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Ultralife Stock Gains Post Q2 Earnings Despite Y/Y Revenue Dip
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Shares of Ultralife Corporation (ULBI - Free Report) have gained 34.6% since the company reported its earnings for the quarter ended June 30, 2026, outperforming the S&P 500 Index’s 0.04% loss over the same period. Over the past month, ULBI shares have gained 26.5% compared with the S&P 500’s 2.3% rise.
Ultralife’s Earnings Snapshot
Ultralife reported second-quarter 2026 revenues of $47.9 million, down 1.3% from $48.6 million a year earlier, while GAAP earnings per share (EPS) increased to $0.15 from $0.05. Net income attributable to ULBI rose to $2.5 million from $0.9 million.
Battery & Energy Products revenues decreased 3.7% to $44.2 million from $45.9 million. This reflected a 4.7% decline in commercial sales, including an 8.7% decrease in oil & gas and industrial sales, partly offset by 7.2% growth in medical battery sales. Government/defense sales in the segment declined 1.4%. Communications Systems revenues climbed 39.3% to $3.8 million from $2.7 million, primarily due to order timing.
ULBI’s Other Key Business Metrics
Gross profit increased 19.5% year over year to $13.9 million, while gross margin expanded 500 basis points to 28.9% from 23.9%. The improvement reflected favorable product mix across both segments and a $1.1 million net refund of previously paid IEEPA tariffs, which contributed 230 basis points to gross margin. Battery & Energy Products gross margin rose to 28.3% from 23.6%, while Communications Systems margin increased to 36.3% from 28.4%.
Backlog reached a company record of $117.5 million from $84.5 million a year earlier and $115.1 million at the end of the first quarter. More than $14 million of backlog came from products released within the past year.
Adjusted EBITDA increased 49.5% to $6.1 million, or 12.8% of sales, from $4.1 million, or 8.5%, a year ago. Working capital stood at $69.8 million, with a current ratio of 2.9 compared with $68.5 million and 2.8 for 2025-end, respectively.
Ultralife Corporation Price, Consensus and EPS Surprise
CEO Mike Manna said that Ultralife is making progress on operational improvements and product commercialization. Management highlighted Communications Systems’ growing opportunity funnel and new-product releases, while defense spending on force modernization and advanced network capabilities was viewed as supportive of future program opportunities.
ULBI has addressed a significant scrap issue affecting its largest margin-impacting product line and corrected another major source of margin inefficiency. Management expects these initiatives to generate approximately $600,000-$800,000 in annual Battery & Energy gross-margin savings.
Ultralife is also undertaking lean manufacturing and automation projects at its Raynham facility as it anticipates more than 30% growth in customer demand and cell consumption over the next year.
Factors Influencing ULBI’s Headline Numbers
Profitability benefited materially from product mix and the tariff refund. Excluding the $1.1 million refund, consolidated gross margin was 26.6%.
Meanwhile, operating expenses increased 11.6% to $10.4 million as new-product development costs rose 39.1%. Ultralife also incurred $0.9 million of one-time costs related to litigation expenses for a cyber-insurance claim and consulting work tied to manufacturing margin improvements. Operating income nevertheless rose 52.3% to $3.4 million from $2.3 million, with operating margin expanding to 7.2% from 4.6%.
Ultralife’s Outlook
Management did not provide specific revenue or EPS guidance. However, it maintained an outlook for profitable growth in 2026, supported by backlog execution, margin initiatives and multi-year development opportunities.
Several battery programs serving medical, safety and drone markets are expected to move into production later in 2026 and into 2027. Management also expects water-based drone opportunities using Electrochem cells to begin contributing meaningful incremental revenues in the fourth quarter.
ULBI’s Other Developments
Ultralife continued expanding vertical-integration opportunities stemming from its 2024 Electrochem acquisition by incorporating Electrochem cells into existing battery-pack assemblies.
ULBI is also realigning its various businesses under the Ultralife Master brand, with completion expected by year-end.
