Astrotech Reports Second Quarter of Fiscal Year 2025 Financial Results

Rhea-AI Summary

Astrotech (NASDAQ: ASTC) reported Q2 FY2025 financial results with revenue of $295 thousand, primarily from activities with the U.S. Department of Homeland Security (DHS) for the TRACER 1000™ explosives trace detection system. The company maintains a strong balance sheet with $24.7 million in cash and liquid investments.

Key developments include a new R&D contract (70RSAT24CB0000015) with DHS for the TRACER 1000 and a purchase order from Intuitive Research and Technology , a TSA contractor. The company's 1st Detect subsidiary has expanded its product line to include narcotics trace detection, particularly focusing on fentanyl identification, and introduced Pro-Control products for chemical manufacturing process optimization.

The TRACER 1000 has demonstrated success with four years of operational history in cargo warehouses across 14 countries, processing thousands of samples.

Positive

• Strong cash position of $24.7 million to support R&D and growth
• New DHS R&D contract awarded for TRACER 1000
• Purchase order received from TSA contractor
• Successful operational history in 14 countries

Negative

• Modest quarterly revenue of $295,000

Insights

Financial Analyst

The Q2 FY2025 results reveal Astrotech's strategic pivot towards commercialization, with revenue of $295,000 primarily derived from government contracts. The company's robust cash position of $24.7 million is particularly noteworthy, representing over 220% of its current market capitalization of approximately $11 million - an unusual situation that suggests significant undervaluation or market skepticism about execution.

The recent DHS contract award and TSA-related purchase order demonstrate growing validation of the TRACER 1000 technology. Government contracts typically serve as strong reference customers and can lead to expanded opportunities across agencies. The company's expansion into narcotics detection, particularly focusing on fentanyl identification, targets a critical market need amid the ongoing opioid crisis. The Pro-Control product line for industrial applications further diversifies revenue streams beyond security applications.

While current revenue remains modest, the company's strong cash position provides substantial runway for product development and market expansion without immediate dilution concerns. The challenge ahead lies in converting technical validation into meaningful commercial traction. The company's ability to leverage its experience in 14 countries and thousands of airport cargo samples represents valuable real-world validation that could accelerate market adoption.

AUSTIN, Texas, Feb. 14, 2025 (GLOBE NEWSWIRE) -- Astrotech Corporation (Nasdaq: ASTC) (the “Company” or “Astrotech”) reported its financial results for the second quarter of fiscal year 2025, which ended December 31, 2024.

Financial Highlights & Recent Developments

• Fiscal year 2025 Q2 revenue of $295 thousand is primarily generated by activities supporting work with the U.S. Department of Homeland Security (“DHS”) to demonstrate the capabilities of our TRACER 1000™ for advanced explosives trace detection.
  
  
• On January 14, 2025, our wholly owned subsidiary, 1st Detect Corporation (“1^st Detect”), announced that it was awarded research and development contract 70RSAT24CB0000015 with the DHS to research, develop and mature the TRACER 1000 for DHS next generation explosives trace detection.
  
  
• On January 23, 2025, 1^st Detect received a purchase order for its TRACER 1000™ explosive trace detectors (ETDs) from Intuitive Research and Technology Corporation, a Transportation Security Administration contractor.
  
  
• Astrotech’s consolidated balance sheet remains strong with $24.7 million in cash and cash equivalents and liquid investments which is anticipated to support the Company’s research and development, organic growth, and potential acquisition targets.

Thomas B. Pickens, III, Astrotech’s Chairman, Chief Executive Officer and Chief Technology Officer, said “We are now prioritizing and accelerating our attention to selling and marketing our line of portable, rugged and inexpensive mass spectrometry instruments. We believe 1^st Detect’s explosive trace detection products are now proven with four years of use in cargo warehouses having run thousands of samples at airports in 14 countries.”

