Core Viewpoint - Orion Energy Systems, Inc. has announced a 1-for-10 reverse stock split to comply with Nasdaq's minimum bid price requirement of $1.00 per share, effective August 22, 2025 [1][3]. Group 1: Reverse Stock Split Details - The reverse stock split will reduce the number of shares from approximately 35.2 million to about 3.5 million, and the total authorized shares will decrease from 200 million to 20 million [3]. - Shareholders will not receive fractional shares; instead, they will receive a cash payment based on the closing price prior to the split [3]. - The reverse stock split will also adjust all outstanding options and similar securities proportionally [4]. Group 2: Shareholder Impact - The reverse stock split will affect all shareholders uniformly, maintaining their percentage ownership interest in the company, except for those receiving fractional shares [2]. - Equinity Trust Company, LLC will act as the exchange agent, providing instructions for shareholders with physical stock certificates [5]. Group 3: Company Overview - Orion Energy Systems specializes in energy-efficient solutions, including LED lighting and electric vehicle charging stations, focusing on large national customers and sustainability [6].

PART I [Financial Statements](index=3&type=section&id=ITEM%201.%20Financial%20Statements%20(unaudited)) This section presents the unaudited condensed consolidated financial statements for the quarter ended June 30, 2025, including balance sheets, statements of operations, shareholders' equity, and cash flows, along with accompanying notes. [Condensed Consolidated Balance Sheets](index=3&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) As of June 30, 2025, total assets decreased to $49.0 million from $52.5 million, primarily due to a reduction in cash and cash equivalents, while total liabilities and shareholders' equity also declined. Condensed Consolidated Balance Sheet Highlights (in thousands) | Account | June 30, 2025 | March 31, 2025 | | :--- | :--- | :--- | | **Assets** | | | | Cash and cash equivalents | $3,564 | $5,972 | | Total current assets | $32,667 | $35,498 | | Total assets | $49,017 | $52,463 | | **Liabilities & Equity** | | | | Total current liabilities | $26,553 | $26,844 | | Total liabilities | $38,211 | $40,579 | | Total shareholders' equity | $10,806 | $11,884 | [Condensed Consolidated Statements of Operations](index=4&type=section&id=Condensed%20Consolidated%20Statements%20of%20Operations) For the three months ended June 30, 2025, the company reported a net loss of $1.2 million, a significant improvement from a $3.8 million net loss in the prior-year period, driven by increased gross profit despite a slight revenue decrease. Statements of Operations Summary (in thousands, except per share data) | Metric | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | | :--- | :--- | :--- | | Total revenue | $19,575 | $19,906 | | Gross profit | $5,901 | $4,299 | | Loss from operations | $(1,013) | $(3,432) | | Net loss | $(1,244) | $(3,758) | | Basic net loss per share | $(0.04) | $(0.12) | [Condensed Consolidated Statements of Cash Flows](index=6&type=section&id=Condensed%20Consolidated%20Statements%20of%20Cash%20Flows) Net cash used in operating activities significantly improved to $0.5 million for the first quarter of fiscal 2026, but financing activities used $1.8 million, resulting in a net decrease in cash and cash equivalents to $3.6 million. Cash Flow Summary (in thousands) | Activity | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | | :--- | :--- | :--- | | Net cash used in operating activities | $(515) | $(2,962) | | Net cash used in investing activities | $(55) | $(24) | | Net cash (used in) provided by financing activities | $(1,838) | $3,523 | | Net (decrease) increase in cash | $(2,408) | $537 | | Cash and cash equivalents at end of period | $3,564 | $5,692 | [Notes to the Condensed Consolidated Financial Statements](index=7&type=section&id=Notes%20to%20the%20Condensed%20Consolidated%20Financial%20Statements) These notes provide crucial context to the financial statements, detailing accounting policies, revenue breakdown, debt structure, and segment performance, including significant customer concentration and a NASDAQ compliance issue. - For the three months ended June 30, 2025, one customer accounted for **30.2% of total revenue**, indicating significant customer concentration risk[25](index=25&type=chunk) - The company received a notice from NASDAQ for not meeting the minimum **$1.00 bid price requirement** and has until September 15, 2025, to regain compliance, potentially through a reverse stock split[26](index=26&type=chunk)[27](index=27&type=chunk)[28](index=28&type=chunk) Revenue by Segment (in thousands) - Q1 FY2026 vs Q1 FY2025 | Segment | Q1 2025 Revenue | Q1 2024 Revenue | | :--- | :--- | :--- | | Lighting product and installation | $12,716 | $12,719 | | Maintenance services | $3,997 | $3,323 | | Electric vehicle charging | $2,696 | $3,830 | | **Total Revenue** | **$19,575** | **$19,906** | - As of June 30, 2025, the company has accrued **$3.3 million** for the unpaid acquisition earn-out related to the Voltrek acquisition, with a subsequent term sheet entered into to settle these obligations[57](index=57&type=chunk)[70](index=70&type=chunk) [Management's Discussion and Analysis of Financial Condition and Results of Operations](index=23&type=section&id=ITEM%202.