FTC Solar Q2 2026 earnings: Revenue grows 31% but losses persist

FTC Solar (Nasdaq: FTCI) reported Q2 2026 revenue of $26.2 million, up 30.8% from $20.0 million a year earlier, while GAAP diluted loss per share widened to $1.69 from $1.18. Revenue growth and a narrower gross loss improved adjusted results modestly, but negative margins, higher operating costs and financing-related charges kept the company well below profitability.

Core financial results

Revenue increased 51.5% sequentially and finished slightly above the company’s $22 million to $26 million target range. GAAP gross margin recovered substantially from the prior year but remained negative, meaning the company still spent more delivering products and services than it generated from them.

Higher operating expenses and below-the-line charges offset the gross-margin improvement. Consequently, the GAAP net loss widened even as adjusted EBITDA and adjusted EPS improved modestly.

Business and segment performance

Product revenue was the main growth driver, rising approximately 41.2% to $22.4 million from $15.9 million. Service revenue declined approximately 9.1% to $3.8 million from $4.1 million, creating a clear difference between the two revenue streams.

FTC Solar reported approximately $560 million in contracted and awarded backlog. Investors should note that the company’s backlog definition can include awards without signed contracts or binding pricing, so the ultimate revenue and timing may differ from the reported amount.

Several project developments support the planned second-half ramp:

• The company received its first 1P tracker order from a large U.S. developer that had previously been a 2P customer. The East Coast project exceeds 100 megawatts.
• FTC Solar received notice to begin production for a project exceeding 330 megawatts in Queensland, with deliveries scheduled for the second half of 2026. The project had originally been expected to enter production in mid-2025 and was already included in backlog.
• The company entered India and reported multiple initial wins ranging from pilot projects to projects exceeding 100 megawatts, with shipments underway during 2026.
• After quarter-end, FTC Solar received a 400-megawatt purchase order involving a top-five U.S. EPC and developer.
• The company also reported an Australia award exceeding 80 megawatts for second-half delivery.

Gross-margin recovery has not yet delivered breakeven

Both revenue streams produced smaller gross losses than a year earlier. Product gross loss narrowed to approximately $2.2 million from $3.0 million, while the service business was close to gross breakeven, with a loss of approximately $34,000 versus $910,000 previously.

However, non-GAAP operating expenses rose to $8.5 million from $6.5 million. The roughly $2.2 million improvement in non-GAAP gross loss was therefore largely absorbed by an approximately $1.9 million increase in operating expenses, leaving only a $0.6 million improvement in adjusted EBITDA.

The sequential comparison also shows that higher revenue has not yet produced consistent operating leverage. Despite 51.5% sequential revenue growth, GAAP gross loss widened from $1.2 million in Q1, and adjusted EBITDA loss increased from $8.2 million.

The widening GAAP net loss also reflected an $8.9 million loss from the change in fair value of warrant liabilities, compared with $2.8 million a year earlier, and interest expense of $4.3 million versus $0.7 million. The warrant remeasurement is non-cash and excluded from adjusted results, but the increase in interest expense represents a separate drag on reported earnings.

Cash flow and balance sheet

FTC Solar used $4.5 million of operating cash during the first six months of 2026, an improvement from $10.8 million a year earlier. That improvement was aided by $7.1 million from lower accounts receivable and $15.3 million from higher accruals and other current liabilities, rather than by positive operating earnings.

Liquidity nevertheless declined, while the company’s reported debt shifted entirely into the short-term category.

After the quarter, FTC Solar established an equity line of credit with Lincoln Park Capital for up to $20 million. The company controls the timing and amount of share sales, with pricing based on the market price at each sale. The facility provides another source of funding but could dilute existing shareholders if used.

Guidance

Management expects another sequential revenue increase in Q3, followed by further growth in Q4. At the Q3 revenue range midpoint of $32.5 million, revenue would rise roughly 24% from Q2, consistent with the company’s stated outlook.

The gross-margin range crosses breakeven, while the adjusted EBITDA range implies a smaller loss than in Q2. FTC Solar also reaffirmed its expectation for 40% full-year revenue growth over 2025.

The company did not provide a quantitative reconciliation of this non-GAAP guidance to GAAP measures because it said several inputs, including customer project schedules and potential impairment or restructuring items, could not be forecast without unreasonable effort.

Management priorities

CEO Anthony Carroll identified customer conversion, bookings, second-half execution, cost reduction and technology development as the company’s main priorities. FTC Solar has qualified with nine of the top 10 EPCs and is now focused on converting those qualifications into projects.

Management also plans to use sales hiring, AI-supported bidding and international expansion to build bookings. On costs, the company is targeting savings, automation and improved monetization of its engineering value to lower the revenue level required for breakeven. Robotics projects remain in the pilot and testing stage, with commercial deployment and operating data expected next.

Recent insider transactions

The reported transaction list shows several director and executive purchases in May 2026, following executive sales in December 2025. These transactions are presented as reported and do not by themselves establish insiders’ views about the company’s prospects.

Risks investors need to watch

• Negative gross margin: FTC Solar still generated a gross loss on both a GAAP and non-GAAP basis. Revenue growth must be accompanied by better project economics for the company to approach operating breakeven.
• Execution required for the second-half ramp: The 40% full-year growth outlook depends on approximately 24% sequential growth in Q3 and another increase in Q4. Customer schedule changes can delay production and deliveries, as occurred with the Queensland project.
• Backlog conversion: Some reported awards may lack executed contracts or binding prices. Projects can be delayed, repriced, amended or canceled before becoming revenue.
• Liquidity and dilution: Cash declined to $10.1 million, current liabilities exceeded current assets by approximately $7.9 million, and all reported debt was classified as short-term. Using the new equity facility would raise capital but issue additional shares.
• Earnings volatility: Warrant liability remeasurement created a substantial non-cash GAAP loss this quarter, while higher interest expense added a separate financing burden.

Summary

FTC Solar delivered faster Q2 revenue growth and a meaningful year-over-year recovery in gross margin, led by product sales and supported by a larger international project pipeline. The company nevertheless remained gross-margin negative, adjusted EBITDA improvement was limited, and the GAAP loss widened because of higher operating costs, interest expense and warrant-related charges. The main issues ahead are whether Q3 and Q4 project deliveries can support the reaffirmed 40% growth target, whether gross margin can cross breakeven, and how the company manages its near-term liquidity needs.