Phunware

Q2 FY2026 EarningsQ2 FY26 results presented a significant bottom-line miss despite a slight revenue beat of $799K vs. $796K expected. Diluted GAAP EPS of -$0.26 fell well short of the -$0.14 consensus, driven by a 48.3% YoY surge in operating expenses, including heightened legal fees and AI-related R&D. While gross margins outperformed at 69.0% vs. 51.0% anticipated, the beat was largely attributed to a one-time early contract termination fee. Management's ongoing $34 million arbitration case and persistent material weaknesses in internal controls remain key overhangs for the stock.