# Trio-Tech International: Form 10-Q for the period ended Mar 31, 2025

- Company: [Trio-Tech International](/companies/trt.md) (CIK 732026)
- Form: 10-Q
- Filed: 2025-05-13
- Accepted by EDGAR: May 13, 2025, 10:26 ET
- Period: 2025-03-31
- Accession: 0001437749-25-016318
- Inline XBRL: yes
- Main document: https://www.sec.gov/Archives/edgar/data/732026/000143774925016318/trt20250331_10q.htm
- All documents and exhibits: https://www.sec.gov/Archives/edgar/data/732026/000143774925016318/

## Figures reported in this filing

Standardized XBRL line items for the period ended 2025-03-31.

| Line item | Period | Value | XBRL concept |
| --- | --- | ---: | --- |
| Revenue | 3 months, 2025-01-01 to 2025-03-31 | $7.4m | us-gaap:RevenueFromContractWithCustomerIncludingAssessedTax |
| Revenue | 9 months, 2024-07-01 to 2025-03-31 | $25.8m | us-gaap:RevenueFromContractWithCustomerIncludingAssessedTax |
| Cost of revenue | 3 months, 2025-01-01 to 2025-03-31 | $5.4m | us-gaap:CostOfGoodsAndServicesSold |
| Cost of revenue | 9 months, 2024-07-01 to 2025-03-31 | $19.3m | us-gaap:CostOfGoodsAndServicesSold |
| Gross profit | 3 months, 2025-01-01 to 2025-03-31 | $2.0m | us-gaap:GrossProfit |
| Gross profit | 9 months, 2024-07-01 to 2025-03-31 | $6.5m | us-gaap:GrossProfit |
| Research and development | 3 months, 2025-01-01 to 2025-03-31 | $90.0k | us-gaap:ResearchAndDevelopmentExpense |
| Research and development | 9 months, 2024-07-01 to 2025-03-31 | $292.0k | us-gaap:ResearchAndDevelopmentExpense |
| Operating income | 3 months, 2025-01-01 to 2025-03-31 | −$343.0k | us-gaap:OperatingIncomeLoss |
| Operating income | 9 months, 2024-07-01 to 2025-03-31 | −$213.0k | us-gaap:OperatingIncomeLoss |
| Interest expense | 3 months, 2025-01-01 to 2025-03-31 | $10.0k | us-gaap:InterestExpenseNonoperating |
| Interest expense | 9 months, 2024-07-01 to 2025-03-31 | $36.0k | us-gaap:InterestExpenseNonoperating |
| Income tax | 3 months, 2025-01-01 to 2025-03-31 | $6.0k | us-gaap:IncomeTaxExpenseBenefit |
| Income tax | 9 months, 2024-07-01 to 2025-03-31 | $196.0k | us-gaap:IncomeTaxExpenseBenefit |
| Net income | 3 months, 2025-01-01 to 2025-03-31 | −$495.0k | us-gaap:NetIncomeLoss |
| Net income | 9 months, 2024-07-01 to 2025-03-31 | −$224.0k | us-gaap:NetIncomeLoss |
| Diluted EPS | 3 months, 2025-01-01 to 2025-03-31 | −$0.12 | us-gaap:EarningsPerShareDiluted |
| Diluted EPS | 9 months, 2024-07-01 to 2025-03-31 | −$0.05 | us-gaap:EarningsPerShareDiluted |
| Basic EPS | 3 months, 2025-01-01 to 2025-03-31 | −$0.12 | us-gaap:EarningsPerShareBasic |
| Basic EPS | 9 months, 2024-07-01 to 2025-03-31 | −$0.05 | us-gaap:EarningsPerShareBasic |
| Diluted shares (weighted) | 3 months, 2025-01-01 to 2025-03-31 | 4,375,000 shares | us-gaap:WeightedAverageNumberOfDilutedSharesOutstanding |
| Diluted shares (weighted) | 9 months, 2024-07-01 to 2025-03-31 | 4,371,000 shares | us-gaap:WeightedAverageNumberOfDilutedSharesOutstanding |
| Operating cash flow | 9 months, 2024-07-01 to 2025-03-31 | $1.0m | us-gaap:NetCashProvidedByUsedInOperatingActivities |
| Capital expenditure | 9 months, 2024-07-01 to 2025-03-31 | $410.0k | us-gaap:PaymentsToAcquirePropertyPlantAndEquipment |
| Cash and equivalents | at 2025-03-31 | $11.0m | us-gaap:CashAndCashEquivalentsAtCarryingValue |
| Current assets | at 2025-03-31 | $30.9m | us-gaap:AssetsCurrent |
| Total assets | at 2025-03-31 | $40.0m | us-gaap:Assets |
| Current liabilities | at 2025-03-31 | $6.3m | us-gaap:LiabilitiesCurrent |
| Total liabilities | at 2025-03-31 | $7.2m | us-gaap:Liabilities |
| Long-term debt | at 2025-03-31 | $729.0k | us-gaap:LongTermDebt |
| Shareholders' equity | at 2025-03-31 | $32.3m | us-gaap:StockholdersEquity |

## Management's discussion and analysis

As filed, 48,766 characters.

### Overview

*The following should be read in conjunction with the condensed consolidated financial statements and notes in Item I above and with the audited consolidated financial statements and notes, the information under the headings “Management’s discussion and analysis of financial condition and results of operations” in our Annual Report on Form 10-K for the fiscal year ended June 30, 2024 (“Fiscal 2024”).*

Trio-Tech International (“TTI”) was incorporated in 1958 under the laws of the State of California. As used herein, the term “Trio-Tech” or “Company” or “we” or “us” or “Registrant” includes Trio-Tech International and its subsidiaries unless the context otherwise indicates. Our mailing address and executive offices are located at Block 1008 Toa Payoh North, Unit 03-09 Singapore 318996, and our telephone number is (65) 6265 3300.

