NVEC earnings analysis
What we found in NVEC's 10-Q: the parts that mattered, the offsets in the same document, and what the company said about what comes next.
Our reading of the filing · Free to read, no account needed
NVE reported strong first-quarter fiscal 2027 operating momentum: revenue rose 80.7% year over year, gross margin improved 70 basis points to 81.3%, and operating margin expanded 400 basis points to 65.9%. Product sales, which were 97.3% of revenue, grew 81.7%, while contract R&D grew 52.7%; net income rose 78.8%. Operating cash flow of $5,306,318 and just $56,833 of capex supported calculated free cash flow of $5,249,485, although receivables rose $3,136,772 and dividends consumed $4,837,166. The supplied 10-Q excerpt does not provide a sequential revenue/EPS comparison or a new quantitative revenue/EPS outlook.
The parts that mattered.
Pulled out of the filing itself, with the figures the company reported.
- Revenue growth accelerated 81% year over year
- Total revenue increased 80.7% year over year, driven by an 81.7% increase in product sales and a 52.7% increase in contract R&D revenue. Management attributed product growth to higher defense and non-defense sales through both direct and distributor channels.
- Operating leverage expanded margins
- Gross margin improved to 81.3% from 80.6% in the prior-year quarter, while operating margin expanded to 65.9% from 61.9%. Income from operations grew 92.1%, outpacing the 80.7% increase in revenue.
- Net income rose 79% despite cost growth
- Net income increased 78.8% year over year, despite a 49.5% increase in total operating expenses and a 9.7% decline in interest income.
- Strong cash conversion and low capex
- Operating cash flow was $5,306,318, and fixed-asset purchases were only $56,833, implying calculated free cash flow of $5,249,485 and capex intensity of roughly 1.1% of operating cash flow.
- Cash increased despite shareholder payout
- Cash and cash equivalents increased $1,182,108 to $2,896,148 at June 30, 2026, even after $4,837,166 of dividends paid during the quarter.
- Capital-spending burden is set to ease
- Management expects fiscal 2027 fixed-asset purchases to be significantly below fiscal 2026 levels; current-quarter fixed-asset purchases were $56,833 following completion of the prior-year expansion.
And the other side of it.
The offsets in the same document — the things a summary that only listed the good news would have left out.
- Receivables growth increases working-capital risk
- Accounts receivable increased $3,136,772 during the quarter, principally because of increased sales and customer-payment timing. This absorbed a meaningful portion of the $5,306,318 operating cash inflow.
- Compensation and development costs rose
- Selling, general and administrative expense increased 80.5% year over year, primarily from performance-based compensation, while R&D expense increased 31.4% from staffing and new-product development.
- Recurring dividends draw on liquidity
- The company paid $4,837,166 in dividends during the quarter and declared another $1.00-per-share dividend totaling $4,837,166, payable August 31, 2026. Future dividends remain subject to Board approval and may be modified or discontinued.
- No material risk-factor updates
- Item 1A states there were no material changes to risk factors from the Form 10-K for the fiscal year ended March 31, 2026. Existing disclosed exposures include reliance on several large customers, industry economic conditions, and tariffs or other trade barriers.
What they reported.
What the company itself reported, taken out of the document.
- Gross margin
- 81.3%
- Operating margin
- 65.9%
- Segment
- Product sales represented 97.3% of revenue and increased 81.7% year over year.
- Segment
- Contract research and development represented 2.7% of revenue and increased 52.7% year over year.
What they said about what is next.
The 10-Q contains no quantitative revenue or EPS outlook. Management expects fiscal 2027 fixed-asset purchases to be significantly lower than fiscal 2026 following completion of the expansion; it also declared a $1.00-per-share dividend payable August 31, 2026.
The filing reads better than the one before it.
What came before.
- 10-K · May 6, 2026
- NVE Corporation's FY2026 report shows a modest revenue growth of 1.8% to $26.33 million, with a gross margin decline to 78.7% from the previous year's 83.6%. Net income rose slightly by 1% to $15.2 million, driven by…
- 10-Q · January 21, 2026
- NVE reported quarterly revenue of $6,224,776 (up 22.9% YoY) and diluted EPS of $0.70 (up from $0.63). Product sales of $5,778,674 (up 16.5%) and contract R&D of $446,102 (up 335%) drove the top-line gain, while gross…
- 10-Q · October 23, 2024
- NVE reported quarterly revenue of $6,758,690 and diluted EPS of $0.83 for the quarter ended September 30, 2024. Gross margin expanded to 86.0% and operating margin remained very high at 65.1%, but revenue declined 5%…
- 10-K · May 1, 2024
- NVE (NVEC) is a niche spintronics developer focused on sensors, couplers (isolators), isolated DC-to-DC converters and low-density MRAM; the 10-K emphasizes product roadmap (new coupler+DC‑DC, ultra‑high isolation…
This is our reading of a public filing, not the filing. Read the original on SEC.gov · Educational only. Nothing here is investment advice.
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