NVE (NASDAQ:NVEC) reported a sharp increase in revenue and earnings for the quarter ended June 30, 2026, with management citing higher product sales, new products and a stronger semiconductor market as key drivers.
President and CEO Dan Baker said the company delivered “exceptional results,” including an 81% increase in revenue and a 79% increase in net income. The results were released shortly before the company’s earnings call, along with NVE’s quarterly report on Form 10-Q.
Net income rose to $6.39 million, or $1.32 per diluted share, from $3.58 million, or $0.74 per share, a year earlier. Nelson said the increase was primarily due to higher revenue, partly offset by increased operating expenses and lower interest income.
Margins Remain Strong as Volumes Rise
NVE’s gross margin increased to 81.3% of revenue from 80.6% in the prior-year quarter, helped by higher volumes, Nelson said. Total expenses rose 49%, including a 31% increase in research and development expense and an 81% increase in selling, general and administrative expense.
Nelson attributed the higher R&D expense to increased staffing and new product development activity. The increase in SG&A expense was primarily due to higher performance-based compensation. Even with the expense growth, total expenses as a percentage of revenue declined to 15% from 19% because revenue grew faster than costs.
Nelson said NVE’s profitability metrics remained strong during the quarter:
- Operating margin was 66%.
- Pre-tax margin was 78%.
- Net margin was 58%.
Interest income declined 10%, which Nelson said reflected a decrease in the company’s marketable securities portfolio after proceeds from bond maturities partially funded dividends and fixed asset purchases in the prior fiscal year.
NVE’s quarterly earnings more than covered its $1-per-share dividend for the second consecutive quarter. Cash plus marketable securities increased to $43.9 million as of June 30 from $43.5 million as of March 31. Inventories declined 6% during the quarter due to increased product sales.
Fixed asset purchases were $57,000, down from $1.06 million in the year-earlier quarter. Nelson said the decline followed the completion of NVE’s two-year, multimillion-dollar expansion and said fixed asset purchases are expected to be “significantly less” this fiscal year than in the prior year.
New Sensors Target Implantable Medical Devices
Peter Eames, NVE’s vice president of advanced technology and successor CEO, said the company’s R&D strategy is focused on turning its technologies into products for high-value markets such as advanced humanoid robotics, data centers and highly automated factories using what the company calls the Artificial Intelligence of Things.
Eames said NVE launched two new wafer-level chip scale sensors for implantable medical devices during the week of the call. He said the new parts are about one-third the area of conventionally packaged versions and are designed to support miniaturized implantable medical devices.
The new sensors are NVE’s first wafer-level chip scale sensors with what Eames described as an MRI-safe feature. He said the sensors function as magnetic switches in normal magnetic fields and remain stable in very high magnetic fields of more than 9 tesla, above the fields produced by the strongest MRI machines. Eames said MRI safety helps ensure a medical device using the sensor does not fail if a patient needs an MRI.
Eames also said NVE is developing more precise sensors for robotics and more power-efficient isolators for power conversion.
Management Highlights Robotics, AIoT and Power Conversion Markets
Baker said NVE exhibited at two sensor-focused trade shows during the quarter: Sensors Converge in Silicon Valley in May and Sensor+Test in Germany in June. At Sensors Converge, the company focused on robotics and AIoT, while the German event also gave NVE an opportunity to highlight its power conversion products.
Baker said the shows generated “some good leads” and that management believes the company’s investments in trade shows will contribute to future sales.
During the question-and-answer portion of the call, Eames said both recent capacity expansion and market demand contributed to the company’s sequential increase. He said the recently completed expansion is being used primarily for R&D, but also for production, especially for some newer products. He added that production is expected to continue shifting as new products ramp.
Asked about demand by end market, Eames said robotics represents one of the most promising areas for NVE’s technology. He cited advantages in low power and precision for automation and robotics, calling that area “probably the strongest growing” and most promising for the company’s products.
In response to a question about new product sales, Baker said most of the volume came from existing customers adopting newer products, while new customers were also evaluating newer products. He said new customers tend to start more slowly but “bode very well for the future.”
Leadership Transition Set for August
Baker also discussed NVE’s previously announced leadership transition. He said he will retire as president and CEO effective as of the company’s annual meeting in August, and the board has appointed Eames to succeed him.
Subject to shareholder approval, Baker will remain on the board as chairman, current Chairman Terry Glarner will remain on the board, and Eames will join the board. The board has also nominated Carolyn Valentine as a new director. If shareholders approve the nominees, the board will expand from five to seven directors.
Baker said the larger board would strengthen corporate governance and noted that NVE already has the highest possible ISS governance score. He said the board conducted a thoughtful succession planning process and unanimously chose Eames as the company’s next CEO.
Eames thanked Baker for his service and said he looked forward to building on NVE’s momentum through “profitable growth, strong shareholder returns” and continued spintronic product excellence.
Management did not provide specific forward-looking revenue guidance. In response to a shareholder question about whether the quarter represented a new higher revenue base, Baker said NVE could not provide guidance with specific numbers but described the company as “very optimistic” and said the quarter validated its growth strategy.
About NVE (NASDAQ:NVEC)
NVE Corporation (NASDAQ:NVEC) is a technology company specializing in the development, manufacturing, and marketing of spintronic products. The company’s core expertise lies in magnetoresistive sensing and magnetic-field-based digital isolation, leveraging patented spin-valve and tunneling magnetoresistance technologies to deliver high-performance, low-power solutions.
NVE’s product portfolio includes magnetic sensors for current, position, and angle sensing applications, as well as micro-isolators and digital isolators that provide galvanic isolation in industrial, automotive, medical, instrumentation, and consumer electronics systems.
