Ultralife (ULBI) Q1 2026 earnings summary

Executive summary

• Q1 2026 revenue was $47.4 million, down 6.5% year-over-year, with both Battery & Energy Products and Communications Systems segments experiencing lower sales.

• Gross profit margin fell to 21.3% from 25.1% year-over-year, impacted by unfavorable product mix, higher utility costs, and production disruptions.

• Net loss attributable to shareholders was $0.5 million, or $(0.03) per share, compared to net income of $1.9 million, or $0.11 per share, in the prior year.

• Adjusted EBITDA was $3.2 million (6.8% of sales), down from $5.4 million (10.7%) year-over-year.

• Backlog reached a record $115.1 million, up 21.1% year-over-year, with over $12 million from new products released in the past year.

Financial highlights

• Battery & Energy Products segment revenue was $44.2 million, down 4.7% year-over-year; medical sales increased 5.9%.

• Communications Systems segment revenue was $3.3 million, down 25.7% year-over-year, mainly due to lower shipments to a major international defense contractor.

• Consolidated gross profit was $10.1 million, down from $12.7 million year-over-year; gross margin declined to 21.3% from 25.1%.

• Operating expenses rose to $10.3 million (21.8% of revenue), up 10.5% year-over-year, driven by higher R&D, consulting, litigation, and transition costs.

• Cash at quarter-end was $8.9 million, down from $9.3 million at year-end 2025.

Outlook and guidance

• Focused on improving manufacturing efficiency, Communications Systems revenue capture, gross margin in Battery & Energy Products, and vertical integration.

• Expecting mid-year improvements from corrective actions on scrap and process enhancements.

• Execution and replenishment of backlog expected to support cash flow, debt reduction, and strategic investments in 2026.

• Continued investment in new product development and branding alignment to drive future growth.

• Positive operating cash flow and available credit are expected to meet funding needs for the foreseeable future.