Unusual Machines (UMAC) investor relations material

Executive summary

• Q1 2026 operating revenue reached $8.1 million, up 296% year-over-year and 65% sequentially, driven by B2B growth and new product manufacturing.

• Net profit for the quarter was $10.3 million, reversing a prior year loss and remaining profitable even excluding unrealized gains.

• Headcount increased from 81 to 141 during the quarter, now approaching 200 employees.

• Raised $150 million at $17/share in a public offering in March 2026, boosting working capital and liquidity.

• Signed a definitive agreement in May 2026 to acquire Upgrade Energy for up to $52 million, expanding into battery systems.

Financial highlights

• Gross margin for Q1 was 32.8%, up from 24.3% year-over-year, with gross profit at $2.7 million.

• Operating expenses rose to $9.9 million, including $4 million in non-cash and $1.7 million in non-recurring expenses.

• Net income included $7.3 million realized and $9.5 million unrealized gains from investments, plus $0.8 million interest income.

• Cash and cash equivalents at March 31, 2026, stood at $222.9 million; short-term investments exceeded $60 million.

• Inventory, including raw materials and finished goods, is $27.4 million and expected to rise with $75 million in planned purchases.

Outlook and guidance

• Demand is expected to outstrip supply through 2027, driven by government drone programs.

• Revenue is anticipated to grow sequentially each quarter, with no expected declines.

• Margins may fluctuate but are targeted to remain in the low 30% range as efficiency improves.

• Battery acquisition positions the company for future drone delivery markets, with regulatory changes expected by 2027.

• Manufacturing capacity and staffing are set to expand to meet rising demand.