IPG Photonics 2025 Q1 Earnings Misses Targets as Net Income Declines 84%
Wednesday, May 7, 2025 7:37 am ET
54min read IPG Photonics (IPGP) reported its fiscal 2025 Q1 earnings on May 06th, 2025. The total revenue of IPG Photonics decreased by 9.6% to $227.79 million in 2025 Q1, down from $252.01 million in 2024 Q1. IPG Photonics' earnings per share (EPS) fell short of expectations, reporting $0.09, significantly lower than previous quarters. The company issued guidance for Q2 2025, projecting revenue between $210 million and $240 million, a decrease due to shipment delays related to tariffs. The EPS guidance for Q2 ranges from negative $0.05 to $0.25, underscoring the near-term challenges. Despite these results, the company maintained a positive outlook, focusing on strategic priorities and long-term growth initiatives.
Revenue
IPG Photonics reported a 9.6% decline in total revenue for Q1 2025. The High Power Continuous Wave (CW) Lasers segment generated $69.42 million, while Medium Power CW Lasers brought in $24.40 million. Pulsed Lasers contributed $36.66 million, and the Quasi-Continuous Wave (QCW) Lasers segment reported $10.89 million. The Laser and Non-Laser Systems division achieved $33.05 million. Other Revenue, which includes various other lasers, amplifiers, service, parts, accessories, and deferred revenue changes, amounted to $53.37 million, culminating in a total revenue of $227.79 million.
Earnings/Net Income
IPG Photonics's EPS declined 82.7% to $0.09 in 2025 Q1 from $0.52 in 2024 Q1. Meanwhile, the company's net income declined to $3.76 million in 2025 Q1, down 84.4% from $24.10 million reported in 2024 Q1. The Company has sustained profitability for 20 years over the corresponding fiscal quarter, reflecting stable business performance. The EPS performance indicates financial challenges in the current quarter.
Price Action
The stock price of IPG Photonics has dropped 3.07% during the latest trading day, has dropped 7.23% during the most recent full trading week, and has edged down 0.33% month-to-date.
Post-Earnings Price Action Review
The strategy of purchasing IPG Photonics shares following a quarter-over-quarter revenue decline and holding for 30 days resulted in a modest 6.76% return, significantly underperforming the benchmark's robust 83.12% return. The strategy's compound annual growth rate (CAGR) stood at a mere 1.33%, accompanied by a substantial maximum drawdown of -16.30%. The Sharpe ratio was recorded at 0.12, underscoring the strategy's higher risk profile compared to the benchmark while delivering only modest returns. This data suggests that the strategy may not be an optimal choice for investors seeking substantial returns with manageable risk levels, as it demonstrated lower performance and higher volatility relative to the benchmark.
CEO Commentary
Mark Gitin, CEO of IPG Photonics, expressed optimism about the company's performance, stating, "We had a solid start to the year with continued signs of stabilization in the business and modest upticks in demand across some of our markets." He highlighted that revenue exceeded guidance due to improved bookings and stabilization in welding revenue, particularly in e-mobility. Gitin emphasized strategic priorities, mentioning "strong relationships with customers around the world" and the importance of investing in R&D. He noted the company's agility in navigating challenges, asserting confidence in their long-term growth opportunities, stating, "We're energized by the progress we're making against our strategic priorities."
Guidance
For Q2 2025, IPG Photonics expects revenue between $210 million and $240 million, reflecting a $15 million reduction due to shipment delays related to tariffs. Adjusted gross margin is anticipated to range from 36% to 38%, factoring in a 150 to 200 basis point impact from tariffs. Operating expenses are projected to be between $86 million and $88 million. Adjusted earnings per diluted share are expected to be in the range of minus $0.05 to $0.25, with approximately 43 million diluted common shares outstanding.
Additional News
In recent non-earnings related developments, IPG Photonics announced a strategic acquisition aimed at enhancing its capabilities in advanced laser systems, further solidifying its position in the market. This move aligns with the company's growth strategy focused on expanding its technological footprint. Additionally, the company reported a buyback initiative, demonstrating its commitment to returning value to shareholders. In leadership news, IPG Photonics appointed a new Chief Technology Officer, bringing fresh perspectives to drive innovation and strategic growth in emerging markets
Revenue
IPG Photonics reported a 9.6% decline in total revenue for Q1 2025. The High Power Continuous Wave (CW) Lasers segment generated $69.42 million, while Medium Power CW Lasers brought in $24.40 million. Pulsed Lasers contributed $36.66 million, and the Quasi-Continuous Wave (QCW) Lasers segment reported $10.89 million. The Laser and Non-Laser Systems division achieved $33.05 million. Other Revenue, which includes various other lasers, amplifiers, service, parts, accessories, and deferred revenue changes, amounted to $53.37 million, culminating in a total revenue of $227.79 million.
Earnings/Net Income
IPG Photonics's EPS declined 82.7% to $0.09 in 2025 Q1 from $0.52 in 2024 Q1. Meanwhile, the company's net income declined to $3.76 million in 2025 Q1, down 84.4% from $24.10 million reported in 2024 Q1. The Company has sustained profitability for 20 years over the corresponding fiscal quarter, reflecting stable business performance. The EPS performance indicates financial challenges in the current quarter.
Price Action
The stock price of IPG Photonics has dropped 3.07% during the latest trading day, has dropped 7.23% during the most recent full trading week, and has edged down 0.33% month-to-date.
Post-Earnings Price Action Review
The strategy of purchasing IPG Photonics shares following a quarter-over-quarter revenue decline and holding for 30 days resulted in a modest 6.76% return, significantly underperforming the benchmark's robust 83.12% return. The strategy's compound annual growth rate (CAGR) stood at a mere 1.33%, accompanied by a substantial maximum drawdown of -16.30%. The Sharpe ratio was recorded at 0.12, underscoring the strategy's higher risk profile compared to the benchmark while delivering only modest returns. This data suggests that the strategy may not be an optimal choice for investors seeking substantial returns with manageable risk levels, as it demonstrated lower performance and higher volatility relative to the benchmark.
CEO Commentary
Mark Gitin, CEO of IPG Photonics, expressed optimism about the company's performance, stating, "We had a solid start to the year with continued signs of stabilization in the business and modest upticks in demand across some of our markets." He highlighted that revenue exceeded guidance due to improved bookings and stabilization in welding revenue, particularly in e-mobility. Gitin emphasized strategic priorities, mentioning "strong relationships with customers around the world" and the importance of investing in R&D. He noted the company's agility in navigating challenges, asserting confidence in their long-term growth opportunities, stating, "We're energized by the progress we're making against our strategic priorities."
Guidance
For Q2 2025, IPG Photonics expects revenue between $210 million and $240 million, reflecting a $15 million reduction due to shipment delays related to tariffs. Adjusted gross margin is anticipated to range from 36% to 38%, factoring in a 150 to 200 basis point impact from tariffs. Operating expenses are projected to be between $86 million and $88 million. Adjusted earnings per diluted share are expected to be in the range of minus $0.05 to $0.25, with approximately 43 million diluted common shares outstanding.
Additional News
In recent non-earnings related developments, IPG Photonics announced a strategic acquisition aimed at enhancing its capabilities in advanced laser systems, further solidifying its position in the market. This move aligns with the company's growth strategy focused on expanding its technological footprint. Additionally, the company reported a buyback initiative, demonstrating its commitment to returning value to shareholders. In leadership news, IPG Photonics appointed a new Chief Technology Officer, bringing fresh perspectives to drive innovation and strategic growth in emerging markets
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