Lantronix Q2 Earnings Beat Expectations Despite Revenue Decline
Written by Emily J. Thompson, Senior Investment Analyst
Updated: 4d ago
0mins
Should l Buy LTRX?
Source: seekingalpha
- Earnings Beat: Lantronix reported a non-GAAP EPS of $0.04 for Q2, exceeding expectations by $0.01, indicating stability in profitability despite revenue challenges.
- Revenue Decline: The company’s revenue of $29.77 million represents a 4.5% year-over-year decline, missing the forecast of $29.94 million, which highlights ongoing market demand challenges and competitive pressures.
- Future Outlook: For Q3 FY2026, Lantronix projects revenue between $28.5 million and $32.5 million, with a midpoint estimate of $30.5 million, and non-GAAP EPS expected to range from $0.03 to $0.06, reflecting cautious optimism for future growth.
- Positive Stock Reaction: Despite missing revenue expectations, Lantronix shares rose by 4.33%, indicating a positive investor response to the earnings beat, which may bolster market confidence.
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Analyst Views on LTRX
Wall Street analysts forecast LTRX stock price to rise over the next 12 months. According to Wall Street analysts, the average 1-year price target for LTRX is 7.88 USD with a low forecast of 7.00 USD and a high forecast of 9.00 USD. However, analyst price targets are subjective and often lag stock prices, so investors should focus on the objective reasons behind analyst rating changes, which better reflect the company's fundamentals.
4 Analyst Rating
4 Buy
0 Hold
0 Sell
Strong Buy
Current: 5.820
Low
7.00
Averages
7.88
High
9.00
Current: 5.820
Low
7.00
Averages
7.88
High
9.00
About LTRX
Lantronix Inc. specializes in compute and connectivity Internet of things (IoT) solutions that target industries including smart cities, automotive and enterprise. The Company's products and services help companies to capitalize on the expanding IoT market by delivering customizable solutions that address each layer of the IoT stack. Its solutions include intelligent substations infrastructure, infotainment systems and video surveillance, supplemented with advanced out-of-band management (OOB) for cloud and edge computing. Its solutions enable ultra-fast ethernet-to-cellular and wi-fi connectivity for machines in the demanding environments. Its product lines include Embedded IoT Modules, IoT Systems Solutions, and Software and Engineering Services. The Company's products include Edge AI, OOB, network infrastructure, industrial IoT, SoMs and dev kits, and connectivity modules. Its SmartLV, powered by the Qualcomm IQ-615 processor, is an AI-enabled IoT Edge Compute Cellular Gateway.
About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
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Lantronix (LTRX) Q2 2026 Earnings Call Transcript
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- Revenue Decline: The company’s revenue of $29.77 million represents a 4.5% year-over-year decline, missing the forecast of $29.94 million, which highlights ongoing market demand challenges and competitive pressures.
- Future Outlook: For Q3 FY2026, Lantronix projects revenue between $28.5 million and $32.5 million, with a midpoint estimate of $30.5 million, and non-GAAP EPS expected to range from $0.03 to $0.06, reflecting cautious optimism for future growth.
- Positive Stock Reaction: Despite missing revenue expectations, Lantronix shares rose by 4.33%, indicating a positive investor response to the earnings beat, which may bolster market confidence.
See More
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- Technological Integration Advantage: By acquiring established, profitable service companies, ZenaTech is building a global multi-service DaaS network aimed at enhancing service quality and operational efficiency through drone innovation while reducing capital costs for clients.
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- Launch of Golf Survey Services: ZenaTech has initiated golf course survey services in Florida with plans for nationwide expansion, having completed drone-enabled surveys for five championship-level golf courses in the past year, showcasing its technical capabilities and market potential in complex environments.
- Enhanced Technological Advantage: By utilizing advanced drone mapping and analytics, ZenaTech's services can deliver accurate topographic and vegetation health data faster and more efficiently than traditional ground surveys, significantly improving the quality and speed of client decision-making.
- Strategic Expansion Plans: ZenaTech aims to build a global multi-service DaaS network by acquiring established, profitable service companies, intending to enhance service efficiency and reduce operational costs through drone innovation, thereby gaining a competitive edge in a crowded market.
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Lantronix Q2 2026 Earnings Highlights
- Significant Revenue Growth: Lantronix reported revenue of $29.8 million for Q2 2026, with a non-GAAP EPS of $0.04, both within guidance, indicating strong performance in embedded computing and drone programs that drove overall business growth.
- Drone Revenue Guidance Raised: The company increased its fiscal 2026 drone revenue outlook from $5 million to $10 million to a new range of $8 million to $12 million, projecting that drone revenue will represent 15% to 20% of total revenue in fiscal 2027, reflecting robust market demand and successful strategic transformation.
- Effective Cost Control: CFO reported GAAP operating expenses of $14 million for Q2, down nearly 6% from the prior quarter and approximately 9% from the same period last year, indicating significant success in cost optimization that enhances profitability.
- Increased Customer Engagement: Management emphasized that customer engagement in unmanned systems is transitioning from development and pilot phases to broader deployment, signaling ongoing growth in critical infrastructure monitoring and stable revenue from major mobile network operators.
See More
Lantronix Reports Strong Q2 Results with Increased Drone Revenue Outlook
- Strong Financial Performance: Lantronix reported revenue of $29.8 million and non-GAAP EPS of $0.04 for Q2 FY2026, exceeding company guidance and demonstrating continued execution of its Edge AI strategy.
- Increased Drone Revenue Outlook: The company raised its fiscal 2026 drone revenue outlook to $8 million to $12 million from a previous range of $5 million to $10 million, reflecting accelerated customer deployment activity and growing market demand.
- Margin Improvement: Lantronix achieved a GAAP gross margin of 43.6%, up from 42.6% year-over-year, while non-GAAP gross margin increased to 44.0% from 43.2%, indicating the effectiveness of cost optimization efforts.
- Healthy Cash Flow: The company ended the quarter with $23.0 million in cash and cash equivalents, an increase of $0.8 million from the prior quarter, and generated nearly $2.2 million in positive operating cash flow during the period, highlighting ongoing financial health improvements.
See More
Lantronix (LTRX) Q2 2026 Earnings Call Transcript
See More
Lantronix Q2 Earnings Beat Expectations Despite Revenue Decline
- Earnings Beat: Lantronix reported a non-GAAP EPS of $0.04 for Q2, exceeding expectations by $0.01, indicating stability in profitability despite revenue challenges.
- Revenue Decline: The company’s revenue of $29.77 million represents a 4.5% year-over-year decline, missing the forecast of $29.94 million, which highlights ongoing market demand challenges and competitive pressures.
- Future Outlook: For Q3 FY2026, Lantronix projects revenue between $28.5 million and $32.5 million, with a midpoint estimate of $30.5 million, and non-GAAP EPS expected to range from $0.03 to $0.06, reflecting cautious optimism for future growth.
- Positive Stock Reaction: Despite missing revenue expectations, Lantronix shares rose by 4.33%, indicating a positive investor response to the earnings beat, which may bolster market confidence.
See More
