eMagin Shares Slipped 4% On Double-Digit Q2 Revenue Decline

eMagin Corp EMAN reported a second-quarter FY21 revenue decline of 18.5% year-on-year to $6.28 million, missing the analyst consensus of $7.7 million.
Segments: Product revenue reduced 8.3% Y/Y to $5.74 million due to a decrease in display revenue from unexpected downtime experienced with manufacturing equipment, which delayed specific display shipments into the Q3.
Contract revenue declined 62.7% Y/Y to $0.54 million, reflecting the timing of phases and milestones associated with the contract of a tier-one consumer company.
The gross margin contracted 1,700 bps to 9% from decreased shipments of displays, lower manufacturing volumes, and decreases in period costs capitalized into inventory due to equipment issues.
The operating loss rose 117.8% Y/Y to $(2.91) million, reflecting the decreased gross profit and higher R&D investments in the current year.
The adjusted EBITDA loss rose 145.2% Y/Y to $(1.98) million. EPS of $0.00 beat the analyst consensus loss of $(0.03).
eMagin held $10.6 million in cash and equivalents.
The Y/Y decrease in total revenue reflected the impact of production issues and unexpected manufacturing tool downtime in the quarter.
Price Action: EMAN shares closed lower by 4.15% at $2.54 on Thursday.