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Aeries Technology, Inc. (AERT)·Q2 2026 Earnings Summary

Executive Summary

  • Q2 FY2026 delivered revenue of $17.36M (+2.9% YoY, +13.2% QoQ), GAAP net income of $0.64M ($0.01 EPS), and Adjusted EBITDA of $2.55M (14.7% margin), marking a second straight profitable quarter and the strongest first half in company history per management .
  • Profitability was driven by disciplined cost control, AI-led delivery, and private equity sponsor network expansion; management emphasized the turnaround is “complete” and the company is entering a “new phase” of growth .
  • Guidance: AERT reiterated FY2026 Adjusted EBITDA of $6–$8M; revenue guidance was not reiterated in Q2 (previously $74–$80M from Q1 and FY25 calls) .
  • Potential stock catalysts: sustained profitability with rising EBITDA margins, visibility into H2 contract ramps, and ongoing AI/GCC momentum across the PE ecosystem highlighted by planned hiring (+500 roles) and operational wins .

What Went Well and What Went Wrong

  • What Went Well

    • Two consecutive profitable quarters with stronger margins; Q2 Adjusted EBITDA margin expanded to 14.7% (from 6.7% in Q1 and -13.6% in Q2 FY2025) on AI-led delivery leverage and cost discipline .
    • “Turnaround complete”: CEO underscored shift to a growth phase powered by AI and GCC scale; new enterprise client wins and multi-million-dollar AI partnerships support pipeline .
    • H1 FY2026 positive operating cash flow ($2.39M) and net income ($2.32M) vs losses in prior-year period, evidencing structural improvements in execution and collections per management .

  • What Went Wrong

    • EPS declined QoQ ($0.01 vs $0.03 in Q1) despite higher revenue, reflecting mix and below-the-line items; YoY EPS improved from $(0.05), but QoQ optics softened .
    • Shareholders’ equity remains negative (deficit of $(2.9)M at 9/30/25), and the company flagged going-concern and other macro/FX/regulatory risks in its forward-looking statements .
    • Revenue guidance was not reiterated in Q2 materials (previously $74–$80M), which may reduce near-term visibility despite reiterated EBITDA outlook .

Financial Results

Income statement comparison (oldest → newest)

MetricQ2 FY2025Q1 FY2026Q2 FY2026
Revenue ($M)$16.87 $15.33 $17.36
Gross Profit ($M)$3.58 $3.78 $5.02
Gross Margin (%)21.2% 24.6% 28.9%
GAAP Net Income ($M)$(2.31) $1.68 $0.64
GAAP Diluted EPS ($)$(0.05) $0.03 $0.01
Adjusted EBITDA ($M)$(2.30) $1.03 $2.55
Adjusted EBITDA Margin (%)(13.6)% 6.7% 14.7%

YoY and QoQ deltas (computed from reported figures)

MetricYoY (Q2 FY2026 vs Q2 FY2025)QoQ (Q2 FY2026 vs Q1 FY2026)
Revenue+2.9% +13.2%
GAAP EPS+$0.06 (from $(0.05) to $0.01) $(0.02) (from $0.03 to $0.01)
Adj. EBITDA Margin+28.3 pts (from (13.6)% to 14.7%) +8.0 pts (from 6.7% to 14.7%)

Non-GAAP adjustments (Q2 FY2026): Adjusted EBITDA excludes stock-based compensation ($0.29M) and the change in fair value of derivative liabilities (net +$0.60M add-back), among other items, taking EBITDA of $1.66M to Adjusted EBITDA of $2.55M .

Balance sheet and cash flow snapshots

MetricQ1 FY2026 (6/30/25)Q2 FY2026 (9/30/25)
Cash & Cash Equivalents ($M)$2.14 $1.87
Short-term Borrowings ($M)$5.40 $4.37
Total Shareholders’ Equity ($M)$(4.49) $(2.98)
Operating Cash Flow ($M)$1.37 (Q1) $2.39 (H1 total)

Segment breakdown: Not disclosed in Q2 materials .

KPIs and operating highlights (Q2 FY2026)

  • Planned hiring: 500+ roles to expand India/Mexico capacity .
  • AI content automation: >80% efficiency gains, ~12× throughput improvement .
  • Client value: $20M+ savings via nearshore GCC model (Guadalajara) .
  • New enterprise client additions across tech, healthcare, and software, with additional opportunities anticipated in Q3 .

