Ondas Inc. (NASDAQ:ONDS) stock fell Thursday after the company reported second-quarter 2026 results that showed a wider-than-expected loss despite a revenue beat and stronger full-year guidance.
Ondas reported second-quarter revenue of $83.77 million, up more than 13-fold from $6.27 million a year earlier and 67% sequentially. Revenue topped the $67.97 million analyst estimate.
On a pro forma organic basis, revenue rose 85% year over year.
The company reported a GAAP loss of 19 cents per share, wider than the 5-cent loss analysts expected.
During the earnings call, CEO Eric Brock said demand for counter-drone and precision-strike systems is likely to remain strong for the “foreseeable future.”
Brock said recent conflicts have highlighted a shortage of these technologies and argued that significantly larger inventories will be needed on a sustainable basis.
Ondas is expanding production capacity not only for the second half of 2026, but also for 2027 and beyond.
Profitability And Margin Outlook
Gross profit rose to $36.1 million, with a GAAP gross margin of 43.1%. Adjusted gross profit was $42.3 million, with an adjusted gross margin of 50.4%.
The adjusted EBITDA loss widened to $50.6 million as Ondas invested ahead of expected second-half growth.
Operating expenses totaled $199.1 million. That included $105.8 million in noncash expenses, primarily related to stock-based compensation, contingent consideration remeasurement and amortization.
Management expects some pressure on gross margins in the second half due to product mix and excess capacity at acquired businesses. However, the company maintained its longer-term gross-margin target of more than 50%.
Orders And Backlog Climb
Ondas captured about $175 million in orders during the second quarter and another $105 million through Aug. 10.
Backlog stood at about $613 million as of June 30. Pro forma backlog, including DZYNE Technologies and Cyberhawk, reached $757 million, up 65% sequentially.
The pro forma backlog included $300 million in precision strike, $258 million in ISR and persistent intelligence, $100 million in aerial security and $99 million in autonomous ground systems.
Defense Programs Gain Momentum
Precision strike generated more than $34 million in second-quarter orders.
A $52.9 million Lethal Unmanned Strike order in July pushed aggregate orders under the U.S. Army’s $982 million IDIQ contract above $240 million.
Management expects the program to contribute materially in the second half. However, the company said quarterly delivery timing remains difficult to predict and cited supply-chain challenges as production scales.
Other awards included an $18.8 million ULTRA order, a $9 million IonStrike integration order and a $4.8 million U.S. Navy SOUTHCOM contract.
Ondas Raises 2026 Revenue Outlook
Ondas ended June with about $1.4 billion in cash, cash equivalents, restricted cash and short-term investments. Total debt stood at $6.4 million.
The company subsequently used about $325 million to close its DZYNE and Cyberhawk acquisitions.
Ondas raised its 2026 revenue outlook to $525 million to $550 million, above the $509.25 million analyst estimate. It expects third-quarter revenue of $140 million to $155 million.
Management also said it believes portfolio growth of 30% to 40% into 2027 is sustainable. Ondas could exit 2026 at roughly a $1 billion annualized revenue run rate, potentially reaching its $1.5 billion 2030 revenue target “perhaps a couple of years” early.
ONDS Price Action: Ondas shares were down 7.57% at $9.035 at the time of publication on Thursday, according to Benzinga Pro data.
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