Espey Mfg. & Electronics Corp. (ESP): Business Model Canvas [Dec-2025 Updated]

You're looking for a clear, precise view of Espey Mfg. & Electronics Corp.'s business engine as of late 2025, and honestly, the numbers tell a great story of defense-driven growth. The company's focus on specialized, high-reliability power systems for the military is defintely paying off, as evidenced by the record backlog. With net sales hitting $43.95 million for fiscal year 2025 and a massive $139.7 million backlog as of June 30, 2025, this isn't just business as usual; it's a deep dive into a vertically integrated supplier powering critical US Navy submarine programs. I've broken down exactly how they make money and what keeps the primes coming back in the full Business Model Canvas below-you'll want to see the Key Activities section.

Espey Mfg. & Electronics Corp. (ESP) - Canvas Business Model: Key Partnerships

You're looking at the core relationships Espey Mfg. & Electronics Corp. (ESP) relies on to execute its specialized defense manufacturing strategy, especially as the company posted record backlog figures in fiscal year 2025. These partnerships are not just transactional; they represent strategic co-investments in the domestic industrial base.

The relationship with the US Navy is foundational, driving significant capital investment into Espey Mfg. & Electronics Corp.'s operational capacity. This is clearly seen through direct funding aimed at sustaining critical defense supply chains. For instance, Espey Mfg. & Electronics Corp. announced in March 2025 it was awarded $3.4 million in funding for capital equipment and facility upgrades, which is part of the U.S. Navy's initiative to strengthen the domestic U.S. Surface Combatant Industrial Base.

This recent infusion builds upon prior support. This $3.4 million award complements the $7.4 million grant received in February 2023, which was earmarked for constructing a new manufacturing facility. Taken together, these two specific government funding actions total $10.8 million as of early 2025, directly supporting the expansion that resulted in the new 24,000-square-foot Magnetics Center of Excellence, which began full-scale production in April 2025. The overall facility upgrade project is slated for completion in 2026.

Collaboration with Prime Defense Contractors is where the funding translates directly into high-value, long-term revenue streams, particularly supporting the U.S. Navy's submarine programs. Espey Mfg. & Electronics Corp. secured a major contract in April 2025, valued at $19.8 million when fully funded, to supply electrical power transformers for the Virginia and Columbia class submarines. This work involved Espey Mfg. & Electronics Corp. being chosen by General Dynamics Electric Boat and the U.S. Navy.

Furthermore, Espey Mfg. & Electronics Corp. announced in March 2025 securing a $29.5 million contract, again with the U.S. Navy and General Dynamics Electric Boat, specifically for electric power distribution panels for the Columbia class submarines. Deliveries for this specific contract are expected to continue through 2030, covering four of the twelve planned submarines. These defense-related new orders contributed significantly to the company's fiscal year 2025 new orders reaching $86.4 million.

The nature of these defense relationships is best summarized by looking at the direct financial impact and program alignment:

Regarding BAE Systems, Espey Mfg. & Electronics Corp.'s role as a supplier in the broader defense ecosystem suggests deep integration, though specific, confirmed data for a late-2025 Gold Medallion award is not immediately apparent in the latest disclosures. However, the structure of the Partner2Win program itself provides context for the required performance. For example, in a recent symposium, a Gold Medallion award recognized suppliers with 100% on both delivery and quality metrics. Espey Mfg. & Electronics Corp.'s overall fiscal year 2025 performance, which saw its backlog grow to a record $139.7 million from $97.2 million the prior year, underscores the high-level execution expected by such partners.

The support from Government Agencies, channeled primarily through the U.S. Navy initiatives, is critical for capacity building. This funding is explicitly tied to enhancing domestic industrial capabilities. The goal of the Surface Combatant Industrial Base Development Initiative is to strengthen the nation's shipbuilding industrial base and support increased production rates. This strategic alignment ensures Espey Mfg. & Electronics Corp. is investing in infrastructure directly relevant to national defense priorities.

