What changed in this filing

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Item 1. Business

2025-09-19 compared with 2024-09-23 · 78 added, 48 removed, 100 unchanged (56% of the section changed)

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Additional information about Trio-Tech is available on our website at www.triotech.com.

During the fiscal year ended June 30, 2024 (“ Fiscal 2024 ”), the Company operated its business in four segments:

manufacturing, testing services, distribution, and real estate.

The Company has traditionally been a provider of reliability test equipment and services to the semiconductor and other industries.

Our customers rely on us to verify that their semiconductor components meet or exceed the rigorous reliability standards demanded for automotive electronics, industrial electronics, computing and data storage, consumer electronics, and communication markets.

We act as a global one-stop solution for our customers by designing and building reliability test solutions and offering comprehensive testing services.

The Company also develops and manufactures an extensive range of equipment used in the manufacturing processes of semiconductors and various other industries.

During the fiscal year ended June 30, 2025 (“ Fiscal 2025 ”), the Company operated its business in two segments:

Semiconductor Back-end Solutions and Industrial Electronics.

In the first quarter of Fiscal 2025, we made changes in our business strategy in an effort to better align with our focus areas and to streamline operations.

Geographically, the Company operates in the United States (“ U.S.

”), Singapore, Malaysia, Thailand and China.

Management periodically evaluates the ongoing contributions of each of its business segments to its current and future revenue and prospects.

As a result, it may divest one or more business segments in the future to enable management to concentrate on segments where it anticipates opportunities for future revenue growth, thereby maximizing shareholder value.

The Company is a provider of reliability test equipment and services to the semiconductor industry.

We act as a global one-stop solution for our customers by designing and building reliability test solutions and offering comprehensive testing services through our testing laboratories in the U.S.

For information relating to revenue, profit and loss and total assets for each of the segments, see Note 18 - Business Segments contained in the consolidated financial statements included in this Annual Report.

While the semiconductor industry is and will remain a major market for the Company, an important component of our strategy is to reduce our historic concentration on this industry.

As a result, we decided to organize our operating business based on the markets that we serve.

Beginning in Fiscal 2025, we report our financial performance based on our new segments, Semiconductor Back-end Solutions and Industrial Electronics.

For information relating to revenue, profit and loss and total assets for each of the segments, see Note 17 - Business Segments co ntained in the consolidated financial statements included in this Annual Report.

Company History – Certain Highlights for the Five Fiscal Years Ended June 30, 2025

Trio-Tech International recertified for BizSafe re-certification (March 2020)

Trio-Tech (Tianjin) Co.

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recertified to ISO 45001:2018 standards.

Trio-Tech International Pte.

(Singapore) recertified to ISO 9001:2015 standards.

Trio-Tech International Pte.

(Singapore) recertified to ISO 14001:2015 standards.

Trio-Tech (Malaysia) Sdn.

recertified to ISO 9001:2015 standards.

Trio-Tech (Malaysia) Sdn.

recertified to ISO 14001:2015 standards.

Trio-Tech (Bangkok) Co.

recertified to ISO 9001:2015 standards.

Overall Business Strategies

Our core business is, and historically has been, in the semiconductor industry, including our manufacturing of equipment segment (“ Manufacturing ”), our testing services segment (“ Testing ”) and our distribution of test and other semiconductor equipment and electronic components segment (“ Distribution ”).

Revenue from the Manufacturing, Testing and Distribution segments accounted for 99.9% of our total revenue for the years ended June 30, 2024 and 2023, respectively.

Our core business is in the semiconductor industry, encompassing the manufacturing of equipment, provision of testing services and distribution of test and other semiconductor equipment and electronic components.

The “Semiconductor Back-end Solutions” (“ SBS ”) segment comprises of our core semiconductor back-end manufacturing and testing operations that serve the semiconductor industry.

Our value-added distribution business, along with our services and equipment manufacturing operations that serve various industries comprises our “Industrial Electronics” (“ IE ”) segment.

