Data I/O Corporation (DAIO) Earnings
Data I/O Corporation is expected to report next earnings on October 29, 2026 (in NaN days), with a consensus EPS estimate of $0.01. DAIO has beaten EPS estimates in 2 of its last 10 reported quarters (average surprise -43.7% over the last four).
| Report date | EPS est | EPS actual | Surprise | Revenue | Rev. surprise |
|---|---|---|---|---|---|
| May 14, 2026 | $-0.16 | $-0.34 | -112.5% | $3M | -18.8% |
| Oct 30, 2025 | $-0.10 | $-0.15 | -57.9% | $5M | -3.7% |
| Jul 24, 2025 | $-0.05 | $-0.08 | -60.0% | $6M | +11.7% |
| Apr 24, 2025 | $-0.09 | $-0.04 | +55.6% | $6M | +16.6% |
| Feb 27, 2025 | $-0.03 | $-0.13 | -333.3% | $5M | -9.0% |
| Oct 24, 2024 | $0.00 | $-0.03 | -1404.3% | $5M | -7.7% |
| Jul 25, 2024 | $-0.01 | $-0.09 | -500.0% | $5M | -19.8% |
| Apr 25, 2024 | $-0.01 | $-0.09 | -1700.0% | $6M | -9.2% |
| Feb 22, 2024 | — | $0.02 | — | $7M | +1.2% |
| Oct 26, 2023 | $-0.00 | $-0.01 | -139.8% | $7M | -2.2% |
| Jul 27, 2023 | — | $0.03 | — | $7M | +9.1% |
| Apr 27, 2023 | $-0.09 | $0.01 | +111.1% | $7M | +7.8% |
Source: company filings + earnings calendar. For informational purposes only — not investment advice.
Earnings call summary
Q2 FY2026 · August 12, 2026
AI summary of management’s prepared remarks and analyst Q&A. For informational purposes only — not investment advice.
Management highlights
- Top Line and Margin Performance * Q2 2026 revenue hit $5.2 million, landing at the midpoint of the company's previously guided 5.1-5.4 billion range * Gross margin improved to 57%, the highest level since Q2 2023, driven by positive mix shift (more high-value system sales), value-based pricing, improved operational efficiency, and greater overhead absorption on higher revenue * Six new customer logos were added in the first half of 2026: 3 in automotive, 2 in robotics, and 1 in global communications. New non-automotive domains are expected to drive significant long-term revenue upside, with robotics revenue projected to ramp meaningfully in the second half of 2027 - Operational Efficiency and Cash Flow Milestones * The company achieved its 2025 target of reducing annual operating costs to below $22 million by April 2026, bringing the break-even revenue point to approximately $5.25-$5.5 million * Preliminary July 2026 results show the company reached near cash flow neutrality, a major milestone after a period of cash burn, though management notes this is only one month of data * The company is targeting a 4-week device turnaround time, half the 8-12 week industry standard, to meet growing customer demand for faster service - Strategic Acquisition Progress * Two transformational acquisitions are progressing on plan: a larger unannounced acquisition (with exclusivity extended to August 31, 2026) and the planned acquisition of embedded software security assets from IAR * Due diligence for the larger acquisition identified small issues that allowed the company to reduce the negotiated purchase price * The IAR security acquisition is well-timed to address upcoming regulatory requirements, including the EU Cyber Resiliency Act (CRA), which requires full product compliance by the end of 2027, with vulnerability monitoring starting in September 2026. This acquisition adds four new recurring revenue streams: software platform sales, annual support contracts, licensing fees, per-device security tokens, and security provisioning as a service * The acquisition will add 60-70 new active accounts, accelerate domain diversification beyond automotive, and integrates with Data I.O.'s existing Luminex and DataResCore platforms without requiring major new capital investment. The company will maintain a strategic commercial partnership with IAR post-close to continue supporting existing joint customers - Domain Diversification * Management is working to reduce historical reliance on the automotive sector, and is seeing early signs of recovery in automotive demand, alongside growing opportunities in robotics, industrial, medtech, and global communications. The security platform is domain-agnostic, creating opportunities across all customer segments
Guidance