The Company has traditionally been a provider of reliability test equipment and services to the semiconductor and other industries. Our customers rely on us to verify that their semiconductor components meet or exceed the rigorous reliability standards demanded for automotive electronics, industrial electronics, computing and data storage, consumer electronics, and communication markets. We act as a global one-stop solution for our customers by designing and building reliability test solutions and offering comprehensive testing services. The Company also develops and manufactures an extensive range of equipment used in the manufacturing processes of semiconductors and various other industries.

In the first quarter of Fiscal 2025, we made changes in our business strategy in an effort to better align with our focus areas and to streamline operations. While the semiconductor industry is and will remain a major market for the Company, an important component of our strategy is to reduce our historic concentration on this industry. As a result, we organized our operating businesses based on the markets that we serve. Beginning in Fiscal 2025, we report our financial performance based on our new segments, Semiconductor Back-end Solutions and Industrial Electronics.

“Semiconductor Back-end Solutions” (“SBS”) segment comprises of our core semiconductor back-end manufacturing and testing operations that serve the semiconductor industry. Our value-added distribution business, along with our services and equipment manufacturing operations that serve various industries will be reported together in our “Industrial Electronics” (“IE”) segment. A mapping of our previous presentation and the revised segments is presented below:

- Manufacturing – Manufacturing of equipment that solely serves the back-end processes of the semiconductor industry is presented under the SBS segment, and manufacturing of equipment that serves various industries is presented under the IE segment.
- Testing Services – Testing services are presented under the SBS segment
- Distribution – Value-added distribution of burn-in test related equipment is presented under the SBS segment, and value-added distribution of other electronic products are presented under the IE segment.
- Real estate – Real-estate segment relates to real estate investments made in ChongQing, China. When identifying reportable segments, management evaluates the contribution of each segment to our overall business strategy and whether the segment reported provides meaningful information to users about the Company’s performance and prospects. Revenue from the real-estate segment has been below 1% of total revenue in the past five fiscal years due to the negative real-estate environment in China. Effective in Fiscal 2025, management therefore concluded that the real-estate segment is not integral to the Company’s operations and does not intend to allocate any additional resources to this segment. As a result, this segment will cease to be a reportable segment in Fiscal 2025, and therefore will be presented under the Others segment.

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The types of products and services provided by each segment are summarized below:

### Semiconductor Back-end Solutions

The SBS segment of the Company designs and manufactures an extensive range of burn-in and reliability test equipment used in the “back-end” manufacturing processes of semiconductors. Our equipment includes burn-in systems, burn-in boards and related equipment that is used in the testing of structural integrity of integrated circuits. We also act as an extended development team of Integrated Device Manufacturers (“IDMs”) and Fabless semiconductor companies in the testing process with our expert technical skills, especially in the New Product Introduction (“NPI”) process.

The Company also provides comprehensive electrical, environmental, and burn-in testing services to semiconductor manufacturers in our testing laboratories in Asia. Our customers include both manufacturers and end users of semiconductor and electronic components who look to us when they decide to outsource their testing process. We also support the asset-light strategy of our customers by setting up test facilities and providing component level, package level and system level testing services with expert technology that improves the productivity of our customers. The independent tests are performed to industry and customer specific standards.

### Industrial Electronics

The IE segment of the Company includes the design, manufacture and distribution of an extensive range of test, process and other equipment used in the manufacturing processes of customers in various industries in the consumer and industrial market. Our equipment includes environmental chambers, leak detectors, autoclaves, centrifuges, dynamic testers, HAST testers, temperature-controlled chucks, and more. This segment also provides preventive maintenance, calibration services, repair services and upgrading and refurbishment services for temperature, humidity and pressurization equipment.

In addition to marketing our proprietary products, we distribute mechanical, electrical and electronic products made by manufacturers around the world. The products include environmental chambers, mechanical shock and vibration testers, specialized equipment for aerospace applications and more. We also distribute a wide range of components such as connectors, sockets, cables, LCD displays and touch screen panels. We act as value-added resellers by enhancing the value of the distributed products by customizing each to the needs of our customers through our expert engineering and integration services. We also support our customers as their extended research and development arm in product design, leveraging the expert skills of our component engineers and design engineers.

### Critical Accounting Estimates & Policies

The preparation of our Condensed Consolidated Financial Statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions in applying our accounting policies that affect the reported amounts of assets, liabilities, revenues and expenses, and related disclosure of contingent assets and liabilities. We base these estimates and assumptions on historical experience and evaluate them on an ongoing basis to ensure that they remain reasonable under current conditions. Actual results could differ from those estimates. We discuss the development and selection of the critical accounting estimates with the Audit Committee of our Board of Directors on a quarterly basis, and the Audit Committee has reviewed our related disclosure in this Quarterly Report on Form 10-Q.

There have been no material changes in our critical accounting estimates and policies since our Annual Report on Form 10-K for Fiscal 2024. Refer to Note 1 “Basis of Presentation and Summary of Significant Accounting Policies” to our Condensed Consolidated Financial Statements for additional details. In addition, please refer to “Management’s Discussion and Analysis of Financial Condition and Results of Operations” contained in Part II, Item 7 of our Annual Report on Form 10-K for Fiscal 2024 for a complete description of our critical accounting policies and estimates.

### Third Quarter Fiscal Year 2025 Highlights

- Total revenue decreased by $3,014, or 29.0%, to $7,384 in the third quarter of Fiscal 2025, compared to $10,398 for the same period in Fiscal 2024.
- SBS segment revenue decreased by $2,272, or 29.5% to $5,425 for the third quarter of Fiscal 2025, compared to $7,697 for the same period in Fiscal 2024.
- IE segment revenue decreased by $745, or 27.6%, to $1,950 for the third quarter of Fiscal 2025, compared to $2,695 for the same period in Fiscal 2024.
- The overall gross profit margin increased by 0.8% to 26.8% for the third quarter of Fiscal 2025, from 26.0% for the same period in Fiscal 2024.

