Acorn Energy (ACFN) investor relations material

Executive summary

• Q1 2026 revenue was $2,227,000, down 28.1% year-over-year, driven by a sharp decline in hardware revenue after completion of a major contract with a large customer.

• Monitoring revenue grew 11.7% to $1,417,000, reflecting expansion in high-margin, recurring services.

• Gross margin improved to 80.2% from 75.1% in Q1 2025 due to a higher mix of monitoring revenue.

• Net loss attributable to stockholders was $77,000 ($0.03 per share) versus net income of $464,000 ($0.19 per share) in Q1 2025, impacted by $197,000 in non-cash stock compensation.

• The Infrastructure Solutions (IS) segment was established via the AIO Systems partnership, targeting telecom towers and energy sites, with no revenue expected in the first half of 2026 but anticipated to be a material contributor in the future.

Financial highlights

• Total Q1 2026 revenue was $2,227,000, down 28.1% year-over-year, with hardware revenue declining 55.7% to $810,000 and monitoring revenue increasing 11.7% to $1,417,000.

• Gross profit was $1,790,000 (80.2% margin), up from 75.1% in Q1 2025.

• Operating expenses rose 11.2% to $1,914,000, mainly due to higher non-cash stock-based compensation and increased SG&A.

• Net loss was $77,000 ($0.03 per share), including $197,000 in non-cash stock compensation.

• Cash at quarter end was $4,257,000, with $53,000 in cash provided by operating activities and net working capital of $6,024,000.

Outlook and guidance

• Management expects $350,000–$500,000 in incremental hardware revenue from the major customer in 2026.

• 20%+ average annual revenue growth over the next 3–5 years is targeted, supported by secular tailwinds and a scalable, capital-light model.

• IS segment revenues are not expected in the first half of 2026, but the segment is anticipated to become material as AIO partnership integration progresses.

• Q1 is typically the lowest revenue quarter; stronger performance is expected through the year.

• Existing cash is expected to fund planned operating and capital expenditures for at least the next 12 months.