STEM · Stem, Inc.

Stem, Inc. delivered Q1 2026 results reflecting operational discipline with revenue of $29.0 million, down 11% year-over-year primarily from reduced low-margin battery hardware sales, offset by 4% growth in higher-margin software, services, and edge hardware to $29.0 million, driven by 16% YoY increase in PowerTrack software revenue. GAAP gross profit rose to $10.9 million (38% margin) from $10.5 million (32%), and non-GAAP gross profit improved to $15.2 million (52% margin) from $14.8 million (46%), benefiting from a shift to higher-margin products and 2025 efficiency gains. Net loss narrowed to $18.9 million from $25.0 million, supported by lower operating expenses, while adjusted EBITDA turned positive at $2.0 million versus a $4.6 million loss, marking the fourth consecutive positive quarter. CEO Arun Narayanan highlighted durable margins and PowerTrack momentum, reaffirming confidence in 2026 priorities of operational leverage, core business strength, and growth foundation. CFO Brian Musfeldt emphasized record non-GAAP margins and software strategy benefits. Operating metrics showed bookings of $26.5 million (seasonally down from Q4), contracted backlog up to $23.0 million, CARR flat at $67.2 million, and ARR slightly up to $61.2 million. Business updates included PowerTrack EMS selection for 100 MWh BESS projects in Germany, acquisition of raicoon GmbH's solar fault detection software to bolster PowerTrack, and a co-marketing deal with Nuvation Energy for North American BESS controls. The company reaffirmed full-year guidance, signaling execution confidence despite macroeconomic risks like tariffs and geopolitical tensions. Cash ended at $36.6 million, down from $48.9 million at year-end.