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- General and administrative expense decreased by $284, or 12.1%, to $2,067 for the third quarter of Fiscal 2025, from $2,351 for the same period in Fiscal 2024.
- Selling expense increased by $12, or 5.9%, to $216 for the third quarter of Fiscal 2025, from $204 for the same period in Fiscal 2024.
- Loss from operations was $343 for the third quarter of Fiscal 2025, reflecting a decline of $402 as compared to income from operations of $59 for the same period in Fiscal 2024.
- Other expense was $144 for the third quarter of Fiscal 2025, representing an unfavorable variance of $396 as compared to other income of $252 for the same period in Fiscal 2024.
- Income tax expense was $6 in the third quarter of Fiscal 2025, a decrease of $136 as compared to $142 for the same period in Fiscal 2024.
- During the third quarter of Fiscal 2025, loss from continuing operations before non-controlling interest, net of tax was $481, as compared to income from continuing operations before non-controlling interest of $164 for the same period in Fiscal 2024.
- Net income attributable to non-controlling interest for the third quarter of Fiscal 2025 was $19, a decrease of $74 as compared to net income of $93 for the same period in Fiscal 2024.
- Basic loss per share for the third quarter of Fiscal 2025 was $0.12, as compared to earnings per share of $0.02 for the same period in Fiscal 2024.
- Diluted loss per share for the third quarter of Fiscal 2025 was $0.12, as compared to earnings per share of $0.02 for the same period in Fiscal 2024.
- Total assets decreased by $2,581 to $39,959 as of March 31, 2025, compared to $42,540 as of June 30, 2024.
- Total liabilities decreased by $3,731 to $7,231 as of March 31, 2025, compared to $10,962 as of June 30, 2024.

### Results of Operations and Business Outlook

The following table sets forth our revenue components for both three and nine months ended March 31, 2025 and 2024.

*(Unaudited)*

*(Unaudited)*

*(Unaudited)*

*(Unaudited)*

| Revenue Components | Three Months Ended March 31, 2025 | March 31, 2024 | Nine Months Ended March 31, 2025 | March 31, 2024 |
| --- | ---: | ---: | ---: | ---: |
| Semiconductor Back-end Solutions (SBS) | 73.5% | 74.0% | 70.2% | 69.9% |
| Industrial Electronics (IE) | 26.4% | 25.9% | 29.7% | 30.0% |
| Others | 0.1% | 0.1% | 0.1% | 0.1% |
| Total | 100% | 100% | 100.0% | 100.0% |

Revenue for the three and nine months ended March 31, 2025 was $7,384 and $25,802, respectively, a decrease of $3,014 and $6,764, respectively, when compared to the revenue of $10,398 and $32,566 for the same period of Fiscal 2024. As a percentage, revenue decreased by 29.0% and 20.8% for the three and nine months ended March 31, 2025, when compared to revenue for the same period of Fiscal 2024.

Revenue within our two current segments for the three and nine months ended March 31, 2025, is discussed below.

### Semiconductor Back-end Solutions (SBS)

Revenue in the SBS segment as a percentage of total revenue was 73.5% and 70.2% for the three and nine months ended March 31, 2025, a decrease of 0.5% and an increase of 0.3% of total revenue respectively, when compared to 74.0% and 69.9% in the same period of Fiscal 2024. Total SBS revenue decreased by $2,272 to $5,425 from $7,697 and decreased by $4,656 to $18,113 from $22,769 for the three and nine months ended March 31, 2025, respectively.

\- 31 -

SBS experienced a decline in revenue from its China and Singapore operations. The weakened demand for testing services in China was driven by the broader market downturn and ongoing trade tensions between China and the U.S. However, demand appears to be shifting from China to other countries in the region, benefiting the Malaysia and Thailand operations. Malaysia's revenue demonstrated year-on-year growth for both the three-month and nine-month periods ended March 31, 2025, compared to the same timeframe in the previous fiscal year. Similarly, revenue in Thailand trended upward in the third quarter of Fiscal 2025, indicating early signs of recovery from the cyclical downturn. The increase in revenue noted from Malaysia and Thailand operations has not fully mitigated the revenue contraction in China, and until trade tensions ease and macroeconomic conditions stabilize, we may continue to experience weakened revenue in our SBS segment.

The contraction in manufacturing sales in Singapore is similarly primarily driven by the overall market downturn, reflecting the cyclical nature of the semiconductor industry—where phases of growth are often followed by periods of reduced demand, as observed in this fiscal year. The market remains highly sensitive to global economic shifts and changes in consumer demand, leading to fluctuations in performance. The decline in SBS segment demand underscores broader challenges across the customer base, where macroeconomic uncertainties and volatile external conditions have impacted financial performance.

Overall, the revenue decline in our SBS segment may be sustained in the short-term in the event the trade tensions between the U.S. and China continue and the resulting market downturn reflecting reduced consumer demand for semiconductors is not reversed. While external market dynamics are beyond the Company's control, proactive measures are being taken to align cost structures and operational capacity with current demand levels. The focus remains on preserving financial flexibility and ensuring the ability to efficiently scale operations when market conditions improve.

### Industrial Electronics (IE)

Revenue in the IE segment as a percentage of total revenue was 26.4% and 29.7% for the three and nine months ended March 31, 2025, representing an increase of 0.5% and a decrease of 0.3% respectively, compared to 25.9% and 30.0% in the same period of Fiscal 2024. Total IE revenue decreased by $745 from $2,695 to $1,950 and decreased by $2,113 from $9,778 to $7,665 for the three and nine months ended March 31, 2025, respectively, compared to the same period of Fiscal 2024

The decline in IE revenue was primarily due to lower sales of electronic components, impacted by temporary supply chain delays from our principal suppliers. These delays are timing-related, with recovery anticipated over the next few fiscal quarters. The Company’s production and inventory planning is guided by demand forecasts, which are complex and influenced by macroeconomic factors but allow flexibility to respond to changing market conditions. Although customers may reschedule orders on short notice or request short lead times, we continue to collaborate closely with suppliers to enhance responsiveness. The Company remains confident in its ability to navigate these challenges and is focused on strengthening supply chain agility and demand forecasting to support a sustained recovery.

