Orion(OESX) - 2026 Q2 - Quarterly Results

Financial Performance - Q2'26 total revenue increased to $19.9 million, up from $19.4 million in Q2'25, reflecting a growth of approximately 2.6% year-over-year[4] - Net loss narrowed to $(0.6) million in Q2'26 from $(3.6) million in Q2'25, representing an improvement of $3.0 million[4] - Adjusted EBITDA for Q2'26 was $0.5 million, marking the fourth consecutive quarter of positive adjusted EBITDA, compared to a loss of $(1.4) million in Q2'25[5] - Net loss for the six months ended September 30, 2025, was $1,825,000, a decrease from a net loss of $7,383,000 in the same period of 2024, indicating improved financial performance[33] - The company reported a basic net loss per share of $0.17 for the three months ended September 30, 2025, compared to $1.10 for the same period in 2024[29] - Net income for the three months ended September 30, 2025, was a loss of $581 million, compared to a loss of $3,625 million for the same period in 2024[35] Revenue Breakdown - Maintenance revenue grew by 18% to $4.5 million in Q2'26, up from $3.8 million in Q2'25, due to new customer contracts and expanded relationships[2] - EV charging revenue was $4.8 million in Q2'26, relatively flat compared to Q2'25, with expectations for slight declines in FY'26 due to market uncertainties[20] - Orion reiterated its FY 2026 revenue growth outlook of approximately 5%, targeting $84 million, which is expected to lead to positive adjusted EBITDA for the full fiscal year[5] - Significant new business wins included $11 million in public sector lighting and $7 million in LED lighting for major automotive industry facilities[7] Cost Management - Gross profit margin improved by 790 basis points to 31.0% in Q2'26 compared to 23.1% in Q2'25, driven by product mix and cost improvements[4] - Orion's operating expenses decreased to $6.4 million in Q2'26 from $7.7 million in Q2'25, reflecting ongoing cost containment efforts[18] - Operating expenses for the six months ended September 30, 2025, were $13,333,000, down from $15,475,000 in the same period of 2024, reflecting cost management efforts[29] - The company continues to face pressures to reduce selling prices of its lighting products due to increased competition, which may negatively impact gross margins[29] Assets and Liabilities - Cash and cash equivalents decreased to $5,155,000 as of September 30, 2025, down from $5,972,000 at the end of March 2025[32] - Total assets decreased to $47,902,000 as of September 30, 2025, compared to $52,463,000 as of March 31, 2025[32] - Total liabilities decreased to $36,520,000 as of September 30, 2025, from $40,579,000 as of March 31, 2025, indicating improved financial stability[32] Operational Changes - The company is currently implementing a new ERP system, which may involve substantial costs and potential operational disruptions[29] - The company is expanding its Voltrek EV Charging field sales and service presence to the Southeastern United States, establishing a new office in Jacksonville, FL[15] Other Financial Metrics - EBITDA for the latest quarter was $269 million, a significant improvement from a negative EBITDA of $2,691 million in the same quarter last year[35] - Adjusted EBITDA increased to $451 million, up from $32 million in the previous year, indicating a strong operational performance[35] - Stock-based compensation expenses were $157 million, slightly down from $180 million in the same quarter of 2024[35] - The company incurred restructuring costs of $0 in the latest quarter, compared to $163 million in the same quarter last year[35] - Severance costs decreased to $25 million from $158 million year-over-year, reflecting improved workforce management[35] - Interest expenses for the quarter were $280 million, compared to $283 million in the same quarter of the previous year[35] - Depreciation expenses were $263 million, an increase from $278 million in the same quarter of 2024[35] - The company reported no deferred cost write-offs for ATM in the latest quarter, while it had $0 in the same quarter last year[35] - Earnout expenses were $0 in the latest quarter, down from $630 million in the same quarter of the previous year, indicating a reduction in contingent liabilities[35]