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Data I/O Reports Second Quarter 2017 Results

REDMOND, WA--(Marketwired - July 27, 2017) - Data I/O Corporation (DAIO), the leading global provider of advanced data and security programming and IP management solutions for flash-memory, flash based microcontrollers and other intelligent devices, today announced financial results for the second quarter ended June 30, 2017.

Second Quarter 2017 Highlights (on year-over-year basis unless noted)

  • Net sales of $9.1 million, a 17-year high
  • Total bookings of $10.1 million, a 17-year high
  • Gross margin as a percentage of sales of 56.9%, up from 53.2% in 2Q16
  • Net income of $1.2 million or $0.14 diluted earnings per share, up from $444,000 or $0.06 diluted earnings per share in 2Q16
  • Adjusted EBITDA*, excluding equity compensation, of $1.7 million, up from $789,000 in 2Q16
  • Backlog of $4.7 million at end of quarter, compared with $4.9 million at March 31, 2017 and $3.2 million at December 31, 2016
  • Deferred revenue of $2.8 million, including 3 systems
  • Cash and securities of $12.0 million at June 30, 2017, compared with $10.5 million at March 31, 2017 and $11.6 million at December 31, 2016
  • Progress for SentriX™ Managed and Secure Programming Platform
    • Additional Secure Elements enablement orders received
    • Leadership team bolstered
    • On track for system release in second half of 2017

Management Comments

"Our second quarter financial and operating performances were outstanding," said Anthony Ambrose, President and CEO of Data I/O Corporation. "Building upon the progress achieved in the first quarter, revenue and bookings in the second quarter reached the highest level in 17 years. During the second quarter, we shipped our 150th PSV family system, extending our global market share leadership.

"The turnaround strategy we started over 4 years ago has delivered our best quarter since the year 2000. We are delivering operational excellence across the board: sales, engineering, service and operations all drove our performance.

"Automotive electronics were over 50% of bookings in the first half of 2017, continuing a multiyear growth trend. We booked multiple systems from an international automotive electronics company, and shipped 2 systems to them in the second quarter. Reflecting our growing base of installed systems, revenue from adapters in the second quarter increased 72% from the prior year period to $2.1 million, or 23% of consolidated revenue.

"While we continue to experience high demand and interest in our product platforms, our second quarter bookings of $10.1 million were unusually strong. Second quarter bookings are likely to be the peak level for the year due to unprecedented demand in the first half of 2017 and our seasonal sales funnel.

"We improved overall profitability while increasing investment in research and development for our Managed and Secure Programming ("MSP") technology and automotive targeted products. In June, we announced organizational changes that significantly strengthen our management team to enable us to better address our new opportunities from MSP. Through our continued work on the MSP platform, we are developing the technologies behind a new generation of security solutions for authentication devices, secure elements and secure microcontrollers. The mission of Data I/O's MSP platform is to enable a democratization of security capabilities for OEMs globally."

Financial Results

Net sales in the second quarter of 2017 were $9.1 million, compared with $5.8 million in the second quarter of 2016.

For the 2017 second quarter, gross margin as a percentage of sales was 56.9%, compared to 53.2% in the second quarter of 2016. The improvement in gross margin as a...