### Uncertainties and Remedies

There are several influencing factors which create uncertainties when forecasting performance, such as the changing nature of technology, specific customer requirements, decline in demand for certain types of burn-in devices or equipment, decline in demand for testing services and fabrication services, and other factors. One factor that influences uncertainty is the highly competitive nature of the semiconductor industry. Additionally, certain customers are unable to provide a forecast of the products required in the upcoming weeks, rendering it, difficult to plan adequate resources needed to meet these customers’ requirements because of short lead time and last-minute order confirmation. This will normally result in a lower margin for these products as it is often more expensive to purchase materials in a short time frame. However, the Company has taken certain actions and formulated certain plans to deal with and to help mitigate these unpredictable factors. For example, to meet manufacturing customers’ demands upon short notice, the Company maintains higher inventories but continues to work closely with its customers to avoid stockpiling. We believe that we have improved customer service through our efforts to keep our staff up to date on the newest technology and stressing the importance of understanding and meeting the stringent requirements of our customers. Finally, the Company is exploring new markets and products, looking for new customers, and upgrading and improving burn-in technology while at the same time searching for improved testing methods for higher technology chips.

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The Company’s primary exposure to movements in foreign currency exchange rates relates to non-U.S. dollar-denominated sales and operating expense in its subsidiaries. Strengthening of the United States dollar (“U.S. Dollar”) relative to foreign currencies adversely affects the U.S. Dollar value of the Company’s foreign currency-denominated sales and earnings, and generally leads the Company to raise international pricing, potentially reducing demand for the Company’s products. Margins on sales of the Company’s products in foreign countries and on sales of products that include components obtained from foreign suppliers could be materially adversely affected by foreign currency exchange rate fluctuations. In some circumstances, for competitive or other reasons, the Company may decide not to raise local prices to fully offset the U.S. Dollar’s strengthening, or at all, which would adversely affect the U.S. Dollar value of the Company’s foreign currency-denominated sales and earnings. Conversely, a strengthening of foreign currencies relative to the U.S. Dollar, recently observed as a result of current U.S. economic and trade policies, while generally beneficial to the Company’s foreign currency denominated sales and earnings, could cause the Company to reduce international pricing, thereby limiting the benefit. Additionally, strengthening of foreign currencies may also increase the Company’s cost of product components denominated in those currencies, thus adversely affecting gross margins.

We may experience supply shortages as well as inflationary cost pressures in at least the near term. Risks and uncertainties related to supply chain challenges, and inflationary pressures may continue to negatively impact our revenue and gross margin. We continue to monitor and evaluate the business impact to react proactively.

On August 9, 2022, the CHIPS and Science Act of 2022 (“CHIPS Act”) was enacted in the U.S. The CHIPS Act will provide financial incentives to the semiconductor industry which are primarily directed at manufacturing activities within the U.S. We continue to evaluate the business impact and potential opportunities related to the CHIPS Act. As of date, we do not see any direct effect of the CHIPS Act on the Company in the foreseeable future.

The recent U.S. tariff regime announced in April 2025 could potentially influence downstream demand variability among our customers. While we have no direct significant exposure to these tariffs, secondary effects may arise if customers adjust their procurement strategies in response to trade policy changes. Based on our preliminary observations, demand appears to shift from China to other countries in the region. However, potential effects on macro demand in the future are far from clear, although we recognize the risk of revenue volatility should global demand continue to weaken due to the continued trade tensions between China and the U.S. and the potential that such continued trade tensions result in declining economic conditions. We continue to evaluate capacity adjustments in alignment with observable demand signals while maintaining operational flexibility to adapt to changing market conditions.

### Comparison of the Three Months Ended March 31, 2025, and March 31, 2024

The following table sets forth certain consolidated statements of income data as a percentage of revenue for the three months ended March 31, 2025 and 2024 respectively:

*(Unaudited)*

*(Unaudited)*

|  | Three Months Ended March 31, 2025 | 2024 |
| --- | ---: | ---: |
| **Revenue** | 100.0% | 100.0% |
| Cost of sales | 73.2% | 74.0% |
| **Gross Margin** | 26.8% | 26.0% |
| Operating expense |  |  |
| General and administrative | 28.0% | 22.6% |
| Selling | 2.9% | 2.0% |
| Research and development | 1.2% | 0.8% |
| (Gain) on disposal of property, plant and equipment | (0.7)% | 0.0% |
| Total operating expense | 31.4% | 25.4% |
| **(Loss) / Income from Operations** | (4.7)% | 0.6% |

### Overall Gross Margin

Overall gross margin as a percentage of revenue increased by 0.8% to 26.8% for the three months ended March 31, 2025, from 26.0% for the same period of Fiscal 2024. Gross profits decreased by $727 to $1,976 for the three months ended March 31, 2025, from $2,703 for the same period in Fiscal 2024.

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Gross profit margin as a percentage of revenue in the SBS segment decreased by 2.4% to 26.5% for the three months ended March 31, 2025, as compared to 28.8% for the same period in Fiscal 2024. In absolute dollar amounts, gross profit in the SBS segment for the three months ended March 31, 2025, was $1,436, a decrease of $784, compared to $2,220 in the same period in Fiscal 2024. Gross margin decreased as the revenue contraction outpaced our ability to proportionally reduce cost of sales. Specific structural costs comprising our cost of sales, such as indirect technical labor and equipment depreciation have limited scalability, resulting in a proportionally smaller reduction in cost of sales compared to the revenue decline, which amplified gross margin erosion.

Gross profit margin as a percentage of revenue in the IE segment increased by 9.8% to 28.1% for the three months ended March 31, 2025, from 18.3% for the same period in Fiscal 2024. In absolute dollar amounts, gross profit in the IE segment for the three months ended March 31, 2025, was $548, indicating an increase of $55, compared to $493 in the same period in Fiscal 2024. The gross profit margin improvement in the IE segment reflects a more favorable product mix of equipment sales this quarter, with higher-margin products accounting for a significantly larger proportion of total sales compared to previous periods. This shift in mix dynamics where higher-value products drive more revenue has lifted overall profitability. This is in contrast with same quarter in last Fiscal 2024 when margins were diluted by greater volume of lower-margin sales.

