Stem Inc. Reports Q1 Revenue Decline Amidst Positive EBITDA
Written by Emily J. Thompson, Senior Investment Analyst
Updated: 4 days ago
0mins
Should l Buy STEM?
Source: stocktwits
- Revenue Decline: Stem Inc. reported a Q1 revenue of $29 million, an 11% year-over-year decline primarily due to the absence of battery hardware resales, resulting in a more than 20% drop in stock price during Thursday's premarket trading.
- Core Revenue Growth: Despite the overall revenue decline, Stem's core revenue from software, services, and edge hardware increased by 4% year-over-year, indicating sustained demand and market potential in these segments.
- Positive Adjusted EBITDA: The company achieved its fourth consecutive quarter of positive adjusted EBITDA at $2 million, a significant improvement from a negative $4.6 million in the same period last year, showcasing enhanced profitability.
- Debt Concerns Raised: While the earnings report highlighted growth in software sales, investor concerns over the company's increasing debt led retail sentiment to shift from 'bullish' to 'neutral', reflecting a decrease in market confidence regarding the company's future.
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Analyst Views on STEM
Wall Street analysts forecast STEM stock price to rise
4 Analyst Rating
0 Buy
4 Hold
0 Sell
Hold
Current: 9.160
Low
18.00
Averages
19.25
High
23.00
Current: 9.160
Low
18.00
Averages
19.25
High
23.00
About STEM
Stem, Inc. provides artificial intelligence (AI)-driven software and services that enable its customers to plan, deploy, and operate clean energy assets. It offers a suite of solutions that are designed to transform how solar and energy storage projects are developed, built, and operated, including an integrated suite of software and edge hardware products, and full-lifecycle energy services. Its software applications are enabled by its AI platform, PowerTrack Optimizer. Its software applications include PowerTrack APM, PowerCore EMS and PowerBidder Pro. Its asset performance management (APM) application, PowerTrack APM, provides a unified solution that enables asset owners and operators to efficiently monitor and control complex storage, solar, and hybrid portfolios. Its energy management system (EMS) application, PowerCore EMS, is a technology-agnostic, edge-to-cloud integration solution for monitoring, managing, and controlling energy storage and hybrid systems.
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.
Stem Reports Q1 2026 Results Below Expectations
- Performance Decline: Stem reported a GAAP loss of $2.22 per share in Q1 2026, missing analyst expectations by $0.09, indicating significant overall performance impact due to weaker battery hardware sales.
- Revenue Drop: The company's revenue fell 10.8% year-over-year to $29 million, missing consensus estimates by $5.61 million, reflecting a weakening market demand.
- Software Revenue Growth: Despite the overall revenue decline, Stem's revenue from software, services, and edge hardware rose 4% year-over-year to $29 million, driven by a 16% increase in PowerTrack software revenue, showcasing the company's ongoing growth potential in the software sector.
- Cash Flow Status: At the end of Q1, Stem had $36.6 million in cash and cash equivalents, down from $48.9 million at the end of Q4 2025, indicating some pressure on the company's financial management.
See More
Stem Inc. Reports Q1 Revenue Decline Amidst Positive EBITDA
- Revenue Decline: Stem Inc. reported a Q1 revenue of $29 million, an 11% year-over-year decline primarily due to the absence of battery hardware resales, resulting in a more than 20% drop in stock price during Thursday's premarket trading.
- Core Revenue Growth: Despite the overall revenue decline, Stem's core revenue from software, services, and edge hardware increased by 4% year-over-year, indicating sustained demand and market potential in these segments.
- Positive Adjusted EBITDA: The company achieved its fourth consecutive quarter of positive adjusted EBITDA at $2 million, a significant improvement from a negative $4.6 million in the same period last year, showcasing enhanced profitability.
- Debt Concerns Raised: While the earnings report highlighted growth in software sales, investor concerns over the company's increasing debt led retail sentiment to shift from 'bullish' to 'neutral', reflecting a decrease in market confidence regarding the company's future.
