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DATE

Wednesday, Aug. 5, 2026 at 5:00 p.m. ET

CALL PARTICIPANTS

  • President and Chief Executive Officer - Jacob Suen
  • Chief Financial Officer - Michael Elbaz

TAKEAWAYS

  • Revenue -- $13.7 million, representing a 19% sequential increase and 0.7% growth year over year.
  • Enterprise Market Sales -- $6.7 million, driven by higher IoT modem shipments and custom product sales.
  • Automotive Market Sales -- $1.2 million, reflecting higher sales of AirgainConnect vehicle gateways.
  • Consumer Market Sales -- $5.8 million, supported by Wi-Fi 7 antenna shipments and demand from Tier 1 service providers.
  • Non-GAAP Gross Margin -- 43.6%, representing a sequential decline from 44.2% primarily due to changes in the product and customer sales mix.
  • Adjusted EBITDA -- $400,000, representing an improvement of $1.3 million sequentially on higher sales and lower expenses.
  • Non-GAAP EPS -- $0.02, exceeding the midpoint of management's guidance by $0.01.
  • Cash Balance -- $7.6 million as of June 30, 2026, representing a sequential increase of $500,000.
  • Revenue Guidance -- $14.25 million to $16.25 million for the third quarter, with the midpoint representing 11% sequential growth.
  • Non-GAAP Gross Margin Guidance -- 41.5% to 44.5% for the third quarter, reflecting the anticipated sequential decline in consumer market sales.
  • Adjusted EBITDA Guidance -- $700,000 at the midpoint for the third quarter, driven by projected revenue scale and operating leverage.
  • Non-GAAP EPS Guidance -- $0.04 at the midpoint for the third quarter ending Sept. 30, 2026.
  • AirgainConnect Pipeline -- 60 Tier 1 and Tier 2 opportunities, with more than 50% of the funnel currently in trial or post-trial stages.
  • Pipeline Conversion -- five Tier 2 design wins secured in the second quarter, including four first responder organizations and one utility company.
  • AirgainConnect Market Mix -- 55% of opportunities are in first responder markets and 45% are in utilities and other commercial fleet applications.
  • IoT Modem Purchase Order -- $4 million for energy monitoring applications, with shipments expected to be fully completed by the end of the third quarter.
  • Severance Expense -- $600,000 in headcount reduction costs recorded during the second quarter to align resources with high-priority development programs.
  • ATM Offering -- $1 million in net cash proceeds during the second quarter from the company's at-the-market offering.
  • Public Safety Deployment -- one design win with a countywide customer covers more than 1,000 vehicles expected to enter service in phases.
  • Robotics and Drones -- production shipments for autonomous delivery vehicles and mission-critical drone applications are expected to begin ramping in the third quarter.
  • Data Center Design Win -- secured for remote energy monitoring, with revenue expected to begin in early 2027.

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RISKS

  • Suen stated, "Logic in AI infrastructure is causing suppliers to prioritize high bandwidth memory, tightening the availability and increasing the cost of the standard memory used in home gateways," potentially impacting the consumer segment.
  • Management stated that an FCC ruling affected the timing of new product launches for mobile network operators, leading to "shipping delays in the second half" of 2026.

SUMMARY

Airgain, Inc. (AIRG -0.94%) reported sequential revenue growth of 19% for the second quarter, driven by recovery in the enterprise IoT and automotive segments. Management achieved positive adjusted EBITDA and reported 60 active opportunities in the AirgainConnect pipeline, with more than half of these programs entering trial or post-trial stages. The company provided third-quarter guidance reflecting continued growth in its core industrial markets, though leadership anticipated sequential declines in consumer revenue due to component supply constraints and regulatory timing. Leadership highlighted the expansion of the Lighthouse platform into U.S. end-customer trials and targeted 2027 for meaningful revenue contribution from that segment.

