Qualstar Corporation Reports Second Quarter 2026 Results
Rhea-AI Summary
Qualstar (OTC: QBAK) reported second quarter 2026 revenue of $2.10 million, up 47% from $1.43 million a year earlier. First-half 2026 revenue rose 14% to $3.53 million, driven mainly by higher sales of tape-based data storage products and partially offset by lower power-supply sales.
Adjusted gross margin for Q2 2026 increased to 36.4% from 33.7%. However, a $970,000 net realizable value charge on slow-moving power-supply inventory led to a GAAP gross margin of -9.8% and a GAAP net loss of $1.10 million. Adjusted EBITDA improved to $170,000 from $(7,000). The company ended the quarter with $2.0 million in cash, cash equivalents and marketable securities and no debt. According to Qualstar, the 2025 audit is expected to be completed in the coming weeks, after which it plans to pursue a Form 10 filing and potential uplisting.
Positive
- Q2 2026 revenue up 47% to $2.10 million
- First-half 2026 revenue up 14% to $3.53 million
- Q2 2026 adjusted gross margin rose to 36.4% from 33.7%
- Q2 2026 adjusted EBITDA improved to $170,000 from $(7,000)
- Quarter-end liquidity: $2.0 million cash, equivalents and marketable securities, no debt
- Growth in tape-based data storage sales driving higher revenues
Negative
- Q2 2026 GAAP net loss of $1.10 million versus $204,000 profit
- Recorded $970,000 net realizable value charge on slow-moving power-supply inventory
- Q2 2026 GAAP gross margin of -9.8% after inventory charge
- First-half 2026 adjusted EBITDA of $(32,000) versus $55,000
- First-half 2026 adjusted gross margin fell to 32.2% from 35.3%
- Lower demand and sales in power-supply segment
AI-generated analysis. How Rhea-AI works. Not financial advice.
Revenues increased
CAMARILLO, Calif., Aug. 13, 2026 (GLOBE NEWSWIRE) -- Qualstar Corporation (OTC: QBAK), a trusted provider of scalable data storage and high-efficiency power solutions, today reported financial results for the quarter ended June 30, 2026.
2026 and Recent Highlights
- Revenues increased
47% for the second quarter of 2026 and14% for the first half of 2026 over the comparable 2025 periods, driven by higher sales of our tape-based data storage products, reflecting increased customer demand. - We continue to make progress in expanding our data storage business, which has experienced significant growth driven by the continued expansion of the data and data storage markets.
- The audit of the Company’s 2025 financial statements is expected to be completed in the coming weeks. Following completion of the audit, we intend to continue pursuing the filing of our Form 10 and an uplisting of our securities.
Management Commentary
“The results for the current quarter reinforce our strategy of growing our data storage business and positioning the Company to benefit from the continued growth of this market,” said Steven N. Bronson, President and CEO. Mr. Bronson continued, “We remain focused on expanding our product offerings and exploring strategic product partnerships and acquisition opportunities within the data storage market.”
