Acorn Energy, Inc. (ACFN) Q2 2026 Earnings: Revenue $2.5M (-29.4%)
ACFN — Q2 2026 Financial Report Analysis
Q2 · Fiscal year 2026 · Published by Pham Hop
Acorn Energy's Q2 revenue fell 29% to $2.49M and EPS to $0.12 from $0.28 as a big cell-carrier hardware contract faded; the rest of the business was flat while monitoring revenue grew 8%.
Revenue
$2.5M
-29.4% YoY
Net income
$294K
-59.2% YoY
Diluted EPS
$0.12
-57.1% YoY
Operating margin
15.1%
This period vs a year ago
Same period last year
This period
Revenue▼-29.4%
≈$3.5M
$2.5M
Net income▼-59.2%
≈$721K
$294K
Diluted EPS▼-57.1%
≈$0.28
$0.12
Year-ago figures (≈) are worked out from the growth rate the company reported. Each row has its own scale.
Acorn Energy's second-quarter revenue fell 29% to $2.49 million and net income dropped 59% to $294,000, or $0.12 a share. Almost all of the decline traces to one customer: a national cell phone carrier whose large 2025 hardware orders did not repeat. Strip that customer out of both years and revenue was flat, at about $2.08 million each quarter. The recurring monitoring business (subscription fees customers prepay for OmniMetrix to watch their equipment remotely) grew 8%. So this is a lumpy-contract comparison more than a sign the business is shrinking. Growth is still slow, though, and costs are rising.
At a glance
Monitoring revenue: $1.43 million, up 8.0%. The subscription side kept growing and is now 57% of sales. It earns a 95.6% gross margin, so the fall in total revenue cost less profit than you might expect.
Hardware from the big carrier: $263,000, down from $1.34 million. That $1.08 million drop is more than the company's entire $1.04 million revenue decline.
Cash: $4.48 million at June 30, and no debt. On September 9, after the quarter closed, OmniMetrix bought a competing generator-monitoring business for $3.5 million. It paid $1.0 million up front and owes the rest over five years.
What the company actually is
Acorn Energy is a holding company with one operating business: OmniMetrix, based in Buford, Georgia. At June 30 Acorn owned 99% of it, and a share swap in August took that to 100%. OmniMetrix sells monitoring devices and ongoing monitoring subscriptions for three markets, which it reports as separate segments:
Power Generation (PG): remote monitoring of standby generators at businesses and homes. This brought in $2.37 million of the quarter's $2.49 million.
Cathodic Protection (CP): monitoring of the corrosion-protection systems on gas pipelines. $122,000, down 26% on fewer hardware sales.
Infrastructure Solutions (IS): a new segment for cell towers, data centers and utility sites. It resells equipment and software from Israel-based AIO Systems under the OmniMetrix brand. No revenue yet; its first product, OMNI360, launched this quarter.
The business makes money two ways. It sells a device (hardware, a one-time sale) and then charges an annual monitoring fee (recurring). The fee is usually paid a year in advance and booked as revenue month by month.
The numbers
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Metric
Q2 2026
Q2 2025
YoY Change
Revenue
$2.489M
$3.525M
-29.4%
Monitoring revenue
$1.425M
$1.320M
+8.0%
Hardware revenue
$1.064M
$2.205M
-51.7%
Gross margin
82.4%
74.9%
+7.5 pts
Operating income
$375K
$947K
-60.4%
Operating margin
15.1%
26.9%
-11.8 pts
Net income to Acorn stockholders
$294K
$720K
-59.2%
Diluted EPS
$0.12
$0.28
-57.1%
Backlog (June 30)
$3.24M
$3.67M
-11.8%
Operating margin is the share of revenue left after running the business, before interest and tax. Backlog is contracted revenue not yet recognized, mostly prepaid monitoring fees.
Figures for the first six months tell the same story. Revenue was $4.72 million, down 28.8%. Net income to stockholders was $217,000 ($0.09 a share), down from $1.18 million ($0.47). The six-month figures are lower than the second quarter alone would suggest because Acorn lost about $77,000 in the first quarter (the six-month total minus Q2).
Why revenue fell: one contract, not the whole business
In June 2024 OmniMetrix signed what the filing calls its "Material Contract" with a national cell phone provider. The customer isn't named. Most of the deployment's hardware shipped in 2025. The earnings release breaks out the customer's contribution:
From the cell carrier
Q2 2026
Q2 2025
Hardware revenue
$263K
$1,338K
Monitoring revenue
$147K
$102K
Everything else (total minus carrier)
$2,079K
$2,085K
So the rest of the business, taken together, did not grow at all. Monitoring revenue from other customers rose from $1.22 million to $1.28 million, about 5%. Hardware sold to other customers fell from $867,000 to $801,000. Part of the fall in total hardware revenue is an accounting tail-off. Some hardware sold in earlier years was booked as revenue gradually rather than all at once, and that "amortization of deferred revenue" fell from $270,000 to $53,000 as the old balance nears its end. The filing doesn't split this line by customer. Either way, there is no sign yet of a broad pickup in new device sales.
