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Image source: The Motley Fool. Tuesday, Aug. 11, 2026 at 8:30 a.m. ET Investor Relations - Barbara Russo Chief Executive Officer and Co-Founder - Kevin Knopp Chief Financial Officer - Joe Griffith Operator: Hello, everyone. Thank you for joining us, and welcome to the 908 Devices Second Quarter 2026 Earnings Call. [Operator Instructions] I will now hand the conference over to Barbara Russo in Investor Relations. Barbara, please go ahead. Barbara Russo: Thank you, and good morning. On this call, we will be discussing our financial results for the second quarter ending June 30, 2026, which were released earlier this morning. Joining me from 908 Devices is Kevin Knopp, Chief Executive Officer and Co-Founder; and Joe Griffith, Chief Financial Officer. During today's call, we will make forward-looking statements within the meaning of federal securities laws. These statements involve material risks and uncertainties that could cause actual results or events to materially differ from those anticipated. For a discussion of these risks and uncertainties, please review the forward-looking statement disclosure in the earnings news release as well as in our most recent annual report on Form 10-K and other SEC filings. These forward-looking statements reflect management's beliefs and assumptions as of the date of this live broadcast, August 11, 2026. Except as required by law, we disclaim any obligation to update forward-looking statements to reflect future events or circumstances. Our commentary today will also include non-GAAP financial measures, which should be considered as a supplement to and not a substitute for GAAP financial measures. The non-GAAP reconciliations can be found in today's earnings press release, which is available in the Investor Relations section of our website. With that, I now turn the call over to Kevin. Kevin Knopp: Thanks, Barbara. Good morning, and thank you for joining our second quarter 2026 earnings call. I'm pleased to report that we delivered strong results this quarter, demonstrating the power of our strategy and dedication of our team. In the second quarter, we generated $16.1 million in revenue, representing 23% growth year-over-year. Our momentum with U.S. state and local customers remain particularly strong with these customers representing more than half of our revenues in the second quarter. We're seeing continued funding support at the state and local level, driven by the urgent need to modernize detection capabilities in response to evolving threats from the ongoing fentanyl crisis to emerging synthetic drugs and chemical hazards. This funding momentum, combined with strong customer demand, gives us confidence in the durability of this growth trajectory. From a profitability standpoint, we are making meaningful progress. The cost structure initiatives we implemented last year are delivering results. Our adjusted EBITDA loss was less than $2 million in the second quarter, which is a 50% improvement year-over-year. These improvements demonstrate our commitment to scale efficiently while investing in growth. As announced on May 6, we acquired NIRLAB, expanding our narcotics detection portfolio. We now have an AI-powered subscription-based cloud-connected near-infrared spectroscopy platform that enables point and click analysis of common drugs in seconds. Along with our VipIR and MX908 devices, we provide a comprehensive narcotics workflow for law enforcement from fast screening to confirmatory analysis. Overall, I'm very pleased with our execution this quarter. We are delivering against our strategy on multiple fronts, expanding our market presence, both organically and through strategic M&A while building a stronger foundation for longer-term value creation. This execution maps directly to our 3 focus areas for 2026, scaling proven platforms, extending platform leadership and strengthening revenue durability. Let me walk through the progress we made in each. First, scale our proven platforms. Our objective is to accelerate growth by modernizing legacy detection equipment, especially FTIR across global fire, law enforcement and defense enterprise accounts. We've made tangible progress in these areas in 2026. Start with our scale. Over the past 24 months, we've shipped more than 750 FTIR devices, confirming this opportunity is real, substantial and one we're capturing. VipIR, our newest FTIR device, is leading that modernization push. We shipped more than 35 units in Q2, and we believe we will achieve our goal of shipping more than 100 VipIR devices this year. Two wins this quarter show why. A major South Asian law enforcement agency displaced an incumbent competitive product after a trial, purchasing more than 15 units and the Bureau of International Narcotics and Law Enforcement Affairs ordered its first VipIR unit to support Mexico's narcotic interdiction mission using U.S. State Department funding, a mechanism we believe can extend to other partner nations. Together, these show VipIR winning on 2 key fronts: capturing competitive share and capturing funding. Our flagship MX908 plays the same role for trace level analysis as it enables our customers to keep pace as the modern illicit drug landscape evolves from fentanyl to nitazenes and now to [ orphans ]. Clear evidence of the modernization cycle in motion is our Texas Department of Criminal Justice win, 15 MX908 devices for corrections facilities statewide were purchased in Q2, converting from a successful two-device trial with the Texas Office of Inspector General. We expect more orders to follow as that program's success becomes visible across the state. That's our playbook working exactly as designed, engage early, prove value, delight the customer and expand. We also attained a high visibility proof point this summer. MX908 Beacon, VipIR and XplorIR devices were part of the security toolkit at several stadiums during the FIFA World Cup. Deployments at major international events are exactly the kind of field validation that builds confidence across the first responder community, raising awareness of our solution. Finally, this momentum is being carried into the third quarter. We are pleased to announce that in July, we secured a $6 million ProtectIR order for corrections agency in the Asia Pacific region. This progress validates the 3 dynamics underpinning our platform scaling focus. Governments need better tools to identify unknown substances. We have the relationships and technical credibility to win competitive procurements and every deployment builds an installed base that opens the door to further expansion, feeding a flywheel. Turning to our second focus area, extend platform leadership. Our objective here is to drive growth through greenfield placements, differentiated capabilities and disciplined product introductions in markets our existing platforms don't yet reach. XplorIR is the clearest example of that strategy at work. XplorIR represents a genuine breakthrough in gas and vapor detection, and the market is responding. Placements grew nearly 70% over the 12 months ending June 30. That growth is being pulled forward by 2 tailwinds: one, HAZMAT incidents and the other [ CBRNE ] defense. Domestically, chemical incidents are rising. A recent Wall Street Journal article noted 131 serious chemical accidents in the U.S. in 2025, up 20% year-over-year, and first responders are feeling that pressure directly. In May, a chemical tank at a jet part manufacturer in California overheated, forcing the evacuation of more than 40,000 residents near Los Angeles. Responders used XplorIR on entry to identify and quantify the hazardous vapors and relied on it throughout cleanup. As these incidents rise, so does the case for XplorIR. Internationally, we see the same demand from defense customers. The Danish Defense Acquisition and Logistics organization selected XplorIR to enhance long-range chemical detection for defense operations and initial multiunit procurement paired with a framework agreement for future purchases, a strong signal of the confidence in the platform's differentiated performance. XplorIR is exactly what extend platform leadership is supposed to look like. We identified an unmet need, real-time gas and vapor identification and quantification in the field, built differentiated technology to solve it, and now we're capturing a market opportunity that's growing on its own as chemical incidents rise and customers see what modern detection technology can do. Finally, our third strategic focus area is strengthening revenue durability. Our objective is to build a more predictable revenue mix through recurring revenue from connected services, growth in OEM-based revenue and longer-term programs. NIRLAB is a key driver of the Connected Services vision we're building towards. And while OEM revenue and longer-term programs remain important parts of this focus area, I want to spend today's update on NIRLAB and where we see its potential. For decades, presumptive drug identification in the field has relied on colorimetric test kits, cheap, single-use and disposable with no data trail behind the result. That has created real problems. Innocent substances can trigger false positives, leading to wrong flurest and legal challenges, and it's becoming a legislative issue. Colorado's legislature voted unanimously this year to ban custodial arrest based solely on colorimetric results and reform efforts are underway in at least 7 other states. We see that as a durable tailwind, not a onetime event, and it points to where this category is headed away from disposable chemistry and towards connected technology that produces a defensible, auditable result with the identification, the underlying data and the chain of custody all captured and retained. That's the model NIRLAB lets us build towards the same kind of recurring subscription-based model that has transformed other public safety hardware categories, pairing durable hardware with a cloud-connected software layer that agencies rely on and return to every day. Within the first 60 days post close, our U.S. commercial team ran in-person and virtual demonstrations and secured field evaluations through our try-before-you-buy program, engaging 30 agencies and hundreds of prospects at the federal, state and local levels. This includes 7 HIDTA task forces, the multi-agency teams on the front lines of drug trafficking enforcement that tend to set the procurement tone for their regions. Agencies evaluating the platform consistently cite 4 things: speed, ease of use and intuitive interface and accurate identification, exactly the attributes that make the case against colorimetric testing. That commercial motion is already converting. In the roughly 2 months since close, we sold more than 35 NIRLAB devices, each with a multiyear software subscription, meeting our expectations for the initial post-acquisition period with shipments to law enforcement agencies in Colorado and California and customs agencies in Morocco and Iceland. Our overall pipeline is strong and growing, and we're starting to see enterprise scale opportunities develop in that pipeline, both domestically and internationally, a meaningful early signal of NIRLAB's longer-term potential. But the real opportunity is bigger than any one product. NIRLAB is an example of what our entire