### Operating Expense

Operating expense for the three months ended March 31, 2025 and 2024 was as follows:

*(Unaudited)*

*(Unaudited)*

|  | Three Months Ended March 31, 2025 | 2024 |
| --- | ---: | ---: |
| General and administrative | $2,067 | $2,351 |
| Selling | 216 | 204 |
| Research and development | 90 | 89 |
| (Gain) on disposal of property, plant and equipment | (54) | - |
| **Total** | $2,319 | $2,644 |

General and administrative expense decreased by $284, or 12.1%, from $2,351 to $2,067 for the three months ended March 31, 2025, compared to the same period in Fiscal 2024. The decrease in general and administrative expense was mainly attributable to lower remuneration related and travel expense in the current quarter as compared to same period of Fiscal 2024, driven by our ongoing cost optimization initiatives in the testing operations.

Selling expense increased by $12, or 5.9%, from $204 to $216 for the three months ended March 31, 2025, compared to the same period in Fiscal 2024. The increase in selling expense was primarily attributable to an increase in commissions paid to agents for commission-based sales in the IE segment.

### (Loss) / Income from Operations

Loss from operations was $343 for the three months ended March 31, 2025, an unfavorable transition of $402, as compared to income of $59 from operations for the same period in Fiscal 2024. The transition from an income to loss was driven primarily by a large revenue decline in absolute terms, which outpaced the reduction of operating costs proportionately, due to the inherently fixed nature of its operating costs, where a substantial portion such as depreciation, remuneration, administrative and professional fees, remained structurally rigid and could not be scaled down dynamically to match the decline in revenue. Consequently, the revenue shortfall had an amplified impact on operating profitability as fixed costs were absorbed across a diminished revenue base.

\- 34 -

### Interest Expense

Interest expense for the three months ended March 31, 2025 and 2024 was as follows:

*(Unaudited)*

*(Unaudited)*

|  | Three Months Ended March 31, 2025 | 2024 |
| --- | ---: | ---: |
| Interest expense | $10 | $17 |

Interest expense was $10 for the three months ended March 31, 2025, a decrease of $7, or 41.2%, compared to $17 for the same period of Fiscal 2024 due to lower utilization of credit facilities and a reduction in outstanding loans. As of March 31, 2025, the Company had an unused line of credit of $5,797 as compared to $5,794 as at March 31, 2024.

### Other (Expense) / Income

Other (Expense) / Income for the three months ended March 31, 2025 and 2024 was as follows:

*(Unaudited)*

*(Unaudited)*

|  | Three Months Ended March 31, 2025 | 2024 |
| --- | ---: | ---: |
| Interest income | $74 | $88 |
| Other rental income | 29 | 29 |
| Exchange (loss) / gain | (251) | 113 |
| Other miscellaneous income | 4 | 22 |
| **Total** | $(144) | $252 |

There was an unfavorable shift by $396 in other expense to $144 for the three months ended March 31, 2025 as compared to other income of $252 for the same period in Fiscal 2024. The shift was primarily driven by an unfavorable foreign currency movement, with unrealized exchange loss of $235, for the three months ended March 31, 2025, in contrast with exchange gain recorded for the same period in Fiscal 2024. Our net income is exposed to foreign exchange fluctuations as our subsidiaries' functional currencies differ from the U.S. dollar. For the three months ended March 31, 2025, the strengthening of the Singapore dollar against the U.S. dollar resulted in unrealized foreign exchange losses, primarily from the remeasurement of USD-denominated monetary assets and liabilities.

### Government Grant

*(Unaudited)*

*(Unaudited)*

|  | Three Months Ended March 31, 2025 | 2024 |
| --- | ---: | ---: |
| Government Grant | $22 | $12 |

In the three months ended March 31, 2025, the Company received government grants amounting to $22, $19 of which was an incentive from the Singapore government for local resident recruitment, and $3 related to capital expenditure subsidy received from the China government.

During the same period in Fiscal 2024, the Company received government grants amounting to $12, $7 of which was an incentive from the Singapore government for local resident recruitment, and $5 related to capital expenditure subsidy received from the China government.

\- 35 -

### Income Tax Expense

The Company's income tax expense was $6 and $142 for the three months ended March 31, 2025, and 2024, respectively. Income tax expense declined in line with lower chargeable income attributable to the revenue decrease.

### Non-controlling Interest

As of March 31, 2025, we held a 55% interest in Trio-Tech (Malaysia) Sdn. Bhd., SHI International Pte. Ltd., and 52% interest in PT. SHI Indonesia. We also held a 76% interest in Prestal Enterprise Sdn. Bhd and 51% interest in Trio-tech JiangSu Co. Ltd. The share of non-controlling interest in the net income from the subsidiaries for the three months ended March 31, 2025 was $19 compared to the share of income from the non-controlling interest of $93 for the same period of Fiscal 2024. The decrease in net income shared by non-controlling interest in the subsidiaries was attributable to the decrease in net income generated by the Company’s China operations.

### Net (Loss) / Income Attributable to Trio-Tech International Common Shareholders

Net loss attributable to Company’s common shareholders was $495 for the three months ended March 31, 2025, compared to a net income of $70 for the same period in Fiscal 2024.

### Loss / Earnings per Share

Basic loss per share from continuing operations were $0.12 for three months ended March 31, 2025 as compared to basic earnings per share of $0.02 for the same period of Fiscal 2024. Basic earnings per share from discontinued operations were $nil for three months ended March 31, 2025 and March 31, 2024 respectively.

Diluted loss per share from continuing operations were $0.12 for three months ended March 31, 2025 as compared to diluted earnings per share of $0.02 for the same period of Fiscal 2024. Diluted earnings per share from discontinued operations were $nil for three months ended March 31, 2025 and March 31, 2024.

### Segment Information

The revenue, gross margin, and (loss) / income from operations for each segment during the third quarter of Fiscal 2025 and Fiscal 2024 are presented below. As the revenue and gross margin for each segment were discussed in the previous section, only the comparison of (loss) / income from operations is discussed below.