  • CEO Suen attributed growth in the AirgainConnect pipeline to 60 Tier 1 and Tier 2 opportunities, noting that "more than half of the pipeline is now in trial or post trial stages."
  • Management targeted the end of 2026 to close a Tier 1 first responder opportunity currently in the final certification phase, which would establish a reference point for similar opportunities in larger fleets.
  • CFO Elbaz stated the company's data center win "extends the Skywire platform into the growing data center connectivity market," with production expected to contribute to 2027 growth.
  • Suen noted that non-first responder vehicles, such as sanitation and pest control fleets, often lack trunk space for traditional routers, making the integrated AirgainConnect solution a "major differentiation" in those markets.
  • Lighthouse testing has transitioned from network provider trials to direct end-customer engagements, including a residential community trial involving preproduction samples expected in the third quarter.
  • Management reported that 70% of the 60 tracked opportunities in its pipeline are Tier 2 deals, while 30% are Tier 1 deals, with the latter often requiring a "consultative type of an approach" involving executive-level approval.

INDUSTRY GLOSSARY

  • HPUE: High Power User Equipment; technology designed to improve cellular coverage at the edge of the network.
  • MNO: Mobile Network Operator; a provider of wireless communications services.
  • FirstNet: A dedicated high-speed wireless broadband network for first responders and public safety organizations.
  • eSAM: Embedded Subscriber Identity Module; a programmable SIM card embedded directly into a device.
  • Skywire: Airgain's brand of plug-and-play cellular modems for industrial IoT applications.

Full Conference Call Transcript

Operator: Good afternoon. Welcome to Airgain's Second Quarter 26 Conference Call. My name is Jasmina, and I will be your operator for today's call. Joining us today are Airgain's President and CEO, Jacob Suen and CFO, Michael Elbaz. As a reminder, this call will be recorded. And made available for replay via a link found in the Investor Relations section of Airgain's website, at investors.airgain.com. Following management's prepared remarks, the call will be opened for questions from Airgain's covering analysts. I caution listeners that during this call, Airgain, management will be making forward-looking statements about future events as well as Airgain's business strategy and future financial and operating performance.

Actual results could differ materially from those stated or implied by these forward-looking statements due to risks and uncertainties associated with the company's business. These forward-looking statements are qualified by the cautionary statements contained in today's earnings release and Airgain's SEC filings. This conference call contains time sensitive information that is accurate only as of the date of this live broadcast, 08/05/2026. Airgain undertakes no obligation to revise or update any forward-looking statements to reflect events or circumstances after the date of this conference call. In addition, this conference call will include a discussion of non GAAP financial measures. Please see today's earnings release for further details. Including a reconciliation of GAAP to non GAAP results.

Now, I would like to turn the call over to Airgain's CEO, Jacob Suen.

Jacob Suen: Good afternoon, everyone. And thank you for joining us. The second quarter marked another meaningful step forward for Airgain. Revenue increased 19% sequentially to $13.7 million We achieved positive adjusted EBITDA. And we advanced important customer programs across the business. Enterprise and automotive continue their revenue growth trajectories. While consumer sales remain relatively stable supported by Wi-Fi 7 demand and strong Tier 1 relationships. We enter the second half with a stronger foundation than we had at the beginning of the year. Customer engagement is deeper Our pipeline is more mature. And more programs are progressing from evaluation into trials and deployments. We are encouraged by this progress. And we are increasingly confident in the direction of the business.

Our priorities are clear. Built on the momentum in our core businesses. Convert the AirgainConnect pipeline into revenue. Advance Lighthouse, toward commercialization. And increased the operating leverage of our business model. Let me start with AirgainConnect. During the second quarter, we continue to expand our AirgainConnect portfolio through our work with FirstNet, Built with AT&T. We added MegaFi and MegaFi both FirstNet trusted solutions that use high power technology designed for demanding coverage environments. Together with AC Fleet and GoKit Pro, AirgainConnect now provides multiple connectivity solutions for vehicle, fixed, portable and rapid response applications. The portfolio serves first responders. Utilities, transportation energy and other critical field operations. Through FirstNet, AT&T offers Airgain's HPUE vehicle solution for public safety customers.