Consolidated Financial Results (Unaudited)
(Amounts in thousands except per share data and percentages)
| Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||||||||||||||||||||
| 2026 | 2025 | $ ∆ | % ∆ | 2026 | 2025 | $ ∆ | % ∆ | |||||||||||||||||||||||
| Revenues | $ | 2,102 | $ | 1,430 | $ | 672 | 47.0 | % | $ | 3,527 | $ | 3,089 | $ | 438 | 14.2 | % | ||||||||||||||
| Adjusted gross profit | $ | 765 | $ | 482 | $ | 283 | 58.7 | % | $ | 1,135 | $ | 1,091 | $ | 44 | 4.0 | % | ||||||||||||||
| Adjusted gross margin | 36.4 | % | 33.7 | % | 32.2 | % | 35.3 | % | ||||||||||||||||||||||
| Adjusted income (loss) from operations | $ | 159 | $ | 5 | $ | (77 | ) | $ | 140 | |||||||||||||||||||||
| Adjusted net income (loss) | $ | (132 | ) | $ | 204 | $ | (194 | ) | $ | 387 | ||||||||||||||||||||
| Adjusted earnings (loss) per share | $ | (0.03 | ) | $ | 0.05 | $ | (0.05 | ) | $ | 0.09 | ||||||||||||||||||||
| Adjusted EBITDA | $ | 170 | $ | (7 | ) | $ | (32 | ) | $ | 55 | ||||||||||||||||||||
Non-GAAP financial measures. To supplement our financial statements, which are prepared and presented in accordance with United States generally accepted accounting principles (“GAAP”), we use the following non-GAAP financial measures: Adjusted gross profit, adjusted gross margin, adjusted income (loss) from operations, adjusted net income (loss), and adjusted earnings (loss) per share. The presentation of these non-GAAP financial measures is not intended to be considered in isolation or as a substitute for, or superior to, the financial information prepared and presented in accordance with GAAP. These non-GAAP financial measures exclude the net realizable value charge of
Revenue for the quarter increased
Adjusted gross margin for the quarter was
Adjusted net income/loss for the three months ended June 30, 2026 and 2025 included (losses) gains on marketable securities of
Adjusted EBITDA for the second quarter of 2026 was
The Company ended the quarter with
Qualstar makes available its annual financial statements, quarterly financial statements, and other significant reports and amendments to such reports, free of charge, on its website as soon as reasonably practicable after such reports are prepared. Please visit www.qualstar.com to view the Company’s financial results in more detail.
About Qualstar Corporation
Qualstar Corporation, founded in 1984, manufactures and markets data storage system products and compact, high-efficiency power solutions.
Our data storage systems are marketed under the Qualstar™ brand and include highly scalable automated magnetic tape libraries used to store, retrieve and manage electronic data primarily in the network computing environment. Our products, sold through resellers, system integrators and OEMs, range from entry-level to enterprise and are a cost-effective solution for organizations requiring backup, recovery and archival storage of critical electronic information.
The Company’s power solutions, marketed under the N2Power™ brand, include standard, semi-custom and custom versions and provide OEM designers with increased functionality while reducing thermal loads and cooling requirements and lowering operating costs. These products are sold to OEMs in a wide range of markets, including telecom/networking equipment, audio/visual, industrial, gaming and medical.
More information is available at www.qualstar.com and www.n2power.com or by phone at 805-583-7744.
Adjusted EBITDA Non-GAAP Financial Measure
Adjusted EBITDA is a non-GAAP financial measure. The presentation of this financial information is not intended to be considered in isolation or as a substitute for, or superior to, the financial information prepared and presented in accordance with GAAP.
We define Adjusted EBITDA for a particular period as net income (loss) before interest, taxes, depreciation and amortization, and as further adjusted for non-routine expenses that may not be indicative of our core business operating results such as severance compensation, provisions (recoveries) for inventory net realizable value, gains/losses on marketable securities, gains/losses on foreign currency transactions, and non-cash expenses such as stock-based compensation expense.
We use this non-GAAP financial measure for financial and operational decision-making and as a means to evaluate period-to-period comparisons. We believe that this non-GAAP financial measure provides meaningful supplemental information regarding our performance by excluding certain items that may not be indicative of our core business operating results. We believe that both management and investors benefit from referring to this non-GAAP financial measure in assessing our performance and when planning, forecasting, and analyzing future periods. This non-GAAP financial measure also facilitates management’s internal comparisons to our historical performance and liquidity as well as comparisons to our competitors’ operating results. We believe this non-GAAP financial measure is useful to investors both because (1) is allows for greater transparency with respect to key metrics used by management in its financial and operational decision-making and (2) it is used by our investors to help them analyze the health of our business.
There are a number of limitations related to the use of non-GAAP financial measures. We compensate for these limitations by providing specific information regarding the GAAP amounts excluded from these non-GAAP financial measures and evaluating these non-GAAP financial measures together with their relevant financial measures in accordance with GAAP.