%20Management's%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management discusses Q1 FY26 financial results, highlighting a slight revenue decrease but significant improvements in gross profit and operating loss due to better margins and cost reductions, alongside updates on liquidity and backlog. [Results of Operations](index=26&type=section&id=Results%20of%20Operations) In Q1 FY26, total revenue decreased slightly by 1.7% to $19.6 million, but gross margin improved significantly from 21.6% to 30.1%, leading to a 66.9% reduction in net loss to $1.2 million. Q1 FY26 vs Q1 FY25 Performance Summary (in thousands) | Metric | Q1 2025 | Q1 2024 | % Change | | :--- | :--- | :--- | :--- | | Total revenue | $19,575 | $19,906 | (1.7)% | | Gross profit | $5,901 | $4,299 | 37.3% | | Loss from operations | $(1,013) | $(3,432) | (70.5)% | | Net loss | $(1,244) | $(3,758) | (66.9)% | - The decrease in operating expenses was primarily due to reduced wages and benefits resulting from restructuring that took place in fiscal 2025[120](index=120&type=chunk)[121](index=121&type=chunk) [Segment Analysis](index=27&type=section&id=Segment%20Analysis) The Maintenance segment showed strong performance in Q1 FY26 with a 20.2% revenue increase and a swing to operating profit, while the Lighting segment improved operating income despite flat revenue, and the EV segment faced declining revenue and widening losses. Segment Operating Results (in thousands) - Q1 FY26 vs Q1 FY25 | Segment | Revenue (Q1'26) | Operating Income/(Loss) (Q1'26) | Revenue (Q1'25) | Operating Income/(Loss) (Q1'25) | | :--- | :--- | :--- | :--- | :--- | | Lighting | $12,882 | $235 | $12,751 | $(1,206) | | Maintenance | $3,997 | $128 | $3,324 | $(976) | | EV | $2,696 | $(322) | $3,831 | $(231) | [Liquidity and Capital Resources](index=28&type=section&id=Liquidity%20and%20Capital%20Resources) The company's cash decreased to $3.6 million due to operating losses and debt repayment, but its backlog grew to $19.0 million, and management believes existing cash and credit availability are sufficient for the next 12 months. - Cash and cash equivalents decreased to **$3.6 million** as of June 30, 2025, from **$6.0 million** at March 31, 2025[128](index=128&type=chunk) - As of June 30, 2025, the company had **$11.5 million** of availability under its revolving credit facility, with **$5.3 million** drawn[137](index=137&type=chunk) - Backlog increased to **$19.0 million** as of June 30, 2025, from **$17.3 million** at the end of the prior fiscal year[144](index=144&type=chunk) [Quantitative and Qualitative Disclosures about Market Risk](index=31&type=section&id=ITEM%203.%20Quantitative%20and%20Qualitative%20Disclosures%20about%20Market%20Risk) The company reports no material changes to its market risk exposures since the end of its last fiscal year on March 31, 2025. - There have been no material changes to the company's market risk exposures since March 31, 2025[149](index=149&type=chunk) [Controls and Procedures](index=31&type=section&id=ITEM%204.%20Controls%20and%20Procedures) Management, including the CEO and CFO, concluded that the company's disclosure controls and procedures were effective as of June 30, 2025, with no material changes in internal control over financial reporting during the quarter. - Management concluded that disclosure controls and procedures were effective as of June 30, 2025[151](index=151&type=chunk) - No material changes were identified in the company's internal control over financial reporting for the quarter ended June 30, 2025[152](index=152&type=chunk) PART II OTHER INFORMATION [Legal Proceedings](index=32&type=section&id=ITEM%201.%20Legal%20Proceedings) The company is subject to various claims and legal proceedings in the ordinary course of business but does not expect them to have a material adverse effect on its financial results. - The company does not believe that any current legal proceedings will have a material adverse effect on its future results of operations or financial condition[154](index=154&type=chunk) [Risk Factors](index=32&type=section&id=ITEM%201A.%20Risk%20Factors) This section refers investors to the detailed discussion of risk factors in the company's Annual Report on Form 10-K for the fiscal year ended March 31, 2025, indicating no new material risks have been identified. - For a comprehensive discussion of risks, the company refers to Part I, Item 1A of its Annual Report on Form 10-K for the fiscal year ended March 31, 2025[155](index=155&type=chunk) [Unregistered Sales of Equity Securities and Use of Proceeds](index=32&type=section&id=ITEM%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) The company reported two instances of unregistered equity sales, including approximately 1.65 million shares issued for the Voltrek earn-out and restricted stock and options granted to a new executive. - On July 16, 2025, the company issued **1,649,077 shares** of Common Stock as earn-out consideration related to the Voltrek acquisition, exempt from registration under Section 4(a)(2) of the Securities Act[156](index=156&type=chunk) - On July 18, 2025, the company granted **100,000 restricted shares** and a non-qualified stock option for **125,000 shares** to a new Senior Vice President as a material inducement for employment[157](index=157&type=chunk) [Other Information](index=32&type=section&id=ITEM%205.%20Other%20Information) During the quarter ended June 30, 2025, none of the company's directors or officers adopted or terminated a Rule 10b5-1 trading plan. - No directors or officers adopted or terminated a Rule 10b5-1 trading arrangement during the three months ended June 30, 2025[159](index=159&type=chunk) [Exhibits](index=33&type=section&id=ITEM%206.%20Exhibits) This section lists the exhibits filed with the Form 10-Q, including an amendment to the Voltrek earn-out term sheet and certifications by the CEO and CFO. - The report includes several exhibits, such as the Earn Out Term Sheet Amendment dated July 31, 2025, and CEO/CFO certifications pursuant to securities laws[163](index=163&type=chunk)

