Data I/O acquires V-TEK for $23m to double revenue and diversify

Data I/O has completed its $23m acquisition of semiconductor handler V-TEK, which the Redmond firm says will more than double its consolidated revenue.

By The Datatech Times Editorial Team AI level 2 of 5
AI level 2 of 5: drafted by our AI editorial assistant from the company's announcement; fact-checked, edited and signed off by Mark Walker, Editorial Director. What the levels mean
Rows of white robotic arms with blue accents perform assembly on blue rectangular modules moving along a conveyor belt in a brightly lit, clean room production facility with transparent safety barriers.

Data I/O Corporation (NASDAQ: DAIO) has completed the acquisition of V-TEK, Inc. and its affiliate A&J Programming, Inc., paying approximately $23 million in a combination of $20 million cash and $3 million in Data I/O common stock. The Redmond, Washington-based data programming equipment specialist says the deal, first signalled two years ago, is expected to be immediately accretive and to more than double the company's consolidated revenue.

V-TEK, headquartered in Mankato, Minnesota, manufactures semiconductor handling automation systems for test and packaging applications. A&J Programming adds contract programming services to the group. V-TEK will operate as a wholly owned subsidiary, with its president Mitch Jacobs moving into the role of Senior Vice President at the enlarged company.

William Wentworth, President and CEO of Data I/O, said the transaction marks the completion of a deliberate strategic pivot. "The NEW Data I/O becomes real and is materially impactful to its financial performance and growth outlook," he said, adding that the group will now shift its revenue mix toward software and services, which are expected to play a greater role in next year's growth plan.

The selling shareholders have taken $3 million of the purchase consideration in Data I/O stock, a structure that gives them ongoing upside in the combined business. Bill Karol, representing the selling ownership group, cited conviction in the merged entity's prospects across a broader set of end markets.

Strategic rationale

Data I/O's existing business is closely tied to the automotive electronics cycle, a notoriously lumpy market for capital equipment suppliers. Management has explicitly framed the acquisition as a tool to reduce that cyclicality, opening exposure to data centres, AI hardware, photonics, industrial automation, medical devices, and defence and aerospace. The addition of V-TEK's handling systems to Data I/O's programming and security provisioning technology is positioned by the company as covering the full data-provisioning supply chain: programme, handle, test, inspect and package.

The deal also accelerates what Data I/O calls Programming-as-a-Service, a recurring-revenue model built on V-TEK's existing contract programming operations via A&J Programming. Shifting from pure capital-equipment sales toward a services layer is a well-established playbook in the semiconductor equipment industry, offering smoother revenue recognition and higher long-term margins.

Market context

The semiconductor equipment and handling market has faced considerable pressure since the 2022-2023 inventory correction, with capital spending by chip manufacturers and electronics contract manufacturers remaining subdued in many segments. Against that backdrop, consolidation among smaller equipment vendors is accelerating, as scale becomes a prerequisite for maintaining global field-service networks and qualifying for tier-one automotive and defence supply chains.

Data I/O sits in a specialised niche: device programming and security provisioning for Flash-based microcontrollers and high-density memory devices. Competing platforms exist across a range of larger test-and-measurement vendors, but few address the combined programming, security and logistics workflow that Data I/O targets. By adding V-TEK's handling and inspection capability, the company can pitch a more complete turnkey solution to original equipment manufacturers, potentially reducing its exposure to single-step competitive displacement.

The cash portion of the deal was partly funded by a private placement announced on 19 October 2026. Advisers were StoneX Financial and Dorsey & Whitney on the Data I/O side, and Sperry Mitchell and Blank Rome for V-TEK. The company has not disclosed pro-forma revenue figures, EBITDA targets, or a specific accretion timeline beyond describing the deal as immediately accretive.

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