Summary of Frequency Electronics, Inc.

Business Overview

Frequency Electronics, Inc. is a global leader in precision time and frequency generation technology. Its products are essential for aerospace, defense, and communication markets, especially in applications involving satellites, command and control systems, and electronic warfare.

Core Technologies & Products

• Time and Frequency Generation: Master timing systems, power converters, and distribution systems that support satellite payloads and ground-based communication networks.
• Space Applications: Products are used onboard over 5,000 U.S. satellites across Geostationary, Medium, and Low Earth Orbits, including space-qualified oscillators and high-precision clocks.
• Government & Military Systems: Develops ruggedized, high-accuracy clocks supporting secure GPS, C4ISR, electronic warfare, and electronic attack systems.
• Commercial Applications: Products support satellite constellations in low-earth orbits and terrestrial communication infrastructure, including wireless and GPS systems.

Business Segments and Operations

• FEI-NY Segment: Based in New York, designs and manufactures satellite electronics, including master timing systems, RF modules, and microwave components for space and military end-uses.
• FEI-Zyfer Segment: Located in California, focuses on terrestrial and military positioning, navigation, timing (PNT) systems using GPS technology, supporting secure communications and anti-spoofing applications.
• Morion Investment: Previously invested in a Russian crystal oscillator manufacturer, Morion, holding 4.6% of shares. Due to sanctions, the investment was impaired fully as of 2022.

Customers & Market For Principal Revenue

• U.S. Government: Approximately 94% of sales in FY2025 and 98% in FY2024.
• Major Customers: Include Northrop Grumman, Lockheed Martin, BAE Systems, and the Office of Naval Research.
• Number of Shareholders: About 441 stockholders of record as of July 8, 2025.
• Revenue:
  • FY2025: $69.8 million
  • FY2024: $55.3 million
• Net Income:
  • FY2025: $23.7 million
  • FY2024: $5.6 million
• Market Cap: Approximately $73.4 million (as of October 31, 2024).

Employees

• Total employees: 226 (216 full-time and 10 part-time).
• The workforce is solely U.S.-based, with no union representation.
• Employee retention is high, with an aging workforce and potential retirement considerations.

Financial Highlights

• Reported significant revenue growth in FY2025 driven predominantly by U.S. Government satellite programs.
• Operating income increased from $5.0 million in FY2024 to $11.7 million in FY2025.
• Gross margins improved from 33.6% in FY2024 to 43.1% in FY2025.
• Cash position: $4.7 million as of April 30, 2025.
• Total working capital stood at $29.7 million.
• The company declared a special dividend of $1.00 per share on August 29, 2024, totaling approximately $9.4 million.

Research & Development

• Investment of $6.1 million in FY2025 (up from $3.4 million in FY2024).
• Focus on improving core technologies, satellite hardware, and terrestrial GPS/anti-spoofing systems.

Markets & Strategic Focus

• Primary markets: satellite payloads, terrestrial secure communications, electronic warfare, and anti-spoofing GPS-enabled systems.
• Focus on high-precision, robust, and space-qualified products for defense and commercial space markets.

Summary

Frequency Electronics, Inc. specializes in advanced time and frequency systems for high-precision aerospace, defense, and communication applications. It operates mainly through two segments (FEI-NY and FEI-Zyfer), provides products predominantly to the U.S. government, and reports annual revenues of approximately $70 million with a net income of $23.7 million in FY2025. The company employs 226 people in the U.S., with a significant R&D investment to maintain technological leadership.