Financial Data and Key Metrics Changes - Orion reported Q1 2026 revenue of $19.6 million, a slight decrease from $19.9 million in Q1 2025, with two of the three segments showing year-over-year growth [19] - The gross profit percentage rose to over 30% for the first time in six years, with a net loss reduced to $1.2 million from $3.6 million in Q1 2025 [11][17] - Adjusted EBITDA improved to positive $200,000 in Q1 2026 compared to a negative $1.8 million in Q1 2025 [22] Business Line Data and Key Metrics Changes - LED lighting segment revenue increased by 1% to $12.9 million, while the electrical maintenance segment revenue rose by 21% to $4 million [19][20] - EV charging solutions revenue decreased to $2.7 million from $3.8 million, primarily due to the timing of larger projects [20] - The gross margin for the LED lighting segment improved to 31.8% from 22.6%, and the maintenance segment gross margin increased to 22.4% from 3.8% [20] Market Data and Key Metrics Changes - The company is experiencing tailwinds in all three business lines nationally and regionally, with a focus on converting quality leadership into market leadership [8] - The electrical infrastructure market is seeing significant investments, providing a unique opportunity for Orion to leverage its expertise [15] Company Strategy and Development Direction - The company aims to achieve $84 million in revenue for FY 2026, with a growth expectation of 5% [24] - Orion is focusing on enhancing margins, reducing costs, and expanding its footprint in existing maintenance service customers [12][13] - The decision was made to retain the existing operational structure rather than reorganizing into two business units, allowing for better integration of EV solutions [16] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in achieving year-over-year growth in revenue, profitability, and shareholder value [6] - The company anticipates modest growth in LED lighting and electrical maintenance revenues, with flat to slightly lower EV charging revenues due to funding uncertainties [25] - Management believes that the company is well-positioned to manage tariff impacts due to its domestic manufacturing capabilities [25] Other Important Information - Orion has made significant reductions in overhead and has built a diversified pipeline of revenue to support growth [17] - The company has reduced total operating expenses by 10.6% to $6.9 million in Q1 2026 from $7.7 million in Q1 2025 [12][22] Q&A Session Summary Question: Interest in electrical infrastructure and potential investment needed - Management indicated that they are in the early stages of electrical infrastructure development and believe their current infrastructure can manage growth without significant initial investment [32] Question: Expectations for pipeline impact in fiscal 2027 and beyond - Management confirmed that the current pipeline will contribute to revenue growth in fiscal 2027 and beyond [35] Question: Details on the electrical infrastructure project - Management stated that the initial project involves expanding electrical infrastructure work based on customer requests, with more details to be shared in future releases [39][40] Question: Clarification on the Boston Public Schools contract - Management clarified that the recent $6.5 million contract is an expansion of previous work done for the Boston Public Schools, indicating a significant increase in project scope [43][46] Question: Status of fluorescent bulb ban and its impact - Management acknowledged the potential impact of the fluorescent bulb ban on business but indicated that it is too early to assess enforcement [50][52]

Company Overview - Orion Energy Systems focuses on helping customers achieve sustainability, energy savings, and carbon footprint reduction goals through innovative technology and service[7] - The company operates in lighting (retrofit), EV charging, and maintenance segments, targeting industrial, commercial, retail, automotive, and public sector vertical markets[16] - Orion offers turnkey solutions, product sales, maintenance services, and EV charging installations as revenue streams[16] Macro Environment & Business Units - Macro factors influencing Orion's business include energy prices, climate/ESG concerns, EV infrastructure development, regulatory landscape (BAA/BABA compliance), and LED penetration rates[19, 20, 21] - Orion's business units include Lighting (focused on commercial & industrial retrofit), Maintenance (lighting and electrical services with 3-year recurring revenue contracts), and EV Charging Systems (turnkey installation with recurring revenue)[23] Lighting Solutions & Case Study - Orion's lighting solutions offer substantial energy cost reduction with an average payback of 1-4 years[26] - A case study at CLARIOS's 100,000 sq ft facility in Florence, KY, involved installing 