business has the potential to become, durable hardware paired with recurring connected software and the kind of real-time analytical reachback support our customers consistently tell us they value most from 908. We believe that model, hardware, software and expert support working together can guide how we build and monetize every product in our portfolio for years to come. With that, I will turn it over to Joe to walk through the detailed financial results for the quarter. Joseph Griffith: Thanks, Kevin. Total revenue was $16.1 million for the second quarter 2026, increasing 23% from $13 million in the prior year period. Handheld product and service revenue was $15.5 million for the second quarter 2026, up 24% from $12.5 million for the second quarter of 2025. The increase was primarily driven by our FTIR products, including more than 35 VipIR shipments in NIRLAB law enforcement revenue. In total, we shipped 198 devices in the second quarter, bringing our installed base to 4,101. Recurring revenue represented 31% of total revenues this quarter and was $4.9 million, a 4% increase over the prior year period, primarily related to software and accessories and FTIR service revenue, offset in part by the expected reduction in mass spec service revenue. Gross profit was $8.3 million for the second quarter of 2026 compared to $6.4 million for the prior year period. Gross margin was 52% for the second quarter of 2026 compared to 49% for the prior year period. The increase was driven by higher product revenue volume and decreased facility costs related to the move of our Boston facility in 2025. In addition, in the quarter, we benefited from a shift in channel mix with more U.S. state and local placements that have lower channel costs compared to international placements. These factors were offset in part by a lower service gross margin related to the decreased mass spec service revenue in the second quarter of 2026. Adjusted gross profit was $9.2 million for the second quarter of 2026 compared to $7.3 million for the prior year period. Adjusted gross margin was 57%, an increase of approximately 85 basis points compared to the prior year period. The increase in adjusted gross margin was driven by our improved 2026 operating structure, including higher revenues, channel mix and the reduced facility costs, as mentioned above. Total operating expenses for the second quarter of 2026 were $21.2 million compared to $21.5 million in the prior year period. The reduction was primarily due to decreases in the fair value of contingent consideration, lower facility costs and a reduction in R&D program spending, offset by operating costs from NIRLAB and transaction costs incurred with the acquisition. Net loss from continuing operations for the second quarter of 2026 was $11.9 million compared to a net loss of $12.9 million for the prior year period. This decrease in loss was primarily driven by the $2 million in higher gross profit, net of a $1.2 million reduction in transition services agreement income and a $0.3 million reduction in noncash charges for revaluing contingent consideration. Adjusted EBITDA for the second quarter of 2026 was negative $1.9 million compared to a loss of $3.9 million in the prior year period, representing a $2 million improvement. In the second quarter, we cut our adjusted EBITDA loss by more than 50% due to improved margins and a lower operating cost base. We ended the quarter with $101.5 million in cash, cash equivalents and marketable securities with no debt outstanding. We consumed $10.2 million of cash in the quarter, which was primarily related to the $13.5 million used for the acquisition of NIRLAB, net of the $3.5 million received from the release of the escrow from the desktop divestiture to Repligen. Looking ahead in 2026, we have raised the low end of our range and now expect revenue to be $68 million to $70 million, representing growth of 21% to 25% over full year 2025. Our guidance range includes the following assumptions: First, we now expect handheld product and service revenue to grow 23% to 27% year-over-year, which equates to a range of $65 million to $67 million. This increase is supported by our performance to date and the recent $6 million ProtectIR order. Second, we continue to expect OEM and funded partnerships, including contract revenue to be approximately $3 million. And third, given that the AVCAD program is still working through next steps, as Kevin will discuss more in a moment, we are excluding it from our core 2026 guidance. Any AVCAD contribution would represent upside to our stated range. Moving down the P&L, we continue to expect adjusted gross margins to be in the mid- to high 50% range for full year 2026. And on the bottom line, we continue to expect to reduce our adjusted EBITDA loss to the mid-single-digit millions, closing the gap on achieving breakeven while balancing investments to enable the growth opportunity. At this point, I would like to turn the call back to Kevin. Kevin Knopp: Thanks, Joe. As Joe mentioned, the U.S. military AVCAD program is continuing to work through next steps, and we fully support that process. The current contract has run its course. And as part of the next steps, the government is also considering our commercially available product due to a broader procurement reform at the Department of Defense that's prioritizing speed and program flexibility. We expect more clarity soon as the government's fiscal year closes and FY '27 begins on October 1. Overall, we believe we have the best-in-class aerosol and vapor detection technology, which has been extensively government tested and validated and can win this opportunity regardless of the chosen path, either in partnerships with Smiths Detection or directly with our commercial MX908. We remain excited about the long-term potential of this program. Now stepping back, as I reflect on our second quarter performance and look ahead to the remainder of 2026 and beyond, I'm energized by what we've accomplished and confident in the trajectory we're on. Let me be clear about how I characterize this quarter. Strong execution across the board. We delivered 23% revenue growth, placed 198 devices and expanded our adjusted gross margin by 85 basis points and cut our adjusted EBITDA loss by more than half, all while successfully integrating a strategic acquisition and continuing to invest in our growth initiatives. This demonstrates the fundamental strength of our business model, and I believe in our ability to meet our near-term and longer-term objectives. Before I close, I want to express my gratitude to those who have supported us through our strategic transformation over the past 1.5 years, to our customers who trust us to protect their communities, to our employees who execute with excellence every day, to our partners and distributors who extend our reach into markets worldwide and to our shareholders who continue to back our vision as we build a category-defining company in handheld detection. We're executing our strategy. We're delivering on results, and we're building momentum. I look forward to updating you on our continued progress when we report third quarter results later this year. With that, let's open it up for questions. Operator: [Operator Instructions] Your first question comes from the line of Dan Arias with Stifel. Daniel Arias: Kevin, as we think about this broader portfolio that you now have, can you maybe just talk to the extent that you see bundling opportunities as being higher than they were and more meaningful? Is there an appetite for multisystem orders across applications when you target these customer groups? Or is it still sort of siloed from an application standpoint? I'm just trying to make sure that I fully appreciate the benefit of just the different product lines that you have and what that might mean when you target some of these government agencies and law enforcement agencies. Kevin Knopp: Yes. Sure thing, Dan. Happy to touch on that. So I think that's one of the big advantages we've been having as we scale here with the FTIR portfolio now coupled with Mass Spec and now we have NIRLAB thrown in here. We're absolutely seeing and have many examples of bundled orders where they may order a couple of FTIR products or a couple of MX products, not yet with the NIRLAB because that's very new to us, but we absolutely see that pairing well with our MX. And I think if you look at it from a high level, right, we think about law enforcement, we think about their workflow. We think about what they need to do from screening to confirmation. And if you take in total, our MX, our NIRLAB as well as the VipIR, it creates kind of a complete workflow for those customers. So absolutely multiunit multisystem across there. And then similar on the HAZMAT side, so more on the fire services side, with our XplorIR, with our FTIR, our ThreatID device, absolutely, those can be bundled offerings, and we've seen that. Daniel Arias: Okay. And then maybe just one on AVCAD. It sounds like there are some alternative courses of action that could come out of the evolution of that opportunity. If something more direct were to be the way that you go, how do you see that impacting the ramp and just the revenue potential that could come out of that in '27 and '28? You've kind of laid out some initial thoughts there. I'm just curious how that would change. Kevin Knopp: Yes, absolutely. On AVCAD, it's taking a little bit longer than we and the market expected, but our confidence in winning hasn't moved. Really, the current contract run its course and the government is working through those next steps, which we're fully supportive of. We believe we've got really the best-in-class vetted validated technology in the aerosol vapor detection category and can win this opportunity either way it plays out. And that can be in partnership with Smiths Detection, but it also can be through our commercial MX908. And as we mentioned and as you probably know, there is a shift underway within the Department of War that's really making sure that they take their moment in time and look at commercial off-the-shelf products and using that in a preferential way to speed up deployments and speed up getting solutions to the war fighter. So at the moment, the government is working through that process. They're looking at both COTS solutions like our MX908, these commercial off-the-shelf solutions. And then, of course, continuing with the program we've been working with Smiths on the custom development. From an economic side, yes, I think it's clear that the more product content we provide, whichever path they choose is better on the economics for us. From a ramp, as Joe mentioned, we have taken it out of the guide for today and taking it to upside, and we're pleased we're able to do that with the strength of our core business. And as we mentioned, we see this as a $10 million-plus opportunity into the future. And I don't think our confidence there has changed and how to ramp to that point is TBD here as we sit today. But I think the program is going to be good for us over the long term. Operator: Your next question comes from the line of Brendan Smith with TD Cowen. Brendan Smith: Maybe just first on NIRLAB. I was hoping, can you speak just a little bit more to what kind of potential cross-selling opportunities you're now seeing