Itron (ITRI) Q1 2026 earnings summary

Executive summary

• Q1 2026 revenue was $587 million, down 3% year-over-year, but exceeded expectations due to accelerated project deployments and strong execution.

• Adjusted EBITDA rose 5% to $92 million, with non-GAAP EPS of $1.49 and free cash flow of $79 million.

• Outcomes segment grew 22% year-over-year, annual recurring revenue increased 28% to $414 million, and the Resiliency Solutions segment was enhanced by the Locusview acquisition.

• Backlog at quarter end was $4.4 billion, with Outcomes and Resiliency Solutions comprising 25% of total backlog.

• Integration of Urbint and Locusview is progressing, with higher operating expenses but strong standalone performance.

Financial highlights

• GAAP net income attributable to shareholders was $53.5 million ($1.18 per diluted share), down from $65.5 million ($1.42) last year due to higher operating expenses and lower interest income.

• Adjusted gross margin improved to 40.7%, up 490 basis points year-over-year.

• Non-GAAP operating income was $84.5 million, up 5% year-over-year; adjusted EBITDA also rose 5%.

• Free cash flow increased to $79 million from $67 million a year ago, mainly due to lower tax payments.

• Product revenues declined 9% to $477.8 million, while service revenues grew 30% to $109.2 million year-over-year.

Outlook and guidance

• Q2 2026 revenue is expected between $560 million and $570 million, down 7% year-over-year at the midpoint.

• Q2 2026 non-GAAP EPS is projected at $1.25–$1.35 per diluted share, down about 8–20% year-over-year after normalizing for tax and interest.

• Full-year outlook remains consistent with prior guidance, with anticipated back-half weighted growth driven by network deployments.

• Management expects sufficient liquidity for at least the next 12 months and into the foreseeable future.

• Guidance assumes EUR/USD at 1.16 and a 22% effective non-GAAP tax rate.