Pickens continued, “Using this same proven and rugged mass spectrometry technology, we have recently introduced 1^st Detect’s narcotics trace detector. Fentanyl is one of the most difficult of the drugs to identify and the TRACER NTD is able to differentiate between fentanyl, heroin, THC and methamphetamine with a high degree of accuracy. The Pro-Control line of products helps chemical manufacturers better control the industrial production process to increase yields and profits.  With our newest product lines, the TRACER NTD and Pro-Control, we believe we are entering large markets in need of our technology.” 

About Astrotech Corporation

Astrotech (Nasdaq: ASTC) is a mass spectrometry company that launches, manages, and commercializes scalable companies based on its innovative core technology through its wholly owned subsidiaries. 1^st Detect develops, manufactures, and sells trace detectors for use in the security and detection market. AgLAB develops and sells chemical analyzers for use in the agriculture market. Pro-Control is developing the mass spectrometry technology for use in chemical manufacturing processes. BreathTech is developing a breath analysis tool to screen for volatile organic compounds that could indicate infections or critical conditions. Astrotech is headquartered in Austin, Texas. For information, please visit www.astrotechcorp.com.

Forward-Looking Statements

This press release contains forward-looking statements that are made pursuant to the Safe Harbor provisions of the Private Securities Litigation Reform Act of 1995. Such forward-looking statements are subject to risks, trends, and uncertainties that could cause actual results to be materially different from the forward-looking statement. These factors include, but are not limited to, the adverse impact of inflationary pressures, including significant increases in fuel costs, global economic conditions and events related to these conditions, including the ongoing wars in Ukraine and the middle east and the COVID-19 pandemic, the Company’s use of proceeds from the common stock offerings, whether we can successfully complete the development of our new products and proprietary technologies, whether we can obtain the FDA and other regulatory approvals required to market our products under development in the United States or abroad, whether the market will accept our products and services and whether we are successful in identifying, completing and integrating acquisitions, as well as other risk factors and business considerations described in the Company’s Securities and Exchange Commission filings including the Company’s most recent Annual Report on Form 10-K and Quarterly Reports on Form 10-Q. Any forward-looking statements in this document should be evaluated in light of these important risk factors. While we do not intend to directly harvest, manufacture, distribute or sell cannabis or cannabis products, we may be detrimentally affected by a change in enforcement by federal or state governments and we may be subject to additional risks in connection with the evolving regulatory area and associated uncertainties. Any such effects may give rise to risks and uncertainties that are currently unknown or amplify others mentioned herein. Although the Company believes the expectations reflected in its forward-looking statements are reasonable and are based on reasonable assumptions, no assurance can be given that these assumptions are accurate or that any of these expectations will be achieved (in full or at all) or will prove to have been correct. Moreover, such statements are subject to a number of assumptions, risks and uncertainties, many of which are beyond the control of the Company, which may cause actual results to differ materially from those implied or expressed by the forward-looking statements. In addition, any forward- looking statements included in this press release represent the Company’s views only as of the date of its publication and should not be relied upon as representing its views as of any subsequent date. The Company assumes no obligation to correct or update these forward-looking statements, whether as a result of new information, future events or otherwise, except as required by applicable law.

Company Contact: Ryan Polk, Chief Financial Officer, Astrotech Corporation, (512) 737-7378.

Financial tables follow

ASTROTECH CORPORATION AND SUBSIDIARIES Condensed Consolidated Statements of Operations and Comprehensive Loss (In thousands, except per share data) (Unaudited)
		Three Months Ended								Six Months Ended
		December 31,								December 31,
		2024				2023				2024				2023
Revenue		$	261			$	1,115			$	295			$	1,540
Cost of revenue			106				583				131				825
Gross profit			155				532				164				715
Operating expenses:
Selling, general and administrative			2,039				2,022				3,727				3,668
Research and development			2,437				1,578				4,386				3,450
Total operating expenses			4,476				3,600				8,113				7,118
Loss from operations			(4,321	)			(3,068	)			(7,949	)			(6,403	)
Other income and expense, net			312				427				662				850
Net loss		$	(4,009	)		$	(2,641	)		$	(7,287	)		$	(5,553	)
Weighted average common shares outstanding:
Basic and diluted			1,638				1,631				1,634				1,631
Basic and diluted net loss per common share:
Net loss per common share		$	(2.45	)		$	(1.62	)		$	(4.46	)		$	(3.40	)
Other comprehensive loss, net of tax:
Net loss		$	(4,009	)		$	(2,641	)		$	(7,287	)		$	(5,553	)
Available-for-sale securities:
Net unrealized gain (loss)			(219	)			325				97				270
Total comprehensive loss		$	(4,228	)		$	(2,316	)		$	(7,190	)		$	(5,283	)

