INTERLINK ELECTRONICS INC: Annual Report Guide

I’ve put together this guide to help you understand Interlink Electronics’ performance over the past year. My goal is to translate complex filings into plain English so you can decide if this company fits your investment strategy.

1. The Big Picture

Interlink Electronics, based in Fremont, California, acts as the "nervous system" for modern gadgets. They make sensors that help devices "feel" touch, pressure, and movement. While not a household name, they have a unique niche. They pioneered "Force-Sensing Resistor" (FSR) technology over 40 years ago and supply these sensors to industrial, medical, and consumer electronics companies.

2. How They Performed

Interlink is still in a growth phase and is not yet profitable. Here is the breakdown of their 2025 performance:

• Revenue: They brought in $11.89 million, a 1.8% increase from $11.68 million in 2024.
• Profitability: They are still losing money, though they narrowed that loss from $1.98 million in 2024 to $1.62 million in 2025.
• Costs: It cost them 61 cents of every dollar to make their products, up from 58 cents last year. Rising material and labor costs are currently impacting profit margins.
• Stock Update: In October 2025, the company issued a 50% stock dividend. This acted like a 3-for-2 stock split, increasing shares from 9.9 million to 14.8 million. This aimed to make the stock easier to trade, though the company’s total market value remains small at about $8.24 million.

3. Their Business Strategy

Interlink acts as a partner, not just a parts supplier. They work with large companies to design custom solutions. Once Interlink’s tech is designed into a product, they often become the exclusive supplier for 5 to 10 years. This creates stability, as customers rarely switch suppliers due to the high cost of re-engineering. They are currently focusing on "design-wins" in automotive and medical equipment, which provide steady income once mass production begins.

4. The "Watch Out" List

Because Interlink is a small company, they face specific risks:

• Concentrated Power: CEO Steven N. Bronson controls about 45% of the company’s stock. He effectively dictates the company’s direction, which means other shareholders have limited influence on corporate decisions.
• Global Supply Chain: They manufacture in China, Scotland, and the U.S. This makes them vulnerable to trade barriers, tariffs, and geopolitical instability.
• Cybersecurity: They rely on digital systems for their designs. A successful cyberattack could disrupt operations and impact their finances, particularly given their current cash position of approximately $3.5 million.
• Stock Volatility: Because few shares are traded daily, the stock price can swing significantly. It may be difficult to buy or sell large positions without impacting the share price.

5. The Bottom Line

Interlink is betting that their sensors will become essential in everything from car seats to medical gear. They are slowly growing revenue and cutting losses, but they remain a high-risk investment. Between the concentrated leadership and the fact that they are still burning cash, this is for investors with a high appetite for risk.

Investor Tip: To track their progress, watch their "design-win" pipeline closely. Their path to profitability depends on successfully turning these custom, long-term projects into high-volume sales.