• Funding targets capital equipment and facility upgrades.
• The new facility enhances state-of-the-art testing capabilities.
• The initiative prioritizes a U.S.-based workforce and supply chain revitalization.
• Espey Mfg. & Electronics Corp. is committed to co-investing with industry partners.

The company's fiscal year 2025 results show net sales of $43.95 million and net income of $8.14 million, demonstrating the financial health underpinning these key relationships.

Espey Mfg. & Electronics Corp. (ESP) - Canvas Business Model: Key Activities

You're looking at the core engine driving Espey Mfg. & Electronics Corp.'s recent success, especially given the massive order book they've built up. The Key Activities are where the rubber meets the road for a specialized defense and industrial supplier like Espey Mfg. & Electronics Corp.

Specialized power supply and transformer design and development

This activity centers on creating the 'Best in Class' products Espey Mfg. & Electronics Corp. is known for, supporting government and the Warfighter since 1930. The demand for these specialized, high-reliability products is clearly reflected in the company's order intake. For the fiscal year ended June 30, 2025, Espey Mfg. & Electronics Corp. secured new orders totaling $86.4 million, a significant jump from approximately $52.4 million in the prior year. This robust demand pushed the total backlog to a record $139.7 million as of June 30, 2025, which then grew further to approximately $141.1 million by September 30, 2025. This activity is the source of that future revenue visibility.

The design expertise covers a wide range of electrical specifications, which you can see in the following table summarizing their experience in power conversion and magnetics solutions:

The company's market capabilities rely on an experienced, multi-disciplinary engineering organization focused on solving the most difficult manufacturing problems. This design work directly feeds the manufacturing pipeline, which is why the full-year net sales for FY2025 reached $43,950,872, a 13.47% increase over FY2024.

High-reliability manufacturing and assembly (Fully Vertically Integrated)

Espey Mfg. & Electronics Corp. maintains a competitive edge by being Fully Vertically Integrated with its engineering capabilities. This means they control more steps in the production process, which is crucial for maintaining the high-reliability required by military and industrial customers. The company's operations include a suite of vertical manufacturing services that support the final product assembly.

The vertical integration encompasses several key in-house processes:

• Sheet Metal fabrication
• CNC Machining & Turning
• Certified Welding
• In House Painting/Coating (MilSpec)
• Circuit Board Assembly (CCA/PCBA)
• Complex Electro-Mech Assembly

This integration, combined with strong demand, resulted in FY2025 net income climbing to $8,142,954, up from $5,815,140 the year before. Even with a softer Q4 2025 in terms of sales, the operational efficiencies you'd expect from vertical control helped Q4 net income rise to $2,931,651.

Rigorous MIL-STD testing and qualification

A core activity supporting the high-reliability claim is the on-premise, complete MIL-STD testing facility. This capability is heavily invested in for product validation without compromise. The company recently completed a major infrastructure upgrade to bolster this area. Specifically, full-scale production and testing are now underway at the new 24,000-square-foot Magnetics Center of Excellence, which finished construction in April 2025. This expansion was partly funded by a $7.4 million U.S. Navy grant awarded in fiscal year 2023 under the Surface Combatant Industrial Base Development Initiative. This facility directly increases Espey Mfg. & Electronics Corp.'s MIL-STD testing capacity and testing power to support scalable growth.

The on-premise testing laboratory features specific high-power capabilities:

• 3 high power test areas (up to 500KW) with liquid cooling
• AC partial discharge (corona) testing, 100KV hi-pot capability
• 12KV surge testing
• 900VDC 100KW DC power source, 4160VAC400KW power source

This on-site testing capability supports requirements compliance, test engineering, and design verification and qualification testing, which is a defintely key differentiator for their defense sector customers.