Revenue from the SBS and IE segments accounted fo r 99.9% of our total revenue for the years ended June 30, 2025 and 2024, respectively.

The semiconductor industry has experienced periods of rapid growth, but has also experienced downturns, often in connection with, or in anticipation of, maturing product cycles of both semiconductor companies’ and their customers’ products and decline in general economic conditions.

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Management periodically evaluates the ongoing contributions of each of its business segments to its current and future revenue and prospects.

To achieve our strategic plan for our semiconductor business, we believe that we must pursue and win new business in the following areas:

To achieve our strategic plan, we believe that we must pursue and win new business in the following areas:

• Primary markets – Capturing additional market share within our primary markets by offering superior products and services to address the needs of our major customers.

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Business Segments

Manufacturing

TTI develops and manufactures an extensive range of test equipment used in the “front-end” and the “back-end” manufacturing processes of semiconductors.

Our equipment includes leak detectors, autoclaves, centrifuges, burn-in systems and boards, HAST testers, temperature-controlled chucks, wet benches and more.

In the first quarter of Fiscal 2025, we made changes in our business strategy in an effort to better align with our focus areas and to streamline operations.

Beginning in Fiscal 2025, we report our financial performance based on our new segments, Semiconductor Back-end Solutions (“ SBS ”) and Industrial Electronics (“ IE ”).

A mapping of our previous presentation and the revised segments is as presented below:

• Manufacturing – Manufacturing of equipment that solely serves the back-end processes of the semiconductor industry is presented under the SBS segment, and manufacturing of equipment that serves various industries is presented under the IE segment.

• Testing – Testing services are presented under the SBS segment.

• Distribution – Value-added distribution of burn-in test related equipment is presented under the SBS segment, and value-added distribution of other electronic products are presented under the IE segment.

• Real estate – Real estate segment relates to real estate investments made in ChongQing, China.

When identifying reportable segments, management evaluates the contribution of each segment to our overall business strategy and whether the segment reported provides meaningful information to users about the Company’s performance and prospects.

Revenue from the real-estate segment has been below 1% of total revenue in the past five fiscal years due to the negative real-estate environment in China.

Effective in Fiscal 2025, management therefore concluded that the real-estate segment is not integral to the Company’s operations and does not intend to allocate any additional resources to this segment.

As a result, this segment ceased to be a reportable segment in Fiscal 2025, and therefore will be presented under the Others segment.

Semiconductor Back-end Solutions (SBS)

The SBS segment of the Company designs and manufactures an extensive range of burn-in and reliability test equipment used in the “back-end” manufacturing processes of semiconductors.

Our equipment includes burn-in systems, burn-in boards and related equipment that is used in the testing of structural integrity of integrated circuits.

We also act as an extended development team of Integrated Device Manufacturers (“ IDMs ”) and Fabless semiconductor companies in the testing process with our expert technical skills, especially in the New Product Introduction (“ NPI ”) process.

TTI provides comprehensive electrical, environmental, and burn-in testing services to semiconductor manufacturers in our testing laboratories in Asia.

Our customers include both manufacturers and end users of semiconductors and electronic components who look to us when they decide to outsource their testing process.

We provide comprehensive electrical, environmental, and burn-in testing services to semiconductor manufacturers in our testing laboratories in Asia.

Our customers include both manufacturers and end users of semiconductor and electronic components who look to us when they decide to outsource their testing process.

We also support the asset-light strategy of our customers by setting up test facilities and providing component level, package level and system level testing services with expert technology that improves the productivity of our customers.

The independent tests are performed to industry and customer specific standards.

In addition to marketing our proprietary products, we distribute complementary products made by manufacturers around the world.

The products include environmental chambers, mechanical shock and vibration testers, and other semiconductor equipment.