in these first 60 days? And maybe even broadly more qualitatively, how conversations with new customers are going now that you've got this arguably broader portfolio of products? I guess, are they coming to you with one in mind? Are they looking for a more comprehensive set of tools? Just trying to understand how kind of demand here is evolving across these different end markets as your catalog grows. Kevin Knopp: Yes. Sure thing, Brendan. Thanks for the question. We're very happy with how the NIRLAB integration is going. We've really been working hard to get out there fast. Part of the thesis was bringing this product into the U.S. markets where they've had very, very little to none penetration. And to your point, right, we can bring that right to the customers of our core flagship MX908, right to those law enforcement customers. And we closed here in early May, but the team has been moving fast, and we really hit that ground running. We've engaged about 30 agencies, hundreds of prospects across about 20 states in those first 60 days. That includes the 7 HIDTA regions, and these are multi-agency task force -- these are the ones that really are on the front lines, the illicit drug crisis. They really set kind of the tone for what gets adopted in their regions. So we've been doing a lot of engagement with those groups there, and we're pleased with where we're at. Absolutely, as you mentioned, there can be a bundling as we move forward. And there is an analyte compatibility, complementary compatibility there. So if you think on the THC side and cannabis, the NIRLAB is the product in our portfolio that can quantify that, and we can't do that with our MX. So those, you can imagine being paired very well. The subscription side, we think, is very exciting for the NIRLAB products. We think that's also a great model that we should work to get our other products in over time and making sure that we really provide that excellent service support and doing so on an ongoing recurring basis. And then I'd say the last point on NIRLAB really excited about a tailwind in the regulations that are changing. And that's really been going away from colorimetric kits, which have expiration dates, have usage issues and have been causing some false positives and wrong [ flurest ] and starting to get banned in different states. So we're excited to see where that will play out by having, call it, a lower price point offering with our NIRLAB that can help us there. And Colorado is one of the first states to ban such things. And in the quarter, we did receive orders from Colorado and California. So I think overall, we're pleased with it and do see a portfolio effect developing. Brendan Smith: Got it. That's great. And maybe if I could just a quick follow-up. On your point about the kind of recurring revenues here. I appreciate all the color on kind of growing that as a proportional part of total revenue. I guess as we look at our model for maybe the next, I don't know, a couple of years, how should we think about that relative proportion of total revenues coming from that recurring bucket just as some of the more recent launches scale up? I mean you're talking about NIRLAB here. So I guess, is there like an ideal ratio between core recurring you guys have in mind that's capable over the medium term? Just any color there would be great. Joseph Griffith: I'll give a little bit of color and feel free to chime in, Kevin. But Brendan, we were about 30% for the current quarter or a little over 30% last year. That's kind of our current baseline. As we drive initial devices, example, the ProtectIR order that we talked about doesn't have recurring revenue. So in any given quarter or year, there can be a shift, right? You might end up in the high 20s, low 30s. But over time, I think that's where it gets exciting, especially with NIRLAB and the subscription model, more and more of a it carries 50% of recurring revenue opportunity with those subscriptions. You have the snowball effect of the installed base. So I think starting to creep up into the 30s, kind of approaching that 40% is what we aspire to. But it is good to sell those devices and build the opportunity, which we're focused on today. Operator: Your next question comes from the line of Matt Larew with William Blair. Matthew Larew: Just wanted to circle back on AVCAD. If indeed a different path is chosen by the Department of War, would there be another pilot phase where they trial a variety of different technologies? In other words, would sort of reopen a different RFP or based on the success of the first project where you were a sub and it's the same technology from your standpoint, would it be sort of the immediate opportunity? So I just wanted to be curious a little bit more on how you expect things to play out and I guess, how that informs your perspective on timing? Kevin Knopp: Yes, absolutely, Matt. Great question. So you're right, we've been performing for a long time now under the AVCAD program in partnership with Smiths. We've done a lot of testing of the base HPMS, a lot of analytical testing, a lot of rigorous testing of that. But similarly, if you think about our commercial product, our MX908, we have more than 3,000 of those devices out there. We estimate that about 1,200 are within the U.S. federal and military. We have quite an extensive test record for that, that also parallels what's been done in the AVCAD program. So I think it's a bifurcated path. I think they can choose to continue with the path we're on and/or a hybrid path where potentially they continue with the program and the development or some custom modifications there along the same lines and then use COTS products such as our MX908 to fill the gap to get -- again, their desire is to move the program faster here. So I know that you see a timing delay from this lens, but their desire is to ultimately move the program faster. Matthew Larew: Okay. And then Joe, just thinking about the guide implies, I think, sort of high teens or $20 million of revenue per quarter in the back half, you did $16 million in Q2. It sounds like AVCAD has moved out of the guide. Can you just talk to us a little bit about what the progression will look like? And I guess, in particular, I'm thinking of the large order, $6 million order you got in July. I don't know if all of that or some of that might be coming in '26 versus perhaps more in '27. Joseph Griffith: Absolutely. I can give a few different data points there. Yes, last year in H2, we were 45% in Q3, 55% in Q4, a little bit more heavy weighted in Q4 with the VipIR ramp-up and a little bit of AVCAD revenue. As I think about this year, it's probably a little bit more in Q3 on a percent basis, maybe a few hundred basis points in Q3 versus Q4. Specifically on the $6 million ProtectIR order, we do anticipate that to be split over Q3 and Q4. So we'll see some revenues here in Q3 as we build the number of devices and some go out in the fourth quarter. I think more broadly, as we think about the guide and our confidence is high and growth levers, we feel are performing this year. For H1, as you mentioned, our growth was 19%, 23% in Q2, and we expect that to ramp here in the second half. and potentially get to the higher end of 25% for the full year growth. It would imply about 29% at the high end for H2. We think our growth to date has been impressive and see our key growth areas and enabling that high 20% growth. We've talked about some of these, I think, over the past 2 quarters. We expect VipIR to be a key contributor to the full year post launch. We had 60-plus in H1 and see a path where device placements can exceed 100 and maybe approach 150 for the full year, doubling or tripling our '25 levels. XplorIR to drive growth similar to '25. As a reminder, we opened the broader fire gas detection market with XplorIR, which is exciting, and we shipped over 150 devices in '25. And over the last 12 months, it's grown nearly 70% -- we talked about ProtectIR, getting that $6 million order gained us confidence having that order in hand to ship over Q3, Q4. And in May, with the close of NIRLAB, we expect approximately $1 million a quarter in H2 contributing to the growth. So hopefully, that's helpful as you think about the multiple levers and our path to achieving the guidance range that we tightened this quarter. Operator: Your next question comes from the line of Puneet Souda with Leerink. Puneet Souda: Just wanted to clarify on the ProtectIR order, the $6 million. Was that something that you were contemplating in the guide before? Or is that new? Maybe just give us some color on that. Joseph Griffith: Yes, we did have a level of ProtectIR anticipated in the second half and the opportunity, but it was good to see that the specific opportunity was upsized a bit from the initial thinking in the first half. So I would say it was in our purview, was in our pipeline, but to be able to get it in hand early and be able to ship it all here in '26 was a positive. It definitely gave us confidence in tightening and pushing the AVCAD opportunity to upside as we've continued to learn more on that opportunity. So we like these big orders on the ProtectIR side, and it's been a steady product early days from RedWave and continued under our purview from a commercial perspective. Puneet Souda: Okay. And then on the cloud attach side, could you -- Kevin, could you talk about where your cloud attach rate for devices is today, where you would like that to be what is the incremental revenue that you think you can achieve by integrating these devices into the cloud platform. Clearly, there is a recurring, there's a subscription model there. I just wanted to understand the approach you're taking here and where you would like to be. Kevin Knopp: Yes, absolutely. Thanks for that question. So we're very excited about the more connectivity we can have on our products and the more we can connect it to an ecosystem for our customers to add value to allow them to share results, manage their fleet do in-depth analysis, reach AI tools for support, all of those types of features we're working on. We have a product called Team Leader that's out there today that connects to our FTIR products and will connect in the future to our next generation of our mass spec products. That product has hundreds of users. It's really provided with service and support today. But where we're really going is looking at the model for NIRLAB. And part of the strategic decision around that M&A was to leverage that model much more broadly across our portfolio over time. So if we zoom into the NIRLAB model for a moment, Lab is a purchase where 50% is recurring. So nominally list price around $10,000 for the device and nominally around $5,000 per year for the subscription and being able to support that customer with upgrades, new threat assessments, new drugs, new analytes that can be added over time. So that's a 50% target. They've shown and demonstrated that we're able to achieve annual recurring revenues that are quite high and obviously early days, but greater than the 90% level. And that comes from the stickiness of the product, right? It really gets designed in with those customers for drug screening applications across a set of very common illicit substances -- and people will sign up for 1-year subscriptions, 2, 3, 5 and even as many as, say, 7 