823.7% is the oddest number in Trio-Tech's new annual report. That is the increase in operating cash flow, from $371,000 to $3.4 million, during the twelve months ended June 30, 2026.

The business also grew fast enough to make last year's $36.5 million of revenue look small. Sales reached $62.6 million, up 71.6%. The catch, in plain accounting language, is that gross profit rose only 13.9%, pushing gross margin down from 25.1% to 16.6%.

[An operating cash flow and margin metric strip fits here.]

That left Trio-Tech with a familiar small-company paradox: more activity, more cash, and less operating leverage. Operating income moved from $254,000 to a $204,000 loss. Net income remained close to break-even, at a $34,000 loss.

Management says a new revenue stream helps explain the mismatch. Final testing services began in fiscal 2026 and required no capital investment, but they carry lower margins because they also carry less risk.

"The incremental revenue relating to final testing services that commenced in Fiscal 2026 was attributable to new service streams that required no capital investment, resulting in lower margin profiles that reflect the reduced risk exposure."

Trio-Tech, 10-K, Sept. 24, 2026

It is a disclosed trade: services added sales without requiring new equipment, but the revenue came with a thinner gross-profit layer.

The company also points to a customer reshuffling its geographic sourcing, which expanded demand for Trio-Tech's services. Aviation backlog increased, while equipment and electronic-component backlog declined. The revenue mix is therefore doing more work in the result than the topline alone suggests.

Costs added another drag. Selling and distribution expenses rose with agency commissions in the IE segment, and the company recorded $194 of expected credit loss expense.

"The increase also reflected a $47 increase in selling and distribution expenses, primarily due to higher agency commissions resulting from a greater proportion of commissionable revenue in the IE segment, as well as $194 of expected credit loss expense."

Trio-Tech, 10-K, Sept. 24, 2026

Cash generation did improve materially, but it was not all operating momentum. Cash reached $21.4 million, helped by higher operating cash flow and proceeds from issuing shares. Diluted shares rose 5.5% to 9.0 million, while capex increased 80% to $1.7 million as operations in Malaysia, Singapore, and China added equipment for burn-in testing.

The balance sheet carries a second, quieter question. Inventory rose 50.6% to $3.4 million, while accounts receivable rose 25.4% to $13.5 million. The 10-K does not say why those balances changed. It does show a company expanding capacity and working capital at the same time that its margin has moved away from the 25% range reported in fiscal 2025.

At the latest close, Trio-Tech's shares were up 1.9% at $11.46, after an 84.9% six-month rise. The market value was $50.0 million against $10.2 million of net cash, but the annual earnings base is still too close to zero for a meaningful P/E ratio. Most of the valuation argument is therefore about what price investors attach to future earnings, not what the latest earnings already produce.