Moving iMage Technologies (NYSEAMERICAN:MITQ) reported higher revenue but lower net income for its fiscal first quarter of 2027, as two customers accelerated projects into the period and sales of DCS loudspeakers contributed to growth.
Revenue rose 9.2% to $6.09 million from $5.58 million a year earlier, exceeding the company’s previous outlook. Net income fell to $181,000, or $0.02 per share, from $509,000, or $0.05 per share, as gross margin narrowed and the prior-year period benefited from income related to extinguished payables.
President Francois Godfrey said the accelerated projects helped first-quarter performance, alongside DCS loudspeaker sales and customer activity ahead of the holiday film release season. He cautioned that project schedules can shift by several quarters as customers adjust their implementation plans, creating variability in results.
Margins Decline Despite Revenue Growth
Gross margin fell to 24.1% from 30% a year earlier, while gross profit declined to $1.47 million from $1.67 million. CFO Bart Bedard attributed the margin pressure to lower sales of high-margin cinema accessories and higher costs, including transportation and input costs, particularly in international markets.
Operating expenses declined to $1.3 million from $1.32 million, which Bedard attributed to cost initiatives introduced over the past several quarters. The prior-year net income figure included $128,000 of income from the extinguishment of payables.
Bedard cited net cash of $5.69 million, or approximately $0.55 per common share, compared with $3.19 million in the fourth quarter of fiscal 2026. He referred to the $5.69 million figure as being at the close of “Q1 2026,” although he described the increase as sequential. He said the increase reflected the timing of accounts payable payments and $1 million in customer deposits for future work.
Working capital at the end of the first quarter of fiscal 2027 was $4.24 million, compared with $4.04 million in the year-earlier quarter. The company had no long-term debt, Bedard said.
DCS Sales and Theater Projects
First-quarter DCS loudspeaker revenue was $429,000, including a large shipment to a customer in Sri Lanka. That compared with $400,000 in the fourth quarter of fiscal 2026 and no DCS revenue in the year-earlier period, before the acquisition. Bedard said the DCS order backlog was approximately $459,000 at the time of the call.
Godfrey said Moving iMage had generated $1.3 million in DCS sales across more than 20 countries since closing the acquisition about a year earlier. The company paid $1.5 million in total consideration for the business. He said customer interest remained strong but that the company had faced challenges integrating operations and increasing manufacturing and global logistics capacity.
Godfrey also pointed to discussions about potential calendar 2027 projects, including opportunities involving LEA Professional amplifiers. He said the DCS line allows the company to offer a more comprehensive audio solution.
Second-Quarter Outlook
Moving iMage expects approximately $5.4 million in revenue for its fiscal second quarter ending Dec. 31, supported by a turnkey upgrade of a 16-screen theater complex.
Godfrey said theater capital spending typically slows during the November and December holiday season as exhibitors seek to maximize revenue and plan future upgrades. He said the company looks forward to customers releasing new calendar-year budgets before incorporating potential projects into its public outlook.
The company continues to evaluate potential business combinations or other strategic transactions that could improve its competitive position, growth prospects and financial results, Godfrey said. No analysts or investors asked questions during the call.
About Moving iMage Technologies (NYSEAMERICAN:MITQ)
Moving iMage Technologies, Inc. (NYSE American: MITQ) provides technology, equipment and services for cinemas and other entertainment venues. The company helps customers design, build, upgrade and operate auditoriums through a combination of products, systems integration and technical support. Its offerings include digital cinema projection and audio systems, screens, media servers, cinema management and automation solutions, seating, concession equipment and related theater infrastructure. Moving iMage Technologies also provides installation, engineering, maintenance and other professional services, including customized solutions for new construction and auditorium renovations.
