SES AI Q2 2026 Earnings: Gross Margin Improves as Revenue Declines

SES AI (NYSE: SES) reported Q2 2026 revenue of $5.1 million, down from $6.7 million in Q1, while GAAP loss per share widened to $0.05 from $0.04. Gross margin improved by 4.2 percentage points to 22.3%, but GAAP net loss increased to $17.8 million and the company reported approximately $163 million of liquidity.

Core financial results

Revenue declined approximately 23.9% sequentially, while both GAAP and non-GAAP losses increased. The quarter nevertheless showed better gross margin, alongside initial revenue from newer businesses including Materials and Molecular Universe.

The following comparisons are sequential because the supplied results provide Q1 2026 rather than year-over-year figures.

Business and segment performance

Energy storage systems remained SES AI’s largest revenue-generating business. UZ Energy was certified as a battery partner by Sol-Ark, giving the company access to an established U.S. residential energy-storage ecosystem and an opportunity to compete for battery sales through that channel.

Materials generated $1.2 million of Q2 revenue, representing approximately 23.5% of total revenue. Molecular Universe also recorded its first revenue through a multi-year “Search in a Box” subscription commitment with a major global battery manufacturer.

In drones and unmanned systems, CEO Qichao Hu said the Korea plant was about one month away from reaching annual production scale of one million NDAA-compliant cells. The company was also working to secure orders extending into 2028, although no order value was disclosed.

Higher margin did not offset lower revenue

Applying the reported margins to quarterly revenue, implied gross profit was approximately $1.14 million in Q2, compared with about $1.21 million in Q1. The 4.2-percentage-point margin improvement therefore was not enough to offset the lower revenue base.

At the same time, the GAAP net loss widened by approximately 47.1%, while the non-GAAP net loss increased by about 18.0%. This combination shows that improved gross margin had not yet translated into better bottom-line performance. SES AI’s approximately $163 million liquidity position provides financial capacity, but continuing losses remain an important factor to monitor.

Full-year guidance

SES AI reaffirmed rather than changed its full-year 2026 revenue outlook. With first-half revenue totaling $11.8 million, the company would need approximately $18.2 million to $23.2 million of second-half revenue to reach the range.

The required second-half revenue would be approximately 54% to 97% above the first-half total, making the pace of commercial conversion across energy storage, Materials, Molecular Universe and drone cells central to achieving the target.

Recent insider transactions

The supplied Yahoo Finance summary classified 2,615,044 shares as insider purchases and 50,000 shares as sales over the previous six months, resulting in net purchases of 2,565,044 shares across eight transactions. It reported total insider holdings of 58.33 million shares and net purchases equal to 4.60% of those holdings.

The latest detailed records include six zero-price stock grants, two sales by Kyle Pilkington and two transactions by Hong Gan. All were reported as direct ownership transactions.

Because most of the recent acquisitions were identified as stock awards at no purchase price, they should not be treated as open-market purchases.

Risks investors need to watch

• Second-half revenue execution: Reaching the affirmed annual target requires approximately $18.2 million to $23.2 million of second-half revenue, materially above the first-half total.
• Continued losses: GAAP and non-GAAP net losses both widened despite the higher gross margin, indicating that profitability remains under pressure.
• Commercial conversion: Sol-Ark certification and Molecular Universe’s first subscription revenue are commercial milestones, but their future revenue contribution was not quantified.
• Drone manufacturing and orders: The planned production scale of one million NDAA-compliant cells per year and efforts to secure orders through 2028 depend on manufacturing and customer execution.
• Liquidity requirements: SES AI reported approximately $163 million of liquidity, but persistent losses and uncertainty around future capital needs could reduce that cushion over time.

Summary

SES AI’s Q2 2026 results combined lower sequential revenue and wider losses with a meaningful gross-margin improvement and early commercial progress in Materials, Molecular Universe and U.S. residential energy storage. The central issue for the remainder of 2026 is whether these initiatives can produce the substantial second-half revenue acceleration required by the reaffirmed full-year guidance while limiting further loss expansion.