Precision Optics (POCI) Q3 2026 earnings report shows record revenue of $8.7M, positive adjusted EBITDA of $300K, and increased revenue guidance.

Key Takeaways

• Revenue reached $8.7 million, marking a 108% increase year-over-year and surpassing the previous quarter's revenue of $7.4 million.
• Achieved positive adjusted EBITDA of $300,000, a significant improvement from a negative adjusted EBITDA of $1.3 million in Q3 2025.
• Aerospace program revenue hit a record $3.6 million, contributing to 44% sequential growth.
• Increased fiscal 2026 revenue guidance to $29-$31 million, up from the previous estimate of $26-$28 million.
• Gross margin improved to 24%, compared to 10% a year ago, reflecting operational efficiencies.

Financial Performance

Precision Optics Corporation, Inc. reported robust financial results for the third quarter of fiscal 2026, driven by strong demand from its core production programs. The company recorded total revenue of $8.7 million, which is more than double the $4.2 million reported in the same quarter last year. This marks a 108% year-over-year increase and reflects a steady upward trajectory in the company's performance.

The company’s production revenue alone was approximately $7.6 million, compared to $3.3 million in Q3 2025. Furthermore, the company achieved a positive adjusted EBITDA of $300,000, a major milestone that signifies improved operational performance and better cost management. This is a significant turnaround from the $1.3 million loss reported in the same quarter last year.

Strategic Initiatives

A major driver of Precision Optics' success has been its focus on operational improvements and strategic investments. The company's leadership transition, particularly the hiring of Chief Operating Officer Joe Trout, has led to enhanced manufacturing processes and increased efficiency. For instance, production yields on the aerospace program have improved to 97%, a marked increase from previous months.

The company also announced that revenue from its single-use cystoscope program reached an all-time high of $2.2 million, representing a 10% sequential growth. This program has demonstrated significant progress in production yields, currently exceeding 90%, with expectations to reach 95% in the upcoming quarter.

Additionally, Precision Optics has been advancing its single-use ophthalmic endoscope program, supported by a $3.5 million follow-on production order. The Ross Optical division also contributed approximately $1.3 million to the quarter's revenue, showcasing a 65% year-over-year growth.

Future Outlook

Looking ahead, Precision Optics has adjusted its fiscal 2026 revenue guidance to a range of $29 to $31 million, reflecting an expected 52% to 62% growth compared to fiscal 2025 revenue. Management anticipates continued strong performance from key production lines, including aerospace and cystoscopy products, and expects new programs to ramp up production in fiscal 2027.

The company foresees an exciting pipeline of five to six programs transitioning from development to production, including innovative products for small joint arthroscopy and robotic surgery. The strategic investment in capabilities required to excel in micro optics is expected to further bolster the company’s market position.

“This quarter demonstrates the business model we have been building towards. Our production programs are scaling, our operations are improving, and our pipeline remains active,” stated Dr. Joe Forke, CEO of Precision Optics.

Closing Assessment

In summary, Precision Optics Corporation, Inc. has demonstrated impressive growth and operational improvements in its third-quarter earnings call. The company’s ability to double its revenue year-over-year while achieving positive adjusted EBITDA reflects its strong market positioning and operational efficiencies. With a robust guidance for the upcoming fiscal year and a promising product pipeline, Precision Optics appears well-positioned to continue its trajectory of growth and profitability.

This analysis is based on public earnings call materials and is not investment advice.