800 fixtures, resulting in 814,084 kWh annual energy reduction, $54,869 annual energy cost reduction, and 218 tons annual carbon dioxide reduction[33, 36] - The company emphasizes BAA & BABA compliant products, ensuring domestic materials and American labor for federal and state/municipal/school projects[37, 38, 39] EV Charging & Market Opportunity - Orion acquired Voltrek in October 2022, a premier reseller of EV charging stations, managing over 4,000 charging ports[62] - The US needs approximately 28 million EV charging ports by 2030 to support an estimated 33 million electric vehicles[73] - A fleet project example includes a $400,000 Voltrek turnkey installation of 6 DC ChargePoint Fast Charger Stations for Haverhill High School's EV Transit Vans[77, 79] Financial Performance - In Q1 FY26, revenue was $19.6 million, and the gross margin was 30.1%[89, 91] - The company's liquidity in Q1 FY26 was $14 million, with a working capital of $17.4 million[91] - Adjusted EBITDA for Q1 FY26 was $0.206 million[94]

分组1 - Orion Energy Systems reported a quarterly loss of $0.04 per share, better than the Zacks Consensus Estimate of a loss of $0.05, and an improvement from a loss of $0.11 per share a year ago, resulting in an earnings surprise of +20.00% [1] - The company posted revenues of $19.58 million for the quarter ended June 2025, missing the Zacks Consensus Estimate by 4%, and a decline from year-ago revenues of $19.91 million [2] - Over the last four quarters, the company has surpassed consensus EPS estimates two times but has not beaten consensus revenue estimates [2] 分组2 - Orion Energy Systems shares have declined approximately 28.8% since the beginning of the year, contrasting with the S&P 500's gain of 7.1% [3] - The company's earnings outlook is crucial for investors, as it includes current consensus earnings expectations for upcoming quarters and any recent changes to these expectations [4] - The estimate revisions trend for Orion Energy Systems was unfavorable ahead of the earnings release, resulting in a Zacks Rank 4 (Sell) for the stock, indicating expected underperformance in the near future [6] 分组3 - The current consensus EPS estimate for the coming quarter is -$0.13 on revenues of $19.8 million, and -$0.28 on revenues of $83.8 million for the current fiscal year [7] - The Building Products - Lighting industry, to which Orion Energy Systems belongs, is currently in the bottom 13% of over 250 Zacks industries, suggesting a negative impact on stock performance [8]

[Q1'26 Earnings Overview](index=1&type=section&id=Q1%2726%20Earnings%20Overview) Orion Energy Systems reported Q1'26 revenue of $19.6 million, a 2% year-over-year decrease, with significant gross margin improvement and positive Adjusted EBITDA [Key Financial Highlights](index=1&type=section&id=1.1%20Key%20Financial%20Highlights) Orion Energy Systems reported Q1'26 revenue of $19.6 million, a 2% year-over-year decrease, with gross margin significantly improving to 30.1% (up 850 basis points) and achieving $0.2 million in Adjusted EBITDA, marking the third consecutive quarter of positive Adjusted EBITDA Key Financial Metrics | Metric | Q1'26 ($M) | Q1'25 ($M) | Change | | :--- | :--- | :--- | :--- | | Total Revenue | $19.6 | $19.9 | -2% | | Gross Profit | $5.9 | $4.3 | +37% | | Gross Profit % | 30.1% | 21.6% | +850 bps | | Net Loss | $(1.2) | $(3.8) | +$2.6 | | Net Loss per share | $(0.04) | $(0.12) | +$0.08 | | Adjusted EBITDA | $0.2 | $(1.8) | +$2.0 | - Q1'26 gross margin increased to **30.1%**, up from **21.6%** in Q1'25, reflecting pricing, revenue mix shifts, and cost improvements across all three business segments[4](index=4&type=chunk) - Orion achieved **$0.2 million** in Adjusted EBITDA in Q1'26, marking the third consecutive quarter of positive Adjusted EBITDA, compared to negative **$1.8 million** in Q1'25[4](index=4&type=chunk) [FY 2026 Outlook Reiteration](index=1&type=section&id=1.2%20FY%202026%20Outlook%20Reiteration) Orion reiterated its FY 2026 outlook, projecting revenue growth of approximately 5% to $84 million, positioning the company to achieve or approach positive full-year Adjusted EBITDA, with potential upside if business, economic, global trade, and government policy uncertainties stabilize - Orion reiterated its FY 2026 outlook for revenue growth of approximately **5%** to **$84 million**[1](index=1&type=chunk)[5](index=5&type=chunk) - This is expected to position the company to achieve or approach positive full-year Adjusted EBITDA[1](index=1&type=chunk)[5](index=5&type=chunk) [CEO Commentary](index=2&type=section&id=CEO%20Commentary) CEO Sally Washlow highlights Q1'26 performance driven by strategic pricing and cost measures, achieving the highest quarterly gross margin in six years and significant progress in reducing net loss and sustaining positive Adjusted EBITDA [Q1 Performance and Strategic Focus](index=2&type=section&id=2.1%20Q1%20Performance%20and%20Strategic%20Focus) CEO Sally Washlow noted that Q1'26 performance benefited from pricing and cost measures implemented or planned in FY 2025, achieving the highest quarterly gross margin in six years at 30.1%, with significant progress in reducing net loss and achieving sustained positive Adjusted EBITDA - Q1'26 gross margin of **30.1%** represents the highest quarterly gross margin in six years[6](index=6&type=chunk) - Net loss decreased to **$1.2 million** in Q1'26 from **$3.8 million** in Q1'25 and **$6.6 million** in