Fourth Quarter and Fiscal Year 2026
Filed Sep 17, 2026Q4 Revenue Increased 33% Year-over-year and 43% Sequentially to $26.7 Million
Fourth-quarter revenue growth and lower operating expenses improved adjusted EBITDA and net loss, but fiscal-year revenue and gross margin declined, inventory impairments affected margins, and management said the timing of positive cash flow is less certain.
Key metrics
as reported| Metric | Value | q/q | y/y |
|---|---|---|---|
| Revenue, three months ended June 30, 2026GAAP | $26.7 million | 43% | 32.5% |
| Gross profit, three months ended June 30, 2026GAAP | $1.7 million | – | – |
| Gross margin, three months ended June 30, 2026GAAP | 6.3% | – | – |
| Total operating expenses, three months ended June 30, 2026GAAP | $15.2 million | – | 11.1% reduction |
| Credit loss expense, three months ended June 30, 2026GAAP | $9.2 million | – | increase of $533,000 |
| Net loss, three months ended June 30, 2026GAAP | $13.8 million | – | improvement of $971,000 |
| Net loss per share, three months ended June 30, 2026GAAP | ($0.24) per share | – | – |
| Adjusted EBITDA loss, three months ended June 30, 2026non-GAAP | ($2.3) million | – | improvement of $2.1 million |
| Revenue, fiscal year ended June 30, 2026GAAP | $96,014,610 | – | 24.7% decrease |
| Cost of revenue, fiscal year ended June 30, 2026GAAP | 83,716,563 | – | – |
| Gross profit, fiscal year ended June 30, 2026GAAP | $12,298,047 | – | – |
| Gross margin, fiscal year ended June 30, 2026GAAP | 12.8% | – | – |
| Sales and marketing expenses, fiscal year ended June 30, 2026GAAP | 5,022,884 | – | – |
| Credit loss expenses, fiscal year ended June 30, 2026GAAP | 20,715,826 | – | decrease of $1.3 million |
| General and administrative expenses, fiscal year ended June 30, 2026GAAP | 19,151,861 | – | – |
| Total operating expenses, fiscal year ended June 30, 2026GAAP | 44,890,571 | – | 26% reduction |
| Loss from operations, fiscal year ended June 30, 2026GAAP | (32,592,524) | – | – |
| Loss before income taxes, fiscal year ended June 30, 2026GAAP | (32,056,662) | – | – |
| Income taxes, fiscal year ended June 30, 2026GAAP | (1,147,382) | – | – |
| Net loss, fiscal year ended June 30, 2026GAAP | $(33,204,044) | – | improvement of $6.0 million |
| Net loss per share, fiscal year ended June 30, 2026GAAP | $(0.58) | – | – |
| Weighted average shares outstanding, basic and diluted, fiscal year ended June 30, 2026GAAP | 57,306,470 | – | – |
| Adjusted EBITDA, fiscal year ended June 30, 2026non-GAAP | $(3,959,731) | – | improvement of $4.8 million |
| Net cash used in operating activities, fiscal year ended June 30, 2026GAAP | $(569,416) | – | improvement of $6.8 million |
| Net cash used in investing activities, fiscal year ended June 30, 2026GAAP | $(3,082,454) | – | – |
| Net cash used in financing activities, fiscal year ended June 30, 2026GAAP | $(1,321,017) | – | – |
Segments
| Segment | Revenue | q/q | y/y |
|---|---|---|---|
| Cannabis vaping hardware sales in the United StatesLower cannabis vaping hardware sales in the United States. | $15.1 million | – | decreased by $17.4 million |
| Vaping product sales in EuropeLower vaping product sales in Europe. | $61.4 million | – | decreased by $12.7 million |
| Product sales in Asia Pacific, excluding ChinaProduct sales in Asia Pacific, excluding China, decreased. | $10.9 million | – | decreased by $1.4 million |
Fiscal 2027 / second half of calendar year 2026 outlook
- NoteThe Company previously expected to achieve cash-flow-positive performance in the second half of calendar year 2026.
- NoteThe timing of achieving cash-flow positive is less certain due to investments related to its Malaysia manufacturing facility during the first quarter of fiscal year 2027.
- NoteManagement remains focused on reaching positive cash flow as the benefits of the Company’s new manufacturing and commercial programs begin to scale.
Capital returns
- Common stock repurchased: $(45,001) for the fiscal year ended June 30, 2026, compared to $(60,488) for the fiscal year ended June 30, 2025.
What drove it
- Fourth-quarter revenue increased 33% year-over-year and 43% sequentially to $26.7 million.
- The Malaysia manufacturing facility is now fully operational.
- The Vapor ODM platform is entering the market.
- The Company has begun to expand beyond vaping through its joint venture with Jincheng Pharma, providing a platform to enter the nicotine pouch market.
- Fiscal-year operating expenses declined 26% to $44.9 million.
- Net cash used in operating activities improved by $6.8 million to $569,000.
Concerns
- Fiscal-year revenue decreased 24.7% to $96.0 million, primarily driven by lower cannabis vaping hardware sales in the United States, lower vaping product sales in Europe, and lower Asia Pacific product sales excluding China.
- Fourth-quarter gross margin was 6.3%, compared to 12.3% for the year-ago period, and was impacted by inventory impairments in Q4.
- Fiscal-year gross margin was 12.8%, compared to 17.8% for fiscal 2025, impacted by changes in product mix and a one-time increase in inventory provision.
- Credit loss expense was $9.2 million in the fourth quarter and $20.7 million for fiscal 2026.