### Semiconductor Back-end Solutions (SBS)

The revenue, gross margin and income from operations for the SBS segment for the three months ended March 31, 2025 and 2024 were as follows:

*(Unaudited)*

*(Unaudited)*

|  | Three Months Ended March 31, 2025 | 2024 |
| --- | ---: | ---: |
| **Revenue** | $5,425 | $7,697 |
| **Gross margin** | 26.5% | 28.8% |
| **(Loss) / Income from operations** | $(3) | $412 |

Loss from operations from the SBS segment was $3 compared to income from operations of $412 in the same period in Fiscal 2024. The shift from an income to a loss from operations was due to a decrease in revenue and gross profit in absolute dollar amounts. Operating expense decreased from $1,808 for the three months ended March 31, 2024 to $1,439 for the three months ended March 31, 2025. Although operating expense declined, the sharper drop in revenue, coupled with the fixed-cost nature of general and administrative expenses, led to an operating loss for the three months ended March 31, 2025, a reversal compared to an operating income for the three months ended March 31, 2024. The bulk of these operating costs, which are largely inflexible to revenue fluctuations, could not adjust proportionally to the top-line contraction.

\- 36 -

### Industrial Electronics (IE)

The revenue, gross margin, and (loss) / income from operations for the IE segment for the three months ended March 31, 2025 and 2024 were as follows:

*(Unaudited)*

*(Unaudited)*

|  | Three Months Ended March 31, 2025 | 2024 |
| --- | ---: | ---: |
| **Revenue** | $1,950 | $2,695 |
| **Gross margin** | 28.1% | 18.3% |
| **Income from operations** | $- | $26 |

The IE segment reach breakeven for the three months ended March 31, 2025, a decline of $26 from income from operations of $26 in the same period in Fiscal 2024. The decline was mainly attributable to a decrease in revenue and gross profit in absolute dollar amounts. Operating expense increased from $467 for the three months ended March 31, 2024 to $548 for the three months ended March 31, 2025. While gross margins improved, the significant decline in revenue was insufficient to offset the impact of operating expenses, where costs are primarily fixed in nature. As a result, the current quarter ended with a breakeven operating performance, a shift from the operating income for the three months ended March 31, 2024.

### Comparison of the Nine Months Ended March 31, 2025, and March 31, 2024

The following table sets forth certain consolidated statements of income data as a percentage of revenue for the nine months ended March 31, 2025 and 2024 respectively:

|  | Nine Months Ended March 31, 2025 | March 31, 2024 |
| --- | ---: | ---: |
| **Revenue** | 100.0% | 100.0% |
| Cost of sales | 74.7% | 75.2% |
| **Gross Margin** | 25.3% | 24.8% |
| Operating expense: |  |  |
| General and administrative | 23.2% | 19.5% |
| Selling | 2.1% | 2.0% |
| Research and development | 1.1% | 0.9% |
| (Gain) / Loss on disposal of property, plant and equipment | (0.4)% | 0.2% |
| Total operating expense | 26.1% | 22.6% |
| **Income from Operations** | **(0.8)%** | **2.2%** |

### Overall Gross Margin

Overall gross margin as a percentage of revenue increased marginally by 0.5% to 25.3% for the nine months ended March 31, 2025, from 24.8% for the same period of Fiscal 2024. Gross profits decreased by $1,561 to $6,516 for the nine months ended March 31, 2025, from $8,077 for the same period in Fiscal 2024.

\- 37 -

Gross profit margin as a percentage of revenue in the SBS segment increased by 0.7% to 27.4% for the nine months ended March 31, 2025, as compared to 26.7% for the same period in Fiscal 2024. Despite the revenue contraction, gross profit margin improved slightly, mainly due to the completion of asset depreciation cycles in our China operations, lowering the cost of sales. Going forward, the Company remains focused on prioritizing cost control measures amid a challenging demand environment. In absolute dollar amounts, gross profit in the SBS segment for the nine months ended March 31, 2025, was $4,972, a decrease of $1,110, compared to $6,082 in the same period in Fiscal 2024. The decrease in absolute dollar of gross profit is attributed to the decline in revenue.

Gross profit margin as a percentage of revenue in the IE segment decreased by 0.2% to 20.5% for the nine months ended March 31, 2025, compared to 20.7% in the same period in Fiscal 2024. In absolute dollar amounts, gross profit in the IE segment for the nine months ended March 31, 2025, was $1,572, indicating a decrease of $456, compared to $2,028 in the same period in Fiscal 2024. The gross profit margin contraction was mainly driven by reduced demand and a sales mix with comparatively lower margins. The segment's inherent cost structure further pressured margins, as a portion of the cost of sales consists of fixed costs that, when allocated across lower revenue, result in the decline in gross profit margin.

### Operating Expense

Operating expense for the nine months ended March 31, 2025 and 2024 was as follows:

*(Unaudited)*

*(Unaudited)*

|  | Nine Months Ended March 31, 2025 | March 31, 2024 |
| --- | ---: | ---: |
| General and administrative | $5,996 | $6,326 |
| Selling | 542 | 639 |
| Research and development | 292 | 305 |
| (Gain) / Loss on disposal of property, plant and equipment | (101) | 72 |
| **Total** | $6,729 | $7,342 |

General and administrative expense decreased by $330, or 5.2%, from $6,326 to $5,996 for the nine months ended March 31, 2025, compared to the same period in Fiscal 2024. The decrease in general and administrative expense was mainly attributable to lower remuneration related expense.

Selling expense decreased by $97, or 15.2%, from $639 to $542 for the nine months ended March 31, 2025, compared to the same period in Fiscal 2024. The decrease in selling expense was mainly due to lower commission costs, driven by a decline in commissionable revenue.

### (Loss) / Income from Operations

Loss from operations was $213 for the nine months ended March 31, 2025, an unfavorable shift of $948, compared to income of $735 from operations for the same period in Fiscal 2024. The decrease was mainly due to lower revenue and gross profit in absolute dollars amount across all business segments.