Build-to-Print/Manufacturing Services for complex electronics

Espey Mfg. & Electronics Corp. leverages its design and testing infrastructure to offer Integrated Manufacturing Services (IMS) for Build-to-Print contracts, focusing on complex military components and systems. This service takes a customer's existing design and utilizes Espey Mfg. & Electronics Corp.'s vertical capabilities to manufacture and qualify the product. This activity is supported by the record backlog, indicating strong customer commitment to these manufacturing partnerships. The backlog at June 30, 2025, stood at $139.7 million, showing that customers are locking in production slots for these complex builds.

The Build-to-Print services are supported by the full vertical integration mentioned previously, plus specialized services like:

• Box Builds and Large Cabinet Builds
• Kitting and Packing to Order
• Obsolescence Mitigation
• Supply Chain Management

The success of this activity is evident in the FY2025 performance, where net sales grew to $43,950,872, and net income reached $8,142,954, demonstrating the ability to convert that high-value backlog into realized revenue and profit. Finance: draft 13-week cash view by Friday.

Espey Mfg. & Electronics Corp. (ESP) - Canvas Business Model: Key Resources

You're looking at the core assets that power Espey Mfg. & Electronics Corp.'s operations right now, which are heavily weighted toward specialized manufacturing capacity and a strong order book. These aren't just line items; they are the tangible proof of future revenue and the specialized know-how that keeps them competitive in the defense and industrial power conversion space.

The most immediate indicator of future work is the order pipeline. As of June 30, 2025, Espey Mfg. & Electronics Corp. reported a record backlog of $139.7 million. That's a significant jump when you compare it to the backlog of $97.2 million at June 30, 2024. Honestly, this backlog level suggests strong demand visibility heading into the next fiscal year, especially when you see that new orders for the full fiscal year ended June 30, 2025, totaled $86.4 million.

A major physical asset supporting this backlog is the new Magnetics Center of Excellence. This is a 24,000 sq-ft production and testing facility expansion that finished construction in April 2025. Full-scale production and testing operations began shortly after. This wasn't just company capital, either; the expansion was funded in part by a $7.4 million grant awarded in fiscal year 2023 through the U.S. Navy's Surface Combatant Industrial Base Development Initiative. This facility directly enhances their ability to perform rigorous MIL-STD testing for military-grade transformers and inductors.

Beyond the physical plant and the current order book, the intangible assets are critical for a specialized manufacturer like Espey Mfg. & Electronics Corp. You need the people who actually design and build these complex components, plus the legal protection for those designs.

Here's a quick look at the key tangible and financial anchors supporting these resources as of the fiscal year-end:

The human capital is centered around the experienced, multi-disciplinary engineering and technical staff. These are the folks who translate military specifications into manufacturable products, a skill set that takes years to build. They are essential for maintaining the quality required for their specialized military and industrial power supplies/transformers. This team is now supported by the enhanced testing infrastructure in the new facility.

Finally, the intellectual property and proprietary designs for power conversion are the long-term moat. This IP covers the specialized knowledge for developing, designing, and producing these components, which is the core of Espey Mfg. & Electronics Corp.'s primary business. This proprietary knowledge base, combined with the new capacity, is what allows them to secure those large, multi-year backlog commitments.

You can see the core operational strengths here:

• High Order Visibility: Record backlog of $139.7 million as of June 30, 2025.
• Advanced Infrastructure: New 24,000 sq-ft Magnetics Center of Excellence, operational since April 2025.
• Specialized Talent: An experienced, multi-disciplinary engineering and technical staff.
• Protected Know-How: Intellectual property and proprietary designs for power conversion technology.

Finance: review the working capital implications of the $139.7 million backlog against the Q4 2025 sales dip of $9,596,194.

Espey Mfg. & Electronics Corp. (ESP) - Canvas Business Model: Value Propositions

You're looking at the core reasons customers choose Espey Mfg. & Electronics Corp. (ESP) over others, especially when failure isn't an option. The numbers from fiscal year 2025 definitely show these value propositions are resonating with the market.

