Loading...
01/11 03:18
Loading...
Access earnings results, analyst expectations, report, slides, earnings call, and transcript.
The earnings call reflects positive sentiment due to strong cash flow, debt reduction, and inventory management. Despite margin pressures, guidance for fiscal '26 is optimistic with double-digit growth expectations. The Q&A revealed excitement about the drone market, with significant revenue potential and strategic partnerships. Although management was vague on some specifics, the overall outlook, including new product launches and expansion efforts, suggests a positive stock price movement in the short term.
Revenue for Q4 2025 $28.8 million, a sequential increase from $28.5 million in the prior quarter and approximately 4% higher than fiscal Q4 2024 when excluding the impact of Gridspertise. This growth was driven by continued momentum in Edge IoT products.
Revenue for Fiscal 2025 $123 million, reflecting a transition from a record fiscal 2024 to a more normalized revenue base. Fiscal 2024 included a significant contribution from Gridspertise, which accounted for roughly 25% of revenue that year. In fiscal 2025, only $11 million was recognized from Gridspertise, primarily in the first half of the year.
GAAP Gross Margin for Q4 2025 40%, compared to 43.5% in the prior quarter and 38.1% in the year-ago period. The sequential decline was due to inventory charges for aged inventory and higher duties and tariffs, but margins remained above the year-ago period due to cost and supply chain initiatives and favorable product mix.
Non-GAAP Gross Margin for Q4 2025 40.6%, compared to 44.1% last quarter and 38.8% in the year-ago quarter. The decline was attributed to similar reasons as GAAP gross margin, including inventory charges and higher duties and tariffs.
GAAP Operating Expenses for Q4 2025 $14.7 million, down from $16 million in the prior quarter and $18.2 million in the year-ago period. This reduction reflects cost-cutting measures and operational streamlining.
GAAP Net Loss for Q4 2025 $2.6 million or $0.07 per share, compared to GAAP net income of $400,000 or $0.01 per share in the year-ago quarter. The loss includes restructuring charges of $900,000.
Non-GAAP Net Income for Q4 2025 $400,000 or $0.01 per share, compared to $1.1 million or $0.03 per share in the prior quarter. This reflects the impact of cost reductions and efficiency measures.
Net Inventories as of June 30, 2025 $26.4 million, down from $28.2 million in the prior quarter and $27.7 million at the end of fiscal 2024. This decrease reflects improved inventory management.
Cash and Cash Equivalents as of June 30, 2025 $20.1 million, up from the prior quarter. Positive operating cash flow for the quarter contributed to this increase.
Operating Cash Flow for Fiscal 2025 $7.3 million, reflecting strong cash generation during the year.
Debt Reduction in Fiscal 2025 Approximately $4.5 million of term debt was paid down, reducing the outstanding balance by 28%.
Remaining Debt as of June 30, 2025 $11.8 million, resulting in a net cash position of $8.3 million. The company also refinanced this term debt into an asset-backed line of credit, reducing interest expense and extending maturity to August 2028.
Unmanned Aerial Systems: Lantronix is entering a multiyear growth cycle for unmanned aerial systems, supported by $13 billion in U.S. Department of Defense funding for unmanned platforms in 2026. The company has partnered with Red Cat's Teal drones for the U.S. Army's short-range reconnaissance program, generating initial revenue in fiscal 2025.
Edge AI Solutions: Lantronix is delivering high-performance Edge AI solutions for commercial drone applications through partnerships like Aerora. These solutions enable real-time decision-making for autonomous flight, surveillance, and industrial inspection, with revenue expected in fiscal 2026.
U.S. Mobile Carrier Partnership: Lantronix signed a multiyear agreement with a major U.S. mobile carrier to modernize over 50,000 backup power systems at wireless cell sites nationwide. This includes hardware deployment and software-enabled services, contributing to high-margin annual recurring revenue.
Cost and Supply Chain Optimization: Lantronix reduced costs by over $4 million compared to fiscal 2024, streamlined operations, and shifted manufacturing outside of China to minimize tariff exposure. These actions improved gross margins and created a leaner operating structure.
Debt Refinancing: The company refinanced its term debt into an asset-backed line of credit, reducing interest expenses and extending maturity to August 2028, strengthening liquidity and capital structure.
Transition to Strategic Platform Partner: Lantronix is evolving from a hardware supplier to a strategic platform partner, focusing on Edge IoT and network infrastructure solutions. This transition aims to capture a larger share of customer wallet and create high-margin, long-term business opportunities.
Expansion in Edge IoT and AI: Lantronix deepened its partnership with Qualcomm and integrated the NetComm IoT acquisition, enhancing capabilities in Edge IoT and AI-driven innovation.
Revenue dependency on Gridspertise: The company experienced a significant decline in revenue from Gridspertise, which accounted for 25% of revenue in fiscal 2024 but contributed minimally in the second half of fiscal 2025. This dependency on a single customer created revenue volatility.