Guidance Changes

MetricPeriodPrevious GuidanceCurrent Guidance (Q2 FY2026)Change
RevenueFY2026$74M–$80M (Q1 FY2026, FY25 call) Not reiterated in Q2 materials Not updated
Adjusted EBITDAFY2026$6M–$8M (Q1 FY2026, FY25 call) Reiterated $6M–$8M Maintained

Earnings Call Themes & Trends

TopicPrevious Mentions (Q4 FY2025, Q1 FY2026)Current Period (Q2 FY2026)Trend
AI/Technology InitiativesLaunched AI-centered GCC framework; modular agents; early client deployments in healthcare; AI to accelerate value creation . Q1: OneGCC automation, AeriesONE AI Value Engine, partner network; faster enterprise AI rollouts .Multi-million-dollar AI partnership signed; AI content automation with >80% efficiency and 12× throughput; AI-led delivery emphasized as growth lever .Strengthening and scaling
GCC (India + Mexico)GCC central to delivery; ramping India/Mexico hubs; North America-focused growth . Q1: Integrated nearshore (Mexico) + offshore (India); governance improvements .Dual-shore scale reiterated; +500 planned hires; repeatable model; private equity-driven adoption .Expanding capacity and adoption
Private Equity EcosystemDeepening PE sponsor relationships; pipeline expansion; Chief Growth Officer hire . Q1: Multiple new PE-backed wins; pilots to scaled engagements .Expanding relationships; new enterprise additions; H2 ramp visibility from new contracts .Increasing breadth and depth
Cost Discipline/ProfitabilityFY2025 core adj. EBITDA above guidance; restructuring complete; stock comp to be lower; 2026 poised as best year yet . Q1: SG&A down >85% YoY; positive OCF and net income .Two straight profitable quarters; positive H1 OCF; stable OpEx supports scalability .Sustained improvement
Revenue VisibilityFY2026 revenue guided $74–$80M in prior quarter; strong North America mix .No revenue guidance reiteration; noted contract ramps provide back-half visibility .Narrative shifted to EBITDA focus and contract ramp visibility

Management Commentary

  • “Q2 marks the completion of our turnaround and the beginning of our new phase… Profitability, expanding PE sponsor relationships, and the compounding effect of our AI and GCC models position us to scale with discipline.” — Ajay Khare, CEO .
  • “We continue to expect full year fiscal 2026 adjusted EBITDA to be between $6 million and $8 million… New contracts signed this year are currently ramping, with revenue contribution expected to increase over the next several quarters.” — Daniel Webb, CFO & CIO .
  • “We expanded our India and Mexico operations with plans to hire over 500 new roles… signed a multi-million-dollar AI partnership… unveiled an AI-powered content automation solution delivering over 80% efficiency gains and 12× throughput improvement.” — Company release .

Q&A Highlights

  • The Q2 FY2026 call consisted of prepared remarks; there was no Q&A session recorded (“This concludes today’s conference call”) .

Estimates Context

  • S&P Global consensus estimates for Q2 FY2026 EPS and revenue were not available; the feed only reflected actual results, preventing a beat/miss assessment versus Street [Values retrieved from S&P Global].*
MetricQ2 FY2026 ConsensusQ2 FY2026 Actual
Revenue ($M)N/A*$17.36
EPS ($)N/A*$0.01
EBITDA ($M)N/A*$1.66 GAAP EBITDA; $2.55 Adjusted

*Values retrieved from S&P Global.

Key Takeaways for Investors

  • Profitability turning point: Two consecutive profitable quarters with expanding Adjusted EBITDA margins suggest operating leverage from AI-led GCC delivery and tighter cost structure .
  • Revenue trajectory improving: QoQ revenue acceleration (+13.2%) alongside YoY growth (+2.9%) supports a healthier top-line run-rate entering H2 as ramps progress .
  • Guidance anchored on EBITDA: FY2026 Adjusted EBITDA reiterated at $6–$8M; lack of a revenue guide reiteration shifts investor focus to margin/earnings durability and execution on ramps .
  • Balance sheet watch: Equity remains negative; continued positive OCF and deleveraging (lower short-term borrowings QoQ) are constructive, but capital structure remains an overhang to monitor .
  • AI/GCC flywheel with PE sponsors: Multi-million-dollar AI partnership, >80% efficiency gains in content automation, and +500 planned hires underscore demand; pipeline conversion and ramp timing are near-term drivers .
  • Trading implications (near term): Absent Street estimates, narrative catalysts are margin durability and contract ramp updates; any FY2026 revenue guide reinstatement or H2 bookings detail could move the stock .
  • Medium-term thesis: If AERT sustains profitability and cash generation while scaling dual-shore GCCs in PE portfolios, the model supports multiple expansion; risks include macro/FX, execution, and going-concern considerations highlighted in filings .