LTCH · Latch, Inc.

Latch, Inc., operating as DOOR, delivered Q1 2026 results showing meaningful progress toward profitability amid a strategic shift to software-led growth. Software revenue surged 19.1% year-over-year to $6.1 million, fueled by expanding subscriptions on the DOOR platform, while hardware revenue rose 7.9% to $4.4 million from higher unit shipments. These gains offset a 20.9% drop in professional services to $5.2 million due to reduced installation activity, keeping total revenue nearly flat at $15.7 million. Gross profit climbed $0.7 million to $8.2 million, with margins expanding to 52.3% from 47.4%, driven by services efficiencies and a favorable product mix. Operating expenses fell sharply 25.6% to $13.8 million through cost streamlining and reduced overlapping engineering/corporate spend. This led to a 47.2% narrower net loss of $5.9 million and a 45.7% improved Adjusted EBITDA loss of $3.9 million. CEO David Lillis highlighted priorities including revenue growth via new buildings, expense discipline, and profitability progress, positioning DOOR to capture multifamily trends in integrated building systems. CFO Jeff Mayfield noted $18.6 million lower cash usage versus prior year, ending the quarter with $28.5 million in cash/investments and $25.0 million net inventory. The May 11 refinancing to a $5.0 million Truist revolver on better terms, replacing the Customers Bank loan, is expected to save $0.9 million in 2026 debt service, bolstering liquidity. These results underscore execution on a scalable model, though cash usage variability persists from upfront payments and inventory timing.