years upfront of subscription. We really like that. That's visibility. That's very much a complementary way to what we're selling our MX908. So 50% is an aspiration there on that single product. If you look where Joe mentioned today, we're call it, more in the 30%, and that ebbs and flows a little bit with the size of number of new placements that are done in a particular quarter. But that's the direction we're going. I mean I think NIRLAB is a great example, great model. And if you start looking across the industry of public safety companies, you'll see many of the best-in-class companies have been quite successful across state and local customers using such a model. Now all that said, it's going to take a little bit of time as we work through and get all that into our product portfolio, but we're super happy to have the NIRLAB team in place. We're super happy to have those software development resources that are coupling with our team leader group. And I think good things to come there that we'll keep reporting on. Puneet Souda: Got it. And then one final one on NIRLAB. I mean it seems like it helps you get into accounts that you could have -- maybe you have gotten those accounts before, but maybe some of those accounts were inaccessible just given the price point. Just trying to understand sort of what's the upgrade opportunity to more higher-priced devices? How are you thinking about that just given the access that you have in the account list there from NIRLAB? Kevin Knopp: Yes, that's also a great question. I think it goes in a few different directions. I mean, absolutely, there are cases, and that's our first job one today, call it, 60 days in at the end of the quarter, is to get the NIRLAB device introduced to all of our MX customers that we've got strong partnerships with. And it has complementary analyte capabilities. It also has a different price point, different complexity that can be used to kind of expand the number of sockets that you can reach. So job 1 is focused on that today. But the flip side is also true. They've got a great presence internationally. They've really been doing some good development there over the last 2 years. lot of good validation with the University of Lausanne in Switzerland, the Forensics University. So we're looking to do more in that direction internationally using them as a platform to help us into the reach and validation of our products there, too. So I think it's got kind of a bidirectional benefit to us. And as the first question of the day from Dan, as that portfolio grows and we can serve more of the workflow, we see great efficiencies, both for our customers to have one number for support and service and training contacts, but also from us from a feet on the street, really zoomed in subject matter expert-led organization on the sales side for law enforcement and then similarly on the HAZMAT fire side. So I think a lot of benefits as we scale with this broader complementary portfolio across the board. Operator: Your next question comes from the line of Max Masucci with ROTH Capital Partners. Max Masucci: Nice quarter. First question on VipIR. As you look across the first 110 VipIR placements, what trends have you seen in terms of single versus multi-device orders? What percentage of the VipIR placements have been to existing FTIR customers versus customers that are new to 908? And more generally, how are you -- how is the pipeline shaping up ahead of the second half? And is that factoring into the slightly raised expectations on product revenues? Kevin Knopp: Yes. Thanks, Max, for the question. I mean I think VipIR is a really successful launch for us. It's the first launch under the RedWave with 908 as one here, calling it our VipIR product together launched to the market. Super successful thus far, very pleased with those, call it, passing 100 units to date. I think we're seeing this take advantage of the modernization cycle that's setting up across the globe, whether it's funded from the state and local and the increase of funding that's available to responders or across NATO entities. And we've certainly seen singles, doubles, 10, even 15 unit type orders coming in one go. Joe, do you want to? Joseph Griffith: Yes. And that makes a lot of sense as you think about the different sales channels that we're focused in for the VipIR, whether it's state and local kind of one-off agencies and then more broader potential custom opportunities, both domestically, but really internationally, I see a decent opportunity as we highlighted the win in Kevin's prepared remarks. So as we think about the back half, it is one of the key growth drivers that I mentioned earlier, and we see that continuing. And at times, you might see a big order pop up, but definitely building pipeline. Kevin Knopp: Yes. And Max, if you look over the last 24 months, we've shipped more than 750 FTIR devices, which includes the VipIR, but really a clear proof point to us that this modernization cycle is really real and that we can capture it. And the FTIR is essentially riding 3 cycles at once, that equipment modernization, HAZMAT response and then defense demand. So they're all kind of compounding together. Max Masucci: Great. Second question on gross margins. So it looks like product gross margins expanded nicely in the quarter, about 700 basis points. So how much of the Q2 product gross margin expansion is structural versus volume and mix? And just curious how the VipIR placement ramp and NIRLAB are factoring into your expectations for gross margins for the year? Joseph Griffith: Yes. A lot of different factors you can imagine, whether it's channel, product mix, et cetera. But I'd say our margins do remain healthy and the drivers are well understood, different factors there. For reference in '25, our adjusted gross margin was 56.7%. And for the second quarter and first half, our adjusted gross margin was 57% overall, a favorable result based upon channel and product mix. Product gross margin has improved a bit as some of our service revenue. You might recall that federal government contract that had some funding lapse this year that we'll go after for next year took down our service margins. But as we think about the full year '26, we see it at a similar level, maybe closer to 56% on a full year basis. The higher product volume and H1 lower cost structure are positive drivers, as you touched on. But there are a few H2 factors, including NIRLAB, which isn't at scale today. It's at a lower gross margin, especially on the device. The ProtectIR order, that $6 million order is at a lower gross margin. It's an international and high-volume discounting opportunity and VipIR, which is our -- beyond NIRLAB, our lowest product gross margin contributor in timing of build plan, et cetera. So a lot of different factors. I think volume helps, where you have some other things that may temper our adjusted margin expansion, but being in that mid- to high 50s, kind of 56%, 57% is pretty attractive. Operator: There are no further questions at this time. I will now turn the call back to Kevin Knopp for closing remarks. Kevin Knopp: Well, thank you. Thank you very much for your time this morning. We appreciate your being on the line and for us to give you an update and look forward to the next one. Take care. Operator: This concludes today's call. Thank you for attending. You may now disconnect. 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This article is a transcript of this conference call produced for The Motley Fool. While we strive for our Foolish Best, there may be errors, omissions, or inaccuracies in this transcript. As with all our articles, The Motley Fool does not assume any responsibility for your use of this content, and we strongly encourage you to do your own research, including listening to the call yourself and reading the company's SEC filings. Please see our Terms and Conditions for additional details, including our Obligatory Capitalized Disclaimers of Liability. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. 908 Devices (MASS) Q2 2026 Earnings Call Transcript was originally published by The Motley Fool

This article first appeared on GuruFocus. Revenue: Total revenue was $16.1 million for Q2 2026, a 23% increase from $13 million in the prior year period. Handheld Product and Service Revenue: $15.5 million in Q2 2026, up 24% from $12.5 million in Q2 2025. Recurring Revenue: Represented 31% of total revenues, totaling $4.9 million, a 4% increase year-over-year. Gross Profit: $8.3 million in Q2 2026, compared to $6.4 million in the prior year period. Gross Margin: 52% in Q2 2026, up from 49% in the prior year period. Adjusted Gross Profit: $9.2 million in Q2 2026, compared to $7.3 million in the prior year period. Adjusted Gross Margin: 57%, an increase of approximately 85 basis points year-over-year. Operating Expenses: $21.2 million in Q2 2026, compared to $21.5 million in the prior year period. Net Loss from Continuing Operations: $11.9 million in Q2 2026, compared to a net loss of $12.9 million in the prior year period. Adjusted EBITDA: Negative $1.9 million in Q2 2026, compared to a loss of $3.9 million in the prior year period, a $2 million improvement. Cash Position: Ended the quarter with $101.5 million in cash, cash equivalents, and marketable securities, with no debt outstanding. Device Shipments: Shipped 198 devices in Q2 2026, bringing the installed base to 4,101. VipIR Shipments: Shipped more than 35 VipIR units in Q2 2026. NIRLab Sales: Sold more than 35 NIRLab devices within roughly two months post-acquisition, each with a multi-year software subscription. Full Year 2026 Revenue Guidance: Raised to $68 million to $70 million, representing growth of 21% to 25% over full year 2025. Warning! GuruFocus has detected 8 Warning Signs with MASS. Is MASS fairly valued? Test your thesis with our free DCF calculator. Release Date: August 11, 2026 For the complete transcript of the earnings call, please refer to the full earnings call transcript. 