- The Company reported total stockholders’ deficit of $(29,246,207) at June 30, 2026.
- Management said timing of achieving cash-flow positive is less certain.
What to watch
- Scale-up of vapor and nicotine pouch production at the Company-owned factories in Malaysia.
- Vapor ODM progress with mid-sized brands in 2026 and large brand partnerships in 2027.
- Commercial developments and contracts within the IKE Tech joint venture.
- Commercialization progress for proprietary age-gating technology and G-Mesh technology.
- Whether operating cash flow reaches positive levels as manufacturing and commercial programs scale.
- Collection of accounts receivable in a timely manner.
Balance sheet and cash flow
- Cash: $19.3 million at June 30, 2026, an increase of $1.3 million from the quarter ended March 31, 2026.
- Working capital: $803,000 at June 30, 2026, a decrease of $86,000 from the quarter ended March 31, 2026.
- Cash: $19,328,650 at June 30, 2026, compared to $24,351,765 at June 30, 2025.
- Restricted cash: $50,228 at June 30, 2026, compared to - at June 30, 2025.
- Accounts receivable, net: $19,819,480 at June 30, 2026, compared to $39,588,998 at June 30, 2025.
- Inventories, net: $3,126,252 at June 30, 2026, compared to $6,647,970 at June 30, 2025.
- Total assets: $64,278,571 at June 30, 2026, compared to $102,217,131 at June 30, 2025.
- Borrowing, current portion: $805,361 at June 30, 2026, compared to $1,146,766 at June 30, 2025.
- Amount due to a related party: $47,000,000 at June 30, 2026, compared to $25,000,000 at June 30, 2025.
- Total liabilities: $93,524,778 at June 30, 2026, compared to $101,612,437 at June 30, 2025.
- Total stockholders’ (deficit) equity: $(29,246,207) at June 30, 2026, compared to $604,694 at June 30, 2025.
- Purchase of property, plant and equipment: $(305,952) for the fiscal year ended June 30, 2026, compared to $(1,100,704) for the fiscal year ended June 30, 2025.
- Acquisition of intangible assets: $(449,191) for the fiscal year ended June 30, 2026, compared to $(939,075) for the fiscal year ended June 30, 2025.
- Joint venture investment payable: $(2,327,311) for the fiscal year ended June 30, 2026, compared to $(3,158,826) for the fiscal year ended June 30, 2025.
- Cash and restricted cash – end of year: $19,378,878 for the fiscal year ended June 30, 2026, compared to $24,351,765 for the fiscal year ended June 30, 2025.
Analysis
Ispire ended fiscal 2026 with a sharp fourth-quarter revenue recovery. Revenue was $26.7 million, up 32.5% from $20.1 million in the year-ago quarter and 43% sequentially. The quarter also showed lower total operating expenses of $15.2 million and an adjusted EBITDA loss of ($2.3) million, compared with ($4.4) million a year earlier. Net loss narrowed to $13.8 million, or ($0.24) per share, from $14.8 million, or ($0.26) per share.
The fiscal-year results remained pressured. Revenue was $96.0 million, down 24.7% from $127.5 million, primarily reflecting lower cannabis vaping hardware sales in the United States, lower European vaping product sales, and lower Asia Pacific sales excluding China. The geographic revenue disclosures show $15.1 million in U.S. cannabis vaping hardware sales, $61.4 million in European vaping product sales, and $10.9 million in Asia Pacific product sales excluding China. Gross profit declined to $12.3 million from $22.6 million and gross margin fell to 12.8% from 17.8%.
Margin was the central weak point in the reported period. Fourth-quarter gross margin was 6.3%, versus 12.3% a year ago, as inventory impairments affected Q4 results. For the year, management cited product mix changes and a one-time increase in inventory provision. The company nonetheless reduced total annual operating expenses to $44.9 million from $60.5 million, while credit loss expense declined to $20.7 million from $22.0 million. These items supported improvement in annual adjusted EBITDA loss to ($4.0) million from ($8.8) million and net loss to $33.2 million from $39.2 million.
Cash flow improved substantially but the balance sheet warrants close attention. Net cash used in operating activities was $569,000, compared with $7.4 million in fiscal 2025. Cash was $19.3 million at June 30, 2026, while total stockholders’ deficit was $(29.2) million and amount due to a related party was $47.0 million. Accounts receivable, net declined to $19.8 million from $39.6 million, while cash and restricted cash ended the year at $19.4 million versus $24.4 million.
Management identified Malaysia manufacturing, Vapor ODM, IKE Tech age-gating, G-Mesh, and the Jincheng Pharma nicotine pouch joint venture as growth catalysts. However, the company said investments related to the Malaysia manufacturing facility during the first quarter of fiscal 2027 make the timing of cash-flow-positive performance less certain. The next operating milestones are the scaling of Malaysia production, ODM customer adoption, IKE Tech commercial developments and contracts, and evidence that those initiatives can support positive operating cash flow.
Management, verbatim
We believe fourth quarter results mark an important inflection point for the company and the turnaround we began more than a year ago.
Steven Przybyla, President of Ispire
We believe fiscal 2027 will be a transformational year of fundamental growth and change for Ispire.
Steven Przybyla, President of Ispire
Not in the filing
stated, not guessed- Quarterly operating income or loss from operations was not reported.
- Quarterly operating cash flow was not reported.
- Free cash flow was not reported.
- Quarterly segment revenue was not reported.
- A numerical revenue, gross margin, operating expense, or tax-rate outlook was not provided.
- Dividend information was not reported.
- A prior outlook document was not provided for guidance comparison.
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.