IQSTEL Q3 2026 Results: Preliminary Revenue Slips 2.8% Sequentially to $106 Million

IQSTEL (NASDAQ: IQST) reported preliminary Q3 2026 revenue of approximately $106.0 million, down 2.8% from the record $109.1 million generated in Q2; the company did not provide EPS in this revenue-only update. Revenue for the first nine months rose 35% organically to approximately $314.0 million, but reaching the full-year objective will require a sequential acceleration in Q4.

Core Financial Results

Revenue remained above $100 million for a second consecutive quarter, although it declined modestly from Q2. IQSTEL did not disclose a prior-year Q3 comparison, so the 35% organic growth rate applies only to the nine-month period, not the third quarter.

The figures are preliminary and unaudited. Net income, margins, EPS, and cash flow were not included and are expected to be addressed when IQSTEL files its full Q3 Form 10-Q.

The nine-month increase was achieved without acquisition-related revenue, according to the company. However, the absence of profitability and cash-flow figures limits the ability to assess how effectively the additional revenue translated into earnings or liquidity.

2026 Revenue Objective

IQSTEL maintained its previously announced $430 million revenue objective for 2026. With approximately $314.0 million generated through September, the company has completed about 73% of that objective and needs approximately $116.0 million in Q4 to reach it.

Management noted that second-half revenue has historically exceeded first-half revenue, but cautioned that the seasonal pattern may not recur. The required Q4 amount is a target calculation rather than company guidance that the result will be achieved.

Ultranet Could Add Scale, but the Cash-Flow Benefit Remains Contingent

IQSTEL has signed a binding memorandum of understanding to acquire a 51% controlling interest in Ultranet Telecom Group. Ultranet reported audited 2025 revenue of $130.9 million, up 30%, and net income of $4.6 million. Closing is targeted for Q1 2027, subject to definitive agreements, regulatory approvals, and customary conditions.

Management expects Ultranet to make IQSTEL cash-flow positive on a consolidated basis if the transaction closes. That expectation is significant because the Q3 update did not provide IQSTEL’s current cash-flow results, but it remains a forward-looking outcome rather than a completed improvement.

On October 26, IQSTEL closed the first financing tranche for the transaction, consisting of up to $3 million of two-year senior secured, non-convertible promissory notes and pre-funded warrants covering up to 420,000 common shares. The notes avoid conversion-related dilution, but the warrants could increase the share count, while the secured debt creates interest and repayment obligations.

IQSTEL said its annualized revenue base could exceed $560 million if both the $430 million objective is achieved and the Ultranet transaction closes. This figure is illustrative, not a forecast of actual combined results.

Risks Investors Need to Watch

• Preliminary reporting risk: The $106.0 million Q3 figure is unaudited and remains subject to quarter-end closing and review procedures.
• Q4 execution risk: IQSTEL must generate approximately $116.0 million in Q4, 9.4% more than in Q3, to reach its $430 million objective. Historical seasonality does not ensure that this increase will occur.
• Limited profitability visibility: The update did not include margins, net income, EPS, or operating cash flow, making it difficult to evaluate the quality of the reported revenue growth before the Form 10-Q is filed.
• Ultranet transaction risk: The acquisition still requires definitive agreements, regulatory approvals, and other closing conditions. Its expected revenue and cash-flow contributions will not materialize if the transaction is delayed or does not close.
• Financing and dilution risk: The secured notes require debt service, while the pre-funded warrants could dilute existing shareholders if exercised.

Summary

IQSTEL’s preliminary Q3 revenue stayed above $100 million but declined 2.8% from its record second quarter. Nine-month revenue growth remained substantial and entirely organic, yet the company needs a stronger Q4 to meet its $430 million objective. The full Form 10-Q will be important for evaluating profitability and cash generation, while the proposed Ultranet acquisition remains the main potential source of additional scale and consolidated cash-flow improvement.