Inventory charges and tariffs: The company faced inventory charges for aged inventory and higher duties and tariffs, which negatively impacted gross margins in Q4 2025.
Restructuring costs: Restructuring charges of $3.5 million were incurred during fiscal 2025, reflecting cost reduction initiatives that impacted profitability.
Debt and refinancing: The company has $11.8 million in remaining debt, which was refinanced into an asset-backed line of credit. While this reduces interest expenses, it still represents a financial obligation.
Supply chain risks: Although the company has reduced tariff exposure by moving manufacturing outside of China, supply chain risks remain a potential challenge.
Competitive pressures in Edge AI and IoT: The company is transitioning from a hardware supplier to a strategic platform partner, which may expose it to increased competition in the Edge AI and IoT markets.
Economic uncertainties: The company operates in markets influenced by government funding and regulatory changes, which could be impacted by broader economic uncertainties.
Revenue Projections for Q1 Fiscal 2026: Expected revenue to be in the range of $28.5 million to $30.5 million.
Non-GAAP EPS for Q1 Fiscal 2026: Expected to be in the range of $0.02 to $0.04 per share.
Fiscal 2026 Growth Outlook: Improved visibility supported by momentum in Edge IoT, compute and connectivity, and network infrastructure. Driven by recent design wins, product innovation, and expanding relationships with distribution and technology partners.
Defense and Commercial Drone Market: Anticipates a multiyear growth cycle for unmanned aerial systems, supported by record defense funding and favorable regulatory momentum. Revenue contribution from defense and commercial drone solutions expected to begin in fiscal 2026.
Partnership with U.S. Mobile Carrier: Signed a multiyear agreement to modernize over 50,000 backup power systems at wireless cell sites. Initial shipments began in June quarter, with additional orders expected. This is a long-term opportunity with potential for additional volume and expanded collaboration.
Edge AI Strategy: Encouraging traction observed, with early market feedback being positive. Revenue contribution from Edge AI solutions expected to begin in fiscal 2026.
Gross Margin Recovery: Expected to recover to levels achieved in the first half of fiscal 2025, supported by cost structure improvements and supply chain efficiency.
The selected topic was not discussed during the call.
The earnings call shows strong financial performance with increased net income and cash flow. There is positive momentum in the drone and AI sectors, with partnerships enhancing growth prospects. Despite some vague responses, the overall guidance is optimistic with expected revenue growth and stable margins. The partnership with a U.S. mobile carrier and the Kompress.ai initiative are significant positives. Given these factors, the stock is likely to experience a positive movement in the short term.
The earnings call reflects positive sentiment due to strong cash flow, debt reduction, and inventory management. Despite margin pressures, guidance for fiscal '26 is optimistic with double-digit growth expectations. The Q&A revealed excitement about the drone market, with significant revenue potential and strategic partnerships. Although management was vague on some specifics, the overall outlook, including new product launches and expansion efforts, suggests a positive stock price movement in the short term.
The earnings call presents a mixed outlook. While there are positives like margin expansion, cost reductions, and strategic partnerships, challenges such as revenue decline, economic uncertainty, and supply chain risks weigh heavily. The Q&A reveals cautious optimism but also highlights uncertainties, especially regarding Gridspertise revenue. The guidance suggests flat earnings with potential margin pressure. Debt reduction and cash position are positives, but the lack of strong catalysts or guidance revisions keeps the sentiment neutral. Without market cap data, it's difficult to predict strong market reactions.
The earnings call presents a mixed picture. While there are positive developments like increased gross margins and cost reductions, the revenue decline and weak guidance overshadow these gains. The Q&A reveals uncertainties in market expansion and integration risks, further clouding prospects. The absence of shareholder returns programs and the lack of a new partnership announcement also limit positive sentiment. Overall, the market reaction is likely to be neutral, reflecting the balance between positive operational efficiencies and negative revenue trends.
All transcripts are sourced directly from the official live webcast or the company’s official investor relations website. We use the exact words spoken during the call with no paraphrasing of the core discussion.
Full verbatim transcripts are typically published within 4–12 hours after the call ends. Same-day availability is guaranteed for all S&P 500 and most mid-cap companies.
No material content is ever changed or summarized in the “Full Transcript” section. We only correct obvious spoken typos (e.g., “um”, “ah”, repeated 10 times”, or clear misspoken ticker symbols) and add speaker names/titles for readability. Every substantive sentence remains 100% as spoken.
When audio quality is poor or multiple speakers talk over each other, we mark the section instead of guessing. This ensures complete accuracy rather than introducing potential errors.
They are generated by a specialized financial-language model trained exclusively on 15+ years of earnings transcripts. The model extracts financial figures, guidance, and tone with 97%+ accuracy and is regularly validated against human analysts. The full raw transcript always remains available for verification.
