CSP (CSPI) Q2 2026 earnings summary

Executive summary

• Achieved revenue growth of 21.8%–30% year-over-year in Q2 FY2026, reaching $16.0 million, driven by strong U.S. Technology Solutions and increased AZT PROTECT deployments.

• Net income for Q2 FY2026 was $264,000 ($0.03/share), reversing a prior-year loss, with operating loss narrowing to $0.9 million.

• AZT PROTECT deployments doubled year-over-year, with multi-site contracts signed, including a global cement manufacturer and over 60 unique clients.

• Managed cloud and service practices grew 11% year-over-year, supported by new MSP customers and high retention rates.

• Board declared a quarterly dividend of $0.03/share, payable June 15, 2026.

Financial highlights

• Product revenue rose 30% to $11.1 million; service revenue increased 6.6% to $4.9 million; gross profit was $4.5 million, with gross margin at 27.9%–28% (down from 32%).

• Six-month revenue was $28.0 million (down from $28.8 million), with net income of $355,000 ($0.04/share).

• Cash and cash equivalents at quarter-end were $23.1 million.

• Operating cash flow for the six months was negative $3.4 million, compared to positive $3.7 million prior year.

• HPP segment sales declined 46% year-over-year, while its gross margin improved to 50% for the quarter.

Outlook and guidance

• Management expects continued top and bottom line growth for the second half of FY2026 and full-year growth over FY2025.

• Revenue from the Acronis OEM partnership is expected to begin by fiscal year-end.

• Liquidity is expected to remain sufficient for at least 12 months.