Q1'24[7](index=7&type=chunk) - Q1'26 marked the third consecutive quarter of positive Adjusted EBITDA[7](index=7&type=chunk) [Segment Performance and Growth Initiatives](index=2&type=section&id=2.2%20Segment%20Performance%20and%20Growth%20Initiatives) Despite challenging comparisons and slower project activity in the EV charging business, LED lighting and maintenance services achieved year-over-year growth. Orion is enhancing its LED lighting distribution business by introducing new value-oriented products like TritonPro™ and strengthening its sales team, having secured new projects with automotive customers - Two of the three business segments achieved year-over-year growth, while the EV charging segment faced challenging comparisons to Q1'25 and slower project activity[6](index=6&type=chunk) - The LED lighting distribution business has seen initial success with new value-oriented products like the TritonPro™ fixture series and is strengthening operations with new products and an enhanced sales team[8](index=8&type=chunk) - Recently secured up to **$7 million** in electrical infrastructure and LED lighting projects with three automotive customers[9](index=9&type=chunk) [Business Outlook](index=2&type=section&id=Business%20Outlook) Orion anticipates FY 2026 revenue growth of 5% to $84 million, driven by improved gross margin and operating costs, positioning the company for positive full-year Adjusted EBITDA and securing significant new projects [FY 2026 Guidance](index=2&type=section&id=3.1%20FY%202026%20Guidance) Orion projects FY 2026 revenue growth of 5% to approximately $84 million, which, based on improvements in gross margin and operating costs, is expected to position the company to achieve or approach positive full-year Adjusted EBITDA - Orion's FY 2026 outlook projects revenue growth of **5%** to approximately **$84 million**[11](index=11&type=chunk) - Based on improvements in the company's gross margin and operating costs, this is expected to position the company to achieve or approach positive full-year Adjusted EBITDA[11](index=11&type=chunk) [Key Projects and Initiatives](index=2&type=section&id=3.2%20Key%20Projects%20and%20Initiatives) The company has secured several significant projects expected to contribute to FY 2026 and future performance, including a multi-year LED lighting retrofit contract for over 400 building product distributor locations ($12-18 million), an expanded LED retrofit project for U.S. government agency facilities ($5-7 million), up to $7 million in electrical infrastructure and LED lighting projects with three top automotive customers, and $30-32 million in new store construction revenue potential over five years with a major retail customer - A multi-year LED lighting retrofit contract for over **400** building product distributor locations has commenced, with nearly **$2 million** in orders to be completed in FY 2026, and an estimated **$12-18 million** in revenue over the next several years[12](index=12&type=chunk) - New construction and LED retrofit lighting projects for U.S. government agency facilities have expanded from **$5 million** to **$7 million** in total revenue, expected to be completed in FY 2026[12](index=12&type=chunk) - Electrical infrastructure and LED lighting projects with three long-term top automotive customers are expected to reach **$7 million** in FY 2026[12](index=12&type=chunk) - A major retail customer has increased the number of new store construction projects over the next five years, with an estimated revenue potential of **$30-32 million** from these new stores over five years[12](index=12&type=chunk) - An LED retrofit project for **400** locations with a national bank has commenced, with **$2-3 million** in revenue potential over the next three to four years[19](index=19&type=chunk) [Q1'26 Financial Performance](index=3&type=section&id=Q1%2726%20Financial%20Performance) Orion's Q1'26 financial performance shows a slight revenue decrease but significant gross margin improvement, reduced net loss, positive Adjusted EBITDA, improved cash flow, and varied segment performance [Revenue and Gross Profit Analysis](index=3&type=section&id=4.1%20Revenue%20and%20Gross%20Profit%20Analysis) Q1'26 total revenue was $19.6 million, a slight decrease from Q1'25; however, gross profit significantly increased by 37% to $5.9 million, and gross margin improved by 850 basis points to 30.1%, primarily due to pricing and cost improvements across all business segments Revenue and Gross Profit | Metric | Q1'26 ($M) | Q1'25 ($M) | Change | | :--- | :--- | :--- | :--- | | Total Revenue | $19.6 | $19.9 | -2% | | Gross Profit | $5.9 | $4.3 | +37% | | Gross Profit % | 30.1% | 21.6% | +850 bps | - Q1'26 gross margin increased by **850 basis points** to **30.1%** from **21.6%** in Q1'25, primarily attributed to pricing and cost improvements across all three business segments[13](index=13&type=chunk) [Operating Expenses and Profitability](index=3&type=section&id=4.2%20Operating%20Expenses%20and%20Profitability) Q1'26 total operating expenses decreased to $6.9 million from $7.7 million in Q1'25, reflecting ongoing efforts to reduce infrastructure and personnel costs, despite including $0.6 million in executive signing bonuses and severance, which, combined with higher gross margin, led to reduced net loss and improved Adjusted EBITDA - Total operating expenses decreased to **$6.9 million** in Q1'26 from **$7.7 million** in Q1'25, reflecting