Photronics, Inc. (NASDAQ: PLAB) is a leading manufacturer of photomasks, which are critical in the production of integrated circuits (IC) and flat panel displays (FPD). For the second quarter of fiscal 2025, the company reported revenue of $211 million, down 3% year-over-year and remaining essentially flat compared to the prior quarter. This marks a significant decline compared to revenue of $217 million in the same quarter of 2024 and $213 million in the previous quarter.

The company’s net income attributable to Photronics shareholders was $8.9 million, or $0.15 per diluted share, compared to $36.3 million, or $0.58 per diluted share, in the second quarter of 2024. Non-GAAP diluted earnings per share were $0.40, down from $0.46 in the same quarter of the previous year and down from $0.52 in the first quarter of 2025.

Sales from the IC segment totaled $155.9 million, reflecting a 3% decline year-over-year but an increase of 1% sequentially. The FPD segment generated revenue of $55.1 million, decreasing 2% compared to the same quarter last year and 5% sequentially. The company reported a gross margin of 36.9%, consistent with their historical average, and an operating margin of 26.4%, which was an improvement of 180 basis points sequentially.

Operating cash flow was reported at $31 million, translating to 15% of total revenue. Capital expenditures reached $60.5 million during the quarter, with planned total CapEx for fiscal 2025 estimated at $200 million. As of May 4, 2025, the company had $558.4 million in cash and short-term investments.

Looking forward, Photronics expects third-quarter revenue to range between $200 million and $208 million, with non-GAAP earnings per share projected between $0.35 and $0.41. The operating margin for the upcoming quarter is anticipated to fall between 20% and 22%.