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LT

LIGHTPATH TECHNOLOGIES INC (LPTH)·Q1 2026 Earnings Summary

Executive Summary

  • Revenue of $15.06M grew 79% YoY and materially beat Wall Street consensus by ~19% (consensus $12.66M; actual $15.06M). Gross margin was 30%; adjusted EBITDA positive at $0.36M. Net loss per share was $0.07. Bold beats: revenue and EPS vs consensus; return to positive adjusted EBITDA .*
  • Backlog increased from $86M at quarter-end to “$90+M” currently; mix shifting toward higher-value systems/subsystems (~two-thirds). Large IR camera orders total $40.3M across CY2026–CY2027; additional $4.8M public safety order supports fiscal 2026 deliveries .
  • Strategic initiatives: rapid transition away from Germanium to proprietary BlackDiamond glass in IR systems; first Germanium‑free G5 camera variants entered production; capacity expansion underway (Texas facility; added Orlando camera build/integration) .
  • Management did not provide formal guidance; CFO aims to repeat Q1 revenue in Q2 and maintain positive EBITDA; medium-term margin target trajectory discussed (~35% by end of fiscal year; longer-term ~40% on systems mix) .
  • Potential stock catalysts: continued backlog conversion, defense program awards (SPEIR LRIP, NGSRI timeline), expanded Germanium‑free portfolio, and margin improvement on systems mix .

What Went Well and What Went Wrong

What Went Well

  • Strong top-line growth and mix shift: Revenue +79% YoY to $15.06M; assemblies & modules revenue up 436% YoY to $5.9M, validating systems strategy. “We are moving from components to systems… converting differentiation into multi‑year contracts” .
  • Order momentum and backlog visibility: $18.2M order + $22.1M follow‑on ($40.3M total) and separate $4.8M public safety order; backlog $86M at quarter-end, “$90+M” currently; ~two‑thirds systems/subsystems .
  • Strategic positioning: first Germanium‑free G5 cameras in production; supply-chain resiliency with BlackDiamond glass. “Our materials perform far better than germanium in many use cases” .

What Went Wrong

  • Margin compression vs prior-year quarter: gross margin 30% (vs 34% last year) due to prior‑year high‑margin, end‑of‑life orders and IR components mix; OpEx +66% on G5 integration and sales/marketing .
  • GAAP profitability remains negative: net loss of $2.89M; diluted EPS of ($0.07); fair value earnout adjustment increased OpEx by $1.28M .
  • Execution constraints: capacity additions needed across glass and camera lines; focal plane array supply tightness; camera redesign pace gated by engineering resources until hiring ramps .

Financial Results

MetricQ3 2025Q4 2025Q1 2026
Revenue ($USD)$9,167,627 $12,209,793 $15,058,281
Gross Profit ($USD)$2,664,101 $2,690,753 $4,482,572
Gross Margin (%)29.1% 22.0% 30.0%
Operating Expenses ($USD)$5,987,390 $7,198,753 $6,988,350
Operating Income ($USD)($3,323,289) ($4,508,000) ($2,505,778)
Net Income (Loss) ($USD)($3,560,349) ($7,055,980) ($2,893,002)
Diluted EPS ($USD)($0.09) ($0.16) ($0.07)
Adjusted EBITDA ($USD)($1,984,498) ($1,978,765) $360,802

Segment/Product Group Breakdown

Product Group Revenue ($USD Millions)Q1 2025Q1 2026
Infrared (IR) Components$2.6 $4.3
Visible Components$3.3 $3.8
Assemblies & Modules$1.1 $5.9
Engineering Services$1.4 $1.1

Key Operating KPIs

KPIQ3 2025Q4 2025Q1 2026
Backlog ($USD)$37.4M ~$90M (updated post Q4) $86M at 9/30; $90+M currently
Cash & Equivalents ($USD)$6,478,885 $4,877,036 $11,507,418
Total Debt ($USD)$4.69M (LT) $5.0M total $5.6M
Adjusted EBITDA Margin (%)(21.6%) (16.2%) 2.4%

Guidance Changes

MetricPeriodPrevious GuidanceCurrent GuidanceChange
RevenueQ2 FY2026NoneNo formal guidance; CFO “would like to see that number again”Maintained no guidance
EBITDAFY2026NoneAim to remain positive (Q1 positive; “that will continue”)Raised informally
Gross MarginFY2026NoneTrajectory toward ~35% by FY-end; longer-term ~40% on systems mixRaised informally
OpExFY2026NoneNo major OpEx increase; capacity adds are CapEx-focusedMaintained

Note: Management provided qualitative targets and commentary but no formal numerical guidance ranges.

