Ocean Power Technologies Inc. (OPTT) reported fiscal second‑quarter 2026 revenue of $0.4 million, a sharp decline from $2.4 million in the same period a year earlier. The company posted a gross profit loss of $1.4 million, compared with a $0.8 million profit a year ago, and a GAAP earnings‑per‑share of –$0.06, missing the consensus estimate of –$0.02 by $0.04.
The revenue drop is largely attributable to timing effects from the U.S. federal government shutdown, which shifted a number of OPTT deliverables and development activities into the following quarter. The company’s management noted that the decline is not indicative of underlying demand, and that a portion of the delayed work is expected to convert into revenue later in the fiscal year.
Gross profit loss was driven by one‑time contract losses and a shift toward lower‑margin product mix. Management emphasized that core programs and the commercial pipeline continue to demonstrate improving margin quality and operating leverage, suggesting that the current loss is largely temporary and tied to specific contract circumstances rather than a broader margin erosion.
Backlog and pipeline figures were highlighted as key growth drivers. OPTT’s funded backlog rose to $15 million at quarter‑end, up from $3.8 million a year earlier, while the pipeline expanded to $137.5 million from $84.4 million. The company shipped eight WAM‑V autonomous surface vessels during the quarter and maintained a production cadence of roughly one vessel every two to three weeks, underscoring its ability to scale operations.
Operating expenses increased to $8.7 million from $4.7 million a year earlier, largely due to higher non‑cash stock‑based compensation and increased headcount. Cash, cash equivalents and short‑term investments stood at $11.7 million, providing a liquidity cushion as the company navigates a mixed revenue environment.
CEO Dr. Philipp Stratmann highlighted the company’s operational momentum, noting that the backlog and pipeline growth strengthen OPTT’s competitive position and support continued conversion of the growing pipeline. He also highlighted international demonstrations in Latin America and the UAE, and the strategic partnership with Mythos AI, which expands OPTT’s autonomous maritime capabilities and market reach.
Investors reacted negatively to the results, citing the revenue and EPS miss as primary concerns. Despite the short‑term financial headwinds, the strong backlog and pipeline growth remain positive signals for the company’s long‑term trajectory.
For context, Q1 FY2026 revenue was $1.2 million, a net loss of $7.4 million, and cash of $10.0 million as of July 31, 2025. In the same quarter a year earlier, OPTT reported revenue of $2.4 million and a profit of $0.8 million, illustrating the magnitude of the current decline and the company’s historical performance.
The results underscore near‑term challenges but also highlight significant long‑term growth potential. The company’s ability to convert its expanding backlog into revenue, improve margins on core programs, and leverage its AI partnership will be critical to turning the current financial setbacks into sustainable profitability.
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