- Management reaffirms the full-year 2026 business framework first outlined in the Q1 2026 earnings call, with unchanged core pillars: achieving organic revenue growth over 2025, accelerating recurring and services revenue (including programming as a service), expanding in the programming services market, and driving further margin improvements via operational optimization and internal AI adoption - The first half 2026 performance trajectory is on track to meet these framework targets, which now include the expected consolidation of the two planned acquisitions in the second half of 2026 - No specific third quarter 2026 revenue guidance is provided, as the prior Q2 guidance was a one-time disclosure to account for near-term visibility into delayed Q1 2026 orders. Management remains confident in the company's overall growth trajectory - Management noted that Q3 2026 is off to a strong start, with multiple deals already closed in July, and expects to hit internal 2026 full-year targets. Significant additional corporate announcements are expected over the next 30-60 days - Upon closing, the larger transformational acquisition is expected to nearly double Data I.O.'s annual revenue run rate and boost both earnings and cash flow
Segment performance
Data I.O. reported total Q2 2026 net sales of $5.2 million. This represents a 59% sequential increase from Q1 2026's $3.3 million, but a decrease from $5.9 million in Q2 2025. The two core product segments performed as follows: - Consumable adapters, software, and services: contributed 55% of total Q2 revenue, equal to $2.86 million. - Platform sales: contributed 45% of total Q2 revenue, equal to $2.34 million. This marks a large shift from Q1 2026, when platform sales only made up 19% of total revenue, reflecting a rebound in capital equipment demand. Additional segment-related metrics: Q2 2026 bookings totaled $4.9 million, up from $4.2 million in Q1 2026. Backlog as of June 30 was $2.1 million, down from $2.6 million at the end of Q1, due to improved order-to-ship performance. Deferred revenue fell slightly to $1.1 million from $1.5 million in the prior quarter. Gross margin for the quarter was 57%, up from 49.5% in Q1 2026 and 49.8% in Q2 2025. Operating expenses were $3.7 million including $527,000 in one-time costs; adjusted operating expenses were $3.1 million, down sequentially and year-over-year. The company achieved its target of an annual total cost run rate below $22 million by April 2026. Adjusted EBITDA (excluding one-time items and equity compensation) was a near break-even positive $39,000, compared to a negative $1.75 million in Q1 2026.
Risks & headwinds
- Forward-looking statements are inherently subject to risks and uncertainties that could cause actual results to differ materially from projections. Key known risks include: impacts from global geopolitical events, changes to international tariff and trade regulations, shifts in overall activity levels in the automotive and semiconductor industries, variability in revenue recognition timing based on product delivery and installation schedules, market acceptance of new products, changing economic conditions and customer demand, component shortages, competitive pricing pressure, and risks associated with integrating acquisitions - AI-driven demand for high-speed memory has created ripple effects across the semiconductor market, leading to some memory allocation challenges for a small number of the company's acquired business clients, though this has not created widespread issues to date. Lead times for certain memory components have extended due to broad semiconductor demand driven by AI, edge computing, and automation, but the full scope of this impact is uncertain - The company's achievement of near cash flow neutrality in July is only one month of data, and long-term sustainability of cash flow neutrality has not yet been proven
Analyst Q&A
Q: What is the current progress of the transformational acquisition announced a few months prior, and is management still confident it will close? /
A: The company has extended due diligence exclusivity to August 31, and the process is proceeding according to plan. Management remains confident the acquisition will be completed.
Q: Has the company added any new executive team members recently? /
A: No new full-time executives have been added to the payroll. A strategic consultant has joined to review customer-facing operations and the programming as a service business, and management expects this person may become a full-time employee later in the quarter, but no formal hiring has been completed.
Q: Are AI-driven memory shortages affecting customer demand for your programming services? /
A: High demand for cutting-edge AI-focused memory has created some ripple effects across the broader memory market, as fabs reallocate capacity to newer high-demand memory chips. This has caused limited allocation issues for a small number of clients in the target acquisition pipeline, but has not led to widespread issues or extreme lead time extensions for the memory components Data I.O. customers use.