CVD Equipment Corporation

What they do

CVD designs, develops and manufactures chemical vapor deposition systems, gas control equipment, physical vapor transport (PVT) systems and thermal process equipment used to develop and produce materials and coatings. End markets are aerospace, compound semiconductor, semiconductor, battery energy storage, advanced industrial applications and research. The company has served advanced materials markets for over 40 years and, following the SDC sale and the 2024 cessation of MesoScribe, reports one segment: the CVD Equipment division.

Revenue drivers

• CVD Equipment systems (aerospace, semiconductor and industrial) — Equipment sales and contracts in progress, including aerospace ceramic matrix composite (CMC) coating systems; 2025 revenue fell 4.1% to $25.8 million partly on lower aerospace and industrial contract revenue.
• PVT systems (silicon carbide crystal growth) — PVT150/PVT200 reactor systems sold into silicon carbide and wide band gap research and production; in October 2025 CVD received an order for two PVT150 units from Stony Brook University's onsemi Silicon Carbide Crystal Growth Center.
• Non-system revenue — Parts, service and other non-system sales; in Q2 2026 a higher proportion of non-system revenue lifted gross margin to 16.8% from 14.1% a year earlier.
• PowderCoat systems — Powder coating equipment; Q2 2026 orders of $1.2 million included a $0.8 million PowderCoat 450 system order whose customer filed a prepackaged Chapter 11 after quarter-end.

Recent performance

Second quarter 2026 revenue from continuing operations was $2.0 million, down 42.6% from the prior-year quarter, with gross margin of 16.8% versus 14.1%. Orders were $1.2 million versus $1.5 million a year earlier, and backlog was $3.9 million at June 30, 2026 compared with $4.6 million at March 31, 2026. The net loss from continuing operations was $1.4 million, or $0.20 per share, versus a $1.3 million loss, or $0.19 per share, in the prior-year quarter. Net income including discontinued operations was $12.6 million for the quarter, reflecting the $13.9 million gain on the SDC divestiture. Cash was $23.5 million and long-term debt was zero at June 30, 2026.

Strategy

On November 6, 2025 the board approved a transformation plan that moved CVD Equipment from vertically integrated fabrication to outsourced fabrication of certain components to cut fixed costs. The SDC division was sold to a subsidiary of the Atlas Copco Group under a March 23, 2026 agreement; the sale closed April 1, 2026 for approximately $17.4 million, generating about $15.7 million of net cash proceeds before roughly $0.7 million of estimated income taxes payable in Q3 2026. CVD retained its Saugerties, New York facility and leases it to the acquirer for an initial two-year term. Management says it will use proceeds to enhance financial flexibility while evaluating strategic alternatives for the remaining CVD Equipment business and possible acquisitions of other product lines or businesses.

Risks

• Customer concentration — Two customers represented 27.6% and 13.7% of total 2025 revenues, so losing or deferring a major customer could materially reduce results.
• Order volatility and declining backlog — 2025 bookings fell to approximately $13.0 million from $28.1 million in 2024, backlog dropped from $19.4 million to $6.6 million, and Q2 2026 revenue fell 42.6% on lower system bookings.
• Customer credit event — After quarter-end, the customer behind the $0.8 million PowderCoat 450 order filed a prepackaged Chapter 11, and the company is evaluating the impact on that order, backlog, results and cash flows.
• Silicon carbide and policy exposure — Results depend on the silicon carbide wafer end market and are exposed to tariffs, trade policy changes, university funding reductions and government shutdowns that the company cited for lower 2025 bookings.

Outlook

Management says customer order levels continue to be adversely affected by broader economic and geopolitical uncertainty, while noting it remains engaged with customers and pursuing opportunities in its target markets. The company states it is maintaining a disciplined approach to capital allocation and expense control with a goal of creating long-term shareholder value. Following the SDC sale it continues to evaluate strategic alternatives for the CVD Equipment business, its product lines and facilities, as well as possible acquisitions. No specific revenue or earnings guidance is provided in the excerpts.