High-reliability power solutions for harsh/severe environments

Espey Mfg. & Electronics Corp. focuses on power conversion and magnetic components that must perform flawlessly where others might fail. This isn't about mass-market electronics; it's about mission-critical reliability for defense and demanding industrial uses. The market validation for this focus is clear in the financials.

For the fiscal year ended June 30, 2025, Espey Mfg. & Electronics Corp. reported net sales of $43,950,872, a solid increase from the prior year's $38,736,319. Furthermore, the company's backlog hit a record $139.7 million as of June 30, 2025, showing customers are committing to long-term, high-reliability needs.

The company's commitment to this segment is physically backed by recent infrastructure investment. Full-scale production and testing are now underway at their new 24,000-square-foot Magnetics Center of Excellence, which finished construction in April 2025. This expansion, partially funded by a $7.4 million U.S. Navy grant from fiscal year 2023, directly supports scalable growth in these specialized magnetics.

Here's a snapshot of the financial strength underpinning this value proposition as of late 2025:

Custom design and engineering for military and industrial specifications

Espey Mfg. & Electronics Corp. doesn't just sell off-the-shelf parts; they engineer bespoke solutions. This involves deep collaboration with clients, often starting from a request for quotation (RFQ) that includes stringent, application-specific requirements for size and weight. This capability is what secures major defense contracts.

A concrete example of this custom engineering success is the $19.8 million contract award announced on April 10, 2025, to provide electrical power transformers for the U.S. Navy's Virginia and Columbia class submarines. Espey Mfg. & Electronics Corp. was chosen to manufacture components they had previously designed and supplied, demonstrating trust in their custom engineering lifecycle.

The engineering focus is supported by the company's operational structure:

• All design, manufacturing, and testing performed in a 150,000+ square foot facility.
• Utilizes advanced design and manufacturing tools like Altium and Epicor.
• Maintains the agility of a small business governed by large business disciplines.

Long-term product support and post-delivery sustainment

For defense and critical industrial customers, the value extends far beyond the initial delivery. Espey Mfg. & Electronics Corp. offers dynamic lifecycle management services, which is key for systems that stay in service for decades. This commitment to sustainment builds the deep, lasting customer relationships the CEO mentioned.

The strength of this long-term view is reflected in the new business pipeline. New orders received in fiscal year 2025 totaled $86.4 million, a significant jump from approximately $52.4 million the prior year. This suggests customers are placing larger, long-horizon orders, which inherently require robust sustainment planning.

The company's service offering includes specialized capabilities:

• Dynamic lifecycle management services.
• Reverse engineering of existing or obsolete components.
• Focus on building long-term value with investors and customers.

Compliance with stringent Mil-SPEC and MIL-STD requirements

Compliance isn't a feature; it's the entry ticket for Espey Mfg. & Electronics Corp.'s primary markets. Their reputation rests on consistently meeting or exceeding these rigorous standards, which is why they are a trusted supplier to the Department of Defense. The new Magnetics Center of Excellence is specifically designed to enhance this capability.

The new facility increases the company's MIL-STD testing capacity and testing power, positioning Espey Mfg. & Electronics Corp. for scalable growth in magnetics that require this level of certification. This focus on quality assurance and rigorous testing protocols is a core differentiator against mass-market producers.

Key compliance and quality indicators include:

This dedication to high standards directly translates to customer confidence, evidenced by the $8.14 million net income reported for FY2025. That's a strong return on delivering exactly what the defense sector demands.

Espey Mfg. & Electronics Corp. (ESP) - Canvas Business Model: Customer Relationships

You're looking at a business model where the customer relationship isn't just about a transaction; it's about embedding Espey Mfg. & Electronics Corp. into critical, multi-year defense platforms. This is a relationship built on trust, which you can see reflected in the numbers.

Dedicated supplier model for long-term defense programs

The core of Espey Mfg. & Electronics Corp.'s customer relationship strategy is its role as a dedicated supplier for long-term defense programs. This isn't transactional selling; it's about securing your spot in the supply chain for systems that last decades. The proof is in the order book. As of June 30, 2025, the company's backlog hit a record level of $139.7 million, a substantial jump from $97.2 million the previous year. This backlog gives you excellent revenue visibility, which is the direct result of these sustained relationships.

