Data I/O Reports First Quarter 2026 Results
Rhea-AI Summary
Data I/O (NASDAQ: DAIO) reported Q1 2026 net sales of $3.3 million, down from $6.2 million a year earlier, with a net loss of $3.2 million or $0.34 per share. Gross margin was 49.5% and bookings were $4.2 million.
The company announced a $23 million transformational acquisition expected to nearly double annual revenue, a $9 million private placement, and extensive cost optimizations. Q2 2026 revenue guidance is $5.0–$5.4 million, implying at least ~20% sequential growth, alongside expanded Programming-as-a-Service and AI-driven initiatives.
AI-generated analysis. Not financial advice.
Positive
- $23 million acquisition expected to nearly double annual revenue, per company
- $9 million private placement from a single institutional investor
- Q2 2026 revenue guidance of $5.0–$5.4 million, ~20% sequential growth
- Q1 2026 bookings of $4.2 million, up from Q4 2025
- Consumables and services were 81% of Q1 2026 revenue
- Operating expense optimizations targeting ~$2.8 million annual run-rate savings
Negative
- Q1 2026 net sales $3.3 million vs. $6.2 million in Q1 2025
- Q1 2026 net loss $3.2 million vs. $382,000 prior year
- Gross margin declined to 49.5% from 51.6% in Q1 2025
- Q1 2026 operating expenses $4.75 million vs. $3.6 million in Q1 2025
- Cash decreased to $5.7 million from $7.9 million at year-end 2025
- Company disclosed a material weakness in internal controls over disaggregated revenue reporting
Key Figures
Market Reality Check
Peers on Argus
DAIO fell 3.82% while peers were mixed: SELX +9.95%, CPSH +10.6%, MTEK -0.85%, REFR -2.84%, SGMA 0%. The pattern points to a stock-specific reaction rather than a coordinated sector move.
Previous Earnings Reports
| Date | Event | Sentiment | Move | Catalyst |
|---|---|---|---|---|
| Feb 26 | Q4 2025 earnings | Negative | -1.4% | Weaker Q4 and 2025 results with wider net loss and softer bookings. |
| Oct 30 | Q3 2025 earnings | Negative | -2.9% | Q3 loss persists despite modest bookings growth and steady gross margins. |
| Jul 24 | Q2 2025 earnings | Neutral | -2.9% | Sales grew year-on-year, but company still reported a net loss. |
| Apr 24 | Q1 2025 earnings | Positive | +9.0% | Sequential revenue growth and lower operating expenses signaled early improvement. |
| Feb 27 | Q4 2024 earnings | Negative | +1.4% | Challenging quarter with lower sales and a swing to a net loss. |
Earnings releases have often produced downside moves when losses widen, with occasional upside when progress on transformation is highlighted.
Over the last five earnings reports from Feb 27, 2025 through Feb 26, 2026, Data I/O has reported declining or fluctuating net sales, persistent net losses, and margin pressure, while emphasizing cost reductions, AI-enabled products, and strategic repositioning. Three of these earnings events saw negative price reactions alongside weak results, while two showed divergence when the stock rose or fell despite more mixed fundamentals. Today’s Q1 2026 report continues that narrative of transition, combining deeper losses with cost actions and a forward-looking growth framework.
Historical Comparison
In the past five earnings releases, DAIO’s average next‑day move was about 0.64%, usually skewed negative when losses widened. Today’s -3.82% reaction is larger than typical but remains within a single‑digit range.
Earnings since early 2024 show a shift from shrinking sales and widening losses toward a transformation story stressing AI-enabled platforms, programming services, and cost reductions. The latest Q1 2026 results extend this pattern, pairing weaker near-term numbers with guidance for organic growth and integration of a transformational acquisition.
Regulatory & Risk Context
An effective S-3 shelf filed on 2026-01-09 registers up to $20,000,000 of mixed securities. As of the latest data, there have been 0 usage events disclosed, so the full registered capacity remains available for potential future financings or strategic transactions.
Market Pulse Summary
This announcement combines weak Q1 2026 results—revenue of $3.3 million and a net loss of $3.2 million—with a forward-looking story that includes Q2 revenue guidance of $5.0–$5.4 million, a $23 million acquisition expected to nearly double annual revenue, and a new Programming-as-a-Service model. A $9 million direct investment strengthens liquidity, while an effective $20 million shelf and a disclosed material weakness in internal controls remain key risk factors to monitor.
Key Terms
programming-as-a-service (paas) technical
adjusted ebitda financial
edge ai technical
erp system technical
deferred revenue financial
private placement financial
AI-generated analysis. Not financial advice.
