Acorn Energy (NASDAQ:ACFN) reported second-quarter 2026 revenue of $2.49 million, down from $3.53 million a year earlier, as lower hardware sales more than offset continued growth in recurring monitoring revenue.
Chief Executive Officer Jan Loeb said the year-over-year comparison reflected substantial hardware deployments under a contract with a national cellphone provider in the prior-year quarter. Hardware revenue totaled $1.06 million in the second quarter, compared with $2.21 million in the same period of 2025. The earlier period included more than $1.3 million related to the final significant shipments under the initial purchase orders of that contract.
Monitoring Revenue and Margins Rise
Monitoring revenue increased 8% year over year to $1.43 million as Acorn’s installed base of monitored endpoints expanded. Loeb described monitoring as the company’s highest-margin and most predictable revenue source.
Gross margin rose 750 basis points to 82.4%, from 74.9% a year earlier, driven by monitoring revenue’s larger contribution to the company’s sales mix. Monitoring generated a gross margin of more than 90% during the quarter, according to management.
Loeb said he expects blended gross margin to average closer to 75% as Acorn expands hardware deployments, which carry lower margins than its recurring monitoring business.
Acorn reported net income attributable to stockholders of $294,000, or $0.12 per diluted share, compared with $720,000, or $0.28 per diluted share, in the second quarter of 2025. For the first six months of 2026, net income was $217,000, or $0.09 per diluted share, versus $1.18 million, or $0.47 per diluted share, a year earlier.
Tracy Clifford, Acorn’s chief financial officer and chief operating officer of OmniMetrix, said the company’s operating subsidiary generated operating income of $722,000 in the quarter, compared with $1.2 million a year earlier and $395,000 in the first quarter of 2026. Operating expenses declined 1% to $1.68 million, with lower research and development spending partly offset by modestly higher selling, general and administrative expenses.
Champion Partnership Targets Residential Generator Market
Acorn said it is advancing a partnership with Champion Power Equipment under which OmniMetrix monitoring and control technology will be the standard monitoring option on Champion’s aXis and fleX home standby generator lines.
The agreement assumes annual purchases of 3,000 units for pricing purposes, though Champion is not required to buy a minimum quantity, Loeb said. Management expects the partnership to begin contributing to results in the current quarter.
Loeb said the arrangement is not being classified as an original equipment manufacturer, or OEM, agreement because the products will continue to carry the OmniMetrix name rather than Champion branding. Champion management preferred the OmniMetrix name because of its standing among dealers and within the industry, he said.
The company does not expect the deal to create a major opportunity to retrofit Champion’s existing installed base. Loeb said Champion’s whole-home generator business is relatively new and that Acorn’s focus will be on new generator sales.
OMNI360 Launch Focuses on Cell Tower Sites
Acorn also formally launched OMNI360, a remote monitoring and control platform designed for cell tower campuses and other critical infrastructure. The platform is offered in three tiers—Nova, Horizon and Zenith—and includes 24/7 network operations center support, AI-supported software and mobile asset access.
Management said OMNI360 combines generator and power monitoring with environmental controls, HVAC monitoring, smoke and flood detection, cameras, access controls, intrusion sensing, two-way audio and incident response. The system also offers fuel monitoring, battery health information, transfer-switch monitoring and energy and cooling optimization tools.
Loeb said the key differentiator is that the platform brings multiple systems into “one dashboard,” rather than requiring operators to manage separate solutions for cameras, generators, HVAC and other equipment. He also cited the system’s integrated AI and predictive capabilities.
The company plans to showcase OMNI360 at the ISE EXPO in Nashville later in the month. While management said initial feedback has been positive, it cautioned that enterprise sales cycles could be lengthy.
During the question-and-answer session, Loeb said Acorn is focusing OMNI360 sales efforts on the cell tower market rather than data centers. He cited an estimated 235,000 cell towers in North America and said the company sees a large addressable market among tower owners and tenants.
Management estimated that a traditional cell-tower generator monitor costs approximately $650 in equipment, while a broader OMNI360 system could cost about $5,000 in equipment, before annual monitoring fees. Loeb said annual OMNI360 monitoring could be around $2,000, though he noted the company has not yet completed a sale and pricing will vary by arrangement.
Liquidity, Growth Goals and M&A
Acorn ended the quarter with $4.48 million in cash and no debt. Excluding deferred revenue, net working capital rose to $6.4 million at June 30 from $6.25 million at the end of 2025.
During the first half, the company generated $277,000 of cash from operating activities and used $263,000 in investing activities, including $250,000 related to an exclusive license agreement for OMNI360.
Loeb said Acorn continues to review complementary acquisition opportunities but has declined transactions where competing bidders offered prices management believed exceeded the assets’ value. The company also continues to pursue OEM bundling opportunities to expand its number of monitoring connections.
Management reiterated its long-term goal of approximately 20% average annual revenue growth over a three- to five-year period, while noting that the target dates to when the goal was initially established. Loeb said the company expects more favorable year-over-year comparisons in the second half of 2026 after cycling through the prior year’s major cellphone-provider hardware shipments.
About Acorn Energy (NASDAQ:ACFN)
Acorn Energy, Inc, through its subsidiaries, develops and markets wireless remote monitoring and control systems for various markets in the United States and internationally. It operates through two segments, Power Generation (PG) Monitoring and Cathodic Protection (CP) Monitoring. The PG segment provides wireless remote monitoring and control systems, and services for critical assets, which include stand-by power generators, compressors, pumps, pumpjacks, light towers, turbines, and other industrial equipment; and Internet of Things applications.