ongoing efforts to reduce infrastructure and personnel costs[14](index=14&type=chunk) - Q1'26 net loss improved to **($1.2 million)** or **($0.04)** per share, compared to **($3.8 million)** or **($0.12)** per share in Q1'25[15](index=15&type=chunk) - Q1'26 Adjusted EBITDA significantly improved to **$0.2 million** compared to **($1.8 million)** in Q1'25[15](index=15&type=chunk) [Balance Sheet and Cash Flow Overview](index=3&type=section&id=4.3%20Balance%20Sheet%20and%20Cash%20Flow%20Overview) Due to significantly improved performance, Orion's cash used in operating activities in Q1'26 substantially decreased to $0.5 million from $3.0 million in Q1'25; the company also repaid $1.75 million on its revolving credit facility, reducing outstanding borrowings to $5.25 million, while working capital decreased from $8.7 million to $6.1 million - Cash used in operating activities in Q1'26 was **$0.5 million**, a significant improvement from **$3.0 million** in Q1'25[16](index=16&type=chunk) - Repaid **$1.75 million** on the revolving credit facility in Q1'26, reducing outstanding borrowings to **$5.25 million**[16](index=16&type=chunk) Balance Sheet Highlights | Metric | June 30, 2025 ($M) | March 31, 2025 ($M) | | :--- | :--- | :--- | | Cash and cash equivalents | $3.6 | $6.0 | | Total current assets | $32.7 | $35.5 | | Working capital | $6.1 | $8.7 | | Financial liquidity | $9.8 | $13.0 | [Segment Performance Details](index=3&type=section&id=4.4%20Segment%20Performance%20Details) LED Lighting revenue grew 1% to $12.9 million, driven by large project activity offsetting a decline in electrical distribution sales; Maintenance Services revenue increased 21% to $4.0 million due to new customer contracts and expanded existing relationships; EV Charging Solutions revenue decreased 30% to $2.7 million, reflecting volatility in large project timing, with FY 2026 revenue for this segment expected to be flat or slightly down Segment Revenue | Segment | Q1'26 ($M) | Q1'25 ($M) | Change | | :--- | :--- | :--- | :--- | | LED Lighting Revenue | $12.9 | $12.8 | +1% | | EV Charging Revenue | $2.7 | $3.8 | -30% | | Maintenance Revenue | $4.0 | $3.3 | +21% | - EV charging backlog was approximately **$8 million** at the end of Q1'26; given current uncertainties regarding the scope, timing, and funding availability of EV charging projects, Orion expects FY 2026 EV charging station-related revenue to be flat or slightly down[19](index=19&type=chunk) - LED lighting revenue is expected to be higher in FY 2026 than in FY 2025, supported by an expanded project pipeline and efforts to drive distribution business growth[19](index=19&type=chunk) [Financial Statements](index=7&type=section&id=Financial%20Statements) This section presents Orion's unaudited condensed consolidated financial statements, including statements of operations, balance sheets, cash flows, and an EBITDA reconciliation for Q1'26 and prior periods [Unaudited Condensed Consolidated Statements of Operations](index=7&type=section&id=5.1%20Unaudited%20Condensed%20Consolidated%20Statements%20of%20Operations) This section provides a detailed breakdown of revenue, cost of revenue, gross profit, operating expenses, and net loss for the three months ended June 30, 2025, and 2024 Condensed Consolidated Statements of Operations | Metric (in thousands) | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | | :--- | :--- | :--- | | Total revenue | $19,575 | $19,906 | | Total cost of revenue | $13,674 | $15,607 | | Gross profit | $5,901 | $4,299 | | Total operating expenses | $6,914 | $7,731 | | Loss from operations | $(1,013) | $(3,432) | | Net loss | $(1,244) | $(3,758) | | Basic net loss per share | $(0.04) | $(0.12) | [Unaudited Condensed Consolidated Balance Sheets](index=8&type=section&id=5.2%20Unaudited%20Condensed%20Consolidated%20Balance%20Sheets) This section presents the company's financial position as of June 30, 2025, and March 31, 2025, detailing assets, liabilities, and shareholders' equity Condensed Consolidated Balance Sheets | Metric (in thousands) | June 30, 2025 | March 31, 2025 | | :--- | :--- | :--- | | Total current assets | $32,667 | $35,498 | | Total assets | $49,017 | $52,463 | | Total current liabilities | $26,553 | $26,844 | | Revolving credit facility | $5,250 | $7,000 | | Total liabilities | $38,211 | $40,579 | | Total shareholders' equity | $10,806 | $11,884 | [Unaudited Condensed Consolidated Statements of Cash Flows](index=9&type=section&id=5.3%20Unaudited%20Condensed%20Consolidated%20Statements%20of%20Cash%20Flows) This section outlines cash flows from operating, investing, and financing activities for the three months ended June 30, 2025, and 2024 Condensed Consolidated Statements of Cash Flows | Metric (in thousands) | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | | :--- | :--- | :--- | | Net cash used in operating activities | $(515) | $(2,962) | | Net cash used in investing activities | $(55) | $(24) | | Net cash (used in) provided by financing activities | $(1,838) | $3,523 | | Net (decrease) increase in cash and cash equivalents | $(2,408) | $537 | | Cash and cash equivalents at end of period | $3,564 | $5,692 | [Unaudited EBITDA Reconciliation](index=10&type=section&id=5.4%20Unaudited%20EBITDA%20Reconciliation) This section provides a reconciliation of net income (loss) to EBITDA and Adjusted EBITDA for the quarter ended June 30, 2025, and prior quarters, detailing adjustments for non-GAAP