NanoXplore (GRA) Q3 2026 earnings summary

Executive summary

• Q3 2026 revenue reached CAD 32.3 million, up 6% year-over-year and 17% sequentially, with adjusted gross margin at 22.9% and adjusted EBITDA at CAD 1.2 million, all showing sequential and year-over-year improvement on a normalized basis, excluding prior year one-time items.

• Growth was driven by steady volumes from the Club Car launch, recovery in transportation, Tribograf lubricant sales, and full-quarter contributions from major customers, with momentum expected to accelerate due to graphene and graphene-enhanced solutions.

• The dry graphene manufacturing process is operational, with commercial material qualification expected in Q4 and customer orders to be fulfilled in fiscal 2027; the xGnPTM D-500HP product was launched targeting the CAD 3+ billion conductive carbon additives market.

• CAD 50 million in business wins for the solutions business, with CAD 15 million launched and the remaining CAD 35 million ramping over 18 months, providing clear line of sight to free cash flow generation.

• Loss widened to CAD 2.65 million from CAD 1.75 million year-over-year, while adjusted EBITDA declined to CAD 1.18 million from CAD 1.42 million.

Financial highlights

• Q3 2026 revenue increased 6% year-over-year to CAD 32.3 million, mainly from new Club Car program, CPChem contract shipments, and higher tooling revenues, partly offset by lower government grants and customer volumes.

• Adjusted gross margin rose to 22.9%, up 50 basis points from last year, limited by a higher mix of lower-margin tooling revenues.

• Adjusted EBITDA was CAD 1.2 million, down CAD 240,000 year-over-year due to a one-time CAD 550,000 grant last year; excluding this, adjusted EBITDA would have been CAD 350,000 higher.

• Cash at quarter-end was CAD 24.4 million, with total liquidity of CAD 34.4 million; operating cash flow was CAD -3.5 million due to increased working capital.

• Long-term debt increased to CAD 16.1 million, up CAD 11.8 million from June 30, 2025.

Outlook and guidance

• Fiscal 2026 revenue guidance reaffirmed at CAD 115-120 million.

• Gross margins expected to improve by at least 50 basis points sequentially in Q4, with further increases into fiscal 2027 as new programs ramp up.

• CapEx to reduce to less than CAD 1 million per quarter after current projects are completed, excluding new initiatives.

• Management expects to build on recent momentum, focusing on expanding dry-process graphene and graphene-enhanced solutions.

• Anticipated receipt of $500,000-$700,000 in IEEPA tariff refunds in coming months.