On this page of StockholderLetter.com we present the latest annual shareholder letter from FREQUENCY ELECTRONICS INC — ticker symbol FEIM. Reading current and past FEIM letters to shareholders can bring important insights into the investment thesis.

 •  9/4/2025 Letter Continued (Full PDF)
 •  9/8/2023 FEIM Stockholder Letter
 •  9/9/2024 FEIM Stockholder Letter
 •  More "Electronic Equipment & Products" Category Stockholder Letters
 •  FEIM Benford's Law Stock Score = 76

FEIM Shareholder/Stockholder Letter Transcript:

FREQUENCY
ELECTRONICS,
INC.
ANNUAL REPORT 2025

ABOUT FREQUENCY ELECTRONICS
FREQUENCY ELECTRONICS, INC. is a world leader in the design, development and
m
manufacture of high precision timing, frequency generation and RF control
p
products for space and terrestrial applications. FEI   s products are used in
ssatellite payloads and in other commercial, government and military systems
including C4ISR and electronic warfare, missiles, UAVs, aircraft, GPS, secure
communications, energy exploration and wireline
com
and wireless networks. Frequency has received over
awards of excellence for achievements in
100 awa
providing high performance electronic
pro
assemblies for over 150 space and DOD programs. The Company invests
signi   cant resources in research and development to expand its
capabilities and markets.
Frequency   s Mission Statement:
Our mission is to transform discoveries and demonstrations
made in research laboratories into practical, real-world
products. We are proud of a legacy which has delivered
precision time and frequency generation products, for space
and other world-changing applications that are unavailable from any other source. We aim to
continue that legacy while adapting our products and expertise to the needs of the future.
With a relentless emphasis on excellence in everything we do, we aim, in these ways, to create
value for our customers, employees, and stockholders.
Subsidiaries and Af   liates: FEI-Zyfer provides GPS and secure
timing (   SAASM   ) capabilities for critical military and commercial
applications; FEI-Elcom Tech provides Electronic Warfare (   EW   )
sub-systems and state-of-the-art RF microwave products.
Additional information is available on the Company   s website:
www.frequencyelectronics.com

FINANCIAL HIGHLIGHTS
For the years ended April 30:
2025
2024
Revenues
$ 69,811,000
$ 55,274,000
Net Income
$ 23,686,000
$ 5,594,000
$2.46
$0.59
9,614,536
9,431,264
$ 29,651,000
$ 27,325,000
Earnings per share (diluted)
Average number of common and
common equivalent shares (diluted)
At April 30:
Working Capital
Current Ratio
2.3 to 1
1.9 to 1
Total Assets
$ 93,737,000
$ 83,253,000
Stockholders    Equity
$ 55,620,000
$ 39,816,000
MARKET PRICES OF COMMON STOCK
The common stock of the Company is listed on the NASDAQ Global Market
under the symbol    FEIM.   
Fiscal Quarter
High Sale
Low Sale
$ 14.23
$ 8.62
Second Quarter
14.50
11.51
Third Quarter
20.33
12.47
Fourth Quarter
19.50
13.69
$ 7.25
$ 6.22
7.96
6.35
2025
First Quarter
2024
First Quarter
Second Quarter
Third Quarter
11.41
7.20
Fourth Quarter
11.35
9.15
Frequency Electronics, Inc. Annual Report 2025
1