items EBITDA Reconciliation | Metric (in thousands) | June 30, 2025 | March 31, 2025 | December 31, 2024 | September 30, 2024 | June 30, 2024 | | :--- | :--- | :--- | :--- | :--- | :--- | | Net income (loss) | $(1,244) | $(2,912) | $(1,508) | $(3,625) | $(3,758) | | EBITDA | $(527) | $(1,942) | $(667) | $(2,691) | $(2,821) | | Adjusted EBITDA | $205 | $226 | $32 | $(1,392) | $(1,805) | [Additional Information](index=3&type=section&id=Additional%20Information) This section provides details on the Q1'26 investor webcast, company profile, explanation of non-GAAP financial measures, a safe harbor statement outlining risks, and investor relations contact information [Webcast and Company Profile](index=3&type=section&id=6.1%20Webcast%20and%20Company%20Profile) This section provides details on the Q1'26 investor conference call and webcast. Orion Energy Systems is a company offering energy efficiency and clean technology solutions, including LED lighting, EV charging solutions, and maintenance services, committed to providing large customers with end-to-end design-to-installation solutions and helping them achieve business and environmental goals - Orion provides energy efficiency and clean technology solutions, including **LED lighting and controls**, **electric vehicle (EV) charging solutions**, and **maintenance services**[18](index=18&type=chunk) - Orion focuses on providing end-to-end design-to-installation solutions for large national accounts and executes projects through ESCO and distribution partners[18](index=18&type=chunk) [Non-GAAP Financial Measures](index=4&type=section&id=6.2%20Non-GAAP%20Financial%20Measures) This section explains the rationale for using non-GAAP measures like EBITDA and Adjusted EBITDA, aiming to help investors better understand the company's core operating performance and enhance comparability across periods and with competitors; Adjusted EBITDA specifically excludes items such as stock-based compensation, acquisition-related costs, restructuring and severance, asset impairments, and contingent consideration expense - Non-GAAP measures (**EBITDA** and **Adjusted EBITDA**) are intended to help investors better understand the company's core operating performance and enhance comparability across periods and with competitors[21](index=21&type=chunk) - Adjusted EBITDA is derived by adjusting EBITDA for **stock-based compensation**, **acquisition-related costs**, **deferred financing costs**, **restructuring and severance**, **asset impairments**, and **contingent consideration expense**[21](index=21&type=chunk) [Safe Harbor Statement and Risks](index=4&type=section&id=6.3%20Safe%20Harbor%20Statement%20and%20Risks) The Safe Harbor Statement identifies forward-looking statements and enumerates various risks and uncertainties that could cause actual results to differ materially from expectations, including liquidity issues, Voltrek acquisition contingent consideration obligations, need for additional capital, sustained net losses, pricing pressure, Nasdaq listing compliance, government tariffs, reduced EV/LED incentives, reliance on a few customers, ERP system implementation, project timing volatility, and macroeconomic pressures - Certain matters discussed in this press release are “forward-looking statements” intended to qualify for the safe harbor provisions established by the Private Securities Litigation Reform Act of 1995[23](index=23&type=chunk) - Key risks include: * Existing liquidity and capital resources may be insufficient to meet working capital needs or pay contractual/debt obligations * Voltrek acquisition contingent consideration obligations may involve cash payments or issuance of common stock, potentially impacting liquidity or causing significant shareholder dilution * Additional equity or subordinated/convertible debt may be required to provide additional liquidity and capital resources * Sustained significant net losses and negative cash flows in recent years, which if continued, would further adversely affect liquidity and financial condition * Facing increasing pricing pressure on lighting products due to heightened foreign competition, leading to reduced gross margins * Failure to comply with Nasdaq's minimum bid price requirement could result in delisting of common stock * Government tariffs and other measures have adversely affected and may continue to affect the business * Reduced or eliminated U.S. government incentives for EV charging infrastructure investment could decrease demand * Lack of significant recurring revenue streams and reliance on a few customers for a substantial portion of revenue * Implementation of a new ERP system, which may involve significant costs and risks of operational disruption * Reliance on major project-based retrofit work, where the timing of project awards is difficult to predict[23](index=23&type=chunk)[24](index=24&type=chunk) [Investor Relations](index=6&type=section&id=6.4%20Investor%20Relations) This section provides investor relations contact information and social media channels for engaging with the company - Investor Relations contacts include Per Brodin, CFO of Orion Energy Systems, and William Jones and David Collins of Catalyst IR[25](index=25&type=chunk) - The company engages with investors via X (@OrionLighting and @OrionLightingIR) and StockTwits (@OESX_IR)[25](index=25&type=chunk)

