Precision Optics | 10-Q: FY2026 Q3 Revenue: USD 8.709 M

Revenue: As of FY2026 Q3, the actual value is USD 8.709 M.

EPS: As of FY2026 Q3, the actual value is USD -0.01.

EBIT: As of FY2026 Q3, the actual value is USD -29.35 K.

Total Revenues

Precision Optics Corporation, Inc. reported total revenues of $8,708,631 for the three months ended March 31, 2026, an increase of 108.0% from $4,185,968 in the prior year period. For the nine months ended March 31, 2026, total revenues were $22,757,291, a 76.3% increase compared to $12,909,928 in the prior year period.

Segment Revenue Breakdown

• Engineering Design Services:
  • Three months ended March 31, 2026: $1,059,671, an increase of 22.0% from $868,924 in the prior year.
  • Nine months ended March 31, 2026: $2,678,211, a decrease of -31.0% from $3,882,088 in the prior year.
• Systems Manufacturing:
  • Three months ended March 31, 2026: $6,188,594, an increase of 206.4% from $2,019,596 in the prior year.
  • Nine months ended March 31, 2026: $16,242,332, an increase of 231.4% from $4,900,911 in the prior year.
• MicroOptics Lab:
  • Three months ended March 31, 2026: $137,500, a decrease of -72.4% from $497,779 in the prior year.
  • Nine months ended March 31, 2026: $409,204, a decrease of -69.8% from $1,355,710 in the prior year.
• Ross Optical Industries:
  • Three months ended March 31, 2026: $1,322,866, an increase of 65.4% from $799,669 in the prior year.
  • Nine months ended March 31, 2026: $3,427,544, an increase of 23.7% from $2,771,219 in the prior year.

Gross Profit and Margin

Gross profit for the three months ended March 31, 2026, increased to $2,056,534 from $417,975 in the prior year, with the gross margin improving to 23.6% from 10.0%. The three-month period’s gross margin included $224,544 of grant income recognized in cost of goods sold. For the nine months ended March 31, 2026, gross profit increased to $3,207,552 from $2,605,247 in the prior year, though the gross margin decreased to 14.1% from 20.2%.

Operating Income/Loss

Precision Optics Corporation, Inc. reported an operating loss of -$64,462 for the three months ended March 31, 2026, an improvement from an operating loss of -$2,038,285 in the prior year period. For the nine months ended March 31, 2026, the operating loss was -$3,402,046, compared to -$4,195,247 in the prior year period.

Net Loss

The net loss for the three months ended March 31, 2026, was -$108,283, an improvement from a net loss of -$2,096,761 in the prior year. For the nine months ended March 31, 2026, the net loss was -$3,526,104, compared to -$4,377,689 in the prior year period.

Research and Development Expenses

R&D expenses increased by $56,077 to $267,319 for the three months ended March 31, 2026, compared to $211,242 in the prior year. For the nine months ended March 31, 2026, R&D expenses decreased by $100,915 to $828,733, compared to $929,648 in the prior year period.

Selling, General and Administrative (SG&A) Expenses

SG&A expenses decreased by $373,931, or -16.7%, to $1,853,677 for the three months ended March 31, 2026, compared to $2,245,018 in the prior year. For the nine months ended March 31, 2026, SG&A expenses decreased by $72,571, or -1.2%, to $5,780,865, compared to $5,870,846 in the prior year period.

Cash Flow from Operating Activities

Net cash used in operating activities for the nine months ended March 31, 2026, totaled -$901,110, an improvement from -$2,978,165 in the prior year period. This improvement was primarily due to increased accounts payable and decreased net loss and inventory, partially offset by an increase in accounts receivable.

Cash Flow from Investing Activities

Net cash used in investing activities for the nine months ended March 31, 2026, was -$348,639, primarily due to purchases of property and equipment and patent costs, compared to -$149,837 used in the prior year period.

Cash Flow from Financing Activities

Net cash provided by financing activities for the nine months ended March 31, 2026, was $10,156,060, which included $10,630,678 from a public offering in March 2026, offset by payments on term notes and capital leases of -$474,618. In the prior year period, net cash provided by financing activities was $5,270,597, including $6,270,136 from registered direct offerings and payments of -$196,487 on term notes and capital leases, and -$1,000,000 on the revolving line of credit.

Liquidity and Capital Resources Outlook

Management believes Precision Optics Corporation, Inc.’s available cash and equivalents, cash from operations, eventual line of credit availability, and ability to raise capital will be sufficient for working capital and capital expenditure requirements for at least 12 months from the filing date. The company did not meet the 1.2x annual debt service coverage ratio covenant for fiscal year 2024 and expects not to meet it for fiscal year 2026, but is in discussions with its Lender for a waiver or longer-term solution. The company currently has sufficient liquidity to repay its loans if required.