908 Devices Inc (NASDAQ:MASS) delivered strong Q2 2026 results with 23% year-over-year revenue growth to $16.1 million, driven by robust demand from US state and local customers. The company significantly improved profitability, cutting adjusted EBITDA loss by more than 50% year-over-year to $1.9 million, and expanding adjusted gross margin by 85 basis points to 57%. Strategic acquisition of NirLab is gaining traction, with over 35 devices sold in the first two months, including multi-year subscriptions, and strong pipeline development with 30 agencies engaged. VipIR, the company's newest FTIR device, is capturing market share, with over 35 units shipped in Q2 and a major order from a South Asian law enforcement agency displacing a competitor. The company secured a $6 million ProtectIR order in July from an Asia Pacific corrections agency, boosting confidence in achieving the raised full-year revenue guidance of $68-$70 million. XplorIR placements grew nearly 70% over the last 12 months, driven by rising hazmat incidents and defense demand, including a new framework agreement with Danish defense. The company's recurring revenue model is strengthening, with NIRLab subscriptions and connected services expected to drive recurring revenue toward 40% of total revenue over time. The AVCAD military program remains uncertain, with the current contract having run its course and the government considering alternative paths, leading to its exclusion from 2026 guidance. Recurring revenue growth was modest at 4% year-over-year, impacted by an expected reduction in mass spec service revenue. Gross margin expansion was partly offset by lower service gross margins due to decreased mass spec service revenue. The company consumed $10.2 million in cash during Q2, primarily due to the NIRLab acquisition, though partially offset by escrow release. NIRLab integration is still early, with device gross margins lower than the company average, and the product is not yet at scale, potentially tempering margin expansion in H2. The ProtectIR order, while large, carries lower gross margins due to international and high-volume discounting, which could pressure overall profitability. The company faces ongoing uncertainty in the federal government contract space, with a funding lapse impacting service revenue and requiring future recovery efforts. Q: Can you provide more detail on the AVCAD program's status and how a potential shift to a commercial off-the-shelf (COTS) solution like the MX908 could impact the revenue ramp in 2027 and 2028?A: Kevin Knopp (CEO): The current AVCAD contract has run its course, and the government is working through next steps, which we fully support. Due to procurement reform at the Department of War prioritizing speed, they are considering our commercially available MX908 alongside the custom development path with Smiths. We have high confidence in winning either way, as our technology is best-in-class and extensively tested. A direct commercial path would be better for our economics due to higher product content. We see this as a $10 million-plus opportunity, and while we've excluded it from 2026 guidance as upside, our long-term confidence is unchanged. Q: What are the early results and cross-selling opportunities from the NIRLab acquisition, and how is demand evolving as the product portfolio expands?A: Kevin Knopp (CEO): The integration is going very well. In the first 60 days, we engaged 30 agencies and hundreds of prospects across 20 states, including seven HIDTA task forces. We sold over 35 NIRLab devices with multi-year subscriptions, meeting expectations. We see strong bundling potential, particularly with our MX908, as NIRLab offers complementary capabilities like THC quantification. The subscription model is a key strategic advantage, and we are also benefiting from a regulatory tailwind as states like Colorado ban colorimetric test kits, which NIRLab can replace. Q: How should we think about the revenue progression for the second half of 2026, especially regarding the $6 million ProtectIR order and the overall growth trajectory?A: Joseph Griffith (CFO): We expect the second half to be more weighted to Q3 than last year. The $6 million ProtectIR order will be split between Q3 and Q4. To hit the high end of our 25% growth guidance, we need about 29% growth in H2. Key drivers include VipIR, which we expect to exceed 100 placements and potentially approach 150 for the year, continued strong growth from XplorIR, and approximately $1 million per quarter from NIRLab. Our confidence is high given the strong H1 performance and these multiple growth levers. Q: Can you elaborate on the current cloud attach rate for your devices and the potential incremental revenue from integrating devices into a subscription-based cloud platform?A: Kevin Knopp (CEO): We are excited about increasing connectivity across our products. Our current TeamLeader software has hundreds of users, but the NIRLab model is our blueprint for the future. For NIRLab, roughly 50% of the revenue is recurring (a ~$10,000 device with a ~$5,000 annual subscription). We are seeing high renewal rates above 90%. While our overall recurring revenue is currently around 30%, we aspire to move towards 40% over time by applying this model more broadly across our portfolio. Q: Does the NIRLab product help you access new accounts that were previously inaccessible due to price points, and what is the upgrade opportunity to higher-priced devices?A: Kevin Knopp (CEO): Yes, it works in both directions. Our first priority is introducing NIRLab to our existing MX908 customers, as it has complementary analyte capabilities and a different price point, expanding the number of "sockets" we can fill. Conversely, NIRLab has a strong international presence and validation, which we can leverage to introduce our other products to new markets. This creates a bidirectional benefit and a more efficient, comprehensive workflow for customers. Q: What trends are you seeing with VipIR in terms of single versus multi-device orders, and what is the mix of new versus existing customers?A: Kevin Knopp (CEO) & Joseph Griffith (CFO): VipIR has been a very successful launch, with over 100 units shipped to date. We are seeing a mix of order sizes, from single units to larger orders of 10-15 units, particularly from international customers. The product is capitalizing on a global modernization cycle. Over the last 24 months, we've shipped more than 750 FTIR devices, which is a clear proof point of the real and substantial opportunity we are capturing. Q: How much of the Q2 product gross margin expansion is structural versus volume and mix, and how will VipIR and NIRLab affect margins for the rest of the year?A: Joseph Griffith (CFO): Our adjusted gross margin was 57% in Q2, a favorable result driven by channel and product mix. For the full year, we expect margins to be around 56%, which is in our mid-to-high 50% target range. While higher product volume and a lower cost structure are positive drivers, we anticipate some tempering factors in H2, including the lower-margin NIRLab devices (as it scales), the large international ProtectIR order, and the product mix from VipIR. Q: Can you clarify if the $6 million ProtectIR order was already included in your previous guidance, and what does it mean for the updated outlook?A: Joseph Griffith (CFO): We had anticipated some ProtectIR revenue in the second half, but this specific opportunity was upsized from our initial thinking. Securing the order early and being able to ship it all within 2026 gave us the confidence to raise the low end of our revenue guidance and treat the AVCAD program as potential upside. Q: Are you seeing more opportunities to bundle multiple product lines (e.g., FTIR, mass spec, NIRLab) in orders for government and law enforcement agencies?A: Kevin Knopp (CEO): Yes, bundling is a significant advantage. We are seeing many examples of bundled orders, such as multiple FTIR devices or a combination of MX908 and FTIR products. With the addition of NIRLab, we can now offer a complete workflow for law enforcement, from fast screening to confirmatory analysis. This is also true on the hazmat and fire services side, where XplorIR and ThreatID can be bundled. This portfolio approach creates efficiency for both our customers and our sales force. Q: If the Department of War chooses a different path for AVCAD, would there be a new pilot phase or could it be an immediate opportunity given the technology's track record? For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Our analysts just identified a stock with the potential to be the next Nvidia. Tell us how you invest and we'll show you why it's our #1 pick. Tap here. Revenue growth of 23% was primarily driven by strong demand from U.S. state and local customers, who represented over half of Q2 revenue due to urgent needs for modernized fentanyl and synthetic drug detection. The modernization cycle is accelerating as agencies transition from legacy FTIR equipment to newer platforms like VipIR, which saw more than 35 shipments this quarter. Strategic M&A with NIRLAB has introduced an AI-powered, subscription-based model that addresses legislative shifts away from traditional colorimetric test kits toward auditable, data-driven results. Operational efficiency improved significantly, with adjusted EBITDA loss narrowing by 50% year-over-year, reflecting the impact of 2025 cost structure initiatives and scaled manufacturing. The XplorIR platform is capturing a growing greenfield opportunity in gas and vapor detection, fueled by a 20% year-over-year increase in serious domestic chemical accidents. Management is leveraging a 'flywheel' effect where initial trials, such as the Texas Department of Criminal Justice pilot, successfully convert into larger statewide enterprise deployments. Full-year 2026 revenue guidance was raised at the low end to $68 million–$70 million, assuming handheld product and service growth of 23% to 27%. The $6 million ProtectIR order for an Asia Pacific corrections agency is expected to be split across Q3 and Q4, providing high visibility for second-half targets. Management expects to ship more than 100 VipIR devices in 2026, with potential upside reaching 150 units as international law enforcement agencies displace incumbent products. The AVCAD program has been excluded from core guidance to remain conservative, though management anticipates clarity by October 1 as the DoD explores commercial off-the-shelf (COTS) alternatives for faster deployment. NIRLAB is projected to contribute approximately $1 million in revenue per quarter in the second half, serving as a blueprint for future recurring software-as-a-service revenue across the portfolio. The acquisition of NIRLAB for $13.5 million marks a pivot toward a recurring revenue mix, with subscriptions accounting for roughly 50% of the NIRLAB product's total value. Gross margins benefited from a favorable shift in channel mix toward U.S. state and local placements, which carry lower channel costs than international sales. A reduction in mass spec service revenue acted as a headwind to recurring revenue growth, which grew 4% compared to the 23% overall revenue increase. The Department of Defense's shift toward procurement reform may favor the commercial MX908 over custom-developed solutions, potentially altering the long-term economic profile of the AVCAD program. One stock. Nvidia-level potential. 30M+ investors trust Moby to find it first. Get the pick. Tap here. Management confirmed they are seeing increased multi-system orders, particularly pairing FTIR products with MX908 for complete screening-to-confirmation workflows. The NIRLAB addition allows for specific bundling in drug enforcement where NIRLAB handles THC quantification that the MX908 cannot perform. The government is considering a hybrid path that includes commercial off-the-shelf (COTS) products like the MX908 to speed up warfighter deployments. Management maintains that the program remains a $10 million-plus long-term opportunity, regardless of whether they win via the Smiths Detection partnership or direct commercial sales. While currently at approximately 31%, management aspires to reach the high 30% to 40% range for recurring revenue as the NIRLAB subscription model scales. NIRLAB has demonstrated high retention with annual recurring revenue levels greater than 90% in early international deployments. Adjusted gross margins are expected to settle around 56% for the full year, slightly lower than the Q2 peak of 57%. Second-half margins will be tempered by the $6 million ProtectIR order (which carries high-volume international discounting) and the initial scaling of NIRLAB's hardware.