Industrial Electronics (IE)

The IE segment of the Company includes the design, manufacture and distribution of an extensive range of test, process and other equipment used in the manufacturing processes of customers in various industries in the consumer and industrial market.

Our equipment includes environmental chambers, leak detectors, autoclaves, centrifuges, dynamic testers, Highly Accelerated Stress Test ( “HAST” ) testers, temperature-controlled chucks, and more.

This segment also provides preventive maintenance, calibration services, repair services and upgrading and refurbishment services for temperature, humidity and pressurization equipment.

In addition to marketing our proprietary products, we distribute mechanical, electrical and electronic products made by manufacturers around the world.

The products include environmental chambers, mechanical shock and vibration testers, specialized equipment for aerospace applications and more.

We also distribute a wide range of components such as connectors, sockets, cables, LCD displays and touch screen panels.

We act as value-added resellers by enhancing the value of the distributed products by customizing each to the needs of our customers through our expert engineering, integration, and sub-assembly services.

We also support our customers as their extended research & development arm in product design, leveraging the expert skills of our component engineers and design engineers.

Our real estate (“ Real Estate ”) segment generates rental income and investment income from real estate investments made in Chongqing, China.

We act as value-added resellers by enhancing the value of the distributed products by customizing each to the needs of our customers through our expert engineering and integration services.

We also support our customers as their extended research and development arm in product design, leveraging the expert skills of our component engineers and design engineers.

Product Research and Development

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Marketing, Distribution and Services

We market our products and services worldwide, directly and through independent sales representatives and our own marketing sales team.

We market our products and services worldwide, directly and through independent sales representatives and our own marketing team.

We have approximately five independent sales representatives operating in the U.S.

and another eighteen in foreign countries.

All sales representatives represented the Testing and Manufacturing segments for products and services produced and provided from our facilities in different locations.

and another twenty-two in foreign countries.

All sales representatives represented the SBS and IE segments for products and services produced and provided from our facilities in different locations.

Customer Concentration

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The majority of our sales and services in the years ended June 30, 2025 and 2024 were made or provided to customers outside of the U.S.

As of June 30, 2025 and 2024, trade account receivables from our three largest customers accounted for approximately 56.3% and 57.0%, respectively, of our total trade account receivables.

Within these balance, $2,376 (22.0%) and $2,217 (20.8%) of our total trade account receivables were from one major customer for the years ended June 30, 2025 and 2024, respectively.

We regularly assess the creditworthiness of our customers and evaluate the adequacy of the allowance for expected credit losses.

The following table sets forth the Company’s backlog as of June 30, 2025 and 2024:

For the Year Ended June 30,

Manufacturing backlog

Testing services backlog

Distribution backlog

Real estate backlog*

* Real estate backlog represents the rental income from a non-cancellable lease.

Semiconductor Back-end Solutions backlog

Industrial Electronics backlog

Based on our past experience, we do not anticipate any significant cancellations or renegotiation of sales.

The purchase orders for the manufacturing, testing services and distribution businesses generally require delivery within 12 months from the date of the purchase order and certain costs are incurred before delivery.

The purchase orders for the SBS and IE businesses generally require delivery within 12 months from the date of the purchase order and certain costs are incurred before delivery.

In the event of a cancellation of a confirmed purchase order, we require our customers to reimburse us for all costs incurred.

We do not anticipate any difficulties in meeting delivery schedules.

For testing services, purchase orders are provided only during the process of delivery.

For testing services in the SBS segment, purchase orders are provided only during the process of delivery.

Hence, the backlog is based on estimates provided by our customers and not based on a customer’s purchase order.

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Our ability to compete is dependent on our ability to develop, introduce and sell new products, or enhanced versions of existing products, on a timely basis and at competitive prices, while reducing our costs.

Manufacturing

The principal competitive factors in the manufacturing industry include product performance, reliability, service and technical support, product improvements, price, established relationships with customers and product familiarity.

Although we have competitors for our various products, we believe that our products compete favorably with respect to each of the above factors.