Strategic Progress Accelerated with Transformational Acquisition and Launch of The NEW Data I/O, Including New Programming-as-a-Service Revenue Model
Second Quarter Revenue Guidance for Approximately
REDMOND, Wash., May 14, 2026 (GLOBE NEWSWIRE) -- Data I/O Corporation (NASDAQ: DAIO), the leading global provider of data programming and security provisioning solutions for microcontrollers, security ICs and memory devices, today announced financial results for the first quarter ended March 31, 2026.
First Quarter 2026 and Recent Highlights
- Transformational acquisition announced
$9 million direct investment strengthens balance sheet- Bookings of
$4.2 million increase sequentially and from prior year period - Operating expenses excluding 1x items decline sequentially and from prior year period
- Operating loss declines sequentially excluding 1x items
- Operating expense optimizations implemented since beginning of 2026 total reduction of approximately
$1.8 million annual run rate - Introduction of The NEW Data I/O – Phase One of a broader digital roadmap; new website
- Launched on-site Programming-as-a-Service (PaaS)
2026 Business Framework
Following significant progress with the Company’s strategic plan and the transformational acquisition, Data I/O is providing an update to its business framework for 2026 and is addressing its second quarter results. The update is solely based on organic growth and the consolidation of anticipated results for the acquisition in the second half of 2026, assuming the closing occurs after June 30, 2026. Additional inorganic initiatives may be incremental to the framework provided herein.
- Organic revenue growth for 2026 over 2025
- Second quarter 2026 revenue guidance of
$5.0 -5.4 million, implying a minimum of approximately20% sequential growth from the first quarter which includes delayed first quarter sales - Acceleration of re-occuring and other services revenues
- Entry into Programming Services market
- Operational optimizations driving improved gross margins
- Expense reductions of an additional
$1 million run rate beyond the benefit of previously implemented structural and operational cost improvements - AI deeply engrained across all functional departments
Management Comments
Commenting on the financial results for the first quarter ended March 31, 2026 and recent developments, William Wentworth, President and CEO of Data I/O Corporation, said, “After nearly a year of strategic planning and organizational optimization, we are extraordinarily excited to have announced a transformational acquisition and major direct investment in the company. The acquisition, valued at
“The acquisition will provide Data I/O with unprecedented scale and is expected to be accretive to our consolidated profit and cash flow. We are acquiring the business from its private equity ownership who expressed confidence in the value of the combined business by taking approximately
“Beyond these two monumental corporate developments, Data I/O’s first quarter performance reflects a business transition gaining traction on an organic basis. Costs are coming down, customer activity is building, and we are executing against a plan that is tracking nearly one year ahead of schedule. Revenue of
“The structural work of our planned transition is nearing completion. Our German operations were modified early in the first quarter for operational efficiency and to reflect a more diversified global organizational framework which is expected to lead to an approximate reduction in operating expenses of
“A key driver of our organic transition is the broad deployment of artificial intelligence across our operations, products, and customer-facing capabilities. We have embedded AI throughout our business — from intelligent customer support tools, to AI-enabled processes that allow us to scale operations, accelerate decision-making, and deliver faster, more responsive service. Our new corporate website, launched in April, was created using AI tools. AI adoption is central to how we operate and one of the primary reasons our transformation is moving faster than we originally anticipated. Ongoing investments in our technology platform and IT infrastructure continue to be of vital importance to our transition.
“The Company’s transition is comprehensive and addresses all operational and administrative functions. To this end, with full transparency in our communications and disclosures, we identified a material weakness in our internal financial controls relating to disaggregated revenue reporting, as detailed in our 2025 Form 10-K with the SEC. We are taking full accountability for bringing our systems into compliance with best practices amid our move to a new ERP system, along with the anticipated acquisition integration. We are addressing our financial controls procedures with urgency and have engaged outside resources in an effort to comply with remediation in 2026.