See More
Stem, Inc. Reports Positive EBITDA and Reaffirms 2026 Guidance
- Strong Financial Performance: Stem, Inc. reported total revenue of $29 million in Q1 2026, reflecting a year-over-year decline attributed to the absence of battery hardware resales, yet marked the company's first positive adjusted EBITDA in a first fiscal quarter, indicating a significant improvement in profitability.
- Record Gross Margin: The company achieved a non-GAAP gross margin of 52%, a record high driven by an improved revenue mix of software, services, and edge hardware, with expectations that margins will naturally compress towards the 40% to 50% guidance range as battery hardware is gradually introduced.
- Asset Management Expansion: In the first quarter, Stem added approximately 1.5 gigawatts of solar assets under management, bringing the total to 37.5 gigawatts, while PowerTrack's annual recurring revenue (ARR) grew by 2%, demonstrating the company's ongoing investment in digital infrastructure and strong market demand.
- Strategic Acquisition Progress: The acquisition of Austrian firm raicoon aims to enhance PowerTrack's fault detection and event management capabilities, with the CEO emphasizing that this strategic move is intended to rapidly elevate technological capabilities and further drive growth in the utility-scale market.
See More
Stem Partners with Nuvation Energy for Battery Control Solution
- Co-Marketing Agreement: Stem has entered into a co-marketing agreement with Nuvation Energy to jointly promote a battery energy storage system control solution, marking a strategic collaboration in the energy management sector.
- Technological Integration: This partnership combines Stem's PowerTrack energy management system with Nuvation Energy's battery management system to create an integrated control stack, addressing the rising demand for domestically sourced energy infrastructure in North America.
- Market Demand Response: The solution is designed to meet evolving regulatory requirements in North America, showcasing both companies' keen insights into market trends and their strategic positioning in energy storage projects.
- Focused Business Roles: Stem will concentrate on energy management software and system integration, while Nuvation Energy will provide battery management hardware and related interfaces, ensuring specialized development in their respective fields.
See More
Stem, Inc. Q4 2025 Earnings Call Highlights
- Significant Revenue Growth: Stem, Inc. reported full-year revenue of $156 million for 2025, reflecting an 8% increase, with over 55% derived from software and services, demonstrating the success of its software-driven transformation and enhancing market competitiveness.
- First Positive Adjusted EBITDA: The company achieved an adjusted EBITDA of $7 million, marking three consecutive quarters of positive results, indicating improved operational efficiency and successful cost control, which lays a solid foundation for future growth.
- International Market Expansion: Stem engaged with German developer Everyray for a 100-megawatt hour project and rolled out the AI assistant PowerTrack Sage, currently in beta testing with over 80 customers, which is expected to further drive market share growth.
- Optimistic 2026 Outlook: Management anticipates 2026 revenue in the range of $140 million to $190 million, with software and services contributing $130 million to $150 million, reflecting confidence in future growth and the effectiveness of strategic planning.
See More
Stem (STEM) Q4 2025 Earnings Call Transcript
See More
Stem Reports Q1 2026 Results Below Expectations
- Performance Decline: Stem reported a GAAP loss of $2.22 per share in Q1 2026, missing analyst expectations by $0.09, indicating significant overall performance impact due to weaker battery hardware sales.
- Revenue Drop: The company's revenue fell 10.8% year-over-year to $29 million, missing consensus estimates by $5.61 million, reflecting a weakening market demand.
- Software Revenue Growth: Despite the overall revenue decline, Stem's revenue from software, services, and edge hardware rose 4% year-over-year to $29 million, driven by a 16% increase in PowerTrack software revenue, showcasing the company's ongoing growth potential in the software sector.
- Cash Flow Status: At the end of Q1, Stem had $36.6 million in cash and cash equivalents, down from $48.9 million at the end of Q4 2025, indicating some pressure on the company's financial management.
