10-Q · May 7, 2026
Lantronix reported a 5.9% year-over-year revenue increase in Q3 FY2026 with net revenue of $30.2 million, slightly below analyst expectations of $30.56 million. Despite an EPS of $0.04 which surpassed the estimate of…
Earnings analysis · 10-K
LTRX earnings analysis
Filed August 27, 2026 · Our reading of the company's report
The latest report
Lantronix is repositioning around Edge AI, embedded computing, industrial IoT and software, with strong fiscal 2026 growth in Embedded IoT and Software & Services offset by the loss of more than $11 million of…
Read full summary
Lantronix is repositioning around Edge AI, embedded computing, industrial IoT and software, with strong fiscal 2026 growth in Embedded IoT and Software & Services offset by the loss of more than $11 million of Gridspertise revenue and declines in EMEA and APJ. Profitability improved substantially, with gross margin rising to 43.8%, operating loss narrowing to $4.121 million and net loss declining to $4.181 million, but the company remains loss-making and revenue fell 1.6% to $120.899 million. Liquidity was bolstered by $44.090 million of equity-offering proceeds and debt repayment, although the resulting share issuance and the planned $11.7 million Vecima acquisition increase capital-allocation and integration considerations.
Gross and operating margin
How much of each revenue dollar the business keeps.
One point per quarterly or annual filing. Both margins are shares of that report's revenue.
From revenue to operating profit
Where each $100 of revenue went in this report.
Cost of sales, operating expenses, and what remained. Figures are rounded to whole dollars.
Where revenue came from
The business segments reported by the company.
Shares of the segments disclosed in this filing, largest first.
How we read each report
Our analysis across the last few reports.
Our model's reading of each filing, not the share price or the market's reaction. Annual and quarterly reports each occupy one position.
Reported figures
- Earnings per share
- $-0.1
What stood out
-
Edge AI portfolio targets high-growth markets
Lantronix positions itself as a global leader in Edge AI and Industrial IoT solutions, with hardware, software and services serving unmanned systems, critical infrastructure and resilient enterprise networks. Its portfolio roadmap spans Embedded IoT Solutions, IoT System Solutions, and Software & Services, including SaaS, edge computing, machine learning and secure connectivity.
-
Embedded and software offerings accelerated
Embedded IoT revenue increased 15.6% to $53.607 million, driven by higher embedded compute sales—including drone, aerospace and defense products—and embedded wired connectivity demand. Software & Services revenue rose 15.5% to $9.022 million, led by higher SaaS solutions and design services.
-
Gross margin improved on mix
Gross profit increased 2.4% to $52.923 million and gross margin expanded to 43.8% from 42.1%, primarily because of product mix, including the absence of lower-margin Gridspertise revenue and a higher mix of software and services.
-
Losses materially narrowed
Net loss narrowed to $4.181 million, or $(0.10) per diluted share, from a $11.373 million loss, or $(0.29) per share, in fiscal 2025. Loss from operations improved to $4.121 million from $11.001 million as operating expenses fell to $57.044 million from $62.700 million.
-
Balance sheet liquidity strengthened
Liquidity strengthened substantially: cash and equivalents rose to $60.466 million from $20.098 million, while net cash provided by operating activities increased to $9.877 million from $7.285 million. The company also reported $13.591 million of available borrowing capacity at June 30, 2026.
-
Post-year-end SaaS acquisition broadens reach
Lantronix expanded its industrial IoT strategy after year-end by acquiring Vecima Networks’ industrial IoT business and Nero Global Tracking SaaS platform for approximately $11.7 million; the transaction closed August 1, 2026 and adds GPS-based fleet and asset tracking in North America.
What to watch
-
Memory shortages threaten shipments and margins
Component availability has become a more immediate risk: management states that the market is currently experiencing memory supply shortages, causing higher costs and constrained availability. The company uses single-source components, has no long-term supply arrangements with most vendors, and has previously been unable to meet customer orders because necessary components were unavailable.
-
Tariffs create cost and transition risk
Tariff exposure and policy uncertainty increased materially: Lantronix has paid tariffs on certain imported products and materials subject to IEEPA-based duties, but had recognized no potential refunds as of June 30, 2026. The company also transitioned manufacturing out of China for U.S.-bound products and warns that future transitions may cause substantial expense or material delays.
-
SVB concentration creates liquidity exposure
Banking and liquidity concentration remains significant despite the cash increase. The loan agreement requires 75% of U.S. cash balances to be held at SVB, while the company maintains cash deposits above FDIC limits; a future bank failure could simultaneously restrict access to a substantial portion of cash and the credit line. The amended facility also adds a minimum liquidity coverage ratio of 2.0 to 1.0.
-
Customer and distributor concentration
Customer and channel concentration could amplify volatility: the top five customers represented 37% of fiscal 2026 revenue, and the top five distributors represented approximately 32% of revenue. A distributor reduction or customer loss could reduce sales and increase excess inventory.
-
Product transition and adoption risk
The growth strategy depends on products and markets that require adoption and lengthy qualification cycles. New-product sales cycles typically last six to 24 months or longer, while certain legacy products are in mature markets with declining demand; failure to gain acceptance for new products could reduce market share and revenue.
Management's outlook
The 10-K does not provide quantitative annual revenue or EPS guidance. Management states that liquidity is expected to be sufficient for working capital, capital expenditures and other commitments for at least the next 12 months and beyond.
Earlier filings 4
10-Q · February 5, 2026
Lantronix reported weaker Q2 2026 results with revenue of $29.77 million, down 4.5% year-over-year. The company improved its net loss to $1.33 million, down from a loss of $2.37 million in the same quarter the prior…
10-Q · November 6, 2025
Lantronix's Q1 2026 results indicate a mixed performance with a slight revenue drop compared to the prior quarter but an improvement in EPS and gross margin. Revenue decreased to $29.8 million, down 13.4%…
10-K · August 29, 2025
Lantronix reported significant challenges in FY 2025, with net revenue declining 23.3% year-over-year to $122.9 million, primarily driven by a steep 34.2% decrease in their IoT System Solutions segment. This revenue…
This is our reading of a public filing, not the filing itself. Analysis can contain errors; check the source document for full context.