Knightscope — Third Quarter 2026 Earnings Summary

Financial Performance:

• Revenue reached $8.7 million, a 177% increase year-over-year from $3.1 million in Q3 2025, marking the third consecutive quarter of triple-digit growth.
• Service revenue was $8.6 million, up 349% year-over-year, driven by $6.6 million from Knightscope Security Force (KSF); product revenue was $0.1 million, down from $1.2 million in the prior-year period.
• Gross margin turned positive at $0.4 million (5% of revenue), an improvement of $2.0 million year-over-year compared to a $1.6 million gross loss in Q3 2025.
• Service gross margin was $0.7 million (8% of service revenue), contrasting with a $1.6 million service gross loss in Q3 2025.
• Operating expenses were $12.0 million (138% of revenue), down from $7.9 million (254% of revenue) in the prior-year period.
• Research and development expenses declined 5% to $3.6 million as engineering moved in-house to reduce costs.
• Sales, general, and administrative expenses were $8.4 million, including $0.9 million in events/sponsorship costs for the GSX 2026 unveiling and $0.6 million in higher intangible asset amortization related to the KSF acquisition.
• Net loss was $11.8 million ($0.50 per share) on 23.6 million weighted average shares, compared to a $9.5 million loss ($0.98 per share) on 9.8 million shares in Q3 2025.
• Cash and cash equivalents stood at $6.8 million at quarter end.

Guidance and Future Outlook:

• Management aims to convert approximately $27 million in renewals, bookings, and client awards secured since May 2026 into revenue.
• K7 manufacturing commenced at Knightscope Headquarters to accelerate deployment during the fourth quarter of 2026.
• The company highlighted expectations regarding margin improvement and operating leverage in forward-looking statements.

Business Segments and Product Lines:

• The company redefined its go-to-market strategy around the "Autonomous Security Force," integrating autonomous machines, AI-driven software, and licensed security agents into a single managed service under one contract.
• The "Signals" orchestration software and operational digital twin was released and demonstrated live at headquarters.
• The H1 Augmented Security Agent wearable is currently in development.

Market and Competitive Landscape:

• The company secured approximately $27 million in renewals, bookings, and client awards since May 2026, described as a company record.
• The Autonomous Security Force was unveiled at GSX 2026.

Risks and Challenges:

• Risks include the ability to raise additional capital on acceptable terms and the need for additional financing.
• Potential risks involve the development, deployment, and performance of new technologies and the integration of acquired businesses.
• There is a risk that clients may order fewer services than estimated or that client awards do not result in definitive agreements.
• The company faces dependence on a limited number of significant clients.

Management Commentary and Tone:

• CEO William Santana Li stated the company delivered its third consecutive quarter of triple-digit revenue growth and positive gross margin in the services business.
• Management emphasized clear priorities: converting secured bookings into revenue, expanding with existing clients, and driving margins higher.

Other Key Points:

• The press release notes the company is a managed service provider building the nation's first Autonomous Security Force.
• The company hosts a conference call for Q3 2026 results on November 12, 2026.
• Forward-looking statements include expectations regarding the K7 Beta Program, the Signals platform, and the at-the-market offering program.