### Interest Expense

Interest expense for the nine months ended March 31, 2025 and 2024 was as follows:

*(Unaudited)*

*(Unaudited)*

|  | Nine Months Ended March 31, 2025 | March 31, 2024 |
| --- | ---: | ---: |
| Interest expense | $36 | $63 |

Interest expense was $36 for the nine months ended March 31, 2025, a decrease of $27, or 42.9%, compared to $63 for the same period of Fiscal 2024 due to lower utilization of credit facilities and a reduction in outstanding loans over the period.

\- 38 -

### Other Income

Other Income for the nine months ended March 31, 2025 and 2024 was as follows:

*(Unaudited)*

*(Unaudited)*

|  | Nine Months Ended March 31, 2025 | March 31, 2024 |
| --- | ---: | ---: |
| Interest income | $257 | $262 |
| Other rental income | 109 | 101 |
| Exchange gain / (loss) | (207) | (64) |
| Other miscellaneous income | 18 | 67 |
| **Total** | $177 | $366 |

Other income decreased by $189 from $366 to $177 for the nine months ended March 31, 2025 compared to the same period in Fiscal 2024. The decrease was primarily driven by a larger unfavorable foreign currency impact, with an unrealized translation effect of $135 for the nine months ended March 31, 2025.

### Government Grant

*(Unaudited)*

*(Unaudited)*

|  | Nine Months Ended March 31, 2025 | 2024 |
| --- | ---: | ---: |
| Government Grant | $93 | $89 |

In the nine months ended March 31, 2025, the Company received government grants amounting to $93, $81 of which was an incentive from the Singapore government for local resident recruitment, and $12 related to capital expenditure subsidy received from the China government.

During the same period in Fiscal 2024, the Company received government grants amounting to $89, $19 of which was financial assistance received from the Singapore government for local resident recruitment, $12 related to capital expenditure subsidy received from the China government and $57 from the U.S. government related to Employee Retention Credit (“ERC”).

### Income Tax Expense

The Company's income tax expense was $196 and $274 for the nine months ended March 31, 2025, and 2024, respectively. Income tax expense decreased due to lower chargeable income resulting from the decrease in revenue discussed above.

### Non-controlling Interest

As of March 31, 2025, we held a 55% interest in Trio-Tech (Malaysia) Sdn. Bhd., SHI International Pte. Ltd., and 52% interest in PT. SHI Indonesia. We also held a 76% interest in Prestal Enterprise Sdn. Bhd and 51% interest in Trio-tech JiangSu Co. Ltd. The share of non-controlling interest in the net income from the subsidiaries for the nine months ended March 31, 2025 was $54 compared to the share of income from the non-controlling interest of $49 for the same period of Fiscal 2024. The increase in the net income shared by non-controlling interest in the subsidiaries was attributable to the increase in net income generated by the Company’s China and Malaysia operations.

### Net (Loss) / Income Attributable to Trio-Tech International Common Shareholders

Net loss attributable to Company’s common shareholders was $224 for the nine months ended March 31, 2025, a negative swing of $1,031, compared to a net income of $807 for the same period in Fiscal 2024.

\- 39 -

### Loss / Earnings per Share

Basic loss per share from continuing operations was $0.05 for nine months ended March 31, 2025 as compared to basic earnings per share of $0.19 for the same period of Fiscal 2024. Basic earnings per share from discontinued operations were $nil for nine months ended March 31, 2025 and March 31, 2024 respectively.

Diluted loss per share from continuing operations were $0.05 for nine months ended March 31, 2025 as compared to diluted earnings per share of $0.19 for the same period of Fiscal 2024. Diluted earnings per share from discontinued operations were $nil for nine months ended March 31, 2025 and March 31, 2024.

### Segment Information

The revenue, gross margin, and (loss) / income from operations for each segment for the nine months ended March 31, 2025 and 2024 are presented below. As the revenue and gross margin for each segment were discussed in the previous section, only the comparison of (loss) / income from operations is discussed below.

### Semiconductor Back-end Solutions (SBS)

The revenue, gross margin and income from operations for the SBS segment for the nine months ended March 31, 2025 and 2024 were as follows:

*(Unaudited)*

*(Unaudited)*

|  | Nine Months Ended March 31, 2025 | March 31, 2024 |
| --- | ---: | ---: |
| **Revenue** | $18,113 | $22,769 |
| **Gross margin** | 27.4% | 26.7% |
| **Income from operations** | $271 | $714 |

Income from operations from the SBS segment was $271 compared to income from operations of $714 in the same period in Fiscal 2024. The decrease in income from operations was mainly due to a decrease in revenue in absolute dollar amounts. Operating expense was $4,701 and $5,368 for the nine months ended March 31, 2025 and 2024, respectively. The decrease in operating expense was mainly due to a gain from disposal of fixed asset, lower performance-based remunerations and also lower selling expenses for the nine months ended March 31, 2025 compared to the same period in Fiscal 2024.

### Industrial Electronics (IE)

The revenue, gross margin, and (loss) / income from operations for the IE segment for the nine months ended March 31, 2025 and 2024 were as follows:

*(Unaudited)*

*(Unaudited)*

|  | Nine Months Ended March 31, 2025 | March 31, 2024 |
| --- | ---: | ---: |
| **Revenue** | $7,665 | $9,778 |
| **Gross margin** | 20.5% | 20.7% |
| **(Loss) / Income from operations** | $(30) | $510 |

Loss from operations in the IE segment for the nine months ended March 31, 2025, was $30, a decline of $540 as compared to income from operations of $510 in the same period in Fiscal 2024. The decline was mainly attributable to a decrease in gross profit in absolute dollar amounts. Operating expense was $1,602 and $1,518 for the nine months ended March 31, 2025 and 2024, respectively.

\- 40 -

### Financial Condition

During the nine months ended March 31, 2025, total assets decreased by $2,581 to $39,959 compared to $42,540 as of June 30, 2024. The decrease was primarily due to a decrease in trade accounts receivable, inventories, operating lease right-of-use assets and property, plant and equipment, which was partially offset by an increase in cash and cash equivalents and other receivables.

Cash and cash equivalents were $11,020 at March 31, 2025, reflecting an increase of $985 from $10,035 at June 30, 2024. The net increase in cash equivalents was partially attributable to proceeds received from the exercise of director and employee stock options in the current quarter and also from favorable changes in working capital.

