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Annual Report 2023 A New Era in Navigation
TO OUR SHAREHOLDERS, CUSTOMERS, SUPPLIERS, AND EMPLOYEES Fiscal 2023 saw the completion of EMCORE s transition to a pure-play Aerospace & Defense (A&D) Inertial Navigation company. In April 2023, we announced the final phase of the restructuring program that would see us exit our non-strategic broadband (cable TV, wireless, sensing, and chips) and defense optoelectronics business segments. This restructuring materially reduced our annual costs and expenses with a reduction in workforce and facility space at our Alhambra headquarters. Our final objective for broadband was to serve our customers' last-time buy requirements and ensure an orderly exit from the business for customers and employees alike, and in August 2023, we announced the anticipated sale of the broadband and defense optoelectronics businesses to Photonics Foundries, Inc. The sale was completed in October 2023. In the March 2023 quarter, EMCORE s Inertial Navigation revenue grew 21% to $24.3 million compared to the prior quarter, representing over 90% of the company s revenue. By 2023 fiscal year-end, EMCORE's Inertial Navigation revenue had grown for six consecutive quarters, producing GAAP gross margin of 26% in the quarter ended September 30, 2023, building on a foundation for sustained revenue growth and expected profitability in Inertial Navigation we established in fiscal 2022. We ve continued the integration of our operations across all of our facilities in Budd Lake, Tinley Park, Concord, and Alhambra, to operate all of our manufacturing like a single entity. Our facilities are expected to all be on common ERP, MES, and PLM systems within fiscal 2024 and we are realizing the benefits of scale and efficiency of completed integrations. We ve also begun an initiative to leverage our state-of-the-art inertial measurement unit (IMU) and inertial navigation system (INS) architecture from Budd Lake across the entire company. A singular focus on this common architecture is expected to streamline our operations, reduce development expenses, and improve our ability to create new component technologies, which is key to achieving favorable gross margins in the Inertial Navigation business. Highlights From Fiscal 2023 Awarded long-term supply partnership by Kratos for multiple unmanned aerial defense programs, including the XQ-58 Valkyrie Introduced the new TAC-440 MEMS inertial measurement unit, the world s smallest 1 /hour IMU Directly awarded additional business by the U.S. Navy for the MK 48 heavyweight torpedo Delivered BoRG units for the successful first flight of the United Launch Alliance (ULA) Vulcan rocket mission to the moon Awarded full-range production orders for BAE s armored multipurpose vehicle program Completed two public offerings of common stock totaling $34.25 million in gross proceeds We continue to be extremely proud to support some of the most mission-critical A&D programs in the world right now, including HIMARS (High-Mobility Artillery Rocket System) operating in Ukraine, Raytheon's advanced electro-optical/infrared (EO/IR) pods for mast-mounted systems (MMS), for which we are completing preproduction units, and for Raytheon s MTS (Multi-Spectral Targeting System) in the ball of the Predator UAV. EMCORE continues to play an important role in the defense of the country and our allies. We recognize the responsibility we carry and have the expertise, commitment, and resources to continue to deliver the highest precision components and systems for these critical defense programs. I would like to congratulate and thank the EMCORE team for completing the transformation of the company into the world s largest independent provider of inertial navigation solutions to the aerospace and defense industry. On behalf of EMCORE s management team and Board of Directors, I would also like to thank our shareholders, customers, and suppliers for their continued support. I look forward to updating you on our progress going forward. Respectfully, Jeffrey Rittichier President & Chief Executive Officer Please refer to our Company s forward-looking statements disclosure under Cautionary Note Regarding Forward-Looking Statements in our Form 10-K included herein.
 • shareholder letter icon 1/26/2024 Letter Continued (Full PDF)
 • stockholder letter icon 2/22/2023 EMKR Stockholder Letter
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EMKR Shareholder/Stockholder Letter Transcript:

Annual Report
2023
A New Era in Navigation

TO OUR SHAREHOLDERS, CUSTOMERS, SUPPLIERS, AND EMPLOYEES
Fiscal 2023 saw the completion of EMCORE   s transition to a pure-play Aerospace & Defense (A&D) Inertial Navigation
company. In April 2023, we announced the final phase of the restructuring program that would see us exit our non-strategic
broadband (cable TV, wireless, sensing, and chips) and defense optoelectronics business segments. This restructuring
materially reduced our annual costs and expenses with a reduction in workforce and facility space at our Alhambra headquarters. Our final objective for broadband was to serve our customers' last-time buy requirements and ensure an orderly
exit from the business for customers and employees alike, and in August 2023, we announced the anticipated sale of the
broadband and defense optoelectronics businesses to Photonics Foundries, Inc. The sale was completed in October 2023.
In the March 2023 quarter, EMCORE   s Inertial Navigation revenue grew 21% to $24.3 million compared to the prior quarter,
representing over 90% of the company   s revenue. By 2023 fiscal year-end, EMCORE's Inertial Navigation revenue had grown
for six consecutive quarters, producing GAAP gross margin of 26% in the quarter ended September 30, 2023, building on a
foundation for sustained revenue growth and expected profitability in Inertial Navigation we established in fiscal 2022.
We   ve continued the integration of our operations across all of our facilities in Budd Lake, Tinley Park, Concord, and Alhambra,
to operate all of our manufacturing like a single entity. Our facilities are expected to all be on common ERP, MES, and PLM
systems within fiscal 2024 and we are realizing the benefits of scale and efficiency of completed integrations. We   ve also
begun an initiative to leverage our state-of-the-art inertial measurement unit (IMU) and inertial navigation system (INS)
architecture from Budd Lake across the entire company. A singular focus on this common architecture is expected to
streamline our operations, reduce development expenses, and improve our ability to create new component technologies,
which is key to achieving favorable gross margins in the Inertial Navigation business.
Highlights From Fiscal 2023
    Awarded long-term supply partnership by Kratos for multiple unmanned aerial defense programs, including the
XQ-58 Valkyrie
    Introduced the new TAC-440 MEMS inertial measurement unit, the world   s smallest 1  /hour IMU
    Directly awarded additional business by the U.S. Navy for the MK 48 heavyweight torpedo
    Delivered BoRG units for the successful first flight of the United Launch Alliance (ULA) Vulcan rocket mission to the moon
    Awarded full-range production orders for BAE   s armored multipurpose vehicle program
    Completed two public offerings of common stock totaling $34.25 million in gross proceeds
We continue to be extremely proud to support some of the most mission-critical A&D programs in the world right now,
including HIMARS (High-Mobility Artillery Rocket System) operating in Ukraine, Raytheon's advanced electro-optical/infrared
(EO/IR) pods for mast-mounted systems (MMS), for which we are completing preproduction units, and for Raytheon   s MTS
(Multi-Spectral Targeting System) in the ball of the Predator UAV. EMCORE continues to play an important role in the defense
of the country and our allies. We recognize the responsibility we carry and have the expertise, commitment, and resources to
continue to deliver the highest precision components and systems for these critical defense programs.
I would like to congratulate and thank the EMCORE team for completing the transformation of the company into the world   s
largest independent provider of inertial navigation solutions to the aerospace and defense industry. On behalf of EMCORE   s
management team and Board of Directors, I would also like to thank our shareholders, customers, and suppliers for their
continued support. I look forward to updating you on our progress going forward.
Respectfully,
Jeffrey Rittichier
President & Chief Executive Officer
Please refer to our Company   s forward-looking statements disclosure under    Cautionary
Note Regarding Forward-Looking Statements    in our Form 10-K included herein.



shareholder letter icon 1/26/2024 Letter Continued (Full PDF)
 

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