stock price movement in the short term.
Optical Cable Corporation (OCC) Q2 2025 Earnings Call Transcript
Unknown6-6
The earnings call showed positive financial performance with increased sales and gross profit, but ongoing net losses and rising SG&A expenses raise concerns. The lack of forward guidance and reliance on sales backlog add uncertainty. The Q&A section highlighted missed opportunities in data centers and unclear management responses. While there are positive trends, the absence of a share repurchase program and the dynamic market environment temper expectations. Overall, these factors suggest a neutral outlook for stock price movement.
Optical Cable Corporation (NASDAQ:OCC) Q1 2025 Earnings Call Transcript
Positive3-11
The earnings call shows strong financial performance with increased net sales, gross profit, and a reduced net loss. The company is optimistic about future revenue and has improved its sales order backlog. While there are concerns about tariffs and competition, management does not expect significant negative impacts. The Q&A section reveals confidence in leveraging operating efficiencies and potential advantages from US manufacturing. Despite no share repurchase program, the overall sentiment is positive due to operational improvements and market potential, suggesting a stock price movement of 2% to 8%.
OCC Report
Frequently Asked Questions
Where does this earnings call transcript come from?
All transcripts are sourced directly from the official live webcast or the company’s official investor relations website. We use the exact words spoken during the call with no paraphrasing of the core discussion.
How soon is the transcript available after the earnings call ends?
Full verbatim transcripts are typically published within 4–12 hours after the call ends. Same-day availability is guaranteed for all S&P 500 and most mid-cap companies.
Is the transcript edited or altered in any way?
No material content is ever changed or summarized in the “Full Transcript” section. We only correct obvious spoken typos (e.g., “um”, “ah”, repeated 10 times”, or clear misspoken ticker symbols) and add speaker names/titles for readability. Every substantive sentence remains 100% as spoken.
Why do some answers appear as “Unclear” or “Inaudible”?
When audio quality is poor or multiple speakers talk over each other, we mark the section instead of guessing. This ensures complete accuracy rather than introducing potential errors.
Who creates the AI Summary and Key Q&A highlights shown above the transcript?
They are generated by a specialized financial-language model trained exclusively on 15+ years of earnings transcripts. The model extracts financial figures, guidance, and tone with 97%+ accuracy and is regularly validated against human analysts. The full raw transcript always remains available for verification.
