Palladyne AI Corp. Q1 FY2026 earnings call

Ben Wolfe covered first quarter results, operational highlights. Revenue increased 107% to $3.5 million, in line with expectations despite federal government shutdown. Backlog added $7 million. Demonstrated true heterogeneous autonomous swarming. Progressed development of Brain flight computer variants. Expanded Dragonfly partnership, established presence in space domain through two engagements. Secured contract with major U.S. defense prime contractor. Actively deploying IQ 2.0 with first customer. Trevor Thatcher focused on first quarter results, liquidity position, and capital outlook.

First quarter revenue increased 107% year over year to $3.5 million. Product revenue was $1.7 million, engineering services revenue was $1.8 million. Cost of revenue was $2.5 million. Consolidated gross margin was approximately 30%. Research and development expense was $3.9 million. General and administrative expense was $6.9 million. Sales and marketing expense was $1.9 million. Operating loss was $11.9 million. Backlog as of quarter end was $17 million, up from $13.5 million at the end of 2025.

Reiterated full year 2026 revenue guidance of $24 to $27 million. Expect revenue to grow sequentially each quarter with growth rate accelerating in second half. Expect quarterly cash usage to trend toward and remain within previously guided range. Believe well positioned to execute 2026 plan with $43.7 million liquidity as of March 31st.

Risks include ability to execute on development programs, convert backlog into revenue, scale production, manage operating expenses, integrate acquired businesses, secure additional contracts, maintain liquidity, and navigate evolving defense and commercial market conditions. These and other risk factors described in detail in Paladine AI's filings with SEC.

Questions from Michael Lattimore, Greg Conrad, Max Michaelis, Brian Kingslinger, and online questions. Discussions on swarm OS integration, manufacturing operations, revenue delay due to government shutdown, Dragonfly partnership timeline, IQ 2.0 customer, REDCAT partnership, and scaling production and IQ 2.0 pipeline