Interested in 908 Devices Inc.? Here are five stocks we like better. Second-quarter revenue rose 23% to $16.1 million, driven by U.S. state and local government demand, FTIR shipments and the NIRLab acquisition. The company shipped 198 devices, expanding its installed base to 4,101. Profitability improved, with gross margin increasing to 52% and adjusted EBITDA loss narrowing by more than half to $1.9 million. 908 Devices ended the quarter with $101.5 million in cash and marketable securities and no debt. The company raised its 2026 revenue outlook to $68 million-$70 million and expects a recently won $6 million ProtectIR order to contribute in the second half. Potential upside from the U.S. military’s AVCAD program remains excluded from guidance because its timing is uncertain. 908 Devices (NASDAQ:MASS) reported second-quarter revenue growth of 23% as demand from U.S. state and local government customers, FTIR product shipments and its recently acquired NIRLab platform supported results. The company also raised the low end of its full-year revenue outlook while continuing to exclude potential revenue from the U.S. military’s AVCAD program from its core guidance. Revenue for the quarter ended June 30 totaled $16.1 million, up from $13.0 million a year earlier. Handheld product and service revenue increased 24% to $15.5 million, driven primarily by FTIR products, including more than 35 VipIR shipments, and NIRLab law-enforcement revenue. The company shipped 198 devices during the quarter, bringing its installed base to 4,101 devices. → SoundHound AI Sends a Loud Signal After Its Q2 Earnings Beat Chief Executive Officer and Co-Founder Kevin Knopp said U.S. state and local customers accounted for more than half of quarterly revenue. He attributed demand to continued funding support for modernizing detection capabilities amid concerns around fentanyl, synthetic drugs and chemical hazards. Gross profit rose to $8.3 million from $6.4 million in the prior-year quarter, while gross margin increased to 52% from 49%. Adjusted gross margin was 57%, up about 85 basis points year over year. → 3 Dividend Champion Utilities for a Market That Can't Sit Still Chief Financial Officer Joe Griffith said the margin improvement reflected higher product revenue, lower facility costs following the company’s 2025 Boston facility move and a channel mix shift toward U.S. state and local placements, which carry lower channel costs than international placements. Those benefits were partly offset by lower service gross margin associated with reduced mass spectrometry service revenue. Total operating expenses declined slightly to $21.2 million from $21.5 million. The decrease reflected lower contingent-consideration fair-value adjustments, reduced facility costs and lower research-and-development program spending, partially offset by NIRLab operating costs and acquisition-related transaction costs. → Take-Two’s Q1 Results Leave GTA 6 Bulls Stuck in the Fog of War Net loss from continuing operations narrowed to $11.9 million from $12.9 million a year earlier. Adjusted EBITDA loss improved to $1.9 million from $3.9 million, which Knopp characterized as a reduction of more than 50%. The company ended the quarter with $101.5 million in cash equivalents and marketable securities and no debt. Cash consumed during the quarter was $10.2 million, primarily reflecting $13.5 million used for the NIRLab acquisition, partly offset by $3.5 million received from the release of escrow related to the desktop divestiture to Repligen. Knopp said the company has shipped more than 750 FTIR devices over the past 24 months. VipIR, its newest FTIR product, shipped more than 35 units during the second quarter, and 908 Devices said it expects to ship more than 100 units for the full year. Among the quarter’s wins, a South Asian law-enforcement agency purchased more than 15 VipIR units after a trial, displacing an incumbent competitor. The Bureau of International Narcotics and Law Enforcement Affairs also ordered its first VipIR unit to support narcotics interdiction in Mexico using U.S. State Department funding. The Texas Department of Criminal Justice purchased 15 MX908 devices for corrections facilities statewide after a two-device trial with the Texas Office of Inspector General. Knopp said the company expects additional orders could follow as the program’s results become more visible across Texas. Following the quarter, 908 Devices secured a $6 million ProtectIR order in July from a corrections agency in the Asia-Pacific region. Griffith said the order is expected to be recognized across the third and fourth quarters as devices are built and shipped. He added that the opportunity had been anticipated in the company’s pipeline but was larger than its initial expectations. Separately, the company said XplorIR placements increased nearly 70% over the 12 months ended June 30. The Danish Defence Acquisition and Logistics Organisation selected XplorIR for long-range chemical detection, with an initial multi-unit procurement and a framework agreement for potential future purchases. 908 Devices acquired NIRLab on May 6, adding a cloud-connected, near-infrared spectroscopy platform designed for drug identification. Knopp said the product complements the company’s MX908 and VipIR offerings by supporting a workflow from screening to confirmatory analysis. In roughly two months after the acquisition closed, the company engaged 30 agencies and hundreds of prospects across federal, state and local markets through demonstrations and field evaluations. The outreach included seven HIDTA task forces. More than 35 NIRLab devices were sold during that period, each with a multi-year software subscription, with shipments to law-enforcement agencies in Colorado and California and customs agencies in Morocco and Iceland. Management sees the platform as an opportunity to expand recurring revenue and address demand for alternatives to colorimetric drug test kits. Knopp noted that Colorado voted to prohibit custodial arrests based solely on colorimetric results and said reform efforts were underway in at least seven other states. Recurring revenue totaled $4.9 million, or 31% of total revenue, up 4% from a year earlier. Griffith said the company’s recurring revenue mix may fluctuate with device sales but that management aspires to move into the 30% range and toward 40% over time. He said NIRLab’s model includes approximately $10,000 for the device and about $5,000 annually for subscriptions at nominal list prices, with recurring revenue representing about 50% of the product’s opportunity. 908 Devices raised the low end of its 2026 revenue guidance and now expects full-year revenue of $68 million to $70 million, representing growth of 21% to 25% over 2025. The outlook calls for handheld product and service revenue of $65 million to $67 million, or growth of 23% to 27%, while OEM and funded partnerships, including contract revenue, are still expected to contribute approximately $3 million. The company maintained its expectation for adjusted gross margin in the mid- to high-50% range and for an adjusted EBITDA loss in the mid-single-digit millions for the full year. Management excluded the AVCAD program from core guidance because the current U.S. military contract has run its course and the government is evaluating next steps. Knopp said the Department of War is considering commercially available products alongside the existing development path with Smiths Detection as part of procurement reforms intended to increase speed and flexibility. Knopp said 908 Devices believes it can compete for the opportunity either through its Smiths Detection partnership or directly through the commercial MX908 platform. Management continues to view AVCAD as a long-term opportunity of more than $10 million, though the timing of any revenue ramp remains uncertain. 908 Devices Inc (NASDAQ: MASS) is a developer and manufacturer of portable analytical instruments designed to deliver rapid chemical detection in field and laboratory environments. The company's core focus lies in miniaturizing high-performance mass spectrometry and ion mobility spectrometry technologies, enabling users to perform on-site analysis that traditionally required benchtop equipment. Key products in 908 Devices' portfolio include the MX908, a handheld high-resolution mass spectrometer capable of detecting and identifying a broad range of chemicals and explosives; the M908 portable mass spectrometer for laboratory or mobile units; and the ZipChip capillary electrophoresis system for high-throughput, microfluidic separations. This instant news alert was generated by narrative science technology and financial data from MarketBeat in order to provide readers with the fastest reporting and unbiased coverage. Please send any questions or comments about this story to [email protected]. The article "908 Devices Q2 Earnings Call Highlights" was originally published by MarketBeat. View MarketBeat's top stocks for August 2026.

Revenue increased 23% compared to prior year Updated full year 2026 outlook reflects 21% to 25% year-over-year growth BURLINGTON, Mass., August 11, 2026--(BUSINESS WIRE)--908 Devices Inc. (Nasdaq: MASS), a core small-cap growth company focused on purpose-built handheld chemical analysis tools for vital health, safety, and defense tech applications, today reported financial results for the quarter ended June 30, 2026. "We delivered another strong quarter, growing revenue 23% year-over-year, while narrowing our Adjusted EBITDA loss by more than half compared to a year ago," said Kevin J. Knopp, CEO and Co-founder. "Our momentum with U.S. state and local customers remained particularly strong, representing more than half of our revenue, as agencies modernize to address today's threats and hazards. Our newest FTIR product, VipIR, is leading that charge, and we surpassed our 100th unit shipped since launch. With the same commercial channel behind that momentum, we are now introducing NIRLab to the U.S. market. In just our first 60 days since deal close, we have engaged hundreds of prospects nationwide across more than 30 agencies. With a robust pipeline of opportunities, we are confident in our team's ability to deliver, and we remain committed to the disciplined execution of our strategy." Recent Highlights Revenue of $16.1 million for the second quarter of 2026, increasing 23% year-over-year Recurring revenue was $4.9 million, representing 31% of total revenues for the quarter Gross margin was 52% and adjusted gross margin was 57% for the second quarter of 2026, an 85-basis point improvement in adjusted gross margin compared to the second quarter of 2025 Net loss from continuing operations was $11.9 million and Adjusted EBITDA loss was $1.9 million for the second quarter of 2026, a reduction of more than 50% year-over-year Ended the quarter with a strong balance sheet, with a cash position of $101.5 million Shipped more than 35 VipIR chemical identification devices in the quarter, including 18 units to a major South Asia law enforcement agency Subsequent to quarter end, secured a $6 million ProtectIR order from a corrections agency in the Asia-Pacific region, further supporting our second-half revenue outlook Second Quarter 2026 Financial Results Revenue was $16.1 million for the three months ended June 30, 2026, a 23% increase over the prior year period, driven by an increase in product revenue for VipIR and the addition of NIRLab revenue. The installed base grew 23% year-over-year to 4,101 devices, with 198 devices placed during the second quarter. Recurring revenue represented 31% of total revenues in the quarter. Gross profit was $8.3 million for the second quarter of 2026, compared to $6.4 million for the corresponding period in the prior year. GAAP gross margin was 52% as compared to 49% for the corresponding prior year period. Adjusted gross profit was $9.2 million for the second quarter of 2026, compared to $7.3 million for the corresponding period in the prior year. Adjusted gross margin was 57%, as compared to 56% for the corresponding prior year period. The increase in adjusted gross margin percentage was primarily driven by higher product revenues, including a shift in channel mix. Operating expenses were $21.2 million for the second quarter of 2026, compared to $21.5 million for the corresponding prior year period. The decrease of $0.3 million includes a noncash decrease of $0.3 million related to a change in the fair value of the contingent consideration liability. Net loss from continuing operations was $11.9 million for the second quarter of 2026, compared to a net loss from continuing operations of $12.9 million for the corresponding prior year period. Adjusted EBITDA was a loss of $1.9 million for the second quarter of 2026, compared to a loss of $3.9 million for the corresponding period in the prior year. Net loss attributable to common stockholders was $11.9 million for the second quarter of 2026, compared to $13.3 million for the corresponding prior year period. Cash, cash equivalents and marketable securities were $101.5 million as of June 30, 2026, with no debt outstanding. In the second quarter of 2026, $13.5 million of cash and cash equivalents were used for the acquisition of NIRLAB SA and $3.5 million was received from the release of the escrow from the desktop divestiture. 