Semiconductor Back-end Solutions (SBS)

Our SBS testing services operate in a competitive landscape, with numerous laboratories in our regions offering similar capabilities.

The intense competition has accelerated industry consolidation, particularly in Asia, thinning the field of competitors.

While the presence of semiconductor manufacturers competitors poses risks to our revenue, we believe that our established reputation, decades of expertise, and deep customer relationships will continue to secure our market position.

The principal competitive factors in the SBS manufacturing processes of burn-in and reliability test equipment include product performance, reliability, service and technical support, product improvements, price, established relationships with customers and product familiarity.

We have been in business for more than 60 years which has helped us to establish and nurture long-term relationships with customers.

There are numerous testing laboratories located in the areas where we operate that perform testing similar to the testing that we offer.

However, due to such competition in the industry, there has been a reduction in the total number of competitors in Asia.

The existence of competing laboratories and the purchase of testing equipment by semiconductor manufacturers and users are potential threats to our future testing services revenue and earnings.

Although these laboratories and competitors may challenge us at any time, we believe that other factors, including reputation, a long service history and strong customer relationships are instrumental in both maintaining and strengthening our position in the market.

Our distribution segment sells a wide range of components and semiconductor equipment.

While the semiconductor equipment industry is highly competitive, we offer the advantage of a one-stop service alternative for customers by complementing our products with design consultancy and other value-added services.

Industrial Electronics (IE)

Our IE segment includes the design, manufacture and distribution of an extensive range of test, process and other equipment used in the manufacturing processes of customers in various industries in the consumer and industrial market.

We also distribute a wide range of components such as connectors, sockets, cables, LCD displays and touch screen panels.

We act as value-added resellers by enhancing the value of the distributed products by customizing each to the needs of our customers through our expert engineering and integration services.

We also support our customers as their extended research and development arm in product design, leveraging the expert skills of our component engineers and design engineers.

While the equipment and component market remains highly competitive, our integrated approach combines standard product offerings with value-added services such as customization and technical support.

This combination allows us to meet specialized customer needs more comprehensively, creating modest but sustainable differentiation in our target markets, supporting consistent revenue generation while strengthening our position in key customer segments.

During the years ended June 30, 2025 and 2024, we did not register any patents within the U.S.

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However, should any claims be brought against us, the cost of litigating such claims and any damages could materially and adversely affect our business, financial condition, and results of operations.

As of June 30, 2024, we had approximately 673 full-time employees and three part-time employees.

Geographically, approximately six full-time employees were located in the U.S.

As of June 30, 2025, we had approximat ely 614 full-time employees and 4 part-time employees.

Geographically, approximately five full-time employees were located in the U.S.

and approximately 609 full-time employees in Asia.

None of our employees are represented by a labor union.

There were approximately 59 employees in the manufacturing segment, 582 employees in the testing services segment, three employees in the distribution segment, three employees in the real estate segment and 26 employees in general administration, logistics and others as of June 30, 2024.

As of June 30, 2023, we had approximately 573 full-time employees and no part-time employees.

Geographically, approximately eight full-time employees were located in the U.S.

There were approximately 559 employees in the SBS segment, 31 employees in the IE segment and 24 employ ees in general administration, logistics, real estate and others as of June 30, 2025.

As of June 30, 2024, we had approximately 673 full-time employees and three part-time employees.

Geographically, approximately six full-time employees were located in the U.S.

and approximately 667 full-time employees in Asia.

None of our employees are represented by a labor union.

There were approximately 56 employees in the manufacturing segment, 481 employees in the testing services segment, three employees in the distribution segment, three employees in the real estate segment and 30 employees in general administration, logistics and others as of June 30, 2023.

There were approximately 621 employees in the SBS segment, 23 employees in the IE segment, and 29 employees in general administration, logistics, real estate and others as of June 30, 2024.

ITEM 1A – RISK FACTORS

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Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 1. Business