The commitment is further evidenced by the new business won. For the fiscal year ended June 30, 2025, Espey Mfg. & Electronics Corp. secured new orders totaling $86.4 million, a significant increase from approximately $52.4 million the year before. This shows prime contractors are leaning on Espey Mfg. & Electronics Corp. for future work.

Here's a quick look at the financial impact of these long-term commitments:

Close collaboration with prime contractors and government on design

Espey Mfg. & Electronics Corp. doesn't just fulfill orders; they help design the components. They serve North American defense contractors, government agencies, and aerospace prime integrators. This deep involvement means they are often manufacturing components they previously designed or helped qualify. For instance, the company was chosen by General Dynamics Electric Boat and the U.S. Navy to manufacture components for the Columbia class submarine, a top priority for the Department of Defense.

This collaborative design work translates into specific, large-value awards:

• Secured a $29.5 million contract for electric power distribution panels for the Columbia class submarines, with deliveries expected through calendar year 2030.
• Awarded an additional $19.8 million contract for electrical power transformers for the U.S. Navy's Virginia and Columbia class submarines.
• The company provides custom engineering, qualification testing, and certification services alongside standard catalog items.

This level of integration is defintely hard to replicate. They are supporting programs that enable US military superiority, as stated by the CEO.

Relationship-driven, sustained by strong execution and quality

The longevity of these relationships is sustained by execution, not just relationship-building. The CEO noted that the strong results were fueled by strong execution and lasting customer relationships. For a defense supplier, quality is non-negotiable. Espey Mfg. & Electronics Corp. backs this up by maintaining ISO 9001 quality certification. Their manufacturing facilities are equipped for small-to-medium volume, high-reliability production, which is exactly what defense programs demand.

The relationship model success can be summarized by the growth in their ability to secure future work:

• New orders in FY 2025 grew by approximately 64.9% year-over-year.
• Net income grew by 40% in FY 2025 to $8,142,954.
• The company's strategy remains focused on supporting programs that continue to enable the US military.

Finance: draft 13-week cash view by Friday.

Espey Mfg. & Electronics Corp. (ESP) - Canvas Business Model: Channels

You're looking at how Espey Mfg. & Electronics Corp. gets its specialized power electronics and magnetics into the hands of defense and industrial customers. The channel strategy is heavily weighted toward direct engagement, which makes sense given the niche, high-reliability nature of their products.

Direct sales and contracting to US Department of Defense (DoD)

The US Department of Defense (DoD) remains a core channel, leveraging Espey Mfg. & Electronics Corp.'s status as a US small business certified company on the eligible list of contractors. This direct access supports long-cycle platforms. For instance, a significant contract award on April 10, 2025, valued at $19.8 million, was secured to provide electrical power transformers for the U.S. Navy's Virginia and Columbia class submarines. This direct contracting capability is key to their revenue visibility.

The scale of their defense engagement is reflected in the overall backlog, which hit a record $139.7 million as of June 30, 2025, up from $97.2 million the prior year. New orders for fiscal year 2025 totaled $86.4 million, a substantial increase from the $52.4 million booked in fiscal year 2024.

Direct sales to major defense prime contractors

Beyond direct government contracting, Espey Mfg. & Electronics Corp. sells through its direct sales organization to major defense companies, often as a sub-tier supplier. They were chosen by General Dynamics Electric Boat to manufacture components for the submarine programs mentioned previously, showing the direct link to prime contractors. The company serves defense companies, the government of the United States, and foreign governments.

Here's a look at the financial scale that flows through these defense-related channels:

Direct manufacturing and delivery from Saratoga Springs, NY facility

All value chain activities-design, manufacturing, and testing-are centralized, which is a key aspect of their channel control and quality assurance. This vertical integration allows for build-to-print services and dynamic lifecycle management services.