Core Viewpoint - Orion Energy Systems, Inc. reported a slight decline in total revenue for Q1'26 but maintained a positive outlook for FY 2026, projecting a revenue growth of approximately 5% to $84 million, which could lead to positive adjusted EBITDA for the fiscal year [1][11]. Financial Performance - Q1'26 total revenue was $19.6 million, down 2% from $19.9 million in Q1'25, with LED lighting revenue increasing by 1% to $12.9 million, EV charging revenue decreasing by 30% to $2.7 million, and maintenance revenue rising by 21% to $4.0 million [2][7][23]. - Gross profit for Q1'26 was $5.9 million, a 37% increase from $4.3 million in Q1'25, resulting in a gross profit margin of 30.1%, up from 21.6% in the prior year [2][14]. - The net loss improved to $1.2 million in Q1'26 from $3.8 million in Q1'25, with net loss per share improving from $(0.12) to $(0.04) [2][16]. - Adjusted EBITDA for Q1'26 was $0.2 million, compared to a loss of $(1.8 million) in Q1'25, marking the third consecutive quarter of positive adjusted EBITDA [2][6][16]. Segment Performance - LED lighting revenue showed resilience with a slight increase, while the EV charging segment faced challenges due to a tough comparison with the previous year and a slowdown in project activity [5][7]. - Maintenance services revenue increased significantly, reflecting new customer contracts and expanded relationships with existing customers [23]. Strategic Initiatives - The company is focusing on enhancing its LED lighting distribution business with new products and improved go-to-market strategies, aiming for a return to growth [8]. - Orion has secured contracts worth up to $7 million for electrical infrastructure and LED lighting projects from automotive customers, indicating strong customer relationships and confidence in future business [9]. Outlook - Orion anticipates a revenue growth of 5% for FY 2026, which should position the company to achieve positive adjusted EBITDA, with potential upside if economic and policy uncertainties stabilize [11][12]. - The company is optimistic about its project pipeline, including a multi-year LED lighting retrofit contract expected to generate $12 million to $18 million over several years [13].

Core Insights - Orion Energy Systems, Inc. has announced the installation of 90 EV charging stations in the Boston Public School system, with contracts valued at $6.5 million [1][3][4] Group 1: Project Details - The recent deployment includes 51 DC fast charging stations at the Freeport Bus Yard and Paris Street facility, utilizing an innovative above-ground mounting method [2][3] - This initiative is part of Boston Public Schools' plan to electrify 100% of its 750 school buses, marking the largest school-bus electrification initiative in the Northeastern United States [3][4] Group 2: Company Positioning - Orion/Voltrek is experiencing increased demand for its turnkey solutions in EV charging, infrastructure, and maintenance, highlighting its reliability and scalability in meeting fleet electrification needs [5][6] - The company has a diverse portfolio of electrification engagements, including multiple-location deployments in municipalities and electric van charging capabilities in school districts [4][5]

Core Insights - Orion Energy Systems, Inc. has secured LED lighting and electrical infrastructure contracts worth up to $7 million for FY 2026 from major automotive industry clients in North America [1][2] - The engagements involve the deployment and upgrade of LED lighting and electrical infrastructure in manufacturing and distribution facilities owned by prominent automakers [2] - Orion's CEO, Sally Washlow, will discuss the company's automotive market leadership and revenue growth expectations during the upcoming conference call [3] Company Developments - The contracts signify Orion's long-term relationships with top-tier North American automakers, highlighting its role as a key provider of lighting and electrical contracting services [2][4] - The company anticipates approaching or achieving positive adjusted EBITDA with projected revenue of approximately $84 million in FY 2026 [3] - Orion emphasizes its commitment to sustainability and energy efficiency through its product offerings, including LED lighting and EV charging solutions [5] Industry Context - The demand for upgrades in manufacturing facilities is driven by trends such as re-shoring and refurbishing, which are increasing the need for installation and maintenance of LED lighting and electrical infrastructure [4] - Orion's established trust with automakers is seen as a significant asset as these companies consider broad-based upgrades in their plants [4]

Company Overview - Orion Energy Systems, Inc. specializes in energy-efficient LED lighting, electric vehicle charging solutions, and electrical maintenance services [3] - The company focuses on providing turnkey design-through-installation solutions for large national customers and projects through ESCO and distribution partners [3] Upcoming Financial Event - Orion will host a conference call and webcast to review its fiscal 2026 first quarter results on August 6, 2025, at 10:00 a.m. ET [1] - The results will be released prior to the market's opening on the same day [1] Engagement and Communication - Live call participants must pre-register to receive dial-in information, and re-registration is available if they lose the dial-in or PIN [2] - Investor relations contacts are provided for further inquiries, including CFO Per Brodin and Catalyst IR representatives [4]