CVD Equipment reported second-quarter 2026 revenue from continuing operations of $2.0 million, down 42.6% year-over-year, as weak system bookings during 2025 and early 2026 continued to weigh on equipment shipments. Orders totaled $1.2 million, compared with $1.5 million a year earlier, while backlog declined sequentially to $3.9 million from $4.6 million at the end of March.
Despite lower revenue, gross margin improved to 16.8% from 14.1% in the prior-year quarter, primarily because of a higher proportion of non-system revenue. The company nevertheless recorded a $1.4 million net loss from continuing operations, or $0.20 per share, compared with a $1.3 million loss, or $0.19 per share, a year earlier.
The quarter was dominated financially by the April 1 divestiture of CVD Equipment’s SDC division for $17.4 million. The transaction generated approximately $15.0 million in net cash proceeds after transaction costs and estimated tax payments, and produced a $13.9 million gain from discontinued operations during Q2. Including transaction costs recognized in the first quarter, the total net gain from the divestiture was $13.5 million.
As a result, reported Q2 net income reached $12.6 million despite the loss in continuing operations. The transaction also significantly strengthened CVD Equipment’s balance sheet, with cash and cash equivalents rising to $23.5 million from $8.7 million at the end of 2025. Stockholders’ equity increased to $36.0 million from $24.7 million, while the company ended the quarter with no long-term debt.
Management described the SDC sale as a transformational step that provides greater financial flexibility while CVD evaluates strategic alternatives and pursues opportunities in its remaining target markets. The company has also completed a major operational restructuring intended to substantially reduce its fixed-cost base.
For the semiconductor equipment business, however, near-term demand remains challenging. Management said customer orders continue to be affected by broader economic and geopolitical uncertainty. One positive development was a $0.8 million order for a PowderCoat 450 system, representing roughly two-thirds of total Q2 bookings.
That order also introduces additional uncertainty. Following quarter-end, the customer responsible for the $0.8 million system order entered a prepackaged Chapter 11 bankruptcy process. Although unsecured trade creditors are expected to remain unimpaired under the proposed restructuring, CVD Equipment is assessing whether the situation could affect the order, backlog, financial results or cash flows.
Original – CVD Equipment