Airgain also retains the ability to offer its HPV technology to other carrier networks globally. This broader portfolio gives customers greater deployment flexibility, simplifies installation and improves operational readiness. It also gives Airgain more entry points with customers and more ways to support them as connectivity needs expand. The 60 Tier 1 and Tier 2 opportunities. Our focus is increasingly on pipeline conversion and more than half of the pipeline is now in trial or post trial stages. Up from approximately 1/3 since our last call. The mix remains balanced. With approximately 55% of opportunities in first responder markets. And 45% in utilities and other commercial fleet applications.

In Q2, we secured 5 Tier 2 design wins across AirgainConnect, 4 are with first responder organizations. And 1 is with a utility company. 1 of these wins is with a large countywide public safety customer covering fire, ambulance and police leaks. The potential deployment spans more than 1 thousand vehicles. But units are expected to be added in phases of vehicles enter service. This illustrates how these programs can begin modestly and grow into meaningful long term opportunities. We are also in the final phase of the sales cycle for a Tier 1 first responder opportunity. Which we are targeting to close by the end of the year. Work remains before a final award.

Including customer specific certification requirements We are making the necessary investments because the opportunity demonstrates the scale of the programs we are pursuing. And the certification can be leveraged to other lead opportunities as well. Hailure relationships are an important part of our go to market strategy. As announced in June, we expand our work with FirstNet, Built with AT&T across public safety, utilities, and other critical field operations. Under this model, carrier sales teams help identify and advance customer opportunities. While Airgain supports product demonstrations. Trials, integration and customization. This extends our commercial reach and helps move qualified opportunities toward deployment. We have also developed a plug and play AirgainConnect configuration for the AT&T channel.

With the eSAM and required cabling pre installed. The goal is to simplify evaluation and deployment for utilities sanitation fleets and other non first responder customers. We are working to expand this carrier enable model to additional markets. We continue to strengthen our relationship with carriers and the FirstNet authority with the support of well respected industrial veterans. Most recently, Jim Begle, former President of AT&T FirstNet, and a member of the prestigious Wireless Hall of Fame Class of 2026 has joined Airgain as a strategic advisor. Jim will help us deepen relationships with public safety, the FirstNet authority in large fleet OEMs.

We believe the pipeline for AirgainConnect has reached a stable level and our emphasis is now on execution. We are benching trials supporting post trial requirements and helping customers move into phased deployments. We believe this is the right approach to build a durable AirgainConnect business. Turning to Lighthouse. We continue to prioritize The U. S. Market opportunity given the ongoing geopolitical dynamics in The Middle East. We are deepening our engagement with domestic mobile network operators service providers, enterprises and communities. We now have 2 scheduled end customer trials in The U. S. But collectively, support coverage across all 3 major carriers. This represents meaningful progress from our prior U. S. Testing.

Which was conducted primarily with a network provider. The first trial is with a large logistics company seeking to improve coverage across its operating environment. Our current production ready configuration supports the mid band spectrum used by AT&T and Verizon. The second trial is with a residential community seeking to address coverage gaps commonly experienced by large communities in HOAs. Our new configuration extends Lighthouse to the spectrum used by T Mobile. And we expect pre production samples during Q3. In Q3, we also secure an international customers trial for our integrated 4G and 5G combo solution. Initial samples are expected it this quarter as well. These trials address a common problem.

Inconsistent cellular coverage across large operating environments and communities. Traditional solutions can be expensive disruptive and slow to deploy. Lighthouse is designed to provide a faster and more cost effective alternative while giving mobile network operators control over network performance. We also continue to advance our engagement with a Tier 1 U.S. mobile network operator we previously mentioned. We are now working through the final certification approval process for its enterprise offering. And the operator has identified several customers for potential trials. Our commercial approach combines a top down and bottom up strategy. We work with the MNOs to obtain network approval and reach enterprise accounts. At the same time, we engage directly with end customers. Including enterprises and communities.

To validate the need and create demand. Service providers and system integrators remain important deployment partners. While we are making very good strides with Lighthouse, we view Lighthouse primarily as a 2027 revenue opportunity. Our near objective is to complete trials establish reference deployments, and demonstrate a repeatable commercial model. Any revenue before then will be incremental to that plan. Now turning to our core markets, Enterprise IoT was the main driver of our sequential growth in the second quarter. And we expect it to remain an important growth driver in Q3. Demand from our long standing end customers continues to increase. Primarily in the energy monitoring applications. And we see renewed activity in the EV charging market.

