Odysight.ai Inc. (ODYS): Results of Operations and Financial Condition
Odysight.ai Inc. (ODYS) filed an SEC Form 8-K — Results of Operations and Financial Condition. Exhibit 99.1 Odysight.ai Reports Financial Results for the First Half of 2026 and Provides Business Update Ramat Gan, Israel, August 13, 2026 – Odysight.ai Inc. (NASDAQ/TASE: ODYS), a leader in AI-powered visual sensing and predictive maintenance (PdM) solutions for the aerospace
How this was made
The 30-second read
Why it matters
The most tradable elements are the fresh customer wins (Boeing direct OEM PO, Elbit/Israeli MoD PO, Honeywell APU PoC) and progress on U.S. certification/commercialization (UH-60 test flights with XP Services, NAWCAD CRADA). These can improve perceived execution credibility and backlog quality, but the company’s small H1 revenue and ongoing net loss keep execution risk elevated.
Market read
This is a company-specific catalyst package: H1 financials plus multiple new purchase orders and U.S. defense progress, which can re-rate near-term backlog-to-revenue expectations.
What to watch
Revenue timing is explicitly described as weighted to the second half, and the filing does not quantify contract values beyond backlog, so investors may need to discount near-term impact until deliveries and milestone confirmations occur.
Odysight.ai reported first-half revenue of $0.5 million and a net loss of approximately $9.5 million, while backlog rose to approximately $16.45 million as of the release date.
Revenue, gross profit and net loss deteriorated versus the first half of 2025, while backlog increased after period end, cash balance was approximately $17.6 million with no debt, and the company cited new Boeing, Honeywell Aerospace, Elbit Systems and U.S. Navy-related programs.
Key metrics
as reported| Metric | Value | q/q | y/y |
|---|---|---|---|
| Revenue, six months ended June 30, 2026GAAP | $0.5 million | – | – |
| Cost of Revenues, six months ended June 30, 2026GAAP | $0.3 million | – | – |
| Gross Profit, six months ended June 30, 2026GAAP | $0.2 million | – | – |
| Research and Development Expenses, six months ended June 30, 2026GAAP | 4,797 (USD in thousands) | – | – |
| Sales and Marketing Expenses, six months ended June 30, 2026GAAP | 1,883 (USD in thousands) | – | – |
| General and Administrative Expenses, six months ended June 30, 2026GAAP | 3,369 (USD in thousands) | – | – |
| Operating expenses, six months ended June 30, 2026GAAP | approximately $10.0 million | – | – |
| Operating Loss, six months ended June 30, 2026GAAP | 9,869 (USD in thousands) | – | – |
| Financing Income, Net, six months ended June 30, 2026GAAP | 364 (USD in thousands) | – | – |
| Net Loss and Comprehensive Loss, six months ended June 30, 2026GAAP | approximately $9.5 million | – | – |
| Revenue, three months ended June 30, 2026GAAP | 420 (USD in thousands) | – | – |
| Cost of Revenues, three months ended June 30, 2026GAAP | 261 (USD in thousands) | – | – |
| Gross Profit, three months ended June 30, 2026GAAP | 159 (USD in thousands) | – | – |
| Research and Development Expenses, three months ended June 30, 2026GAAP | 2,240 (USD in thousands) | – | – |
| Sales and Marketing Expenses, three months ended June 30, 2026GAAP | 921 (USD in thousands) | – | – |
| General and Administrative Expenses, three months ended June 30, 2026GAAP | 1,529 (USD in thousands) | – | – |
| Operating Loss, three months ended June 30, 2026GAAP | 4,531 (USD in thousands) | – | – |
| Financing Income, Net, three months ended June 30, 2026GAAP | 207 (USD in thousands) | – | – |
| Net Loss and Comprehensive Loss, three months ended June 30, 2026GAAP | 4,324 (USD in thousands) | – | – |
| Backlog as of June 30, 2026other | $14.1 million | – | – |
| Backlog as of the date of this releaseother | approximately $16.45 million | – | – |
| Cash Balance as of June 30, 2026GAAP | approximately $17.6 million | – | – |
| Cash and cash equivalents as of June 30, 2026GAAP | 17,220 (USD in thousands) | – | – |
| Short-term deposit as of June 30, 2026GAAP | 333 (USD in thousands) | – | – |
| Restricted cash as of June 30, 2026GAAP | - | – | – |
| Total assets as of June 30, 2026GAAP | 21,379 (USD in thousands) | – | – |
| Total liabilities as of June 30, 2026GAAP | 3,987 (USD in thousands) | – | – |
| Total shareholders' equity as of June 30, 2026GAAP | 17,392 (USD in thousands) | – | – |
second half of 2026 outlook
- NoteThe company expects revenues to be weighted towards the second half of the year as existing orders convert into deliveries based on current delivery schedules and customer timelines.
