Ultralife Corporation

Consolidated revenue was $47.9 million versus $48.6 million in Q2 2025. Consolidated gross profit was $13.9 million, up 19.5%, and gross margin was 28.9% versus 23.9% last year, with a $1.1 million net refund on IEEPA tariffs contributing 230 basis points of the year-over-year increase. Operating income was $3.4 million versus $2.3 million, operating margin was 7.2% versus 4.7%, net income was $2.5 million, or $0.15 per share, versus $0.9 million, or $0.05 per share, and adjusted EBITDA was $6.1 million, or 12.8% of sales, versus $4.1 million, or 8.5%. Battery & Energy Products revenue was $44.2 million, down 3.7%, while Communications Systems revenue was $3.8 million, up 39.3%. Backlog ended at $117.5 million, up $33 million or 39% from the comparable 2025 period, and management said July order pull-through had lifted backlog to almost $130 million. No formal quarterly or full-year financial guidance was given on the call.

Mike Manna framed the quarter as a period of operational progress, noting record backlog, a growing product portfolio, and new products moving from development toward commercialization. He emphasized that the business is aligned with defense modernization and advanced networking needs, and said the company is investing to build more stable and larger revenue streams in Communications Systems. His tone was constructive and confident, with repeated references to long-term upside, meaningful growth opportunities, and expected benefits from brand consolidation and product launches.

Phil Fain focused on the financial improvement in margins and profitability. He cited consolidated gross margin of 28.9% versus 23.9% last year, gross profit of $13.9 million, operating expenses of $10.4 million, and net income of $2.5 million, while also noting a $1.1 million net tariff refund and $0.9 million of one-time litigation and consulting costs. He said working capital was $69.8 million and the current ratio was 2.9, both modestly above year-end 2025, and highlighted that the backlog remained diverse and equal to 63% of trailing 12-month sales.

An analyst asked whether Ultralife should expect to capture most of the Falcon Manpack/NGC2 business from L3Harris; management said it does not yet know which divisions will receive the work and does not have that insight today. The same analyst asked about July backlog additions, and Mike Manna said the company had seen a lot of order pull-through and backlog was almost $130 million as of the call. He also asked about HP Enterprise server testing in heat, and management said the equipment made it through testing, with Phil Fain adding that the accompanying cooling system is designed for extreme conditions.