Shipments under the previously announced $4 million purchase order accelerated and are now expected to be completed by the end of this quarter. In parallel, we continue to expand opportunities in emerging applications such as robotics, drones, and data centers. Coco Robotics, is preparing to launch its next generation autonomous delivery vehicles. And we expect the program to begin ramping up production shipments this quarter. Initial production shipments for a drone application are also expected to begin this quarter. The near term revenue contribution is modest but the program expands our presence in autonomous and mission critical applications. Finally, we recently secured a design win for remote energy monitoring in data centers. With revenue expected to begin in early 2027.

This win extend the Skywire platform into the growing data center connectivity market and create a reference point for similar opportunities. IoT order patterns can be uneven So we are not assuming the current growth rate will continue every quarter. Still, the recovery in established programs and the breadth of newer applications give us greater confidence in the long term opportunity. The near term picture in consumer is more mixed. Q2 revenue was relatively stable. Supported by Wi-Fi 7 antenna shipments and demand from Tier 1 service providers. We are managing 2 distinct factors that are affecting consumer during Q3. The first is the continuing memory shortage. Logic was in AI infrastructure is causing suppliers to prioritize high bandwidth memory.

Tightening the availability and increasing the cost of the standard memory used in home gateways. The timing of improvement in the environment remains uncertain. The second factor was the FCC ruling. Which affected the timing of our MNO's new product launches. Our OEM partners have recently received conditional approvals. As a result, this issue contributed to shipping delays in the second half. Based on our backlog and customer forecast, we expect consumer revenue to decline sequentially in Q3. Which is reflected in our guidance. Importantly, these timing issues do not reflect a change in underlying demand. Our solution spans multiple OEM platforms and service providers. Reducing our reliance on any 1 gateway supplier.

Wi-Fi 7 and our Tier 1 MNO programs remain important long term growth drivers. We have secured the inventory required to support our current AirgainConnect and Lighthouse plans into 2027, limiting the near term impact on these growth platforms. With that, I will turn the call over to Michael.

Michael Elbaz: Thank you, Jacob. Before diving into the numbers, please note that my review of our financial results and guidance refers to non GAAP figures. Information about the non GAAP financial measures including GAAP to non GAAP reconciliations, can be found in our earnings release. Now, let's turn to our second quarter results. Q2 sales were $13.7 million slightly above the midpoint of our guidance range and up 0.7% year-over-year marking our first quarter of year over year growth in 6 quarters. Sequentially, Q2 sales increased $2.2 million or 19% driven by growth across all our markets. Enterprise sales were $6.7 million up $1.7 million sequentially. Driven by higher IoT modems, and custom product sales.

Automotive sales were $1.2 million up $300 thousand sequentially reflecting higher sales of AirgainConnect vehicle gateways. Consumer sales were $5.8 million sequentially up $200 thousand driven by Wi-Fi 7 antenna shipments. Non GAAP gross margin for the second quarter was 43.6% compared to 44.2% in the prior quarter and relatively flat year over year. The sequential decline was primarily due to a change in product and customer sales mix. Non GAAP operating expenses were $5.7 million down $400 thousand sequentially and down $800 thousand or 12% year over year reflecting continued expense discipline. Separately, GAAP operating expenses included $600 thousand in severance expenses associated with the headcount reduction we mentioned on our last call.

These actions align resources with our highest priority development and customer programs. In Q2, adjusted EBITDA was $400 thousand $200 thousand higher than the midpoint of guidance Adjusted EBITDA improved by $1.3 million sequentially on higher sales and lower expenses highlighting the operating leverage in our business model. Non GAAP EPS was $0.02, $0.01 above the midpoint of guidance and an improvement of $0.10 from the prior quarter. As of 6/30/2026, our cash balance was $7.6 million, $500 thousand higher than the prior quarter. Net cash proceeds from our ATM were $1 million Now, moving to our outlook for the third quarter ending 9/30/2026.