ASTROTECH CORPORATION AND SUBSIDIARIES Condensed Consolidated Balance Sheets (In thousands, except share and per share data)
		December 31,				June 30,
		2024				2024
		(Unaudited)				(Note)
Assets
Current assets
Cash and cash equivalents		$	3,161			$	10,442
Short-term investments			21,531				21,474
Accounts receivable			340				77
Contract Asset			4				—
Inventory, net:
Raw materials			2,121				2,038
Work-in-process			181				66
Finished goods			347				370
Prepaid expenses and other current assets			478				261
Total current assets			28,163				34,728
Property and equipment, net			2,760				2,763
Operating lease right-of-use assets, net			48				119
Other assets, net			30				30
Total assets		$	31,001			$	37,640
Liabilities and stockholders’ equity
Current liabilities
Accounts payable		$	1,032			$	373
Payroll related accruals			923				1,174
Accrued expenses and other liabilities			587				754
Lease liabilities, current			81				227
Total current liabilities			2,623				2,528
Accrued expenses and other liabilities, net of current portion			223				232
Lease liabilities, net of current portion			61				73
Total liabilities			2,907				2,833
Commitments and contingencies (Note 13)
Stockholders’ equity
Convertible preferred stock, $0.001 par value, 2,500,000 shares authorized; 280,898 shares of Series D issued and outstanding at December 31, 2024 and June 30, 2024, respectively			—				—
Common stock, $0.001 par value, 250,000,000 shares authorized at December 31, 2024, and June 30, 2024, respectively; 1,712,045 shares issued at December 31, 2024, and June 30, 2024, respectively; 1,701,729 outstanding at December 31, 2024, and June 30, 2024, respectively			190,643				190,643
Treasury shares, 10,316 at December 31, 2024, and June 30, 2024, respectively			(119	)			(119	)
Additional paid-in capital			82,957				82,480
Accumulated deficit			(244,307	)			(237,020	)
Accumulated other comprehensive loss			(1,080	)			(1,177	)
Total stockholders’ equity			28,094				34,807
Total liabilities and stockholders’ equity		$	31,001			$	37,640

Note: The condensed consolidated balance sheet at June 30, 2024, has been derived from the audited consolidated financial statements at that date but does not include all of the information and footnotes required by the United States generally accepted accounting principles for complete financial statements.

FAQ

What was Astrotech's (ASTC) revenue in Q2 FY2025?

Astrotech reported revenue of $295 thousand in Q2 FY2025, primarily from DHS-related activities for the TRACER 1000™ explosives trace detection system.

How much cash and investments does ASTC have as of Q2 FY2025?

Astrotech maintains $24.7 million in cash and cash equivalents and liquid investments.

What new contracts did ASTC secure in January 2025?

ASTC secured a DHS R&D contract (70RSAT24CB0000015) and received a purchase order from Intuitive Research and Technology for TRACER 1000™ ETDs.

What new products has ASTC's 1st Detect subsidiary launched?

1st Detect has launched the TRACER NTD for narcotics detection, particularly for fentanyl identification, and the Pro-Control line for chemical manufacturing process optimization.

In how many countries is ASTC's TRACER 1000 system currently operational?

The TRACER 1000 system has been operational in cargo warehouses across 14 countries over the past four years.