The physical channel infrastructure is concentrated in one location:

• Facility Size: Over 150,000+ square feet.
• Location: 233 Ballston Ave, Saratoga Springs, New York.
• Certification: ISO AS9100 certified.
• Vertical Capabilities: Component production (including inductors), PCB population, metal fabrication, painting, wiring, qualification, and full in-house testing.

The company couples its vertical manufacturing capabilities with the agility of a small business, governed by large business disciplines, which supports reliable delivery schedules extending beyond a year on some contracts.

Espey Mfg. & Electronics Corp. (ESP) - Canvas Business Model: Customer Segments

You're looking at the core buyers for Espey Mfg. & Electronics Corp. (ESP) as of late 2025. The business model is heavily anchored in specialized, high-reliability power electronics for defense and demanding industrial uses. Honestly, the numbers show a clear concentration in government-backed programs.

US Military/Department of Defense (DoD)

This segment represents the foundational customer base, given Espey Mfg. & Electronics Corp.'s core competency in specialized military power supplies and transformers. The company's strategy remains focused on supporting programs that enable US military superiority. You can see this focus reflected in the order intake; for the fiscal year ending June 30, 2025, new orders surged to $86.4 million, up from approximately $52.4 million in the prior year.

The overall financial health tied to this segment is strong, evidenced by the backlog growth:

• Backlog at September 30, 2025: approximately $141.1 million.
• Total outstanding opportunities as of November 10, 2025: approximately $161.5 million.
• FY2025 Net Sales: $43.95 million.

US Navy Submarine Programs (Virginia and Columbia Class)

This is where the most concrete, large-dollar contract wins are announced, signaling deep integration into critical defense platforms. The Columbia class submarine program, designed to replace the Ohio class fleet, is a top priority for the Department of Defense. Espey Mfg. & Electronics Corp. supplies components directly to prime contractors like General Dynamics Electric Boat and the U.S. Navy.

Here are the specific, recent contract values tied to these platforms:

The $29.5 million Columbia class award covers deliveries through calendar year 2030 for 4 of the 12 planned submarines, which gives you excellent long-term revenue visibility. To be fair, these specific defense contracts are the engine driving the overall backlog increase to $139.7 million as of June 30, 2025.

Aerospace and Ground Vehicle Power Platforms

While specific revenue splits aren't broken out publicly for this segment, Espey Mfg. & Electronics Corp.'s capabilities clearly target this area. The company is an AS9100:2016 certified manufacturer, which is the quality standard for the aerospace industry. Their product applications explicitly include airborne power and ground mobile power systems.

The types of products they supply here include:

• Power supplies and power converters.
• Power transformers and magnetic components.
• Power distribution equipment.

Rugged Industrial Power Systems Market

This segment overlaps with defense but also includes commercial heavy-duty applications. Espey Mfg. & Electronics Corp. is an ISO 9001:2015 certified manufacturer serving the rugged industrial marketplace. The applications listed for their specialized power supplies and transformers confirm this focus.

Concrete examples of industrial end-uses include:

• AC and DC locomotives.
• Shipboard power (non-military specific).
• Ground-based radar support systems.

The backlog at March 31, 2025, was $138 million, showing that both military and industrial segments are contributing to the robust order book.

Espey Mfg. & Electronics Corp. (ESP) - Canvas Business Model: Cost Structure

You're looking at the core expenses Espey Mfg. & Electronics Corp. faced to deliver its specialized power conversion and magnetics products for the fiscal year ended June 30, 2025. Honestly, for a vertically integrated manufacturer like Espey Mfg. & Electronics Corp., the cost of making the product is always the biggest line item.

Cost Structure is dominated by direct production costs, followed by the necessary investment in its skilled workforce and future technology. Here's the quick math on the major buckets based on the fiscal year 2025 results.

