nLIGHT, Inc. (NASDAQ:LASR) Q2 2024 Earnings Conference Call August 1, 2024 5:00 PM ET

Company Participants

Scott Keeney - Chairman and Chief Executive Officer
Joseph Corso - Chief Financial Officer

Conference Call Participants

Greg Palm - Craig-Hallum Capital Group
Keith Housum - Northcoast Research
Mark Miller - The Benchmark Company

Operator

Good afternoon, and welcome to nLIGHT Second Quarter 2024 Earnings Conference Call. All participants will be in listen only mode. [Operator Instructions] After today's presentation, there will be an opportunity to ask questions. [Operator instructions] Please note, this conference is being recorded.

I would now like to turn the conference over to Joseph Corso, Chief Financial Officer. Please go ahead.

Joseph Corso

Thank you, and good afternoon, everyone. I'm Joe Corso, nLIGHT's Chief Financial Officer. With me today is Scott Keeney, nLIGHT's Chairman and CEO.

Today's discussion will contain forward-looking statements, including financial projections and plans for our business, some of which are beyond our control, including the risks and uncertainties described from time to time in our SEC filings. Our results may differ materially from those projected on today's call, and we undertake no obligation to update publicly any forward-looking statements, except as required by law. During the call, we will be discussing certain non-GAAP financial measures. We have provided reconciliations of these non-GAAP financial measures to the most directly comparable GAAP financial measures in our earnings release, which can be found on the Investor Relations section of our website.

I will now turn the call over to Scott.

Scott Keeney

Thank you, Joe. Second quarter revenue of $50.5 million was at the upper end of our guidance range and grew 13% compared to our first quarter. We had a strong quarter in aerospace and defense, which grew 26% sequentially. Our commercial business, which includes our industrial and microfabrication end markets, increased approximately 1% from the first quarter.

Overall gross margins improved to approximately 24% in the second quarter and products gross margin expanded to approximately 30%, slightly above the top end of our guidance range. We ended the quarter with cash equivalents and investments of $115 million with no debt. Aerospace and defense remains a significant growth opportunity for our business, and we had a strong quarter in both directed energy and laser sensing.

In directed energy, we continue to see strong interest in our solutions. Ongoing military operations in the Middle East and Ukraine highlight the increasing need for advanced, cost-effective defensive weapons technology. We believe directed energy lasers will be a critical part of the U.S. and foreign allies' layered defense strategy as they offer a significant operating cost advantage compared to traditional kinetic weapons and a deep magazine.