0001828318-26-000029
SEC filingRevenue grew 49% YoY to $7.6M; gross margin expanded to 20.4%; cash position solid at $582.7M.
In the first quarter of fiscal 2026, Enovix reported revenue of $7.6 million, a 49% increase compared to $5.1 million in the prior-year quarter. The growth was primarily driven by higher product shipments from the South Korea facility to defense, industrial, and consumer electronics customers. Gross profit rose to $1.552 million (20.4% margin), a significant improvement from $0.261 million (5.1% margin) in the first quarter of 2025, marking the sixth consecutive quarter of positive gross profit. The gross margin improvement reflects better production volume and product mix. Operating loss widened slightly to $43.9 million from $42.6 million, with increased R&D and SG&A expenses partially offset by higher gross profit. Net loss deepened to $38.3 million from $23.5 million, driven by a $9.4 million reduction in the change in fair value of common stock warrants and a $5.3 million increase in interest expense from additional convertible notes issued in 2025. Interest income increased to $5.8 million from $2.4 million due to higher average cash balances and yields.
Enovix operates as a single reportable segment with product revenue. The revenue growth was concentrated among a small number of South Korean defense customers, with drone applications being a key driver. The global pipeline for products manufactured in South Korea exceeded $130 million, reflecting strong demand for high-performance, non-China battery supply. Revenue mix shifted toward defense and industrial shipments, which carry different margin profiles. The company has commenced early shipments for its smart eyewear platform, representing the first commercial proof point for its 100% silicon-anode architecture. Management emphasized that revenue concentration in a few defense customers exposes the company to risks related to Korean government budget cycles and geopolitical factors.
Management provided forward-looking commentary but no formal quantitative guidance. Key priorities include: advancing smartphone qualification with lead OEMs (Honor and a second smartphone customer), transitioning to a silicon-specific evaluation framework; scaling Fab2 in Malaysia, where step-level yields in Zone 1 dicing reached ~80% with other zones nearing/exceeding 90%; and launching the AI-2 product with EX-3M technology (expected to deliver >20% improved volumetric energy density). Capital expenditures are expected to increase materially for deferred Fab2 invoices and South Korea capacity expansion. The company expects cost of revenue and operating expenses to rise as Fab2 operations ramp. Management believes existing cash ($582.7M) will fund operations for at least the next twelve months, with longer-term funding expected from cash flow improvement, debt, or capital markets. No EPS or revenue guidance was provided.
As of April 5, 2026, Enovix held $88.8 million in cash and cash equivalents, $440.0 million in short-term investments, and $52.1 million in long-term investments, for total liquidity of $580.8 million. The company reported working capital of $507.6 million (Note 1) and an accumulated deficit of $1.02 billion. Inventory stood at $16.5 million, consisting of raw materials ($8.4M), work-in-process ($7.0M), and finished goods ($1.1M). Total debt (net of issuance costs) was $529.6 million, including $172.5 million of 2028 Convertible Senior Notes (3.00%), $360.0 million of 2030 Convertible Senior Notes (4.75%), and short-term loans of $9.2 million. The fair value of the private placement warrants was $0.2 million, down from $6.6 million at year-end 2025.
Purchase commitments totaled $4.0 million as of April 5, 2026 (Note 7), related to open purchase orders and contractual obligations for materials, services, and capital expenditures. Additionally, the company had $4.6 million of performance obligations, primarily deferred revenue and customer deposits, of which 93% is expected to be recognized within twelve months. Operating lease liabilities had a present value of $14.2 million, with total undiscounted payments of $15.5 million through 2031.
Enovix’s board authorized a stock repurchase plan in June 2025 (up to $60M), with an additional $75.0 million authorization in February 2026. Through April 5, 2026, $58.4 million had been used, leaving $76.6 million available for repurchases. The plan has no expiration date. No dividends were declared. Debt activity was limited to routine repayments; no new debt was issued during the quarter.
The notes do not report segment-level revenue or profit. Geographic revenue disclosure (Note 2) indicates that for the fiscal quarter ended April 5, 2026, approximately 69% of product revenue came from South Korea and 14% from Switzerland, based on billing location. For the prior-year quarter, approximately 47% came from South Korea.
Net loss widened to $38.3M from $23.5M, while operating cash flow deteriorated to -$33.1M from -$16.9M, indicating a worsening cash burn relative to net income. The primary driver was a $6.4M gain from the change in fair value of warrants (non-cash) and a $11.8M stock-based compensation expense. Working capital changes consumed $8.2M, driven by inventory build ($2.8M), a decline in accounts payable ($3.6M), and lower accrued expenses ($4.1M).
Capital expenditures dropped to $3.2M from $6.3M, reflecting reduced investment in property and equipment. Free cash flow is not explicitly stated but would be negative given the operating cash outflow and capex. No share repurchases or dividends were paid. The company generated $18.3M from investing activities, primarily from net maturities of investments ($125.0M maturities vs $103.5M purchases). Financing activities used $2.5M, mainly for payroll tax withholdings on RSUs ($1.7M) and a small debt repayment.
Overall, cash burn remains elevated, with no capital returns to shareholders. The company's cash position declined by $17.3M to $90.6M, though it maintains a working capital of $507.6M and expects sufficient liquidity for the next twelve months.