2026 Guidance 908 Devices updates its full year revenue guidance range to $68.0 million to $70.0 million (from $67.0 million to $70.0 million previously), raising the low end of the range and representing 21% to 25% growth compared to 2025 revenue. Webcast Information 908 Devices will host a conference call to discuss the second quarter 2026 financial results before market open on Tuesday, August 11, 2026 at 8:30 am Eastern Time. A webcast of the conference call can be accessed in the Investor Relations section of 908devices.com. The webcast will be archived and available for replay for at least 90 days after the event. About 908 Devices 908 Devices is revolutionizing chemical analysis with its simple handheld devices, addressing life-altering applications. The Company’s devices are used at the point-of-need to interrogate unknown and invisible materials and provide quick, actionable answers in vital health, safety and defense tech applications, addressing the fentanyl and illicit drug crisis, toxic carcinogen exposure, and global security threats. The Company designs and manufactures innovative products that bring together the power of complementary analytical technologies, software automation, and machine learning. For more information, visit www.908devices.com. Non-GAAP Measures of Financial Performance To supplement the Company’s financial statements, which are presented on the basis of U.S. generally accepted accounting principles (GAAP), the following non-GAAP measures of financial performance are included in this release and presented with detailed reconciliations to comparable GAAP financial results in the tables below: Adjusted gross profit is defined as gross profit excluding intangible amortization, acquisition and integration costs, restructuring charges (including the costs of severance), and non-cash expenses related to stock-based compensation. Adjusted gross margin is defined as adjusted gross profit expressed as a percentage of total revenue. Adjusted EBITDA is defined as net income (loss) from continuing operations excluding other income, benefit for income taxes, depreciation, intangible amortization, acquisition and integration costs, restructuring charges (including the costs of severance), non-cash expenses related to stock-based compensation, and costs associated with contingent consideration related to the Company’s acquisitions and for which the conditions for payment have not yet been achieved. The Company’s non-GAAP financial results presented in this earnings release exclude certain costs that management believes do not have a direct correlation to future business operations, nor do the resulting charges recorded accurately reflect the performance of ongoing operations for the period in which such charges are recorded, nor do the resulting charges recorded accurately reflect the anticipated cash flows of ongoing operations, and as such, excluding these costs allows management to understand and evaluate core operating performance and trends. However, as there are no standardized methods of calculating these non-GAAP financial measures, the Company’s methods may differ from those used by other companies in its industry, and accordingly, the use of these measures may not be directly comparable to similar measures used by others, thus limiting their usefulness for purposes of comparison. Furthermore, these non-GAAP measures have certain limitations since they do not include the impact of certain expenses and cash flows that are reflected in the Company’s GAAP financial results. Accordingly, when analyzing the Company’s operating performance and guidance, investors should not consider non-GAAP measures in isolation or as a substitute for, or superior to, comparable financial measures prepared in accordance with GAAP. Rather, the Company believes that these non-GAAP financial measures, when viewed in addition to and not in lieu of reported GAAP financial results, provide investors with additional meaningful information to assess financial performance and trends, enable comparison of financial results between periods, and allow for greater transparency with respect to key metrics utilized internally in analyzing and operating the Company’s business. Forward Looking Statements This press release includes "forward looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. All statements other than statements of historical facts are forward-looking statements, including, without limitation, statements regarding the Company’s future revenue and growth and future business prospects and market opportunities. Words such as "may," "will," "expect," "plan," "anticipate," "estimate," "intend" and similar expressions (as well as other words or expressions referencing future events, conditions or circumstances) are intended to identify forward-looking statements. These forward-looking statements are based on management’s current expectations and involve known and unknown risks, uncertainties and assumptions which may cause actual results to differ materially from any results expressed or implied by any forward-looking statement, including the risks outlined under "Risk Factors" and elsewhere in the Company’s filings with the Securities and Exchange Commission (SEC) which are available on the SEC's website at www.sec.gov. Additional information will be made available in our annual and quarterly reports and other filings that we make from time to time with the SEC. Although the Company believes that the expectations reflected in its forward-looking statements are reasonable, it cannot guarantee future results. The Company has no obligation, and does not undertake any obligation, to update or revise any forward-looking statement made in this press release to reflect changes since the date of this press release, except as may be required by law. 908 DEVICES INC.Condensed Consolidated Statements of Operations(in thousands, except share and per share amounts)(unaudited) 908 DEVICES INC.Condensed Consolidated Balance Sheets(in thousands)(unaudited) 908 DEVICES INC.Reconciliations of GAAP to Non-GAAP Financial Measures(Unaudited, amounts in thousands, except percentage and per share data)In all tables below, totals may not add due to rounding Reconciliation from Gross Profit (GAAP) to Adjusted Gross Profit (Non-GAAP) and Margin Percentage: Reconciliation from Net Loss from Continuing Operations (GAAP) to Adjusted EBITDA (Non-GAAP): View source version on businesswire.com: https://www.businesswire.com/news/home/20260811472580/en/ Contacts Investors and Media: Barbara [email protected]

Tactile Systems Technology (TCMD) came out with quarterly earnings of $0.34 per share, beating the Zacks Consensus Estimate of $0.14 per share. This compares to earnings of $0.14 per share a year ago. These figures are adjusted for non-recurring items. This quarterly report represents an earnings surprise of +142.86%. A quarter ago, it was expected that this medical device maker would post a loss of $0.07 per share when it actually produced a loss of $0.08, delivering a surprise of -14.29%. Over the last four quarters, the company has surpassed consensus EPS estimates three times. Tactile Systems Technology, which belongs to the Zacks Medical - Instruments industry, posted revenues of $85.7 million for the quarter ended June 2026, surpassing the Zacks Consensus Estimate by 0.19%. This compares to year-ago revenues of $78.9 million. The company has topped consensus revenue estimates four times over the last four quarters. The sustainability of the stock's immediate price movement based on the recently-released numbers and future earnings expectations will mostly depend on management's commentary on the earnings call. Tactile Systems Technology shares have added about 1.7% since the beginning of the year versus the S&P 500's gain of 13.3%. While Tactile Systems Technology has underperformed the market so far this year, the question that comes to investors' minds is: what's next for the stock? There are no easy answers to this key question, but one reliable measure that can help investors address this is the company's earnings outlook. Not only does this include current consensus earnings expectations for the coming quarter(s), but also how these expectations have changed lately. Empirical research shows a strong correlation between near-term stock movements and trends in earnings estimate revisions. Investors can track such revisions by themselves or rely on a tried-and-tested rating tool like the Zacks Rank, which has an impressive track record of harnessing the power of earnings estimate revisions. Ahead of this earnings release, the estimate revisions trend for Tactile Systems Technology was mixed. While the magnitude and direction of estimate revisions could change following the company's just-released earnings report, the current status translates into a Zacks Rank #3 (Hold) for the stock. So, the shares are expected to perform in line with the market in the near future. You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here. It will be interesting to see how estimates for the coming quarters and the current fiscal year change in the days ahead. The current consensus EPS estimate is $0.38 on $93.57 million in revenues for the coming quarter and $1.11 on $364.28 million in revenues for the current fiscal year. Investors should be mindful of the fact that the outlook for the industry can have a material impact on the performance of the stock as well. In terms of the Zacks Industry Rank, Medical - Instruments is currently in the bottom 40% of the 250 plus Zacks industries. Our research shows that the top 50% of the Zacks-ranked industries outperform the bottom 50% by a factor of more than 2 to 1. One other stock from the same industry, 908 Devices Inc. (MASS), is yet to report results for the quarter ended June 2026. The results are expected to be released on August 11. This company is expected to post quarterly loss of $0.14 per share in its upcoming report, which represents a year-over-year change of +22.2%. The consensus EPS estimate for the quarter has been revised 12.5% lower over the last 30 days to the current level. 908 Devices Inc.'s revenues are expected to be $15.18 million, up 16.5% from the year-ago quarter. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Tactile Systems Technology, Inc. (TCMD) : Free Stock Analysis Report 908 Devices Inc. (MASS) : Free Stock Analysis Report This article originally published on Zacks Investment Research (zacks.com). Zacks Investment Research

