The quarter cleared a raised market bar. Revenue reached $82.6 million versus the published consensus of approximately $78.6 million, while non-GAAP diluted EPS was $0.15 versus an expected $0.11. That also exceeded the company’s prior Q2 revenue outlook of $75 million to $81 million.
| Metric | Q2 2026 | Q2 2025 | Market expectation / prior guide |
|---|---|---|---|
| Revenue | $82.6M | $61.7M | Consensus ~$78.6M |
| GAAP diluted EPS | $(0.02) | $(0.07) | — |
| Non-GAAP diluted EPS | $0.15 | $(0.06) | Consensus ~$0.11 |
| Gross margin | 31.1% | 29.9% | Prior guide: 29%-33% |
| Adjusted EBITDA | $10.7M | $5.6M | Prior guide: $8M-$12M |
| Operating cash flow, six months | $30.4M | $(1.4)M | — |
The beat was driven mainly by Products, not just development work. Products revenue rose 45.4% to $59.4 million, with Products gross margin improving to 41.2%; Aerospace and Defense revenue increased 40.8% to $57.3 million. Development revenue grew more modestly, while its 5.6% gross margin was sharply below the prior-year 13.1% level. (Segment results — Products and Development; Market verticals)
Profitability improved materially, but the quality of earnings remains mixed. GAAP operating loss narrowed to $3.6 million from $4.2 million, and adjusted EBITDA nearly doubled to $10.7 million. However, stock-based compensation rose to $11.0 million in the quarter and $21.8 million through six months, exceeding the reported net loss and accounting for much of the difference between GAAP and non-GAAP results. (Income Statement; Adjusted EBITDA reconciliation; Stock-based compensation table)
The next-quarter guide is broadly above the old expectation but includes a meaningful execution problem. Q3 revenue guidance has a $70 million midpoint, roughly in line with the available $69.9 million consensus estimate, but management says approximately $17 million of product revenue expected to ship in Q3 is being pushed into later quarters because of supply-chain challenges. Gross margin is guided to 24%-30% and adjusted EBITDA to $1 million-$7 million, both implying a sharp sequential slowdown from Q2, largely because of mix and delayed product shipments. (Q3 2026 outlook)
Net read: a genuine Q2 beat, tempered by weaker near-term visibility. The filing improves the current earnings picture through stronger-than-expected revenue, solid Products margins, and much better cash generation; the offset is that the supply-chain issue makes the Q3 outlook less clean than the headline beat suggests. (Cash Flow statement; Q3 2026 outlook)
Read the original 8-K on SEC EDGAR ↗