Ideal Power Inc. Q1 FY2026 earnings call

• Commercial Project Progress

  • The lead Asia customer low-current SSCB project for 800-volt AI data centers and energy grids remains on track, with prototypes expected for customer evaluation in Q4 2026, accompanied by low-volume prototype orders. Two new additional projects were launched with this lead customer: a medium-current SSCB for 800V DC data centers, energy storage, EV charging, and microgrids, and a low-current SSCB for smart industrial buildings.
  • A letter of intent was signed with an industry partner to co-develop a BTRAN-enabled intelligent SSCB prototype for evaluation by a U.S. hyperscaler for the NVIDIA Rubin Ultra 800-volt DC AI data center power distribution system, with prototype delivery targeted for the end of Q4 2026. The prototype will also be offered to other U.S. hyperscalers adopting the 800-volt DC architecture.
  • Initial next-generation vTRAN custom samples and development kits were delivered to Stellantis for EV applications, with all remaining deliverables under the existing purchase order on track for completion by mid-2026.
  • The company launched its first solid-state transformer (SST)-specific customer engagements, partnering with new Asia-based power solution suppliers to develop BTRAN-enabled SSCBs for SSTs targeting 800V DC AI data centers, energy storage, EV charging, and grid applications.
  • New engagements were initiated with multiple multinational customers for BTRAN-based SSCB development across AI data centers, smart industrial buildings, energy storage, and renewable energy grids.

• Market Opportunity

  • The industry is in the early stages of a multi-year secular transition from legacy 400V AC architectures to 800V DC high-voltage power architectures, driven by growing AI data center rack power requirements (rising from 10-50kW to 100-150kW in the near term, targeting 1MW per rack by 2030). This transition creates strong demand for solid-state circuit protection that traditional mechanical breakers cannot meet, and BTRAN is uniquely positioned to address this need.
  • The company's total sales opportunity funnel grew to over $300 million from ~$200 million at the end of February 2026, with diversified opportunities across AI data centers, automotive, industrial, and multiple geographies.
  • The company met with ~30 interested companies at the March Advanced Power Electronics Conference, several of which have progressed into qualified funnel opportunities.

• Intellectual Property

  • Ideal Power now holds 103 issued BTRAN patents, with 50 issued outside the U.S. across priority geographies including North America, China, Taiwan, Japan, South Korea, India, and Europe.
  • The proprietary double-sided wafer manufacturing process is held as a trade secret, with strict confidentiality agreements in place with fabrication partners. The company exclusively works with foundries and packaging houses in regions with strong intellectual property rights protections to minimize infringement risk.

• Strategic Priorities

  • The top corporate priority is converting the growing sales funnel into design wins, production orders, and revenue, with a focus on close customer collaboration to advance development and testing.

Ideal Power is an early-stage advanced power electronics company focused on BTRAN-enabled solid-state circuit breakers (SSCBs) and related power products. The company recorded $0 in revenue in Q1 2026, as all customer projects are still in the development and evaluation phase, with no commercial production revenue yet generated. Operating expenses totaled $3.7 million in Q1 2026, up from $2.8 million in Q1 2025, driven by higher stock-based compensation and personnel costs. Net loss for Q1 2026 was $3.6 million, compared to a $2.7 million net loss in Q1 2025. No separate product segment financial performance is reported, as all activities are pre-revenue and focused on commercializing the BTRAN technology platform across target markets.

• Cash burn guidance: Q1 2026 operating and investing cash burn was $2.3 million, below the prior guidance range of $2.6 to $2.8 million. Q2 2026 cash burn is guided to $2.5 to $2.7 million, and full year 2026 cash burn is guided to $10 to $10.5 million, up from 2025's full year cash burn of $9.6 million due to planned hiring of additional sales and engineering personnel.
• Operating expenses: Modest increases in operating expenses are expected in coming quarters to support growing commercial activity and customer engagements, with ongoing quarter-to-quarter variability driven by timing of semiconductor fabrication, R&D activities, hiring, and non-cash stock-based compensation recognition.
• The company reaffirmed prior expectations for the timeline of meaningful revenue generation, with no changes to prior guidance.
• Automotive reliability qualification for BTRAN remains on track for completion in summer 2026, and Stellantis project deliverables remain on track for completion by mid-2026.

• All forward-looking statements regarding future revenue, project timelines, and market adoption are subject to inherent risks and uncertainties that could cause actual results to differ materially from expectations, as detailed in the company's SEC filings.
• Converting the $300 million sales opportunity funnel into actual design wins, production orders, and revenue is not guaranteed, as customers must complete multi-stage development, testing, and qualification before commercialization.
• The company is pre-revenue, relies on cash reserves to fund operations, and will need to generate sufficient future revenue or secure additional financing to sustain long-term operations.

Q: What is the core investment thesis for Ideal Power at its current development stage? / A: Management states the company is positioned at the start of a multi-year secular megatrend of shifting energy infrastructure from AC to high voltage DC across data centers, grids, energy storage, and industrial applications. This transition aligns perfectly with BTRAN's unique capabilities for solid-state circuit breakers, and the trend will expand the company's addressable market through 2030 and beyond.

Q: How does BTRAN compare to competing silicon carbide devices like Infineon's CoolSiC JFET? / A: Unlike JFETs and silicon carbide MOSFETs, which require two back-to-back devices to support bidirectional conduction and blocking, BTRAN delivers full bidirectional capability with a single device. BTRAN also simplifies current sharing and switching control for medium and high-current SSCB applications, reduces component count, shrinks system size, improves power density, and lowers overall system cost, addressing key pain points customers report with silicon carbide solutions.

Q: What is the company's current manufacturing readiness for future volume growth? / A: Management confirms the company is already prepared for production ramps over the next two years, with established relationships with multiple capable foundries and packaging partners. The company also has a long-term capacity roadmap in place that supports forecasted volume requirements while delivering planned incremental cost reductions.

Q: What near-term catalysts should investors watch for over the next 3-6 months? / A: The key catalysts will be commercial activity announcements, including new custom development agreements and new customer programs. The company also expects to begin receiving initial purchase orders that it will announce as they are received, and remains on track to complete Stellantis deliverables by mid-2026.