Why profit fell more than revenue
Gross margin rose to 82.4% from 74.9% because more of the sales mix was high-margin monitoring (95.6% gross margin). Hardware carries 64.6%. But gross profit still fell by $589,000, and operating costs did not shrink to match: they were $1.68 million, versus $1.69 million a year ago.
The mix of costs moved in opposite directions:
OmniMetrix's own overhead (selling, general and administrative costs) fell $60,000, mainly from $128,000 lower sales commissions on the smaller hardware volume. Staff costs rose $61,000.
Corporate overhead at the Acorn parent rose 25% to $347,000. Almost all of that was $66,000 more stock-based compensation. More options were granted to officers and directors in January 2026 than in past years, and a higher share price makes each option worth more.
Research and development fell to $239,000 from $265,000 after the new Omni and OmniPro monitors finished development in 2025.
Operating income fell 60%, to $375,000, while revenue fell 29%. That gap is operating leverage in reverse: when most costs are fixed, a revenue drop cuts deeper into profit.
What the headline numbers hide
Cash earnings look slightly better than book earnings. In the first half, operating cash flow was $277,000 against net income of $229,000. Two non-cash charges hold down reported profit. Stock compensation was $296,000 (up from $93,000). Deferred tax expense was $66,000 of the $80,000 total tax charge: Acorn books a normal tax rate (about 26% this quarter) but paid only $13,000 of income tax in cash in the half. Old losses from past years offset taxable income, and the $4.83 million deferred tax asset on the balance sheet represents that future benefit.
But the prepaid-cash cushion shrank. Deferred revenue (fees collected in advance) fell to $3.15 million from $3.41 million at year-end, and backlog is 12% below a year ago. For a subscription business, that is the number to watch: it is next year's revenue already paid for. Part of the drop is the carrier's deferred hardware balance running off, but it means the growth in monitoring revenue is not yet showing up as growth in prepaid contracts.
Receivables grew while sales fell. Accounts receivable rose 20% to $1.07 million from $887,000 at year-end, and 39% of it is owed by the carrier. The company says last year's balance from the same customer was collected in full, so this looks like timing rather than a collection problem. It is still a concentration: one customer supplied 16% of invoiced revenue in the quarter.
No buybacks or financial engineering. Diluted share count was 2.54 million in both years, so EPS moved with profit. Interest income was a minor $32,000.
The first quarter was a loss. The six-month total ($217,000) is below the second quarter's $294,000, which means Q1 lost roughly $77,000. The second quarter was better, but profit at this scale can swing on a single order.
Takeaway: Acorn's 29% revenue drop is almost entirely the fade of one carrier contract. The rest of the business was flat, not growing. The recurring monitoring business is the reason the company stays profitable, but it grew only about 5% outside the carrier. That is a long way from management's 20% annual growth target. The September acquisition is the clearest step toward that target so far.
What comes next
Management's view. CEO Jan Loeb said that the carrier's big hardware quarters have now "cycled through" the year-ago comparisons, so revenue comparisons should improve from here. He expects growth to move toward the company's three-to-five-year target of 20% average annual growth "in coming quarters." The company gave no numeric revenue or profit guidance. Management expects the cash on hand to cover operations and capital spending for at least the next 12 months.
Growth levers, as disclosed:
Champion Power Equipment (signed July 31). A home-standby generator brand will resell OmniMetrix's residential monitors. The CEO says OmniMetrix becomes the standard monitoring option on Champion's aXis and fleX generators. Pricing assumes 3,000 units a year, but the contract sets no minimum purchase, so this is an opportunity rather than committed revenue. Management said it should start helping results in the third quarter.
OMNI360 for cell towers. Launched in the quarter. Management expects a long sales cycle and says it is too early to predict when revenue will start. Acorn paid $250,000 in Q1 for the North American rights.
The Gen-Tracker acquisition (September 9, after the quarter). OmniMetrix bought the assets of Generator Solutions' Gen-Tracker generator-monitoring business, including customer accounts, dealer relationships and inventory, for $3.5 million. $1.0 million was paid at closing (about 22% of June 30 cash). The rest is due as $450,000 a year for four years and $700,000 in year five. The 8-K filing does not say how much revenue Gen-Tracker brings in. The payments are modest next to the company's cash, but the deal turns a debt-free company into one with about $2.5 million of deferred purchase obligations.
Our read. The third quarter should show revenue growth for the first time in several quarters. The carrier comparison no longer hurts, and Gen-Tracker's accounts will add revenue from September 9. That growth will be partly bought rather than organic. The test for the business is whether monitoring revenue outside acquisitions grows faster than about 5%, and whether deferred revenue starts rising again as Champion units ship. Until then, rising stock compensation at the parent is taking a larger share of a small profit.
This is our first published analysis of Acorn Energy, so there is no earlier outlook to check against.