IPG Photonics' Q2 Earnings Beat Estimates, Revenues Decline Y/Y

IPG Photonics IPGP reported second-quarter 2025 adjusted earnings of 30 cents per share, which beat the Zacks Consensus Estimate by 20 cents but plunged 42% year over year.

Revenues of $250.7 million declined 3% on a year-over-year basis but beat the consensus mark by 11.88%. Favorable forex contributed 1% to revenue growth. 

The year-over-year decline was primarily due to lower Materials processing sales as well as divestitures.

Emerging growth product sales accounted for 54% of revenues, which improved from 51% reported in the previous quarter.

IPGP’s Q2 Quarterly Details

Materials processing (85% of total revenues) fell 6% year over year to $212.3 million. The downside was mainly due to lower sales in welding, cutting and additive manufacturing applications.

Revenues from other applications increased 21% year over year, primarily due to higher revenues in medical and advanced applications.

Sales dropped 4% in North America and 24% year over year in Europe, while increasing 14% in Asia.

IPG Photonics reported a gross margin of 37.8% up 30 basis points on a year-over-year basis. 

Adjusted EBITDA dropped 20% year over year to $31.5 million in the reported quarter.

IPGP’s Balance Sheet & Cash Flow Details

As of June 30, 2025, IPG Photonics had $900 million in cash & cash equivalents.

In the second quarter of 2025, the company spent $15 million on capital expenditures.

IPGP's Q3 Guidance

For third-quarter 2025, IPG Photonics anticipates sales to be $225-$255 million. 

IPG Photonics expects third-quarter 2025 adjusted gross margin between 36% and 38% as well as operating expenses of $89 to $91 million.

IPG Photonics expects second-quarter 2025 earnings between 5 cents per share and 35 cents per share.

Zacks Rank & Other Stocks to Consider

IPG Photonics currently has a Zacks Rank #2 (Buy).

MKS Inc. MKSI, DoorDash DASH and Lumentum LITE are some other top-ranked stocks in the broader Zacks Computer and Technology sector. Each of the three stocks currently sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

MKS shares have declined 11.2% year to date. MKS is set to report its second-quarter 2025 results on Aug. 6.

DoorDash shares have appreciated 48% year to date. DASH is set to report its second-quarter 2025 results on Aug. 6.

Lumentum shares are up 27% year to date. Lumentum is set to report its fourth-quarter fiscal 2025 results on Aug. 12.

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This article originally published on Zacks Investment Research (zacks.com).

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