Lantronix, Inc.

What they do

Lantronix sells embedded compute system-on-modules and system-in-package products, wired and wireless connectivity, and standalone IoT systems for routing, switching, gateway, telematics and media conversion. It also sells a SaaS device-management platform for out-of-band and IoT deployments, plus engineering services and extended warranty/support. The company manages sales by three regions: the Americas, EMEA and APJ, and organizes products into Embedded IoT Solutions, IoT Systems Solutions, and Software and Services.

Revenue drivers

• Embedded IoT Solutions — Compute SoMs/SiPs and connectivity products, including Qualcomm Dragonwing-based modules such as the Open-Q 8550 micro SoM and Open-Q 6490CS, sold to OEMs for edge AI, video and drone applications. This line underpins the unmanned systems business that generated $12.6 million in fiscal 2026.
• IoT Systems Solutions — Standalone routers, switches, gateways, telematics and media-conversion products, including the new SLC 9000 out-of-band console manager for AI data center networking. Management said this business is reaccelerating entering fiscal 2027.
• Software and Services — SaaS platform (Percepxion, and Nero Global Tracking after the Vecima acquisition) for single-pane-of-glass device management, plus engineering design services and extended warranty/support. Management said Software & Services moves above 10% of total revenue on a pro forma basis after the acquisition.
• Critical infrastructure monitoring — Edge gateways combined with Percepxion software delivered to a Tier-1 U.S. mobile network operator for backup-power management across more than 50,000 cell sites, providing 24/7 remote monitoring and automated outage/tamper alerts.

Recent performance

Full-year fiscal 2026 revenue was $120.9 million, down from $122.9 million in fiscal 2025, with a GAAP net loss of $4.2 million and GAAP diluted EPS of ($0.10); non-GAAP EPS was $0.15. Fourth-quarter revenue rose 8% year over year to $31.2 million, described as the fifth consecutive quarter of sequential revenue growth, with Q4 GAAP EPS of ($0.01) and non-GAAP EPS of $0.04. Fiscal 2026 unmanned systems revenue reached $12.6 million, above the midpoint of the previously communicated $10 million to $14 million outlook, versus minimal contribution in fiscal 2025. Operating cash flow was $9.9 million for fiscal 2026, and the company ended June 30, 2026 with $60.5 million of cash, no long-term debt, $160.3 million of total assets and $119.3 million of shareholder equity.

Strategy

Management is concentrating on three verticals: unmanned aerial systems, critical infrastructure monitoring, and resilient enterprise networks, and says it is moving from a broad-based hardware provider toward a higher-margin solutions platform. It is promoting NDAA- and TAA-compliant compute modules and a Drone Reference Platform aimed at moving drone customers from concept to flight-ready prototype, and has expanded active unmanned systems engagements to more than 30 at fiscal year-end from about 10 a year earlier. The company closed the acquisition of Vecima Networks' industrial IoT business, including the Nero Global Tracking SaaS platform, on August 1, 2026 for approximately $11.7 million, and launched the SLC 9000 out-of-band console manager integrated with Percepxion for AI data center networking. It was added to the Russell 3000 Index in the 2026 reconstitution.

Risks

• Customer concentration — The company states it has historically relied on a small number of distributors and end-user customers for a significant portion of net revenue, so loss of or reduced purchases by one of them could materially cut sales and increase excess inventory.
• Single-source and obsolete components — Some integrated circuits are available only from a single source and some are no longer manufactured, and when parts are phased out the company must stock up until a substitute is qualified.
• Loss-making history — Lantronix has reported GAAP net losses each year from fiscal 2022 through fiscal 2026, including $4.2 million in fiscal 2026 and $11.4 million in fiscal 2025.
• Tariff refund uncertainty — After the March 2026 U.S. Court of International Trade ruling on IEEPA tariff refunds, the company has not recognized any amounts for potential recovery of tariffs it paid on imported products and materials, and the nature, timing and extent of any refunds remain uncertain.

Outlook

For the first quarter of fiscal 2027, management guides revenue of $31.0 million to $33.0 million and non-GAAP EPS of $0.04 to $0.06. The company expects double-digit revenue growth in fiscal 2027 and expects unmanned systems to represent 15% to 20% of total revenue. It also expects the Vecima industrial IoT acquisition to add approximately $5.3 million of annual revenue, including about $4.5 million of ARR, and approximately 125,000 asset tags under management.