- NoteRevenue under the Boeing purchase order is expected to be recognized as program milestones are delivered, with the majority anticipated within the next twelve months.
What drove it
- The revenue decrease was primarily attributable to $1.86 million first quarter 2025 revenues from a Fortune 500 medical company customer.
- The revenue decrease included the full derecognition of a $1.690 million contract liability that had been recognized during the first quarter of 2025.
- The decrease in cost of revenues was consistent with the decrease in revenues and primarily attributable to the same factors.
- Operating-expense growth was driven by expansion of operations, enhanced global selling and marketing activities, efforts to penetrate new markets and verticals, increased product visibility, and changes in the USD/NIS exchange rate.
- Operating expenses were partially offset by expenses related to fundraising and uplisting to Nasdaq during the first quarter of 2025 and a decrease in stock-based compensation.
- The company received its first purchase order from Boeing, a purchase order from Honeywell Aerospace APU Division for a proof-of-concept collaboration, and a purchase order from Elbit Systems on behalf of the Israeli Ministry of Defense.
- The company announced first U.S. test flights on a UH-60 Black Hawk helicopter with XP Services and signed a CRADA with NAWCAD covering carrier arresting cables.
Concerns
- First-half revenue was $0.5 million compared with approximately $2.4 million for the six months ended June 30, 2025.
- Net loss was approximately $9.5 million compared with approximately $8.3 million for the six months ended June 30, 2025.
- Backlog is not a comprehensive indicator of future revenue or a measure of profitability; orders may be cancelled or rescheduled, and projects may remain in backlog for extended periods.
- The company identified long and unpredictable sales cycles, dependence on a limited number of customers, potential need for additional financing, foreign-currency fluctuations and security, political and economic instability in the Middle East among its risks.
What to watch
- Conversion of the $14.1 million June 30 backlog and approximately $16.45 million backlog as of the release date into deliveries.
- Whether revenue becomes weighted toward the second half of 2026 as the company expects.
- Delivery of Boeing program milestones, for which the majority of revenue is anticipated within the next twelve months.
- Results of the Honeywell Aerospace APU proof-of-concept, the Elbit Systems deployment, the NAWCAD carrier arresting-cable project and the UH-60 Black Hawk commercialization pathway.
- Operating-expense discipline while the company continues investment in U.S. and European commercial activities and deliveries.
Balance sheet and cash flow
- Cash Balance, including cash, cash equivalents, short-term deposit and restricted cash, was approximately $17.6 million as of June 30, 2026.
- The company reported no debt.
- Cash and cash equivalents were 17,220 (USD in thousands) as of June 30, 2026, versus 25,677 (USD in thousands) as of December 31, 2025.
- Total assets were 21,379 (USD in thousands) as of June 30, 2026, versus 28,979 (USD in thousands) as of December 31, 2025.
- Total liabilities were 3,987 (USD in thousands) as of June 30, 2026, versus 3,553 (USD in thousands) as of December 31, 2025.
Analysis
Odysight.ai's first-half operating results weakened against the comparable 2025 period. Revenue was $0.5 million, compared with approximately $2.4 million, while gross profit was $0.2 million compared with $0.7 million. The company attributed the revenue decline primarily to $1.86 million of first-quarter 2025 revenue from a Fortune 500 medical company customer and the full derecognition of a $1.690 million contract liability recognized in the first quarter of 2025. The three months ended June 30 showed revenue of 420 (USD in thousands), compared with 362 (USD in thousands) a year earlier.
Costs remained elevated relative to the smaller revenue base. Operating expenses were approximately $10.0 million, compared with approximately $9.7 million in the prior-year first half, and operating loss was 9,869 (USD in thousands), compared with 8,998 (USD in thousands). Sales and marketing expense increased to 1,883 (USD in thousands) from 1,024 (USD in thousands), while research and development expense was 4,797 (USD in thousands) versus 4,843 (USD in thousands) and general and administrative expense was 3,369 (USD in thousands) versus 3,802 (USD in thousands). The resulting net loss and comprehensive loss was approximately $9.5 million, compared with approximately $8.3 million.
The commercial update centered on new aerospace and defense engagements rather than recognized revenue. The company reported a first Boeing purchase order, a Honeywell Aerospace APU Division proof-of-concept order, an Elbit Systems order on behalf of the Israeli Ministry of Defense, UH-60 Black Hawk test flights with XP Services, and a CRADA with NAWCAD. Backlog was $14.1 million at June 30 and approximately $16.45 million as of the release date. The company defines backlog as booked orders based on purchase orders or hard commitments that have not yet been recognized as revenue, while cautioning that it is not a comprehensive indicator of future revenue or profitability.