Delcath Systems, Inc. (DCTH) came out with quarterly earnings of $0.07 per share, beating the Zacks Consensus Estimate of a loss of $0.16 per share. This compares to earnings of $0.07 per share a year ago. These figures are adjusted for non-recurring items. This quarterly report represents an earnings surprise of +143.75%. A quarter ago, it was expected that this company would post a loss of $0.01 per share when it actually produced a loss of $0.03, delivering a surprise of -200%. Over the last four quarters, the company has surpassed consensus EPS estimates two times. Delcath Systems, which belongs to the Zacks Medical - Instruments industry, posted revenues of $29.13 million for the quarter ended June 2026, surpassing the Zacks Consensus Estimate by 15.88%. This compares to year-ago revenues of $24.16 million. The company has topped consensus revenue estimates two times over the last four quarters. The sustainability of the stock's immediate price movement based on the recently-released numbers and future earnings expectations will mostly depend on management's commentary on the earnings call. Delcath Systems shares have added about 25.1% since the beginning of the year versus the S&P 500's gain of 12.8%. While Delcath Systems has outperformed the market so far this year, the question that comes to investors' minds is: what's next for the stock? There are no easy answers to this key question, but one reliable measure that can help investors address this is the company's earnings outlook. Not only does this include current consensus earnings expectations for the coming quarter(s), but also how these expectations have changed lately. Empirical research shows a strong correlation between near-term stock movements and trends in earnings estimate revisions. Investors can track such revisions by themselves or rely on a tried-and-tested rating tool like the Zacks Rank, which has an impressive track record of harnessing the power of earnings estimate revisions. Ahead of this earnings release, the estimate revisions trend for Delcath Systems was mixed. While the magnitude and direction of estimate revisions could change following the company's just-released earnings report, the current status translates into a Zacks Rank #3 (Hold) for the stock. So, the shares are expected to perform in line with the market in the near future. You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here. It will be interesting to see how estimates for the coming quarters and the current fiscal year change in the days ahead. The current consensus EPS estimate is -$0.29 on $25.75 million in revenues for the coming quarter and -$0.88 on $103.46 million in revenues for the current fiscal year. Investors should be mindful of the fact that the outlook for the industry can have a material impact on the performance of the stock as well. In terms of the Zacks Industry Rank, Medical - Instruments is currently in the bottom 37% of the 250 plus Zacks industries. Our research shows that the top 50% of the Zacks-ranked industries outperform the bottom 50% by a factor of more than 2 to 1. 908 Devices Inc. (MASS), another stock in the same industry, has yet to report results for the quarter ended June 2026. The results are expected to be released on August 11. This company is expected to post quarterly loss of $0.14 per share in its upcoming report, which represents a year-over-year change of +22.2%. The consensus EPS estimate for the quarter has been revised 12.5% lower over the last 30 days to the current level. 908 Devices Inc.'s revenues are expected to be $15.18 million, up 16.5% from the year-ago quarter. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Delcath Systems, Inc. (DCTH) : Free Stock Analysis Report 908 Devices Inc. (MASS) : Free Stock Analysis Report This article originally published on Zacks Investment Research (zacks.com). Zacks Investment Research

The market expects 908 Devices Inc. (MASS) to deliver a year-over-year increase in earnings on higher revenues when it reports results for the quarter ended June 2026. This widely-known consensus outlook is important in assessing the company's earnings picture, but a powerful factor that might influence its near-term stock price is how the actual results compare to these estimates. The earnings report, which is expected to be released on August 11, might help the stock move higher if these key numbers are better than expectations. On the other hand, if they miss, the stock may move lower. While management's discussion of business conditions on the earnings call will mostly determine the sustainability of the immediate price change and future earnings expectations, it's worth having a handicapping insight into the odds of a positive EPS surprise. This company is expected to post quarterly loss of $0.14 per share in its upcoming report, which represents a year-over-year change of +22.2%. Revenues are expected to be $15.18 million, up 16.5% from the year-ago quarter. The consensus EPS estimate for the quarter has been revised 12.5% lower over the last 30 days to the current level. This is essentially a reflection of how the covering analysts have collectively reassessed their initial estimates over this period. Investors should keep in mind that an aggregate change may not always reflect the direction of estimate revisions by each of the covering analysts. Price, Consensus and EPS Surprise Estimate revisions ahead of a company's earnings release offer clues to the business conditions for the period whose results are coming out. This insight is at the core of our proprietary surprise prediction model -- the Zacks Earnings ESP (Expected Surprise Prediction). The Zacks Earnings ESP compares the Most Accurate Estimate to the Zacks Consensus Estimate for the quarter; the Most Accurate Estimate is a more recent version of the Zacks Consensus EPS estimate. The idea here is that analysts revising their estimates right before an earnings release have the latest information, which could potentially be more accurate than what they and others contributing to the consensus had predicted earlier. Thus, a positive or negative Earnings ESP reading theoretically indicates the likely deviation of the actual earnings from the consensus estimate. However, the model's predictive power is significant for positive ESP readings only. A positive Earnings ESP is a strong predictor of an earnings beat, particularly when combined with a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold). Our research shows that stocks with this combination produce a positive surprise nearly 70% of the time, and a solid Zacks Rank actually increases the predictive power of Earnings ESP. Please note that a negative Earnings ESP reading is not indicative of an earnings miss. Our research shows that it is difficult to predict an earnings beat with any degree of confidence for stocks with negative Earnings ESP readings and/or Zacks Rank of 4 (Sell) or 5 (Strong Sell). For 908 Devices, the Most Accurate Estimate is lower than the Zacks Consensus Estimate, suggesting that analysts have recently become bearish on the company's earnings prospects. This has resulted in an Earnings ESP of -7.14%. On the other hand, the stock currently carries a Zacks Rank of #3. So, this combination makes it difficult to conclusively predict that 908 Devices will beat the consensus EPS estimate. Analysts often consider to what extent a company has been able to match consensus estimates in the past while calculating their estimates for its future earnings. So, it's worth taking a look at the surprise history for gauging its influence on the upcoming number. For the last reported quarter, it was expected that 908 Devices would post a loss of$0.15 per share when it actually produced a loss of -$0.15, delivering no surprise. Over the last four quarters, the company has beaten consensus EPS estimates just once. An earnings beat or miss may not be the sole basis for a stock moving higher or lower. Many stocks end up losing ground despite an earnings beat due to other factors that disappoint investors. Similarly, unforeseen catalysts help a number of stocks gain despite an earnings miss. That said, betting on stocks that are expected to beat earnings expectations does increase the odds of success. This is why it's worth checking a company's Earnings ESP and Zacks Rank ahead of its quarterly release. Make sure to utilize our Earnings ESP Filter to uncover the best stocks to buy or sell before they've reported. 908 Devices doesn't appear a compelling earnings-beat candidate. However, investors should pay attention to other factors too for betting on this stock or staying away from it ahead of its earnings release. Stay on top of upcoming earnings announcements with the Zacks Earnings Calendar. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report 908 Devices Inc. (MASS) : Free Stock Analysis Report This article originally published on Zacks Investment Research (zacks.com). Zacks Investment Research

Our analysts just identified a stock with the potential to be the next Nvidia. Tell us how you invest and we'll show you why it's our #1 pick. Tap here. Revenue growth of 14% was primarily driven by sustained demand from U.S. state and local customers, which accounted for approximately 50% of total first-quarter revenue. The acquisition of NIRLAB AG expands the company's addressable market by $200 million, targeting a high-volume, sub-$40,000 price point for frontline narcotics detection. Management is executing a 'full stack' narcotics strategy, spanning from routine screening with NIRLAB to trace-level confirmatory analysis with the flagship MX908. The integration of RedWave FTIR products continues to scale effectively, with cumulative revenue exceeding $37 million over two years, validating the company's M&A integration playbook. Operational discipline led to a 45% reduction in adjusted EBITDA loss year-over-year, supported by a streamlined cost structure and reduced facility expenses. The shift in channel mix toward domestic sales and higher product volumes contributed to a 290 basis point expansion in adjusted gross margin. Full-year 2026 revenue guidance was raised to $67 million–$70 million, reflecting the inclusion of approximately $2.5 million from the NIRLAB acquisition. Management expects NIRLAB to be accretive to the recurring revenue mix, targeting more than $5 million in revenue from the unit in 2027 with positive EBITDA contribution. The AVCAD program is anticipated to contribute $2 million–$3 million in the second half of 2026, supported by a recent Department of War fiscal year 2027 request to Congress. The passage of the Department of Homeland Security funding bill is expected to provide a tailwind for federal and state-level pipeline conversion in the second half of the year. Strategic focus remains on scaling the 'Team Leader' software ecosystem to drive higher lifetime customer value through cloud-connected AI analytics and subscriptions. A $3.9 million non-cash charge related to the revaluation of contingent consideration impacted net loss but did not affect adjusted EBITDA or cash position. The NIRLAB acquisition includes a $15 million upfront payment ($13 million cash, $2 million equity) with up to $8 million in performance-based milestones. Management identified a market shift away from traditional colorimetric field tests due to accuracy concerns, creating a replacement cycle opportunity for electronic detection tools. The company added Kola Otitoju as Chief Business and Strategy Officer to drive organic and inorganic growth initiatives, bringing experience from over 15 M&A transactions at Repligen. One stock. Nvidia-level potential. 30M+ investors trust Moby to find it first. Get the pick. Tap here. Management plans to leverage its existing U.S. commercial infrastructure to accelerate NIRLAB's penetration in North America, where it currently has minimal presence. The acquisition is expected to have minimal cash burn in 2026 due to upfront multi-year software subscription commitments. After shipping 25 units in Q1, management expects to double or triple the total placements seen in 2025 by the end of the year. The product is gaining traction by combining FTIR and Raman technologies to provide higher confidence in identifying unknown substances. NIRLAB brings a high-retention model with over 99% annual retention and a 50% recurring revenue mix. The subscription model for NIRLAB involves a roughly $10,000 device with a recurring annual software fee of approximately $5,000. Management noted that while state and local demand remained strong early in the year, the finalized DHS funding supports larger pipeline opportunities for the second half of 2026. International conflicts are also cited as a long-term driver for modernization and demand for handheld detection technologies.