As a reminder, we provide quarterly guidance for sales non GAAP gross margin and expenses, non GAAP EPS and adjusted EBITDA, as we believe these metrics to be key indicators for the overall performance of our business. For the third quarter of 2026, we project sales to range from $14.25 million to $16.25 million with a midpoint of $15.25 million The midpoint represents an 11% sequential growth driven by continued strength in enterprise, and automotive partially offset by the projected sequential decline in consumer that Jacob just discussed. We expect non GAAP gross margin to range from 41.5% to 44.5% with a midpoint of 43%. The sequential change at the midpoint primarily reflects the anticipated decline in consumer market sales.

We are experiencing higher component and module cost but we have offset these increases through pricing and product cost initiatives. We project non GAAP operating expenses to be approximately $6 million Non GAAP EPS is expected to be positive $0.04 at the midpoint of our guidance Adjusted EBITDA is expected to be positive $700 thousand at the midpoint of our guidance. Now, I would like to turn the call back over to Jacob for his closing thoughts.

Operator: Jacob?

Jacob Suen: Thanks, Michael. Q2 reinforce our confidence in the directions of the business. We deliver on our commitments and enter the second half with building momentum. Our Q3 outlook reflects continued sequential growth and improved profitability. With operating expenses expected to remain relatively stable. We should generate greater operating leverage as revenue scales. We are also making tangible progress across our growth platforms. AirgainConnect is producing design wins and moving more opportunities through trial and post trial stages. Lighthouse is advancing into scheduled U.S. end customer trials as we continue working through the approval process with a Tier 1 mobile network operator. We are encouraged by our progress. But we recognize that converting these opportunities takes time and consistent execution.

Our priorities are clear. Deliver our Q3 outlook convert more customer programs into revenue and expand adjusted EBITDA through gross margin improvement and disciplined growth. Operator, we are now ready to take questions.

Operator: We will now take questions from Airgain's sell side analysts. Our first question is from Jaeson Schmidt with Lake Street Capital Markets. Please go ahead.

Jaeson Schmidt: Hey, guys. Thanks for taking my questions. Just want to start with AirgainConnect. Obviously, it sounds like the funnel continues to expand with, I think you noted, over 50% in trials or post trial stages. How should we think about those trials converting to orders and revenue in the timing around that?

Jacob Suen: Jacob, yes, great questions. On the AirgainConnect, yes, definitely, we are very encouraged about the progress. And as I indicated in the call, in second quarter, we were able to convert 5 of those design wins. So we are hoping to be able to continue at an increasing rate. While we cannot give you a precise number, I would our goal is to convert at least a third of that every quarter. that is gonna be the goal. We are also very close to closing a Tier 1 opportunity and we are really wrapping up the last stage which is just the certification that should also really help the second half growth as a whole.

Jaeson Schmidt: Okay. that is helpful. And then just following up on your comments on the drone application, which understanding it is minimal revenue here in the near term. But can you discuss what you are seeing in that market and if you continue to target other customers in that space?

Jacob Suen: Yes. Certainly. Well, but excited about this particular opportunity relating to our IoT product. So this particular application, it is actually using our IoT modem to help, it is a point so to speak. For drone applications, we are also seeing a number of those using our automotive product including our AirgainConnect solutions as well. In that setup, they are using our AirgainConnect actually on the vehicle to be able to improve communications with the drone. So we are seeing a number of those opportunities using our overall product.

Michael Elbaz: And to give you more color on this, Jacob, this is pretty exciting to see on the Skywire modem growth altogether. We have been very much entrenched with end customers that are very much into the application of energy monitoring, HVAC, you name it. it is basically very industrial. And but those are very resilient type of market markets. Seeing new applications such as robotics, a couple quarters ago and then drones this quarter, And then we started to engage with a couple of companies on a data center remote monitoring application. That is good to see that those new market application provide future growth specifically for 2027.

At this point in Q3, we are counting on the robotics company to start the initial shipments on production units. We expect to see production units next quarter with the drone company and at the same time data center should be in the early part of 2027. But we are using those references points to your point there to really try to expand that top of the base and market applications.

Jaeson Schmidt: Gotcha. So I appreciate that color. Jump back into queue. Thanks a lot, guys.

Jacob Suen: Thank you.

