IRIDEX Corporation

Total revenue in Q2 2026 was $12.6 million, down 7% from $13.6 million in Q2 2025. Retina product revenue was $6.5 million versus $8.0 million a year ago, while Cyclo G6 product family revenue was $3.9 million, up 19% year over year from $3.3 million. Gross profit was $4.3 million, or 34.2% gross margin, compared with $4.7 million and 34.5% in the prior-year quarter. Operating expenses were $5.3 million, down $300 thousand, or 5%, from $5.6 million. Net loss was $1.3 million, or $0.07 per share, versus a net loss of $1.0 million, or $0.06 per share last year. Non-GAAP adjusted EBITDA was a loss of $400 thousand versus income of $21 thousand a year ago. Cash and cash equivalents were $4.7 million at quarter-end, up $100 thousand sequentially. Management reaffirmed 2026 revenue guidance of $51 million to $53 million, excluding Middle East revenue, implying 1% to 5% pro forma growth versus 2025, and reaffirmed full-year operating expense guidance of $19 million to $19.5 million.

Patrick Mercer framed the quarter as an inflection point, stressing that IRIDEX generated positive cash flow and has materially improved its cost structure and working capital discipline over the past two years. He said the headquarters relocation and shift to lower-cost contract manufacturing should support margin improvement, especially in 2027, while the company manages short-term working capital and inventory for supply continuity. His tone was constructive and confident, with emphasis on stronger glaucoma utilization, international regulatory progress, and a path to sustained profitability.

Romeo Dizon highlighted the core financials: revenue of $12.6 million, gross profit of $4.3 million, gross margin of 34.2%, operating expenses of $5.3 million, and a net loss of $1.3 million, or $0.07 per share. He noted the year-over-year revenue decline was mainly due to lower retina sales, partially offset by glaucoma probe growth, and said higher-margin glaucoma probes were offset by softer retina margins and cost pressures. He also pointed to positive cash flow in the quarter, cash and equivalents of $4.7 million, and said quarterly cash generation should build sequentially, though inventory buildup for relocation and supply-chain protection will temporarily use cash.

Analysts focused on whether retina can recover in the second half and whether Q2 glaucoma probe volume was helped by customer inventory build. Management said it expects second-half retina growth to be low single digits, supported by international regulatory approvals, U.S. promotions around the AAO meeting, and normal seasonality, with Q4 usually the strongest quarter. On glaucoma, Patrick Mercer said the quarter was not a new normal because some orders were pulled forward to cover blackout periods in Japan and Europe, though growth remained strong even excluding that effect. He also said system sales should be higher in the second half after slower EMEA activity and pending UK reimbursement progress.