Acorn Energy, Inc.

Q1 2026 revenue was $2.227 million, down 28.1% from $3.098 million in Q1 2025. Hardware revenue was $810,000, down $1.019 million or 55.7% year over year, while monitoring revenue was $1.417 million, up $148,000 or 11.7%. Gross margin improved to 80.2% from 75.1%, and monitoring revenue carried a 94% gross margin. OmniMetrix segment operating income was $395,000. On a consolidated basis, the company reported a net loss of $77,000, or $0.03 per share, versus net income of $464,000, or $0.19 per share, in Q1 2025. Cash from operations was $53,000, and cash ended the quarter at $4.257 million, versus $4.454 million at year-end 2025. Management expects $350,000 to $500,000 of incremental hardware revenue from the large cell-tower customer in 2026, and said no Infrastructure Solutions revenue is expected in the first half of 2026.

Jan Loeb emphasized that the core business remains supported by recurring monitoring growth, secular demand for energy resilience, and the ability to expand into adjacent markets. He framed AIO as a capital-efficient way to broaden OmniMetrix into cell towers, data centers, and utility substations, and said the average AIO sale could be 5x to 6x the average existing OmniMetrix product sale. His tone was upbeat but measured: he highlighted two live demo sites, early customer interest, and a long-term goal of 20% average annual revenue growth over 3 to 5 years.

Tracy Clifford focused on the mix shift in the quarter: higher recurring monitoring revenue and a lower hardware contribution lifted gross margin to 80.2%, while operating expenses rose 11.2% to $1.914 million due mainly to $197,000 of noncash stock compensation in Q1 2026 versus $61,000 a year ago. She said OmniMetrix remained profitable at the operating level with $395,000 of segment operating income, and noted that excluding noncash compensation, Acorn would have been profitable on a consolidated basis. On the balance sheet, she highlighted $4.257 million of cash, no debt, $53,000 of operating cash flow, and a $3.269 million deferred revenue backlog, of which $2.934 million is expected to be recognized over the next 12 months.

Analysts pressed management on whether the new AIO-based infrastructure business could face long sales cycles similar to OmniMetrix’s generator monitoring products. Jan Loeb said the cycle could still be long because the customers are large corporations, but theft and other urgent problems could shorten it; he said the team does not yet know because it has not fully worked the lead pipeline. Questions also focused on the large cell-tower customer, with management explaining that the original contract was largely fulfilled and that the customer has now returned for additional hardware orders. Management also said the AIO effort is being run under OmniMetrix, that the model includes both equipment and ongoing SLA-style revenue, and that discussions with two OEMs continue but no update is available.