FREQUENCY ELECTRONICS INC

Frequenty Electronics, Inc.

Overview

Frequenty Electronics, Inc. (FEI) is a global leader in precision time and frequency generation technology for space (commercial and U.S. Government satellites) and terrestrial secure command, control, communications, computer, intelligence, surveillance, and reconnaissance (C4ISR) and electronic warfare (EW) systems. The company provides timing, frequency generation, and distribution systems from 1 Hz up to 46 GHz, and offers quantum sensing products such as magnetometers and Rydberg sensors.

Corporate structure and recent restructuring

• FEI operates under two reportable segments aligned to geography:
  • FEI-NY (Long Island, NY) — includes FEI Government Systems, Inc. and FEI Communications, Inc.; formerly also included FEI-Elcom.
  • FEI-Zyfer (California) — GPS and secure timing products.
• On April 30, 2026, FEI-Elcom, a wholly owned FEI subsidiary, converted into a Delaware limited liability company; its ongoing business continues under the FEI-NY segment.
• FEI-NY focuses on master timing systems, RF/microwave modules, and quantum sensing products. FEI-Zyfer focuses on GPS-based timing and crypto-secured timing solutions.

Products and markets by segment

• FEI-NY
  • Precision time and frequency products and subsystems for satellite payloads, U.S. Government/non-space programs, and terrestrial networks.
  • Quantum sensing products (magnetometers and Rydberg sensors) based on atomic clock technology.
  • Space-qualified quartz oscillators, oven-controlled oscillators, DC-DC power converters, and related timing hardware.
• FEI-Zyfer
  • Precision time references and GPS-based timing products, including crypto-secured GPS solutions for secure C5ISR applications.
  • Systems integrated into radar, airborne SIGINT/COMINT, information networks, test equipment, and satellite ground stations.

Revenue, backlog and contract mix

• Segment revenue mix (company-wide):
  • FEI-NY: ~72% of consolidated revenues in 2026 and ~76% in 2025.
  • FEI-Zyfer: ~34% of consolidated revenues in 2026 and ~27% in 2025.
  • Totals exceed 100% due to intersegment sales.
• Foreign sales: 9% of consolidated revenues in 2026; 6% in 2025 (primarily Europe and Asia).
• Backlog:
  • Consolidated backlog as of April 30, 2026: approximately $111 million (vs. $70 million at the end of the prior fiscal year).
  • About 73% of the current backlog is expected to be filled during the fiscal year ending April 30, 2027.
  • As of April 30, 2026, no backlog amounts were under funded cost-plus or fixed-fee contracts; partially funded contracts are expected to be fully funded over time.
• Contract types:
  • In 2026, approximately 95% of sales were from fixed-price contracts.
  • Cost-type contracts reimburse allowable costs plus a fee; they carry risks related to profit realization and potential contract termination if performance issues arise.
• Government program exposure:
  • U.S. Government end-use sales comprised the majority of revenue: ~91% in 2026 and ~94% in 2025.
  • In 2026, Lockheed Martin, L3Harris Technologies, and The Boeing Company each accounted for more than 10% of consolidated revenues. In 2025, Northrop Grumman accounted for more than 10%.
  • Contracts are typically fixed-price or cost-plus, with funding cycles tied to government appropriations.

Customers

• Major customers (>10% of consolidated revenues in the specified years):
  • 2026: Lockheed Martin, L3Harris Technologies, Boeing (each >10%).
  • 2025: Northrop Grumman (>10%).
• The business relies heavily on a small number of large customers and programs, particularly U.S. Government prime or subcontractor programs.

Employees

• Total employees: 242 (232 full-time, 10 part-time).
• 99% of employees are based in the U.S.; none are represented by labor unions.
• Workforce characteristics: highly skilled, long tenures (average tenure ~11 years), median age ~53, with security clearances required for certain programs.

Geography and facilities

• Mitchel Field, NY (Long Island) — 93,000 sq ft; leased; corporate headquarters and FEI-NY operations.
• Garden Grove, CA — 37,463 sq ft; leased; FEI-Zyfer operations.
• Northvale, NJ — 6,548 sq ft; leased; FEI-Elcom operations (lease amended; transitional status).
• Boulder, CO — 4,140 sq ft; leased; satellite facility for FEI-NY.
• Facilities support manufacturing, assembly, testing, and administrative functions.

Research & development and intellectual property

• Ongoing internal R&D focuses on core physics, electronic performance, manufacturability, and satellite/terrestrial timing applications.
• R&D spend: $6.1 million in fiscal 2026 and $6.1 million in fiscal 2025.
• Patents: issued patents run through 2026; the company holds patents in quartz oscillator and low g-sensitivity technologies and maintains a mix of defensive and development patents.

Competition

• Competitive differentiation is based on accuracy, performance in harsh environments, and contract execution.
• In space applications, some major customers have in-house capabilities that compete with FEI. In non-space timing and secure communications, competitors include Microchip Technology Incorporated and Mercury Systems, Inc.
• FEI positions its combined quartz/rubidium timing references, RF/microwave capabilities, and security features as competitive strengths.

Regulatory and compliance

• U.S. Government contracts are governed by FAR/DFARS; the company is subject to government audits (DCAA) and compliance requirements.
• FEI maintains a DFARS/CMMC-aligned cybersecurity program and information security controls for government data.
• OFAC and other regulatory considerations have been part of the company’s compliance landscape, including prior voluntary disclosures related to Morion/Gazprombank and the 2024 designation of Morion as a Specially Designated National.

Risks

• Heavy dependence on a small number of government and large commercial customers; revenue and programs can be affected by government funding cycles.
• Exposure from fixed-price contracts, with potential for cost overruns or funding shortfalls.
• Supply chain dependencies for space-qualified components and risks from supplier consolidation or disruptions.
• Operational risks from health events, natural disasters, geopolitical conditions, and regulatory actions (including sanctions and export controls).
• Potential impact of product defects on satellites or mission outcomes, with associated penalties or litigation.

Financial highlights

• Backlog: approximately $111 million as of April 30, 2026; ~73% expected to be recognized in the next year.
• Segment revenue mix (2026): FEI-NY ~72%, FEI-Zyfer ~34% (intersegment sales cause totals to exceed 100%).
• Foreign revenue: 9% (2026), 6% (2025).
• Contract mix: 95% of 2026 sales from fixed-price contracts.
• R&D spend: $6.1 million in both 2026 and 2025.
• Employees: 242 total; 99% U.S.-based; no union representation.

Contact

• Principal office: 55 Charles Lindbergh Blvd, Mitchel Field, NY 11553
• Phone: 516-794-4500
• Website: www.frequencyelectronics.com