Stem, Inc. Q1 FY2026 earnings call

Arun noted 2025 was a transformative year and 2026 is to demonstrate the results. Q1 saw fourth consecutive positive adjusted EBITDA. Key priorities for 2026 include driving operational leverage, strengthening core PowerTrak platform. PowerTrak added ~1.5GW solar assets under management, ARR grew 2%. Acquired Rikoon for platform capability. Powertrack Sage live, early adoption good. Managed Services brought ~$7M revenue. Also, utility-scale bookings more than doubled, international presence expanding, new offerings like AI services and data center focus.

Total revenue for Q1 was $29 million, down 11% year over year. Core revenue from software, services, and edge hardware was up 4% year over year. Powertrack software revenue grew 16% year over year. Adjusted EBITDA was $2 million, marking the fourth consecutive quarter of positive adjusted EBITDA and the first ever positive first quarter adjusted EBITDA. Non-GAAP gross margin was a record 52%. Cash operating expenses were down significantly year over year and sequentially.

Reaffirm full year 2026 guidance. Total revenue $140M - $190M, core revenue $130M - $150M, battery hardware resales up to $40M. Non-GAAP gross margin 40%-50%, adjusted EBITDA $10M - $15M, operating cash flow $0 - $10M, year-end ARR $65M - $70M.

Forward-looking statements involve risks and uncertainties. Managed Services ARR declined modestly due to a battery supplier bankruptcy.

Q: Justin Clair with Roth Capital asked about bookings growth in utility scale, ARR cadence, and margins.

A: Arun and Brian responded on PowerTrack EMS driving utility scale bookings, seasonality in ARR growth, and margin improvements from AUM growth and pricing.

Q: Retail investor asked about cash flow levers, acquisition of Raccoon, and AI value.

A: Brian talked about cash flow from improved bookings and reduced working capital, Arun explained Raccoon acquisition for platform enhancement, and Arun discussed AI in products and internal usage for customer value.