10-Q · May 15, 2026
Solarmax Technology reported significant revenue growth in Q1 2026, achieving $14.8 million, which represents a 114.1% increase compared to $6.9 million in Q1 2025. The company recorded a slight improvement in its net…
Earnings analysis · 10-Q
SMXT earnings analysis
Filed October 7, 2026 · Our reading of the company's report
The latest report
SolarMax delivered strong year-over-year revenue growth and improved gross margin, driven by solar, LED, SGIP activity and the emerging Longfellow BESS EPC project. However, Q2 profitability deteriorated sequentially…
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SolarMax delivered strong year-over-year revenue growth and improved gross margin, driven by solar, LED, SGIP activity and the emerging Longfellow BESS EPC project. However, Q2 profitability deteriorated sequentially and year over year because of a $4.264 million China legal judgment, resulting in a $4.656 million net loss and $(0.98) diluted EPS. Liquidity is highly constrained, with $2.158 million of cash, negative six-month operating cash flow of $5.156 million, $13.7 million of convertible debt in default and an explicit going-concern qualification. Nasdaq compliance, delayed receivables and concentration in Longfellow remain material risks.
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.
Reported figures
- Earnings per share
- $-0.98
What stood out
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Revenue grew year over year
Q2 revenue was $10.24 million, up 48.8% from $6.883 million in Q2 2025, although down approximately 31.7% from $15 million in Q1 2026. Six-month revenue increased 81.6% to $25.074 million from $13.810 million.
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Gross margin expanded
Gross margin improved to 23.6% from 8.8% in Q2 2025 and from 20.5% in Q1 2026. Gross profit increased 299.0% year over year to $2.414 million.
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Core U.S. sales increased
Solar energy and battery sales increased 23.5% year over year to $7.273 million, while LED revenue rose 133.3% to $2.125 million. For the six months, solar revenue rose 31.5% to $15.366 million and LED revenue rose 83.1% to $3.608 million.
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BESS EPC pipeline emerging
Large-scale EPC revenue began contributing materially, with $809,154 recognized in Q2 and $6.010 million in the first six months. Management expects approximately $54.0 million of additional Longfellow revenue in the remainder of 2026 and 2027.
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SGIP collections improved
SGIP-related collections improved after quarter-end: the company received approximately $4.9 million in August and September 2026 against a $6.7 million SGIP receivable at June 30, 2026.
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U.S. operations turned profitable
U.S. operations generated operating income of $58,000 in Q2 and $422,000 for the six months, versus operating losses of $1.6 million and $2.7 million, respectively, in the comparable 2025 periods.
What to watch
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Losses and operating margin worsened
The company reported a consolidated net loss of $4.656 million, or $(0.98) per diluted share, versus a $1.899 million loss, or $(0.50) per share, in Q2 2025. The operating loss was $4.459 million, or approximately 43.5% of revenue, compared with a $1.769 million loss in Q2 2025.
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Liquidity and going-concern risk
Cash and cash equivalents fell to $2.158 million from $7.967 million at December 31, 2025, while operating cash flow was negative $5.156 million for the six months versus negative $380,000 in the prior-year period. Management disclosed substantial doubt regarding going-concern status.
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Convertible debt default exposure
The company was in default on convertible notes with principal of $13.7 million; holders may accelerate repayment and the default rate could rise to 12%, producing approximately $2.2 million of accrued interest if all affected notes were accelerated.
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Receivable concentration risk
Accounts receivable were $17.759 million, but approximately $16.1 million, or 90.0%, experienced collection delays. Longfellow represented $9.4 million of receivables and $51.9 million of contract assets, creating maximum exposure to loss of approximately $61.6 million.
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China litigation charge
A $4.264 million China legal judgment charge was recorded for farmland occupation taxes related to four projects. The company is awaiting the ruling in the fourth case and expects it to be consistent with the other three adverse judgments.
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Nasdaq delisting risk
Nasdaq issued a notice that the company failed the $35.0 million minimum market-value requirement, with a compliance period expiring December 21, 2026. The one-for-12 reverse split addressed the $1.00 bid-price issue but does not address the market-value requirement.
Management's outlook
No explicit numeric EPS or total-company revenue guidance was provided. Management expects residential revenue growth to level off in 2026, expects SGIP growth to level off in 2026, and expects Longfellow to generate approximately $54.0 million of additional revenue during the remainder of 2026 and 2027, with project completion expected by March 2028.
Earlier filings 1
This is our reading of a public filing, not the filing itself. Analysis can contain errors; check the source document for full context.