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Advanced Coating Platforms for Scalable Manufacturing SONO TEK ANNUAL REPORT

Dear Fellow Shareholders In a year filled with global economic uncertainty, we're pleased to report that Sono-Tek continued to grow, posting a 4% increase in revenues for fiscal 2025. While modest, that growth builds on a long-tenn trend that has seen us steadily expand our reach and relevance in a fast-moving world of high-tech manufacturing. We're still inventing and pioneering-just as we always have. Tariffs, Trade, and Transitioning Energy We've been doing business globally for a long time, and one thing we've learned.- trade tensions come and go, but resilience is essential. Tariffs and trade restrictions have been a recurring challenge for several decades, and the current wave is no exception. We're hopeful that global efforts at rebalancing may result in a fairer, more competitive playing field-but as ever, time will tell. Meanwhile, another shift is underway-this one in energy. Over the past few years, we've benefitted from U.S. government support to green energy customers. That support is now evolving, with more emphasis on energy security and domestic supply. Fortunately, a significant portion of our energy-related business serves exactly those needs. Our systems are in high demand for U.S. solar manufacturing and carbon capture technologies that convert emissions into sustainable aviation fuel. Together, these two areas have created a strong backlog to start the new year. Some of our customers are on the cutting edge of green energy innovation, including green hydrogen production, and while we're excited about those prospects, support in those areas is currently less certain. We'll continue to support those efforts while remaining pragmatic about the policy winds. Building More Value for Our Customers We've been leaning into complexity-in a good way. Our newest coating systems are more sophisticated and cover a broader range of our customers' thin film coating needs. That's led to greater value for them and significant growth for us. The demand for ultra-thin, precise coatings continues to rise, and our core ultrasonic nozzle technology-combined with our application know-how has positioned us as a go-to partner across several industries. Whether it's semiconductor wafers, implantable medical devices, handheld electronics, solar panels, or fuel cells, these products all share something in common.- they depend on the type of precision coating that Sono-Tek was built to deliver. Our investment in advanced coating platforms designed for scalable production is positioning us at the heart of next-generation manufacturing. And while product development isn't a line item that grabs headlines, it's one of the most important investments we make. You'll see it in our R&D spending, which remains robust for a company of our size and is absolutely vital to our long-term growth. We've always believed that the best way to build a great future is to invent it-and we're doing just that. Strong Financial Foundation We like optionality. With $12 million in cash and no debt, Sono-Tek is well-positioned to navigate economic eye/es and act quickly when opportunity knocks. That strength is by design. We've seen what happens when companies get overextended, and we've taken a different approach: grow steadily, remain disciplined, and stay ready to accelerate when the right opportunities present themselves. Looking Ahead We remain pleased with the trajectory of the business and enter the new fiscal year with a strong backlog and continued momentum. While visibility into full-year results remains limited-particularly in the evolving clean energy sector-we are encouraged by steady demand across core markets and increasing interest in our high-volume medical production systems. To our customers, employees, and shareholders-thank you. You've helped build Sono-Tek into what it is today, and you remain essential to what it will become tomorrow. Here's to another year of thoughtful innovation, steady growth, and shared success. With appreciation, Dr. Christopher L. Coccio R. Stephen Harshbarger Executive Chairman President and CEO 3
Financial Highlights Revenue Backlog at Fiscal Year End $ in Millions Net Income $ in Millions Gross Margin $ in Millions *Excludes PPP loan, forgiven in QI FY2022 4 ANNUAL RFPORT Cash, Cash Equivalents & Marketable Securities $ in Millions Stockholders' Equity $ in Millions
Net Sales $20,504 $19,700 $15,058 $17,133 $14,833 Gross Profit $ 9,739 $ 9,845 $ 7,652 $ 8,613 $ 6,997 47.5% 50.0% 50.8% 50.3% 47.2% $ 6,005 $ 5,776 $ 4,819 $ 4,994 $ 4,012 29.3% 29.3% 32% 29.1% 27.0% $ 2,724 $ 2,886 $ 2,150 $ 1,730 $ 1,645 13.3% 14.7% 14.3% 10.1% 11.1% $ 1,010 $ 1,182 683 $ 1,889 $ 1,340 5% 6% 4.5% 11.0% 9.0% Net Income $ 1,273 $ 1,441 636 $ 1,543* Diluted Earnings Per Share 0.09 0.04 Gross Margin Selling, General and Administrative Expense % of Sales Research and Product Development Expense % of Sales Operating Income Operating Margin 0.08 0.16 $ 1,121 0.07 15,770 15,774 15,769 15,623 15,672 Cash, Cash Equivalents and Marketable Securities $11,930 $11,847 $11,445 $10,709 $ 8,648 Total Assets $23,132 $20,175 $17,626 $16,423 Total Debt (Long Term) $23,412 0 0 $ 1,002* Stockholders' Equity $17,792 $16,279 1.13 1.03 0.93 s $10,951 S s $13,741 Book Value Per Share s $14,634 0.88 s 0.71 701 S 597 511 436 463 469 795 556 327 344 Weighted Average Shares Outstanding - Diluted Vear End Financial Position 0 0 Other Year End Data Depreciation and Amortization Capital Expenditures *Excludes PPP loan, forgiven in Q1 FY2022 Batch coating systems like the MediCoat CC1000 catheter coating system (shown at the top of this page) allow customers to move easily from R&D to higher volume coatings when ready These systems often have the capability to coat either one product at a time, or several, with included automation features. This built in flexibiility is unique and differentiates Sono-Tek's capabilities from competitive coating systems. 5
 • shareholder letter icon 7/25/2025 Letter Continued (Full PDF)
 • stockholder letter icon 7/20/2018 SOTK Stockholder Letter
 • stockholder letter icon 7/22/2019 SOTK Stockholder Letter
 • stockholder letter icon 7/23/2020 SOTK Stockholder Letter
 • stockholder letter icon 7/15/2021 SOTK Stockholder Letter
 • stockholder letter icon 7/18/2022 SOTK Stockholder Letter
 • stockholder letter icon 7/21/2023 SOTK Stockholder Letter
 • stockholder letter icon 7/25/2024 SOTK Stockholder Letter
 • stockholder letter icon More "Electronic Equipment & Products" Category Stockholder Letters
 • Benford's Law Stocks icon SOTK Benford's Law Stock Score = 96


