Laser Photonics (NASDAQ:LASE), which has changed its name to LASE Corp., reported higher third-quarter sales and a narrower net loss, but said substantial doubt remains about its ability to continue as a going concern. Management also outlined plans to increase investment in defense products while working to improve cash flow.
Net sales rose 25% to $1.1 million from $0.9 million a year earlier, while the net loss narrowed to $2.5 million from $4.7 million, Chief Financial Officer Tim Peterman said on the company’s Nov. 12 earnings call. Gross margin improved by 8 percentage points but remained negative at 39%.
Founder and Executive Chairman Dmitriy Nikitin said the company plans to introduce the first generation of its Quantum Bullet Laser Shield Anti-Drone system at the I/ITSEC trade show later in November. He cautioned that revenue from the emerging counter-drone market remains unpredictable.
Sales rise, but cash flow remains a concern
Peterman said improved production execution contributed to the quarterly sales increase, the company’s first year-over-year sales growth since the fourth quarter of 2025. For the first nine months of 2026, however, sales declined to $3.9 million from $5.8 million a year earlier.
The nine-month decline followed a weaker first half, driven primarily by a $1.1 million decrease in laser cleaning products and services sales and a $0.8 million decline in affiliate sales, Peterman said.
Third-quarter operating expenses fell 34% to $1.8 million, primarily because of lower general and administrative expenses, partly offset by higher marketing and research and development spending. Net interest expense declined 86% year over year following debt repayments.
The company ended September with $7.6 million in cash and short-term investments. During the first nine months of the year, it raised $19.6 million in net proceeds from equity offerings and warrant transactions and repaid $6.4 million in third-party and related-party notes. It used $7.4 million in operating cash over that period, including $2.7 million in the third quarter.
Peterman said the company had not changed its assessment, disclosed in its quarterly filing, that substantial doubt remains about its ability to continue as a going concern over the year following issuance of its third-quarter financial statements.
The near-term goal is to reach operating cash flow breakeven, he said. Fourth-quarter priorities include aligning costs with sales, improving production capacity utilization and establishing more accountable sales processes, while strengthening internal controls and external reporting.
Defense launch and established markets
Nikitin said the company’s long-term strategy focuses on defense, pharmaceuticals, semiconductors and industrial markets. LASE intends to allocate increasing resources to defense while continuing to serve its established markets, Peterman said.
The planned Quantum Bullet system is aimed at countering small drones. Nikitin said the company has completed integration of the product line with Anduril’s Lattice air-defense command-and-control platform. He said the system can operate through that integration or independently for perimeter protection.
Management’s priorities include introducing the system at I/ITSEC and working to convert engagement with U.S. and allied defense customers into programs and orders, Nikitin said. He did not provide a defense revenue forecast.
In pharmaceuticals, Nikitin said the company is expanding CMS Laser’s pill-drilling products into ultraviolet marking and anti-counterfeit systems for pills, capsules and liquid-gel medications. He said orders from prominent customers are expected to translate into revenue next year.
In semiconductors, he said LASE has shipped its first system to customers and intends to advance its licensed material-splitting technology from the industrial prototype stage into commercial applications and revenue. He also said manufacturing of the Beamer Laser product line has restarted in Lake Mary, Florida, following its relocation from Michigan.
Integration and governance
Nikitin said the company spent the quarter consolidating acquisitions and product lines, integrating Beamer Laser into its enterprise resource planning system and combining its Orlando and Maitland facilities. He also described changes to financial leadership, board membership, internal controls and reporting processes.
“We understand that investors’ confidence is earned through actions, not promises,” Nikitin said, adding that the company plans to continue its governance and compliance work in the fourth quarter.
About Laser Photonics (NASDAQ:LASE)
Laser Photonics Corporation develops and manufactures industrial laser systems and related equipment for material processing applications. Its technologies are designed to provide alternatives to traditional abrasive blasting, chemical cleaning, and other surface-treatment methods. The company’s product portfolio includes laser systems for surface cleaning and preparation, rust and paint removal, marking and engraving, cutting, and welding. Its CleanTech laser blasting systems are intended for applications such as removing coatings, contaminants, and corrosion from metal and other surfaces while reducing the need for consumable media.
