CPS Technologies Corporation

What they do

CPS engineers metal matrix composites (MMCs) that combine metals and ceramics for improved thermal conductivity, stiffness, weight reduction, and thermal expansion matching compared with conventional materials. It sells these components for high-speed trains, mass transit, HVDC power systems, electric and hybrid vehicles, wind turbines, satellites, and NASA Mars rovers. A second product line, hermetic packaging, supplies housings and heat spreaders for high-reliability power and communications modules used in avionics, GPS, and microprocessors. The company uses a build-to-order, highly customized manufacturing model and describes itself as a fully qualified supplier to many major global electronics OEMs.

Revenue drivers

• Metal matrix composite (MMC) components — Custom-engineered metal-and-ceramic parts sold into transportation, energy, automotive, electronics, and infrastructure applications; supported by proprietary Quickset and QuickCast manufacturing processes. The filings do not break out revenue by product line.
• Hermetic packaging — Housings and heat spreaders for high-reliability power and communications modules used in avionics, satellite, GPS, and high-performance chip applications where the cost of failure is high.
• HybridTech Armor — Lightweight, high-strength armor built with the company's MMC technology; selected as the crew-served weapons station solution for U.S. Navy aircraft carriers.
• Government R&D programs (SBIR/STTR) — Non-dilutive funded development resumed in 2022; the company reports multiple Phase I and Phase II awards, including three Phase II programs and five new Phase I SBIRs in 2025.

Recent performance

For the fiscal second quarter ended June 27, 2026, CPS reported revenue of $8.3 million versus $8.1 million in the prior-year period. Gross margin was 14.8%, down from 16.5%, and the company posted an operating loss of $(0.2) million compared with operating profit of $0.1 million a year earlier. Net income was just under $40,000, or $0.00 per diluted share, versus $0.1 million, or $0.01 per diluted share, in the quarter ended June 28, 2025. SG&A expenses rose approximately $0.3 million year-over-year. Second-quarter revenue of $8.3 million was above the $7.0 million reported for the quarter ended March 28, 2026, and gross margin improved 620 basis points sequentially per management.

Strategy

CPS aims to grow by selling advanced material solutions into a diversified set of high-growth markets, emphasizing applications where performance and reliability are critical. The company leans on proprietary MMC technology and its Quickset and QuickCast processes to create customized products it believes competitors cannot easily replicate. It continues funded development work, including a controlled fragmentation tungsten warhead program for the U.S. Army and a U.S. Navy-funded effort to reduce the weight of the Amphibious Combat Vehicle. Management says the company remains on course to build out and move to a new operating facility in coming quarters and is finalizing site negotiations. A completed secondary offering raised gross proceeds of $9.6 million to support the move, demand-related investments, and commercialization of new offerings.

Risks

• Customer concentration — Three customers accounted for approximately 64% of 2025 revenue, up from 58% in 2024, so the loss or reduction of any one could be difficult to replace.
• Lengthy, variable sales cycle — Sales cycles can run from several months to several years and require customers to evaluate and redesign end products, making financial results hard to forecast.
• Thin and volatile profitability — Second-quarter 2026 gross margin fell to 14.8% from 16.5% while SG&A rose about $0.3 million, producing a $(0.2) million operating loss and net income of just under $40,000.
• Facility transition execution — The company is still finalizing negotiations for a new operating site and plans to build out and move in coming quarters, a capital and operational undertaking following the $9.6 million secondary offering.

Outlook

Management said it is finalizing negotiations for the best available site to support growth and remains on course to build out and move to a new operating facility in coming quarters. CEO Brian Mackey cited strong demand across product lines, sequential margin recovery, and expanding opportunities, with the secondary offering funding the move and commercialization investments. The company described its pipeline as spanning defense, space, energy infrastructure, and commercial markets but did not provide quantitative revenue or earnings guidance.