SOTK Shareholder/Stockholder Letter Transcript:

Advanced Coating Platforms for Scalable Manufacturing
SONO   TEK
ANNUAL REPORT


Dear Fellow Shareholders
In a year filled with global economic uncertainty, we're pleased to report that Sono-Tek continued to grow, posting a 4% increase in
revenues for fiscal 2025. While modest, that growth builds on a long-tenn trend that has seen us steadily expand our reach and
relevance in a fast-moving world of high-tech manufacturing. We're still inventing and pioneering-just as we always have.
Tariffs, Trade, and Transitioning Energy
We've been doing business globally for a long time, and one thing we've learned.- trade tensions come and go, but resilience is
essential. Tariffs and trade restrictions have been a recurring challenge for several decades, and the current wave is no exception.
We're hopeful that global efforts at rebalancing may result in a fairer, more competitive playing field-but as ever, time will tell.
Meanwhile, another shift is underway-this one in energy. Over the past few years, we've benefitted from U.S. government support
to green energy customers. That support is now evolving, with more emphasis on energy security and domestic supply. Fortunately,
a significant portion of our energy-related business serves exactly those needs. Our systems are in high demand for U.S. solar
manufacturing and carbon capture technologies that convert emissions into sustainable aviation fuel. Together, these two areas
have created a strong backlog to start the new year.
Some of our customers are on the cutting edge of green energy innovation, including green hydrogen production, and while we're
excited about those prospects, support in those areas is currently less certain. We'll continue to support those efforts while
remaining pragmatic about the policy winds.
Building More Value for Our Customers
We've been leaning into complexity-in a good way. Our newest coating systems are more sophisticated and cover a broader
range of our customers' thin film coating needs. That's led to greater value for them and significant growth for us. The demand for
ultra-thin, precise coatings continues to rise, and our core ultrasonic nozzle technology-combined with our application know-how  
has positioned us as a go-to partner across several industries.
Whether it's semiconductor wafers, implantable medical devices, handheld electronics, solar panels, or fuel cells, these products
all share something in common.- they depend on the type of precision coating that Sono-Tek was built to deliver. Our investment in
advanced coating platforms designed for scalable production is positioning us at the heart of next-generation manufacturing.
And while product development isn't a line item that grabs headlines, it's one of the most important investments we make. You'll
see it in our R&D spending, which remains robust for a company of our size and is absolutely vital to our long-term growth. We've
always believed that the best way to build a great future is to invent it-and we're doing just that.
Strong Financial Foundation
We like optionality. With $12 million in cash and no debt, Sono-Tek is well-positioned to navigate economic eye/es and act quickly
when opportunity knocks. That strength is by design. We've seen what happens when companies get overextended, and we've taken
a different approach: grow steadily, remain disciplined, and stay ready to accelerate when the right opportunities present themselves.
Looking Ahead
We remain pleased with the trajectory of the business and enter the new fiscal year with a strong backlog and continued
momentum. While visibility into full-year results remains limited-particularly in the evolving clean energy sector-we are
encouraged by steady demand across core markets and increasing interest in our high-volume medical production systems.
To our customers, employees, and shareholders-thank you. You've helped build Sono-Tek into what it is today, and you remain
essential to what it will become tomorrow. Here's to another year of thoughtful innovation, steady growth, and shared success.
With appreciation,
Dr. Christopher L. Coccio
R. Stephen Harshbarger
Executive Chairman
President and CEO
3