Earnings Call Themes & Trends

TopicPrevious Mentions (Q3 FY2025)Previous Mentions (Q4 FY2025)Current Period (Q1 FY2026)Trend
BlackDiamond glass and shift from GermaniumEmphasized as strategic differentiator; China export ban context Strategy affirmed; redesigning G5 cameras Customers remaining on BlackDiamond; performance superior; ongoing camera redesigns Strengthening
Backlog scale and mixPipeline/orders expanding post G5 acquisition Backlog ~$90M, >2/3 systems/subsystems $86M at quarter-end; “$90+M” now; ~two‑thirds systems/subsystems Improving visibility
Defense programs (SPEIR, NGSRI, Apache)L3Harris SPEIR EDM $2.2M; NGSRI progress; Apache in development NGSRI testing; Texas expansion; SPEIR LRIP anticipated NGSRI timing impacted by shutdown; still bullish; SPEIR advancing to LRIP Advancing, timeline fluid
Counter‑UAS and border surveillanceQualification and follow‑on camera orders Addressing border towers (potential 1,000+); CUAS backlog >$10M CUAS backlog “> $15M”; border tower opportunity at $150k–$250k per camera Expanding
Capacity and supply chainIntegration steps; adding resources Texas facility growth; Orlando camera build/integration; IT upgrade Broad capacity adds; focal plane array vendor constraints; CapEx focus Scaling
Margin trajectoryMix driving 29.1% GM One‑time inventory reserves; adjusted GM ~29.7% Aim to reach ~35% by FY-end; IR components mix headwind in Q1 Uptrend expected

Management Commentary

  • “We are moving from components to systems and… converting that differentiation into multi‑year contracts, strategic investment and long‑term relationships… With a record backlog… we believe LightPath is positioned to sustain growth and expanding profitability” — Sam Rubin, CEO .
  • “We would like to see that [Q1 revenue] number again… in Q2… from an EBITDA perspective, we were positive this quarter. It’s a good sign and that will continue” — Al Miranda, CFO .
  • “Most customers that have been switching over to BlackDiamond will remain in BlackDiamond even if [Germanium] is freely available… our materials perform far better than germanium in many… use cases” — Sam Rubin, CEO .

Q&A Highlights

  • Germanium availability: Even if China loosens exports, defense use likely constrained; customers favor BlackDiamond due to prior disruptions and performance advantages .
  • Capacity/CapEx vs OpEx: Scaling across glass and cameras; expanding Texas and Orlando; expansion largely CapEx (furnaces, assembly lines), not major OpEx increases .
  • Margin outlook: Mix (higher IR components in Q1) muted GM; CFO targets ~35% by FY-end and ~40% mid‑term on systems mix; expects margin improvement in December quarter without noise from expansions .
  • Backlog composition: Cameras and assemblies constitute ~60–~66% of backlog; G5 pushing product more aggressively .
  • NGSRI timeline: Government shutdown uncertainty; down‑selection pending post flight tests; Texas facility expansion is a shared “small bet” to enable rapid scale if awarded .

Estimates Context

Consensus vs Actual (S&P Global)

MetricQ3 2025Q4 2025Q1 2026
Revenue Consensus Mean ($USD)$8,667,520*$12,201,060*$12,659,900*
Revenue Actual ($USD)$9,167,627*$12,209,793*$15,058,281*
Primary EPS Consensus Mean ($USD)($0.0475)*($0.0425)*($0.06)*
Primary EPS Actual ($USD)($0.0978)*($0.0707)*($0.0279)*
  • Q1 FY2026 beats: Revenue +$2.40M (~+19%) vs consensus; Primary EPS beat by ~$0.032. Bold positives: revenue and EPS beats [GetEstimates].*
  • Note: GAAP diluted EPS reported was ($0.07) in Q1; S&P “Primary EPS” actual differs from reported GAAP EPS due to SPGI methodology .*

Values retrieved from S&P Global.*

Key Takeaways for Investors

  • Backlog strength and systems mix support multi‑quarter visibility; prioritize companies transitioning from components to higher-value systems/subsystems to capture margin expansion .
  • Bold beat in Q1 on revenue and EPS alongside positive adjusted EBITDA suggests execution progress; watch December quarter for sustained revenue and margin trajectory toward ~35% .
  • Germanium‑free strategy is resonating; BlackDiamond glass offers performance and supply security; expect continued camera redesigns and customer conversions to underpin growth .
  • Defense program pipeline (SPEIR LRIP, NGSRI, Apache, CUAS, border towers) creates optionality for step‑ups in revenue; near‑term awards could re-rate the story .
  • Capacity investments (Texas, Orlando), VP Manufacturing hire, and strategic $8M investment should ease bottlenecks and accelerate backlog conversion without heavy OpEx drag .
  • Margin levers: mix shift to assemblies/systems, Germanium‑free variants, and scale; monitor GM progression and any one‑time items (earnout fair value adjustments) .
  • Risk watch: focal plane array supply, government timelines/shutdowns, integration cadence; but vertical integration and diversified programs mitigate single‑point risk .

Appendix: Additional Supporting Disclosures

  • Non‑GAAP reconciliation indicates adjusted EBITDA of $0.36M in Q1; exclusions include stock comp, earnout fair value, FX; methodology consistent with prior period reconciliations .
  • Balance sheet strengthened: cash $11.51M (vs $4.88M at Q4 close) following strategic investment; total liabilities stable; equity increased .