The trade accounts receivable balance as of March 31, 2025 decreased by $1,696 to $8,965, from $10,661 at June 30, 2024, primarily due to the decrease in revenue between June 30, 2024 and March 31, 2025. The number of days’ sales outstanding in accounts receivables for the group was 103 days and 90 days for the third quarter of Fiscal 2025 and the end of Fiscal 2024, respectively.

Other receivables at March 31, 2025, were $885, an increase of $344, compared to $541 at June 30, 2024. The increase was mainly due to recognition of deferred costs and advance payments made to our suppliers for goods and services in our Singapore and Malaysia operations. These are recorded as assets that deliver future economic benefits, with sales expected to be realized upon fulfilment in subsequent fiscal quarters.

Inventories at March 31, 2025, were $2,240, a decrease of $922, compared to $3,162 at June 30, 2024. The decrease in inventories was the result of maintenance of a conservative inventory level with the softer demand outlook, with the net reduction primarily reflecting utilization of existing stock for fulfilment of orders in our Singapore operations.

Prepaid expense was $473 at March 31, 2025 compared to $536 at June 30, 2024. Prepaid expense mainly comprises insurance, rental and software license fees. The decrease reflect timing differences in expense recognition where the variance arises from scheduled amortization of prior-period prepayments, offset by lower new prepayment additions.

Investment properties’ net in China was $357 at March 31, 2025 and $407 at June 30, 2024. The decrease was primarily due to the depreciation charged and foreign currency exchange movement between June 30, 2024 and March 31, 2025.

Property, plant and equipment decreased by $408 from $5,937 at June 30, 2024, to $5,529 at March 31, 2025, mainly due to depreciation charged for the period and asset disposals.

Other assets decreased by $111 to $121 at March 31, 2025 compared to $232 at June 30, 2024. Other assets mainly comprise of rental and utilities deposits.

Accounts payable decreased by $1,217 to $1,958 at March 31, 2025, compared to $3,175 at June 30, 2024. The decrease aligns with reduced procurement activity, consistent with lower inventory levels and softer revenue performance, as operational needs were scaled down.

Accrued expense decreased by $1,138 to $2,496 at March 31, 2025, as compared to $3,634 at June 30, 2024. The decrease in accrued expense was mainly due to payments made out of provisions and a decrease in accrued purchases.

Contract liabilities decreased by $81 to $673 at March 31, 2025 as compared to $754 at June 30, 2024. The decrease in contract liabilities is mainly due to fulfillment of services in our Singapore and China operations, where services were delivered against customer deposits received in prior periods.

\- 41 -

Bank loans payable decreased by $145 to $729 as of March 31, 2025, as compared to $874 as of June 30, 2024. The decrease was mainly due scheduled debt repayments, absence of new loan arrangements coupled with foreign currency exchange movement between June 30, 2024 and March 31, 2025.

Finance leases decreased by $46 to $45 at March 31, 2025, as compared to $91 at June 30, 2024. This was due to the repayments of leases in our Singapore and Malaysia operations, with no new lease additions during the period between June 30, 2024 and March 31, 2025.

Operating lease right-of-use assets and the corresponding lease liability decreased by $782 to $1,105 at March 31, 2025, as compared to $1,887 at June 30, 2024. This was due to operating lease expense charged for the period and also partially driven by a shift in our business model in one of our China operations, resulting in a decrease in operating lease right-of-use assets and the corresponding lease liabilities due to the reduced need for space. The decrease is partially offset by lease renewals for our Singapore office.

Other non-current liabilities increased to $30 as at March 31, 2025, as compared to $27 at June 30, 2024.

### Liquidity Comparison

Net cash provided by operating activities decreased by $1,483 to an inflow of $1,035 for the nine months ended March 31, 2025, from an inflow of $2,518 for the same period in Fiscal 2024. The decrease in net cash provided by operating activities was primarily due to higher payments to trade creditors by $2,899 and lower depreciation of $1,453 for the nine months ended March 31, 2025 as compared to the nine months ended March 31, 2024. This was partially offset by higher cash inflow from collections of trade receivables and changes in inventory levels for the nine months ended March 31, 2025 with a difference of $1,953 and $1,453 respectively, compared to the same period in Fiscal 2024.

Net cash used in investing activities was $101 for the nine months ended March 31, 2025 a variance of $557 compared to net cash provided by investing activities of $456 for the same period in Fiscal 2024. This was primarily due to a higher net withdrawal from unrestricted term deposits upon maturity for the nine months ended March 31, 2024, and were held for working capital purposes. This was also due to higher capital expenditures during the nine months ended March 31, 2025 as compared to the nine months ended March 31, 2024.

Net cash used in financing activities for the nine months ended March 31, 2025, was $96, representing a decrease of $18, compared to cash outflow of $78 during the nine months ended March 31, 2024. The changes in cashflow from financing activities was mainly due to lesser proceeds from stock option exercise for the nine months ended March 31, 2024 as compared to the nine months ended March 31, 2025.

## Controls and procedures

As filed, 878 characters.

An evaluation was carried out by the Company’s Chief Executive Officer and Chief Financial Officer of the effectiveness of the Company’s disclosure controls and procedures (as defined in Rule 13a-15(e) or 15d-15(e) under the Securities Exchange Act of 1934, as amended) as of March 31, 2025, the end of the period covered by this Form 10-Q. Based upon that evaluation, the Chief Executive Officer and Chief Financial Officer concluded that these disclosure controls and procedures were effective at a reasonable level.

### Changes in Internal Control Over Financial Reporting

There has been no change in the Company’s internal control over financial reporting during the fiscal quarter ended March 31, 2025, that have materially affected, or are reasonably likely to materially affect, the Company’s internal control over financial reporting.

\- 42 -

### TRIO-TECH INTERNATIONAL

Filed May 13, 2025.
Source: SEC EDGAR, the filing index for accession 0001437749-25-016318. Last ingested by Listed: Oct 26, 2026, 09:24 ET. No prices; not investment advice.