Financial Highlights
Revenue
Backlog at Fiscal Year End
$ in Millions
Net Income
$ in Millions
Gross Margin
$ in Millions
*Excludes PPP loan, forgiven in QI FY2022
4
    ANNUAL RFPORT
Cash, Cash Equivalents &
Marketable Securities
$ in Millions
Stockholders' Equity
$ in Millions

Net Sales
$20,504
$19,700
$15,058
$17,133
$14,833
Gross Profit
$ 9,739
$ 9,845
$ 7,652
$ 8,613
$ 6,997
47.5%
50.0%
50.8%
50.3%
47.2%
$ 6,005
$ 5,776
$ 4,819
$ 4,994
$ 4,012
29.3%
29.3%
32%
29.1%
27.0%
$ 2,724
$ 2,886
$ 2,150
$ 1,730
$ 1,645
13.3%
14.7%
14.3%
10.1%
11.1%
$ 1,010
$ 1,182
683
$ 1,889
$ 1,340
5%
6%
4.5%
11.0%
9.0%
Net Income
$ 1,273
$ 1,441

636
$ 1,543*
Diluted Earnings Per Share

0.09

0.04

Gross Margin
Selling, General and Administrative Expense
% of Sales
Research and Product Development Expense
% of Sales
Operating Income
Operating Margin
0.08


0.16
$ 1,121
0.07

15,770
15,774
15,769
15,623
15,672
Cash, Cash Equivalents and Marketable Securities $11,930
$11,847
$11,445
$10,709
$ 8,648
Total Assets
$23,132
$20,175
$17,626
$16,423
Total Debt (Long Term)
$23,412
0
0
$ 1,002*
Stockholders' Equity
$17,792
$16,279
1.13
1.03
0.93
s
$10,951
S
s
$13,741
Book Value Per Share
s
$14,634
0.88
s
0.71

701
S
597

511

436

463
469

795

556

327

344
Weighted Average Shares Outstanding - Diluted
Vear End Financial Position

0

0

Other Year End Data
Depreciation and Amortization
Capital Expenditures

*Excludes PPP loan, forgiven in Q1 FY2022
Batch coating systems like the MediCoat CC1000 catheter coating system (shown at the top of this page) allow customers to move easily
from R&D to higher volume coatings when ready These systems often have the capability to coat either one product at a time, or several, with
included automation features. This built in flexibiility is unique and differentiates Sono-Tek's capabilities from competitive coating systems.
5



shareholder letter icon 7/25/2025 Letter Continued (Full PDF)
 

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