Flux Power (NASDAQ:FLUX) reported fiscal fourth-quarter revenue of $8.2 million, up 25% sequentially from $6.6 million, as improving order patterns in its ground service equipment and material handling businesses exceeded management’s prior expectations. Revenue remained below the $16.7 million reported a year earlier, however, as the company’s largest material handling customer continued to operate under a capital spending freeze.
Chief Executive Officer Krishna Vanka said broader disruptions from tariffs and higher fuel prices also affected the business. He said Flux remains in close communication with its major customer and expects activity with that customer to resume, though he did not provide a timetable. The customer is reportedly planning for the next calendar year, and Vanka said the company was seeing “positive signs.”
Fiscal 2026 Results and Near-Term Outlook
Chief Financial Officer Kevin Royal attributed the margin decline primarily to product mix, the full-year impact of tariffs, and lower operating leverage. Lower volumes resulted in higher unabsorbed labor and overhead costs, he said.
- Fourth-quarter net loss was $2.3 million, or $0.11 per share, compared with a $3.2 million loss, or $0.15 per share, in the prior quarter.
- Full-year net loss was $7.4 million, or $0.38 per share, compared with a $6.7 million loss, or $0.40 per share, in fiscal 2025.
- Fourth-quarter adjusted EBITDA was negative $1.6 million, improving from negative $2.5 million in the preceding quarter but compared with positive adjusted EBITDA of $0.5 million a year earlier.
- Cash and cash equivalents totaled $0.3 million at quarter-end, compared with $0.4 million at the end of the prior quarter.
Flux expects fiscal first-quarter 2027 revenue of $6 million to $7 million, followed by a rebound to $8 million to $9 million in the second quarter. Royal said gross margins could decline somewhat before revenue recovers, adding that the company expects margins to move above 30% when quarterly revenue reaches a run rate of roughly $12 million to $14 million. He said margins could eventually return to the mid-30% range as volume improves.
Cost Reductions and Customer Diversification
The company continued efforts to reduce its cost base during fiscal 2026. Operating expenses fell to $4.4 million in the fourth quarter from $6.5 million a year earlier, while full-year operating expenses declined to $19.2 million from $26.8 million. Management said the reductions reflected headcount cuts, cost containment and operating-efficiency measures. Fiscal 2025 expenses also included $2.9 million in costs associated with a restatement of previously issued financial statements.
Vanka said Flux is pursuing supply-chain optimization, vendor pricing discussions and product redesigns to lower product costs. The company has also been evaluating component costs and meeting with suppliers in lower-cost regions, although management said the initiatives would take time to implement.
To reduce its dependence on individual customers, Flux has expanded its sales and marketing efforts and added senior sales personnel. Stu Jacover, the company’s new vice president of sales for material handling, said he plans to supplement Flux’s dealer network with a direct enterprise-sales approach focused on large fleet operators and national accounts.
Jacover said the direct strategy would complement rather than compete with the dealer channel. He also highlighted Flux’s documented battery take-back and recycling program, including a certified lithium-ion recycling partner, as a differentiator for customers with sustainability objectives.
OEM Progress, Robotics Entry and Software Platform
Flux said one white-label OEM customer increased its annual order commitment by 50%, which Vanka described as the first such commitment obtained from a white-label customer. The company also received certification from Hyster-Yale Materials Handling for its products across the manufacturer’s Class 1, 2 and 3 forklifts.
Vanka said those three forklift classes represented $3.5 billion of Hyster-Yale revenue in fiscal 2025. Flux now sells to what it described as the top four OEMs representing more than 60% of the North American market.
During the quarter, Flux also entered the robotics market through a collaboration with an unnamed global technology platform company. The company said more than 70 batteries have been deployed or are being tested for robotics applications, using its UL-certified C48 battery model. Royal said a representative average selling price for the product is about $10,000 per battery.
Management said the initial batteries are intended for prototype development and testing. If the customer proceeds to scaled production, Royal said volumes could reach hundreds of batteries annually. Vanka said full-scale production could begin in “a quarter or two” if testing proceeds successfully, though he did not identify the customer or provide a revenue forecast.
Flux also launched its AI-driven SkyEMS 3.0 energy-management platform on June 30. Vanka said the platform combines battery data, predictive analytics and customizable dashboards, with potential connectivity to charger data. SkyEMS access is now included with all ground service equipment batteries, and Flux plans to extend it to material handling battery sales.
The company said SkyEMS 3.0 can provide 15% to 40% faster awareness of battery issues and improve fleet uptime by 10% to 30%. Management views the platform as a means to deepen customer engagement, improve retention and create a foundation for future recurring software-related revenue, though Vanka said it is currently sold as an addition to hardware rather than as a standalone software product.
About Flux Power (NASDAQ:FLUX)
Flux Power (NASDAQ: FLUX) is a U.S.-based designer and manufacturer of advanced lithium-ion battery systems tailored for industrial and material-handling applications. The company develops modular battery packs, battery management systems and related charging solutions that deliver high performance, extended runtimes and rapid recharge cycles. Flux Power’s technology is engineered to withstand the demanding environments of warehouses, manufacturing facilities, airports and port terminals, offering a zero-emission alternative to traditional lead-acid batteries.
Among its core offerings, Flux Power provides plug-and-play lithium-ion battery packs, battery management electronics and telematics software that enable real-time monitoring of state of charge, health metrics and energy usage.