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Ultralife Stock Gains Post Q2 Earnings Despite Y/Y Revenue Dip
Shares of Ultralife Corporation (ULBI - Free Report) have gained 34.6% since the company reported its earnings for the quarter ended June 30, 2026, outperforming the S&P 500 Index’s 0.04% loss over the same period. Over the past month, ULBI shares have gained 26.5% compared with the S&P 500’s 2.3% rise.
Ultralife’s Earnings Snapshot
Ultralife reported second-quarter 2026 revenues of $47.9 million, down 1.3% from $48.6 million a year earlier, while GAAP earnings per share (EPS) increased to $0.15 from $0.05. Net income attributable to ULBI rose to $2.5 million from $0.9 million.
Battery & Energy Products revenues decreased 3.7% to $44.2 million from $45.9 million. This reflected a 4.7% decline in commercial sales, including an 8.7% decrease in oil & gas and industrial sales, partly offset by 7.2% growth in medical battery sales. Government/defense sales in the segment declined 1.4%. Communications Systems revenues climbed 39.3% to $3.8 million from $2.7 million, primarily due to order timing.
ULBI’s Other Key Business Metrics
Gross profit increased 19.5% year over year to $13.9 million, while gross margin expanded 500 basis points to 28.9% from 23.9%. The improvement reflected favorable product mix across both segments and a $1.1 million net refund of previously paid IEEPA tariffs, which contributed 230 basis points to gross margin. Battery & Energy Products gross margin rose to 28.3% from 23.6%, while Communications Systems margin increased to 36.3% from 28.4%.
Backlog reached a company record of $117.5 million from $84.5 million a year earlier and $115.1 million at the end of the first quarter. More than $14 million of backlog came from products released within the past year.
Adjusted EBITDA increased 49.5% to $6.1 million, or 12.8% of sales, from $4.1 million, or 8.5%, a year ago. Working capital stood at $69.8 million, with a current ratio of 2.9 compared with $68.5 million and 2.8 for 2025-end, respectively.
Ultralife Corporation Price, Consensus and EPS Surprise
Ultralife Corporation price-consensus-eps-surprise-chart | Ultralife Corporation Quote
Ultralife’s Management Commentary
CEO Mike Manna said that Ultralife is making progress on operational improvements and product commercialization. Management highlighted Communications Systems’ growing opportunity funnel and new-product releases, while defense spending on force modernization and advanced network capabilities was viewed as supportive of future program opportunities.
ULBI has addressed a significant scrap issue affecting its largest margin-impacting product line and corrected another major source of margin inefficiency. Management expects these initiatives to generate approximately $600,000-$800,000 in annual Battery & Energy gross-margin savings.
Ultralife is also undertaking lean manufacturing and automation projects at its Raynham facility as it anticipates more than 30% growth in customer demand and cell consumption over the next year.
Factors Influencing ULBI’s Headline Numbers
Profitability benefited materially from product mix and the tariff refund. Excluding the $1.1 million refund, consolidated gross margin was 26.6%.
Meanwhile, operating expenses increased 11.6% to $10.4 million as new-product development costs rose 39.1%. Ultralife also incurred $0.9 million of one-time costs related to litigation expenses for a cyber-insurance claim and consulting work tied to manufacturing margin improvements. Operating income nevertheless rose 52.3% to $3.4 million from $2.3 million, with operating margin expanding to 7.2% from 4.6%.
Ultralife’s Outlook
Management did not provide specific revenue or EPS guidance. However, it maintained an outlook for profitable growth in 2026, supported by backlog execution, margin initiatives and multi-year development opportunities.
Several battery programs serving medical, safety and drone markets are expected to move into production later in 2026 and into 2027. Management also expects water-based drone opportunities using Electrochem cells to begin contributing meaningful incremental revenues in the fourth quarter.
ULBI’s Other Developments
Ultralife continued expanding vertical-integration opportunities stemming from its 2024 Electrochem acquisition by incorporating Electrochem cells into existing battery-pack assemblies.
ULBI is also realigning its various businesses under the Ultralife Master brand, with completion expected by year-end.