GARDNER, Mass. - Precision Optics Corporation, Inc. (NASDAQ: POCI), a developer of optical instruments for medical and defense applications, has announced that its technology is integral to a newly FDA-cleared AI-powered surgical platform. The company's single-use endoscope imaging assembly is used in a robotic system designed to treat Benign Prostate Hyperplasia (BPH), a condition affecting the prostate gland.
The surgical robotics company, which focuses on urological treatments, has received FDA 510(k) clearance for its next-generation system, which incorporates artificial intelligence. Precision Optics CEO Dr. Joe Forkey expressed pride in the partnership and the role their micro-optics and digital imaging technologies played in meeting the device's technical and economic requirements.
Production deliveries of the endoscope imaging assembly have already commenced, fulfilling a portion of a $9 million order announced on May 9, 2024. With an estimated $3.6 million in product deliveries expected during the fiscal year ending June 2025, Precision Optics anticipates significant long-term growth from this collaboration.
The company's customer, already a key player in the BPH treatment market with its existing AI-driven robotic platform, is expected to further solidify its market position with this advanced system. Precision Optics is optimistic about the market's potential, forecasting a robust expansion and a possible several-fold increase in its business as the customer's success continues.
Founded in 1982, Precision Optics has been at the forefront of micro-optics and 3D imaging technology, catering to the healthcare and defense/aerospace industries. From concept to mass production, the company offers a range of services, including design, prototype, regulatory, and fabrication capabilities. Their work includes enabling minimally invasive surgical devices and supporting the growth of surgical robotic systems.
This announcement is based on a press release statement, which contains forward-looking statements about the company's future activities and market performance. These statements involve risks and uncertainties, and actual results may differ materially from those projected.
In other recent news, Precision Optics Corporation reported its fiscal year 2024 financial results, noting a revenue of $19.1 million. Despite experiencing operational challenges, this figure exceeded the company's pre-announced expectations. Precision Optics faced a revenue loss of $5.6 million from discontinued programs and a $1.5 million decline in the Ross Optical division. However, the company managed to secure a record production order of $9 million in May and saw a 24% year-over-year growth in product development revenue.
The company's CEO, Dr. Joe Forkey, remains optimistic about future growth, especially in the single-use medical devices market and the development of a new platform product. Precision Optics anticipates a strong start to Fiscal Year 2025, with a projected Q1 revenue between $4.2 million and $4.4 million. Furthermore, a significant $9 million production order is expected to contribute $3.6 million in revenue for fiscal 2025.
Despite a decrease in gross margins to 30% for the year and a reported net loss of $3 million for fiscal 2024, the company is leveraging its intellectual property to enhance product offerings. This approach aims to accelerate time to market and improve gross margins while maintaining customizability for clients. These recent developments highlight Precision Optics' resilience and strategic positioning for growth in the upcoming fiscal year.
InvestingPro Insights
Despite Precision Optics Corporation's (NASDAQ: POCI) recent technological achievement and promising partnership, the company's financial metrics and stock performance paint a complex picture. According to InvestingPro data, POCI's market capitalization stands at $24.51 million, reflecting its position as a smaller player in the medical technology sector.
InvestingPro Tips highlight that the stock has taken a significant hit recently, trading near its 52-week low. This downturn is evident in the 32.75% price decline over the past month and a substantial 39.21% drop in the last three months. These figures suggest that investors may be cautious about the company's near-term prospects, despite the positive news about its FDA-cleared technology.
The company's financial health shows some areas of concern. With a negative P/E ratio of -8.39 and an operating income margin of -14.26% for the last twelve months, POCI is currently not profitable. This aligns with the InvestingPro Tip indicating that the company has not been profitable over the last twelve months. However, it's worth noting that the gross profit margin stands at 30.35%, which could provide some cushion as the company works towards profitability.
Revenue for the last twelve months was reported at $19.1 million, with a year-over-year decline of 9.22%. This decrease in revenue, coupled with the recent stock performance, may explain the market's current sentiment towards POCI. However, the $9 million order mentioned in the article, with expected deliveries of $3.6 million in the coming fiscal year, could potentially improve these figures in future reports.
For investors considering POCI, it's important to note that the company operates with a moderate level of debt, which could provide some financial flexibility as it pursues growth opportunities. Additionally, the InvestingPro Fair Value for POCI is estimated at $4.12, compared to its previous closing price of $3.90, suggesting there might be some upside potential if the company can execute on its growth plans and improve its financial performance.
Readers interested in a more comprehensive analysis can find additional insights on InvestingPro, which offers 7 more tips for POCI beyond those mentioned here.
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