Palladyne Raises Low End of 2026 Sales Outlook

The Tip Desk · November 10, 2026 · 3 min read

Third-quarter revenue reached a record $8.6 million, and the company lifted the low end of 2026 guidance to $25 million while keeping the $27 million top end.

Palladyne AI Corp. (PDYN), a U.S.-based technology company delivering intelligent autonomy software and mission-critical components for defense and advanced manufacturing, reported record third-quarter revenue of $8.6 million, up 895% from a year earlier and 48% from the second quarter.

Sequential growth slowed from 63% in the prior quarter, while year-over-year growth accelerated from 470%. President and Chief Executive Officer Ben Wolff said the company is raising the low end of full-year 2026 revenue guidance to $25 million from $24 million and reiterating the $27 million top end, implying 377% to 415% growth versus 2025 revenue of $5.2 million. Implied fourth-quarter guidance represents growth of 329% to 449% versus the fourth quarter of 2025.

Wolff said components-business revenue rose 26% versus the second quarter, driven in part by the first delivery of next-generation BRAIN FC-1 flight computers, and that revenue from government contracts increased 135% quarter over quarter. The company said it shipped more BRAIN flight computers during the quarter than ever before, including the first units of the cost-optimized FC-1 variant.

Backlog fell 24% during the quarter to $18.7 million as of September 30, 2026, of which $15.3 million was funded, after about $8.6 million of revenue was recognized and partially offset by about $2.7 million in net new contract awards. The company said it expects most of that backlog to be recognized as revenue over the next 12 to 18 months. Wolff said backlog remained materially higher than at the start of both the first and second quarters despite timing fluctuations as customers used remaining funding on existing contracts before renewals.

GAAP net loss widened to $12.0 million, or $0.25 a share, from $3.7 million, or $0.09 a share, a year earlier. Operating loss was $13.4 million, compared with $8.1 million, mainly reflecting higher stock-based compensation, added headcount, and higher research and development costs related to Gremlin-X development. Non-GAAP net loss was $8.2 million, or $0.17 a share, versus $6.4 million, or $0.16 a share. Non-cash stock-based compensation rose to $4.8 million from $1.1 million in the year-ago quarter.

Cash, cash equivalents and marketable securities totaled $47.0 million as of September 30, 2026, up from $43.7 million as of June 30, 2026. The company said that balance will be sufficient to support operations, working capital and capital-expenditure requirements for at least the next 12 months.

Operating cash burn decreased sequentially, driven by revenue performance, though it remained elevated from research and development across product lines and working-capital investments to fund growth. The company now expects full-year 2026 operating cash burn to be close to or slightly above the high end of its $32.0 million to $36.0 million range. Third-quarter burn reflected higher operating expenses, about $0.9 million of capital expenditures, and working-capital investments. Fourth-quarter burn is expected below the year-to-date quarterly average on higher revenue and gross margin.

All 20.5 million warrants, representing the right to purchase about 3.4 million shares, and 2.3 million remaining contingent merger consideration shares expired unexercised or unissued on September 24, 2026, reducing fully diluted shares by 9%.

The company said SwarmOS was evaluated on nine key performance criteria by the U.S. Army and received the highest rating possible on all nine. It also entered agreements to extend SwarmOS to fixed-wing aircraft with Orkid Tech and to NORDA Dynamics’ Underdog module, and after quarter end launched joint development of SwarmShot with Federal Ammunition and Mossberg.