The following table reconciles Net Income (Loss) to Adjusted EBITDA for the three and six months ended June 30, 2026 and 2025:
| Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||||||
| 2026 | 2025 | 2026 | 2025 | |||||||||||||
| (in thousands) | ||||||||||||||||
| Net income (loss) | $ | (1,102 | ) | $ | 204 | $ | (1,164 | ) | $ | 387 | ||||||
| Adjustments to arrive at earnings before interest, taxes, depreciation, and amortization (EBITDA): | ||||||||||||||||
| Interest income | (10 | ) | (35 | ) | (23 | ) | (75 | ) | ||||||||
| Depreciation and amortization expense | 1 | 2 | 2 | 4 | ||||||||||||
| EBITDA | (1,111 | ) | 171 | (1,185 | ) | 316 | ||||||||||
| Adjustments to arrive at Adjusted EBITDA: | ||||||||||||||||
| Employee Retention Credits | -- | (94 | ) | -- | (239 | ) | ||||||||||
| Provisions for inventory net realizable value, net | 980 | 33 | 998 | 57 | ||||||||||||
| (Gains) losses on marketable securities, net | 301 | (156 | ) | 139 | (145 | ) | ||||||||||
| (Gains) losses on foreign currency transactions, net | -- | (8 | ) | 1 | (27 | ) | ||||||||||
| Stock-based compensation expense | -- | 47 | 15 | 93 | ||||||||||||
| Adjusted EBITDA | $ | 170 | $ | (7 | ) | $ | (32 | ) | $ | 55 | ||||||
The following tables reconcile gross profit, gross margin, income (loss) from operations, net income (loss), and earnings (loss) per share as prepared in accordance with GAAP to adjusted gross profit, adjusted gross margin, adjusted income (loss) from operations, adjusted net income (loss), and adjusted earnings (loss) per share for the three and six months ended June 30, 2026 and 2025:
| Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||||||
| 2026 | 2025 | 2026 | 2025 | |||||||||||||
| (in thousands) | ||||||||||||||||
| Gross profit | $ | (205 | ) | $ | 482 | $ | 165 | $ | 1,091 | |||||||
| Add-back: Net realizable value charge of | 970 | -- | 970 | -- | ||||||||||||
| Adjusted gross profit | $ | 765 | $ | 482 | $ | 1,135 | $ | 1,091 | ||||||||
| Gross margin percentage | (9.8 | )% | 33.7 | % | 5.3 | % | 35.3 | % | ||||||||
| Add-back: Net realizable value charge of | 46.2 | % | -- | % | 26.9 | % | -- | % | ||||||||
| Adjusted gross margin percentage | 36.4 | % | 33.7 | % | 32.2 | % | 35.3 | % | ||||||||
| (in thousands) | ||||||||||||||||
| Income (loss) from operations | $ | (811 | ) | $ | 5 | $ | (1,047 | ) | $ | 140 | ||||||
| Add-back: Net realizable value charge of | 970 | -- | 970 | -- | ||||||||||||
| Adjusted income (loss) from operations | $ | 159 | $ | 5 | $ | (77 | ) | $ | 140 | |||||||
| (in thousands) | ||||||||||||||||
| Net income (loss) | $ | (1,102 | ) | $ | 204 | $ | (1,164 | ) | $ | 387 | ||||||
| Add-back: Net realizable value charge of | 970 | -- | 970 | -- | ||||||||||||
| Adjusted net income (loss) | $ | (132 | ) | $ | 204 | $ | (194 | ) | $ | 387 | ||||||
| (in thousands) | ||||||||||||||||
| Net earnings (loss) per share | $ | (0.27 | ) | $ | 0.05 | $ | (0.28 | ) | $ | 0.09 | ||||||
| Add-back: Net realizable value charge of | 0.24 | -- | 0.23 | -- | ||||||||||||
| Adjusted net earnings (loss) per share | $ | (0.03 | ) | $ | 0.05 | $ | (0.05 | ) | $ | 0.09 | ||||||
Contact Information:
Steven N. Bronson
Chief Executive Officer
Qualstar Corporation
805-617-4419
IR@Qualstar.com