2025 PRESIDENT   S LETTER TO STOCKHOLDERS
T H E F I S CA L Y E A R E N D I N G A PR I L 3 0 M A R K E D A N O T H E R PE R I O D O F S U S TA I N E D
G R OWT H F O R O U R CO M PA N Y. Revenue increased from $55 million in FY2024 to $70 million in
FY2025, while operating pro   t rose from $5 million to nearly $12 million during the same timeframe.
Our backlog at year-end stood at just over $70 million, a slight decrease from the previous year but still
historically strong.
We foresee continued long-term growth within our primary markets: space, navigation, secure
communication, and timing. Our technical expertise enables us to win new contracts and maintain
strong gross margins. The current administration in Washington has demonstrated strong support
for both space and defense initiatives. Although there are ongoing discussions regarding changes
to the space architecture and procurement processes, we have not observed any indications of
reduced overall spending. In fact, pronouncements regarding additional spending on space-related
programs and the Department of Defense   s July announcement regarding bolstering the U.S. drone
manufacturing base and expanding the use of drones for military units and training programs, are
signi   cant positives for the future of our business.
One reason for this increased attention on space is that it is ever more clear that space is no longer
the safe, un-contested environment which the nation has operated in for the last 70 years. In addition
to the demonstrated ability to jam and spoof signals from our satellites, it is clear that the satellites
themselves are vulnerable to direct attack from our adversaries. This fact is accelerating the need
to change the space architecture from one with a few exquisite billion-dollar satellites designed to
operate in space for 20 years, to one in which a much larger number of much less expensive satellites
perform the same functions, and are continuously replaced, potentially with updated technology, after
2 to 5 years. The Company is actively involved in this transition, with work underway on several funded
programs, and we are bidding on several others. We    rmly believe that in the long run, technology
applications in the space environment will depend on this architecture, and are actively developing
variants of our core products targeted at this concept. This new architecture holds the promise of
continuous, long-term production of space hardware, in contrast to the sporadic, cyclical development/
production of space hardware we are used to with billion-dollar space vehicles. Coupled with an overall
growth in the use of space for commercial purposes, this represents a solid growth opportunity for the
Company, and potentially a future that has less lumpy revenue patterns than those we have exhibited
in the past. In the short run, this requires investment in the development of targeted low-cost products,
and in some cases lower margins, necessary to capture business and develop a presence in this arena.
2
Frequency Electronics, Inc. Annual Report 2025

SCIENTIFIC EXPERTISE
MATCHED WITH OUR
Another long-term growth opportunity we are pursuing is
MANUFACTURING
the development of quantum sensors. There is a developing
CAPABILITIES WILL
market for quantum magnetometers, Rydberg sensors, and
FURTHER STRENGTHEN
advanced atomic clocks, including optical atomic clocks. These
OUR STRATEGIC POSITIONING
are somewhat esoteric technologies, but enable navigation
IN NEXT GENERATION
alternatives to GPS, very compact receiving antennas, and more
MARKET OPPORTUNITIES
precise timing/navigation, respectively. The Company is ideally
suited to participate in these markets since they use the same
basic physics as our core atomic clock technology, and in many cases some of the same manufactured
physics elements. Much of this development is funded externally through government-led Department
of Defense programs, with additional support from internal R&D resources as required. The Company   s
proven ability to deliver rubidium atomic clocks that operate in harsh environments, including space,
makes us a very credible player in this technology; our decades-long legacy of manufacturing to such
high speci   cations stands in contrast to government laboratories and start-ups which are good at
demonstrating laboratory versions of quantum devices, but have no experience manufacturing reliable
products for demanding real-world environments.
To be successful in the somewhat arcane world of quantum sensors, and also to continue to be
successful in our core technologies, it is important to maintain and grow our scienti   c and engineering
workforce, and attract the best talent in these    elds. To this end, we have opened a small facility in
Boulder, CO, near both the University of Colorado and the NIST (National Institute for Standards and
Technology) time and frequency division. These institutions are both active in state-of-the-art quantum
sensor research. We have already enticed several well-respected senior scientists, until recently
employed at NIST, to join our staff; and are interviewing others. We believe that their scienti   c expertise
matched with our manufacturing capabilities will further strengthen our strategic positioning in next
generation market opportunities, and we are already seeing signs of progress on these fronts.
In closing, the Company achieved strong performance this year and remains vigilant in pursuing future
opportunities. We are taking prudent steps to reshape our organization to help lead the charge in these
increasingly dynamic times. We are con   dent in maintaining pro   tability within our core technologies,
while proactively adapting and innovating to drive long-term growth. With a debt-free balance sheet
and the enduring commitment of our talented workforce, I am optimistic about our path forward.
Thomas McClelland
President and Chief Executive Of   cer
Frequency Electronics, Inc. Annual Report 2025
3

9/4/2025 Letter Continued (Full PDF)

 

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