Direct Answer
8 SEC filers are classified under the Standard Industrial Classification code that describes the electronic test & measurement industry, and their latest annual reports show $9.8 billion of combined revenue and a median operating margin of 0.4%. Investors should still evaluate its revenue model, industry-specific KPIs, valuation framework and the risks that can change the group's economics.
Industry Overview
Electronic test and measurement companies sell the equipment used to design and verify chips, networks and electronics, plus software and service. Orders follow research and development spending and technology transitions. The first numbers to compare across companies here are orders and book-to-bill, gross margin and software and service share.
Key Industry Metrics
- Orders and book-to-bill: New orders and the ratio of orders to shipments. A ratio above one shows demand exceeding sales, which often leads revenue in a business tied to development budgets.
- Gross margin: Revenue left after producing instruments. High-end instruments and software earn more, while competition in standard equipment compresses it.
- Software and service share: The portion of revenue from software, calibration and maintenance. It is steadier than hardware and grows as customers use analysis tools on installed instruments.
- End-market mix: Sales divided among communications, semiconductors, aerospace and industrial uses. Each follows different spending, so mix shows which technology cycles are driving demand.
- R&D investment: Money spent on developing new instruments. Test tools must keep ahead of new standards such as 5G and faster interconnects, so spending sustains competitiveness.
Primary Macro Drivers
- R&D budgets for 5G, AI and semiconductors: Spending on new wireless, AI and chip designs requires measuring and verifying them, so research budgets show up in orders and book-to-bill.
- Aerospace and defense demand: Defense and aerospace programs buy test systems under long contracts, adding steady orders less tied to commercial electronics.
- Product cycles: New standards and faster interfaces require new instruments, creating upgrade waves that lift orders and software share.
- Industrial capex: Factories investing in automation and quality need measurement tools, supporting orders from industrial customers.
Major Risks
- Cyclical orders: Customers cut research and equipment budgets in slowdowns, which reduces orders quickly; watch orders, book-to-bill and customer R&D commentary.
- Customer concentration: A few large manufacturers account for much revenue, so one customer's program change can swing results; watch customer mix and backlog.
- Competition: Rivals and lower-cost instruments pressure prices in standard test categories; watch gross margin and share commentary.
- Technology change: Changes in standards or measurement approaches can make existing gear less useful; watch research spending and software and service share.
Industry Characteristics
| Characteristic | Profile |
|---|---|
| Cyclicality | Cyclical |
| Capital Intensity | Medium |
| Regulatory Intensity | Low |
| Industry Maturity | Mature |
| Geographic Importance | Global |
Electronic Test & Measurement Filers in the SEC Record
8 companies with annual reports in the dataset are classified by the SEC in the Standard Industrial Classification code 3825. Their latest fiscal years end between 2025 and 2026, and together they reported $9.8 billion of revenue. Median revenue growth over the prior year was 1.7%. Median operating margin was 0.4% and median net margin 0.8%. Median total liabilities were 35% of total assets, and 4 of 8 reported a profit in their latest year.
| Company | Revenue | Growth | Operating margin | Net margin | Year |
|---|---|---|---|---|---|
| Veralto Corp | $5.5 billion | 6.0% | 23.2% | 17.1% | FY 2025 |
| Teradyne, Inc | $3.2 billion | 13.1% | 20.4% | 17.4% | FY 2025 |
| Allient Inc | $554 million | 4.6% | 7.9% | 4.0% | FY 2025 |
| Transcat Inc | $332 million | 19.2% | 4.0% | 1.6% | FY 2026 |
| Intest Corp | $114 million | -12.9% | -3.3% | -2.2% | FY 2025 |
| Frequency Electronics Inc | $63 million | -9.4% | -4.7% | -0.0% | FY 2026 |
| Aehr Test Systems | $50 million | -15.2% | -28.3% | -14.3% | FY 2026 |
| Data I/O Corp | $22 million | -1.2% | -23.8% | -24.4% | FY 2025 |
Source: each company's own annual report as filed with the SEC (XBRL data), figures in U.S. dollars. A company's SIC code reflects its main business as the SEC records it, so it can differ from how an index provider or analyst classifies the company, and a diversified group appears under only one code.
Where to Go Next
The Electronic Test & Measurement guide describes how the industry earns money, what to measure and what can go wrong. To see how it compares, read the neighbouring industries in the same sector, then apply the same checks to a specific company.
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Frequently Asked Questions
What are the main KPIs for the Electronic Test & Measurement industry?
Key performance indicators for the Electronic Test & Measurement industry include: Orders and book-to-bill, Gross margin, Software and service share, End-market mix, R&D investment. Which matter most depends on the company's model, so compare them across several companies rather than relying on one.
How cyclical is the Electronic Test & Measurement industry?
The Electronic Test & Measurement industry is cyclical, meaning its revenues and earnings tend to expand during economic expansions and contract during downturns. Investors should monitor leading economic indicators and interest rate trends when evaluating timing.
What are the biggest risks in the Electronic Test & Measurement industry?
The primary risks for Electronic Test & Measurement companies include: Cyclical orders, Customer concentration, Competition, Technology change. Investors should assess each company's exposure to these factors and its track record of navigating them.