Napatech (NAPA) Q1 2026 earnings summary

Executive summary

• Q1 2026 saw strong financial performance, with 69% year-over-year revenue growth, early signs of demand recovery, and momentum in both core and AI infrastructure design wins.

• The company advanced its strategy for scalable, long-term growth in AI data center acceleration platforms, focusing on technology leadership and ecosystem expansion.

• Differentiated product positioning addresses network bottlenecks in AI workloads, supporting future revenue growth.

• Organization strengthened to support the next growth phase and meet customer demand.

Financial highlights

• Q1 2026 revenue was $5.7 million (DKK 36.6 million), up 69% in USD and 53% in DKK year-over-year, driven by improved demand in core infrastructure.

• Gross margin remained strong at 70% for Q1 2026.

• EBITDA was negative DKK 18.1 million, an improvement of DKK 10.9 million year-over-year.

• Free cash flow was negative DKK 5.8 million, a significant improvement from negative DKK 29.4 million in Q1 2025.

• Staff and external costs reduced to DKK 44.5 million, down 9.1% year-over-year.

Outlook and guidance

• 2026 guidance remains unchanged: expected revenue between $32 million and $38 million (DKK 200–240 million), gross margin 60–70%, and staff/external costs DKK 170–180 million.

• EBITDA projected to be negative around DKK 25 million if performance is mid-guidance, with about 9,700 units to be sold.

• AI infrastructure is expected to contribute about 20% of 2026 revenue, with the remainder from core infrastructure.

• First AI infrastructure orders anticipated in H2 2026, with lower gross margins.

• If H2 AI orders do not materialize, there will be a direct impact on full-year revenue.