Lantronix (LTRX) Q1 2026 earnings summary

Executive summary

• Fiscal Q1 2026 revenue was $29.8 million, at the high end of guidance, with non-GAAP EPS of $0.04 and GAAP EPS of ($0.04); revenue grew 3% sequentially and year-over-year, excluding GRIT/Gridspertise, but declined 13.4% year-over-year including all product lines and regions.

• Gross margin expanded to 44.8% GAAP and 45.3% non-GAAP, up from 40% last quarter and 42.1% a year ago, driven by favorable product mix and cost management.

• Net loss improved to $1.4 million ($0.04 per share), from $2.5 million loss ($0.07 per share) a year ago, due to lower operating expenses and gross margin expansion.

• Strong momentum in drone and asset monitoring businesses, with OEM engagements rising from 10 to 17, new product launches (EdgeFabric.ai, Kompress.ai/compress.ai), and expanded partnerships.

• Core network infrastructure business delivered solid growth and margins, supported by demand in government, smart city, and industrial applications.

Financial highlights

• GAAP gross margin was 44.8%, non-GAAP gross margin 45.3%, both up year-over-year and sequentially.

• GAAP net loss was $1.4 million (EPS: -$0.04); non-GAAP net income was $1.5 million (EPS: $0.04).

• Cash and cash equivalents ended at $22.2 million, up over $2 million sequentially, with positive operating cash flow of $3.6 million.

• Paid down $1 million in debt, leaving $10.7 million outstanding and a net cash position of $11.5 million.

• Americas revenue grew to $20.7 million, while EMEA and APJ regions declined to $5.1 million and $4.1 million, respectively.

Outlook and guidance

• Q2 2026 revenue expected between $28 million and $32 million; non-GAAP EPS guidance of $0.02–$0.04.

• At midpoint, Q2 guidance implies sequential revenue growth and nearly 20% year-over-year growth, excluding GRIT/Gridspertise.

• Gross margin expected to remain healthy and consistent with first-half fiscal 2025 levels (43–44%), but may fluctuate due to product mix and costs.

• Management anticipates continued sequential revenue progression and overall growth for fiscal 2026; liquidity and cash flow are sufficient for at least 12 months.