Ouster Q2 2026 earnings: Revenue rises 56% as gross margin reaches 49%

Ouster (Nasdaq: OUST) reported Q2 2026 revenue of $54.6 million, up 56% from $35.0 million a year earlier, while its GAAP diluted loss per share narrowed to $0.27 from $0.38. GAAP gross margin expanded to 49%, and adjusted EBITDA loss improved to $4.5 million as lidar and camera shipments exceeded 17,000 units. Industrial and smart infrastructure customers were the main drivers of product revenue.

Core financial results

For the three months ended June 30, product revenue supplied most of the top-line increase and reached a company record. Gross profit grew faster than operating expenses, narrowing the operating loss even though Ouster continued to spend more on research and development and sales and marketing.

Both GAAP and non-GAAP margins improved. Adjusted EBITDA remained negative, but its loss narrowed by approximately 19% year over year.

Non-GAAP gross margin and adjusted EBITDA exclude items identified by Ouster, including stock-based compensation and certain acquisition-related expenses. The company’s reported 200-basis-point non-GAAP margin increase is based on unrounded figures.

Business and product performance

Product revenue represented roughly 97% of total revenue and increased primarily because of demand from industrial and smart infrastructure customers. Ouster identified warehouse automation, yard logistics and intelligent transportation as important use cases. The company said product revenue reached a record and marked its 14th consecutive quarter of growth.

Ouster shipped more than 17,000 lidar and camera sensors for revenue, with lidar accounting for approximately 53% of the total. No comparable shipment figure was provided for the prior-year quarter, so the unit-growth rate cannot be determined from the release.

Royalty revenue increased to $1.9 million from $34,000. Although that was a meaningful contribution to the year-over-year revenue increase, royalties remained a small portion of total sales, and Ouster did not disclose the reason for the change.

Management attributed product momentum to its broader sensing and perception platform. CEO Angus Pacala highlighted customer interest in the Rev8 lidar platform and described the April introduction of Stereolabs’ ZED X Nano camera as that business’s most successful product launch to date.

Margin gains narrowed losses, but cash use and dilution increased

GAAP gross profit increased by $10.8 million year over year, while operating expenses rose by $4.1 million. That operating leverage reduced the quarterly operating loss by $6.8 million. Research and development expense increased to $19.3 million from $17.1 million, sales and marketing rose to $9.2 million from $7.0 million, and general and administrative expense was nearly unchanged at $18.2 million.

The quarterly profit improvement did not translate into lower first-half cash consumption. Net cash used in operating activities increased to $20.0 million for the first six months of 2026 from $6.2 million a year earlier. Prepaid expenses and other assets used $9.9 million of cash, inventory used $5.7 million, and lower contract liabilities used another $5.6 million, partly offset by a $10.6 million cash contribution from accounts receivable.

Ouster ended June with approximately $263 million in cash, restricted cash and short-term investments, up from approximately $211 million at the end of 2025. Liquidity was supported by $98.0 million of net proceeds from an at-the-market stock offering during the first half. Over the same period, Ouster used $27.5 million for the Stereolabs acquisition and $5.2 million for property and equipment.

The financing strengthened the balance sheet but increased the share base. Quarterly weighted-average diluted shares rose to 66.0 million from 54.5 million a year earlier, an increase of approximately 21%. Inventory also climbed to $31.4 million from $23.6 million at year-end, tying up more working capital as the company scaled shipments.

Q3 2026 guidance

Ouster expects third-quarter revenue of $54.5 million to $57.5 million. The $56.0 million midpoint implies approximately 2.5% sequential growth, pointing to a smaller increase than the 12% sequential growth reported in Q2.

At the low end, revenue would be essentially unchanged from Q2; the high end would extend growth at a more moderate sequential rate.

Recent insider transactions

The supplied six-month insider summary shows 832,172 shares acquired across 23 transactions and 1,157,806 shares sold across 29 transactions, resulting in net sales of 325,634 shares. Total insider holdings were listed at approximately 2.02 million shares, with net shares purchased or sold equal to -13.90%.

Transaction classifications matter when reading that summary. Seven of the latest ten reports were stock awards rather than reported purchases, while the other three were sales. Selected recent transactions, including a May director purchase, are shown below.

These records describe transaction activity but do not, by themselves, establish insiders’ views about Ouster’s future performance.

Risks investors need to watch

• Revenue growth could moderate: The Q3 guidance midpoint implies about 2.5% sequential growth, compared with 12% in Q2. The low end would leave revenue nearly unchanged.
• Profitability remains negative: Despite better margins, Ouster still reported a $20.0 million operating loss and a $4.5 million adjusted EBITDA loss.
• Cash conversion lagged earnings improvement: First-half operating cash use more than tripled year over year as inventory and other working-capital items absorbed cash.
• Equity financing creates dilution: The at-the-market offering added nearly $98 million of capital, while quarterly weighted-average shares increased about 21% year over year.
• Inventory is rising: Inventory increased approximately 33% from year-end, making shipment execution and demand conversion increasingly important for working-capital performance.

Summary

Ouster’s Q2 2026 results combined 56% revenue growth with higher GAAP and non-GAAP gross margins, helping narrow operating, net and adjusted EBITDA losses. Industrial and smart infrastructure demand, record product revenue and more than 17,000 sensor shipments drove the quarter. The next points to monitor are whether Ouster can deliver within its more moderate Q3 revenue range, convert margin gains into improved operating cash flow, and manage inventory and dilution as it continues investing in its lidar and camera platform.