See More
Stem Inc. Reports Q1 Revenue Decline Amidst Positive EBITDA
- Revenue Decline: Stem Inc. reported a Q1 revenue of $29 million, an 11% year-over-year decline primarily due to the absence of battery hardware resales, resulting in a more than 20% drop in stock price during Thursday's premarket trading.
- Core Revenue Growth: Despite the overall revenue decline, Stem's core revenue from software, services, and edge hardware increased by 4% year-over-year, indicating sustained demand and market potential in these segments.
- Positive Adjusted EBITDA: The company achieved its fourth consecutive quarter of positive adjusted EBITDA at $2 million, a significant improvement from a negative $4.6 million in the same period last year, showcasing enhanced profitability.
- Debt Concerns Raised: While the earnings report highlighted growth in software sales, investor concerns over the company's increasing debt led retail sentiment to shift from 'bullish' to 'neutral', reflecting a decrease in market confidence regarding the company's future.
See More
Stem, Inc. Reports Positive EBITDA and Reaffirms 2026 Guidance
- Strong Financial Performance: Stem, Inc. reported total revenue of $29 million in Q1 2026, reflecting a year-over-year decline attributed to the absence of battery hardware resales, yet marked the company's first positive adjusted EBITDA in a first fiscal quarter, indicating a significant improvement in profitability.
- Record Gross Margin: The company achieved a non-GAAP gross margin of 52%, a record high driven by an improved revenue mix of software, services, and edge hardware, with expectations that margins will naturally compress towards the 40% to 50% guidance range as battery hardware is gradually introduced.
- Asset Management Expansion: In the first quarter, Stem added approximately 1.5 gigawatts of solar assets under management, bringing the total to 37.5 gigawatts, while PowerTrack's annual recurring revenue (ARR) grew by 2%, demonstrating the company's ongoing investment in digital infrastructure and strong market demand.
- Strategic Acquisition Progress: The acquisition of Austrian firm raicoon aims to enhance PowerTrack's fault detection and event management capabilities, with the CEO emphasizing that this strategic move is intended to rapidly elevate technological capabilities and further drive growth in the utility-scale market.
See More
Stem Partners with Nuvation Energy for Battery Control Solution
- Co-Marketing Agreement: Stem has entered into a co-marketing agreement with Nuvation Energy to jointly promote a battery energy storage system control solution, marking a strategic collaboration in the energy management sector.
- Technological Integration: This partnership combines Stem's PowerTrack energy management system with Nuvation Energy's battery management system to create an integrated control stack, addressing the rising demand for domestically sourced energy infrastructure in North America.
- Market Demand Response: The solution is designed to meet evolving regulatory requirements in North America, showcasing both companies' keen insights into market trends and their strategic positioning in energy storage projects.
- Focused Business Roles: Stem will concentrate on energy management software and system integration, while Nuvation Energy will provide battery management hardware and related interfaces, ensuring specialized development in their respective fields.
See More
Stem, Inc. Q4 2025 Earnings Call Highlights
- Significant Revenue Growth: Stem, Inc. reported full-year revenue of $156 million for 2025, reflecting an 8% increase, with over 55% derived from software and services, demonstrating the success of its software-driven transformation and enhancing market competitiveness.
- First Positive Adjusted EBITDA: The company achieved an adjusted EBITDA of $7 million, marking three consecutive quarters of positive results, indicating improved operational efficiency and successful cost control, which lays a solid foundation for future growth.
- International Market Expansion: Stem engaged with German developer Everyray for a 100-megawatt hour project and rolled out the AI assistant PowerTrack Sage, currently in beta testing with over 80 customers, which is expected to further drive market share growth.
- Optimistic 2026 Outlook: Management anticipates 2026 revenue in the range of $140 million to $190 million, with software and services contributing $130 million to $150 million, reflecting confidence in future growth and the effectiveness of strategic planning.
See More
Stem (STEM) Q4 2025 Earnings Call Transcript
See More
