Flux Power — 2027 Fiscal First Quarter Earnings Summary

Financial Performance:

• Revenue for the quarter ended September 30, 2026, was $6.8 million, down from $13.2 million in the same quarter of the prior year and $8.2 million in the prior quarter.
• Gross profit was $1.7 million (24.8% of revenue), compared to $3.8 million (28.6%) in the prior year quarter and $2.3 million (27.4%) in the prior quarter.
• Operating expenses were $4.6 million, a 22% decrease year-over-year from $5.9 million, driven by headcount reductions and operational streamlining.
• Operating loss was $3.0 million, widening from an operating loss of $2.2 million in the prior year quarter and $2.1 million in the prior quarter.
• Non-GAAP operating loss was $2.8 million, compared to $2.0 million in the prior year quarter and $1.9 million in the prior quarter.
• Net loss was $3.2 million ($0.15 per share), compared to a net loss of $2.6 million ($0.15 per share) in the prior year quarter and $2.3 million ($0.11 per share) in the prior quarter.
• Non-GAAP net loss was $3.0 million ($0.14 per share), compared to $2.4 million ($0.14 per share) in the prior year quarter and $2.1 million ($0.10 per share) in the prior quarter.
• Adjusted EBITDA was negative $2.6 million, compared to negative $1.7 million in the prior year quarter and negative $1.6 million in the prior quarter.
• Cash on hand was $0.4 million as of September 30, 2026, up from $0.3 million as of June 30, 2026.
• Total liabilities increased to $23.97 million from $21.64 million in the prior quarter, with accounts payable rising to $11.26 million from $8.47 million.
• Stockholders' equity turned negative to a deficit of $0.43 million from a surplus of $2.56 million in the prior quarter.

Guidance and Future Outlook:

• The company guided 2027 fiscal second quarter revenue to be in the range of $7 million to $8 million.
• Management expressed confidence in moving toward profitability in coming quarters due to a leaner cost structure and growing market demand.

Business Segments and Product Lines:

• Received a significant order from the company's largest material handling customer, who had previously paused orders.
• Secured a global technology platform customer in the Robotics market vertical.
• Accelerated dealer engagement following the achievement of Hyster-Yale certification in the previous quarter.
• Announced three product innovations: battery safety with integrated gas detection, expanded material handling applications for additional truck models, and extended connected fleet intelligence with battery location and intelligent charging alerts.
• Launched a go-to-market campaign targeting the 500 largest end-user accounts in North America.
• Leveraging the S-Series battery as an anchor product for white-label opportunities.

Market and Competitive Landscape:

• The company is executing an OEM partnership strategy, evidenced by orders from first-time Flux Power customers through OEM partners.
• Management notes the market demand for lithium-ion battery solutions is growing.

Risks and Challenges:

• The company faces an event of default under its agreement with Gibraltar Business Capital, LLC, and is evaluating potential financing alternatives and strategic partnerships to ensure financial flexibility.
• Risks include the ability to comply with the credit facility agreement, secure sufficient funding, and maintain going concern status.
• Potential risks include failure to meet Nasdaq continued listing standards, impact of tariffs on sourcing, supply chain disruptions, and dependence on a few major customers.
• Legal proceedings regarding accounting practices, financial disclosures, and employment policies are ongoing risks.

Management Commentary and Tone:

• CEO Krishna Vanka stated the team delivered on the $6.8 million revenue commitment despite multiple headwinds.
• Management described the commercial strategy as beginning to compound, citing the initial success of the OEM partnership strategy.
• The tone reflects a focus on discipline, cost reduction, and positioning for accelerated growth.

Other Key Points:

• Flux Power is currently evaluating potential financing alternatives and strategic partnerships.
• A conference call was held on November 3, 2026, to discuss results.
• The company designs and sells lithium-ion energy storage solutions for industrial and commercial sectors, including material handling and airport ground support equipment.