“The cost for these additional efforts as well as all other investments are largely being offset by operational expense reductions. Cash at quarter end declined from year-end, as expected, and we continued to have no debt until we arranged for the direct investment and acquisition announced in May. Based on the progress we have made on our transition and emerging organic demand, our visibility supports organic growth of approximately
First Quarter 2026 Financial Results
Net sales in the first quarter 2026 were
First quarter 2026 bookings were
For the first quarter 2026, consumable adapters and services represented
Gross margin as a percentage of sales was
Operating expenses for the first quarter 2026 were
Net loss in the first quarter 2026 was (
Adjusted earnings before interest, taxes, depreciation and amortization (“Adjusted EBITDA”), which excludes equity compensation and one-time expenses, was (
The Company’s balance sheet and liquidity remained solid with cash at the end of the first quarter 2026 at
Conference Call Information
A conference call discussing financial results for the first quarter ended March 31, 2026 will follow this release today at 2 p.m. Pacific Time/5 p.m. Eastern Time. To listen to the conference call, please dial 412-317-5788. A replay will be made available approximately one hour after the conclusion of the call. To access the replay, please dial 412-317-0088, access code 5264867. The conference call will also be simultaneously webcast over the Internet; visit the Events & Webcasts section of the Data I/O Corporation website at https://www.dataio.com/investor-relations/news/events/ to access the call from the site. This webcast will be recorded and available for replay on the Data I/O Corporation website approximately one hour after the conclusion of the conference call.
About Data I/O Corporation
Since 1972, Data I/O has developed innovative solutions to enable the design and manufacture of electronic products for automotive, Internet-of-Things, medical, wireless, consumer electronics, industrial controls and other electronics devices. Today, our customers use Data I/O’s data programming solutions and security deployment platform to secure the global electronics supply chain and protect IoT device intellectual property from point of inception to deployment in the field. OEMs of any size can program and securely provision devices from early samples all the way to high volume production prior to shipping semiconductor devices to a manufacturing line. Data I/O enables customers to reliably, securely, and cost-effectively bring innovative new products to life. These solutions are backed by a portfolio of patents and a global network of Data I/O support and service professionals, ensuring success for our customers. Learn more at dataio.com/Company/Patents.
Learn more at dataio.com.
Safe Harbor/Forward Looking Statements, Disclosure Information and Non-GAAP financial Measures
The Company cautions you that statements contained in this press release regarding matters that are not historical facts are forward-looking statements. Such forward-looking statements include, but are not limited to, the potential acquisition, its benefit and the timing thereof, the ability to execute definitive agreements and to obtain regulatory approval and meet other closing conditions for the planned acquisition, and any such forward-looking statements involve risks, assumptions and uncertainties. Statements in this news release may be construed as a prediction of future operations and performance or events are forward-looking statements which involve known and unknown risks, uncertainties and other factors which may cause actual results to differ materially from those expressed or implied by such statements.
Forward-looking statement disclaimers also apply to the timing and contributions of acquisitions, acquisition synergies, the demand for the Company’s products, the impact from geopolitical conditions including any related international trade restrictions, and cybersecurity incidents and the possibility that the Company’s containment and remediation efforts may be unsuccessful or becomes a challenging force in maintaining market share. Factors that may impact the Company’s operations and finances include uncertainties as to the ability to record revenues based upon the timing of product deliveries, market acceptance of Edge AI, shipping availability, installations and acceptance, accrual of expenses, coronavirus or other business interruptions, changes in economic conditions, part shortages, business disruptions and other risks including those described in the Company’s 10-K, 10-Q and other periodic filings with the Securities and Exchange Commission (SEC), press releases and other communications.
Data I/O may use its website (www.dataio.com) and investor relations page (www.dataio.com/Company/Investor-Relations), its X account (@DataIO_Company), and its LinkedIn page (linkedin.com/company/data-io) to disclose material non-public information and for complying with its disclosure obligations under Regulation FD. Accordingly, investors and other interested parties should monitor these sites, in addition to following Data I/O’s press releases, Securities and Exchange Commission (SEC) filings, public conference calls and public presentations/webcasts.
*References in this press release are made to non-GAAP (Generally Accepted Accounting Principles) financial measures, including profitability and operating/net income excluding one-time items, EBITDA (Earnings Before Interest, Taxes, Depreciation and Amortization), Adjusted EBITDA (AEBITDA), which excludes equity compensation, and AEBITDA excluding one-time items. Reconciliations are provided in the tables of this press release. Non-GAAP financial measures, such as EBITDA and Adjusted EBITDA, excluding equity compensation, and other one-time investments/expenses should not be considered a substitute for, or superior to, measures of financial performance prepared in accordance with GAAP. We believe that these non-GAAP financial measures provide meaningful supplemental information regarding the Company’s results and facilitate the comparison of results.
Contact:
Investor Relations
Darrow Associates, Inc.