Liquidity consisted of a cash balance of approximately $17.6 million as of June 30, including cash, cash equivalents, short-term deposit and restricted cash, and the company reported no debt. Cash and cash equivalents were 17,220 (USD in thousands), compared with 25,677 (USD in thousands) at December 31, 2025. Total shareholders' equity was 17,392 (USD in thousands), compared with 25,426 (USD in thousands) at year-end, alongside accumulated deficit of 72,449 (USD in thousands).
Management gave no quantified financial outlook. It said revenue is expected to be weighted to the second half of the year as existing orders convert to deliveries under current schedules and customer timelines. The core execution issue is conversion of backlog and the newly announced programs into recognized revenue while managing the cost base. The company said efficiency steps begun in the first quarter helped mitigate the negative effect of changes in the USD/NIS exchange rate, while it continues to invest in U.S. and European commercial activities and deliveries.
Management, verbatim
Receiving our first direct purchase order from Boeing is a significant commercial milestone in the Company’s history.
Yehu Ofer, Chief Executive Officer of Odysight.ai
Our first half revenues reflected the timing of order execution rather than the level of demand and, as stated in our earnings release for the first quarter of 2026, we expect revenues to be weighted towards the second half of the year as existing orders convert into deliveries based on current delivery schedules and customer timelines.
Einav Brenner, Chief Financial Officer of Odysight.ai
We ended the first half of 2026 with approximately $17.6 million in cash and no debt.
Einav Brenner, Chief Financial Officer of Odysight.ai
Not in the filing
stated, not guessed- GAAP diluted EPS and basic EPS
- Non-GAAP revenue, gross profit, operating income, net income and EPS
- Gross margin
- Operating cash flow
- Free cash flow
- Capital expenditures
- Share repurchases
- Dividends
- Quantified revenue guidance
- Quantified gross-margin guidance
- Quantified operating-expense guidance
- Quantified tax-rate guidance
- Prior guidance/outlook section for comparison
- Segment revenue and segment profitability
- Debt balance line item in the interim condensed consolidated balance sheets
- Cash-flow statement
AlphAI analysis generated from the company’s SEC earnings filing (Form 8-K Item 2.02, or Form 6-K for a foreign private issuer). Every figure was cross-checked against the filing text; consensus estimates, price targets and share-price reactions are not shown because they are not in the filing. AI-generated research, not investment advice.
Background
Odysight.ai filed an 8-K (Item 2.02) with Exhibit 99.1 reporting first-half 2026 financial results and a business update on customer orders, U.S. test flights, and a U.S. Navy CRADA.
Ticker impact
Odysight.ai reported $16.45M backlog (vs $14.1M at June 30) and disclosed new Boeing, Elbit, and Honeywell purchase orders plus U.S. test flights.
Likely positive bias for ODYS on backlog and customer wins, with volatility tied to milestone-based revenue recognition.
The filing provides multiple fresh commercial milestones (Boeing direct OEM PO, Elbit/Israeli MoD PO, Honeywell APU PoC, NAWCAD CRADA) and cash/no-debt, but also shows H1 revenue of only $0.5M and a net loss of $9.5M, implying execution and timing risk.
Market effects
Supports the narrative that AI visual sensing and predictive maintenance is gaining traction with aerospace and defense OEMs and primes, potentially improving sentiment for adjacent condition-monitoring/defense-tech suppliers.
Highlights Israeli defense ecosystem demand (Elbit/Israeli MoD) and U.S. commercialization progress, which can matter for cross-border defense-tech investor sentiment.
If Boeing integration expands, it could signal broader adoption of AI PdM/CBM across rotorcraft and defense platforms, though scale is not yet proven in reported revenue.
Counterpoint
Backlog growth and purchase orders may not translate into meaningful revenue quickly, given H1 revenue fell to $0.5M and recognition is milestone-based.
Key entities
- companyOdysight.ai Inc.
AI-powered visual sensing and predictive maintenance provider for aerospace, defense, and industrial markets; reported H1 2026 results and new purchase orders.
- customer/OEMBoeing
Received Odysight.ai’s AI-powered PdM solution at two Boeing sites via a direct purchase order, with milestone-based revenue expected within 12 months.
- defense primeElbit Systems
Placed a purchase order on behalf of the Israeli Ministry of Defense for deployment of Odysight.ai’s solution.
- aerospace supplierHoneywell Aerospace APU Division
Issued a proof-of-concept purchase order to evaluate Odysight.ai’s solution across its APU portfolio.
- test/commercialization partnerXP Services
Partnered with Odysight.ai on successful first U.S. test flights on a UH-60 Black Hawk.