Operator: Our next question is from Anthony Stoss with Craig-Hallum. Please go ahead.

Anthony Joseph Stoss: Thanks. Good afternoon, Jacob and Michael. Wanted to follow-up on Jaeson's questions on the AirgainConnect, the pipeline. I am curious what you are learning so far with the companies that have been in trial and the fact that you converted what they liked Also, maybe it would be helpful if you know the numbers are a rough estimate how many total vehicles are in those 60 opportunities Just trying to get a sense of average deal size perhaps and anything else you might want to be willing to share.

Michael Elbaz: Yes. Absolutely, Tony. So in terms of the 60 deals that we are tracking, those are Tier 1 and Tier 2 deals. Tier 1, if you recall, those are 500-plus vehicle fleet Tier 2 are between 50 and 500 vehicles. We used to give a statistic on the Tier 3 which are below 50 vehicles Those are going to go through distribution channel very quickly on that. So the focus is on Tier 2 and Tier 1 because those are gonna be the meaningful path to revenue.

If you recall about a year ago, we started to also define the overall cycle time that it would take to close from first contact or first interest or expression of interest to revenue generation. And we mentioned that the tier 2 would take about 12, 9 to 15 months, 12 months on the average a year. And the Tier 1 would be about 12 months to 18 months. And we happen to be right on that schedule right now with the Tier 2 starting to ramp up from a closure standpoint. 5 in Q2, we are very excited about that. I believe last quarter we had 1. Those 5 represent 4 first responders fleet and 1 utility company.

What I can tell you is that the orders, as we are seeing from our POS data, is taking place on all 5 companies. So they are starting the deployment phase. And of course we are hoping that the deployment takes place over the next 2, 3 quarters altogether. For the Tier 1, it is a more complex type of a sale because it has multilayer type of contacts and approval sometimes certification from different departments. And sometimes in many cases, executive level approval.

So this is more of a consultative type of an approach where we have been bring together an overall ROI analysis working together to be able to anticipate some of the savings and the performance improvement as well too. So those require more trials and under different type of conditions and we are going through that. 1 thing that I can share as well too is the Tier 1, Tier 2 of about 60 deals right now I would say that 70% of that is Tier 2. And about 30% of that is Tier 1. And on the Tier 1, what is interesting is that the majority are non first responders.

Those are fleet that are definitely very large across the whole U. S in many cases. And at the same time, they are looking at this as an important type of decision because this is having a gateway. Whereas on the Tier 2, I would say that about 70% of that is first responders. And those are the smaller size that are looking for that simplification that we bring all the critical range that we can offer especially with the MegaFi. I hope that helps.

Jacob Suen: Yeah. Let me add a little bit more color to what Michael was just saying about the differentiation. it is becoming very clear to us that for the non first responder vehicle, most of them do not have that trunk space. Those are like the sanitation vehicles. Those are like pest control vehicles and other street vehicles. They do not have that trunk space. So the current setup, it is a router on the back which is not acceptable to them. So most of them are using a, you know, like a tablet or even to say mobile device. That does not give them that coverage.

And what AirgainConnect is able to offer to them is this all in 1 option that they are really intrigued And in working with the network operators, there was a major Tier 1 opportunity that basically AirgainConnect is the only viable solution today. And also going to help them save a lot of these content instead of paying multiple data plan they can consolidate. That provides them a major cost advantage and also easier to maintain, easier to manage. So we have seen that as a major differentiation that is really resonating with the prospects.

And so overall, I think that overall, I would say the overall size of those 60 opportunities is tens of thousands. that is what we are seeing at this point. Great.

Anthony Joseph Stoss: Thanks for the color guys.

Operator: At this time, this concludes our question and answer session. If your questions were not answered, you may contact Airgain's Investor Relations team at [email protected]. I would like to turn the call over now to Mr. Suen for closing remarks.

Jacob Suen: Thank you for your thoughtful questions and continued interest in Airgain. We are encouraged by our progress and look forward to updating you as we execute our priorities through the second half. We appreciate your time today. Operator, you may now conclude the call.

Operator: Thank you for joining us today. For Airgain's Second Quarter 26 Earnings Call. You may now disconnect.