Jordan Darrow
(512) 551-9296
jdarrow@darrowir.com
– tables follow –
| DATA I/O CORPORATION CONSOLIDATED STATEMENTS OF OPERATIONS (in thousands, except per share amounts) (UNAUDITED) | ||||
| Three Months Ended March 31, | ||||
| 2026 | 2025 | |||
| Net sales | ||||
| Cost of goods sold | 1,641 | 2,988 | ||
| Gross margin | 1,609 | 3,188 | ||
| Operating expenses: | ||||
| Research and development | 1,291 | 1,515 | ||
| Selling, general and administrative | 3,462 | 2,050 | ||
| Impairment | – | – | ||
| Total operating expenses | 4,753 | 3,565 | ||
| Operating income (loss) | (3,144) | (377) | ||
| Non-operating income (loss): | ||||
| Interest income | 15 | 38 | ||
| Gain on sale of assets | – | – | ||
| Foreign currency transaction gain (loss) | (41) | (22) | ||
| Total non-operating income (loss) | (26) | 16 | ||
| Income (loss) before income taxes | (3,170) | (361) | ||
| Income tax (expense) benefit | – | (21) | ||
| Net income (loss) | ( | ( | ||
| Basic earnings (loss) per share | ( | ( | ||
| Diluted earnings (loss) per share | ( | ( | ||
| Weighted-average basic shares | 9,393 | 9,238 | ||
| Weighted-average diluted shares | 9,393 | 9,238 | ||
| DATA I/O CORPORATION CONSOLIDATED BALANCE SHEETS (in thousands, except share data) (UNAUDITED) | ||||
| March 31, 2026 | December 31, 2025 | |||
| ASSETS | ||||
| CURRENT ASSETS: | ||||
| Cash and cash equivalents | ||||
| Trade accounts receivable, net of allowance for | ||||
| credit losses of | 2,394 | 2,841 | ||
| Inventories | 6,148 | 5,710 | ||
| Other current assets | 725 | 799 | ||
| TOTAL CURRENT ASSETS | 14,974 | 17,251 | ||
| Property, plant and equipment – net | 700 | 807 | ||
| Other assets | 1,950 | 2,118 | ||
| TOTAL ASSETS | ||||
| LIABILITIES AND STOCKHOLDERS’ EQUITY | ||||
| CURRENT LIABILITIES: | ||||
| Accounts payable | ||||
| Accrued compensation | 653 | 958 | ||
| Deferred revenue | 1,495 | 1,464 | ||
| Other accrued liabilities | 2,273 | 1,328 | ||
| Income taxes payable | 4 | 4 | ||
| TOTAL CURRENT LIABILITIES | 5,685 | 4,981 | ||
| Deferred foreign income tax | 250 | 250 | ||
| Operating lease liabilities | 1,235 | 1,411 | ||
| Long-term other payables | (8) | 20 | ||
| STOCKHOLDERS’ EQUITY | ||||
| Preferred stock – | ||||
| Authorized, 5,000,000 shares, including | ||||
| 200,000 shares of Series A Junior Participating | ||||
| Issued and outstanding, none | – | – | ||
| Common stock, at stated value – | ||||
| Authorized, 30,000,000 shares | ||||
| Issued and outstanding, 9,394,422 shares as of March 31, | ||||
| 2026 and 9,391,922 shares as of December 31, 2025 | 24,126 | 24,062 | ||
| Accumulated deficit | (14,144) | (10,974) | ||
| Accumulated other comprehensive income (loss) | 480 | 426 | ||
| TOTAL STOCKHOLDERS’ EQUITY | 10,462 | 13,514 | ||
| TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY | ||||
| DATA I/O CORPORATION NON-GAAP FINANCIAL MEASURE RECONCILIATION | ||||
| Three Months Ended March 31, | ||||
| 2026 | 2025 | |||
| (in thousands) | ||||
| Net Income (loss) | ( | ( | ||
| Interest (income) | (15) | (38) | ||
| Taxes | 0 | 21 | ||
| Depreciation & amortization | 115 | 127 | ||
| including impairment charge | – | – | ||
| EBITDA earnings (loss) | ( | ( | ||
| Equity compensation | 77 | 174 | ||
| Adjusted EBITDA, excluding equity compensation | ( | ( | ||
| Adjusted EBITDA, excluding equity compensation and one-time expenses/investments | ||||
| Adjusted EBITDA, excluding equity compensation | ( | ( | ||
| One-time expenditures – Germany Restructuring | 1008 | – | ||
| One-time expenditures – Extraordinary IT | 110 | – | ||
| One-time expenditures – SalesForce Migration | 30 | – | ||
| One-time expenditures – PTO Adjustment | 43 | – | ||
| One-time expenditures – S-3 Filing expense | 26 | – | ||
| One-time expenditures – Halo Consulting | 25 | – | ||
| Adjusted EBITDA, excluding equity compensation and one-time expenditures | ( | ( | ||