The primary cost driver is the Cost of Goods Sold (COGS), which reflects the procurement of specialized components and the direct labor to assemble and test those high-reliability units for defense and industrial clients. This cost is derived from the reported Net Sales of $43,950,872 and the reported Gross Profit of $13.10 million for the year ended June 30, 2025.

Personnel Costs are substantial, supporting the company's in-house manufacturing and engineering capabilities. You noted the target of approximately 152 employees, which aligns with the reported headcount as of June 30, 2025. These are skilled roles, from magnetics experts to assembly technicians, all critical to maintaining ISO AS9100 certification.

Regarding Research and Development (R&D), while a specific total R&D figure for fiscal year 2025 isn't explicitly broken out from Selling, General, and Administrative (SG&A) expenses, we see evidence of ongoing investment. The company anticipated spending the remaining $2.3 million allowable under a specific funding award during fiscal year 2025, which relates to development activities. Furthermore, Selling, General, and Administrative expenses totaled $4,557,945 for the year.

Capital Expenditures (CapEx) represent the investment in the physical plant, including facilities like the Magnetics Center of Excellence. For the last 12 months reported, capital expenditures were $4.99 million. To be fair, this figure is offset slightly by a one-time Capital Investment Grant of $300,000 received in fiscal year 2025 related to new building completion.

Here is a breakdown of the key cost-related financial figures for Espey Mfg. & Electronics Corp. for the fiscal year ended June 30, 2025:

You should also note the other significant operating costs that fall outside the direct COGS calculation:

• Taxes paid in the past 12 months were $1.57 million.
• Net Sales (Revenue) for the year were $43,950,872.
• Net Income for the year was $8,142,954.

The vertical integration means Espey Mfg. & Electronics Corp. internalizes costs for component production, PCB population, metalwork, painting, wiring, and testing, which directly inflates COGS but potentially lowers external subcontracting costs.

Finance: draft 13-week cash view by Friday.

Espey Mfg. & Electronics Corp. (ESP) - Canvas Business Model: Revenue Streams

You're looking at the top line for Espey Mfg. & Electronics Corp. (ESP), and frankly, the numbers from fiscal year 2025 show a company successfully converting a massive order book into recognized revenue. The revenue streams are heavily anchored in specialized, high-reliability manufacturing.

Net Sales from specialized product manufacturing for fiscal year 2025 hit $43.95 million. That's a solid increase from the prior year's $38,736,319, showing real traction in their core business. This revenue comes from their primary business: the development, design, and production of specialized military and industrial power supplies/transformers.

A key indicator of future revenue visibility is the flow of new business. Revenue from long-term defense contracts and new orders is best tracked by looking at new orders booked, which were substantial in FY2025. New orders for the fiscal year ended June 30, 2025, totaled $86.4 million, a significant jump from approximately $52.4 million in the corresponding period last year.

This influx of new business directly feeds the backlog, which is a crucial component of their revenue pipeline. The backlog at June 30, 2025, reached a record $139.7 million, up from $97.2 million at June 30, 2024. This backlog represents future revenue that Espey Mfg. & Electronics Corp. expects to recognize over time.

The revenue generation is supported by two main activities:

• Sales of specialized military and industrial power supplies/transformers.
• Revenue from Build-to-Print and Manufacturing Services.

To give you a clearer picture of the FY2025 performance versus the pipeline indicators, here's a quick look at the key financial metrics for the year ended June 30, 2025:

Still, you have to watch the quarterly cadence. For instance, the fourth quarter of fiscal year 2025 saw net sales of $9,596,194, which was down from $11,610,911 in the fourth quarter of 2024. What this estimate hides is that while quarterly sales dipped, Q4 net income actually improved to $2,931,651, suggesting better margin execution on the products shipped that quarter.

The nature of their work, supporting critical platforms like the U.S. Navy's Virginia and Columbia class submarines, means revenue is often secured through long-cycle contracts. For example, an additional contract valued at $19.8 million was awarded in April 2025 to provide electrical power transformers for those submarine programs. This type of contract directly contributes to the robust backlog figure, securing future revenue streams.