Lantronix reported fiscal Q1 2027 revenue of $32.4 million, up more than 8% year over year, and non-GAAP net income of $2.2 million, up 50%, with a non-GAAP gross margin of 45.3%.

The company reaffirmed its expectation of double-digit revenue growth for fiscal 2027 and forecast revenue of $32.5 million to $34.5 million and non-GAAP net income of $1.8 million to $2.7 million, or $0.04 to $0.06 per share, for the quarter ending December 31, 2026.

Embedded IoT Solutions revenue rose 37% year over year, supported by demand for unmanned systems, while design wins in commercial surveying and jobsite security pointed to opportunities beyond drones and defense.

IoT System Solutions revenue declined sequentially to $14.1 million from $15.3 million, partly because substantial shipments to a leading Tier 1 mobile-network operator had wound down; management cited improving networking and enterprise-AI demand.

Lantronix completed its acquisition of Nero Global Tracking, bringing software and services to more than 10% of pro forma revenue; the company paid approximately $10.3 million, with a final $1.3 million payment expected before the end of December 2026.

The company had fiscal 2027 purchase orders from 29 drone customers, including 14 outside North America, but cautioned that orders and revenue timing follow customer program and deployment schedules.

Lantronix added its Open-Q 8550CS system-on-module to the Blue UAS Framework, a vetted listing the company said can simplify customer qualification for unmanned aircraft programs.

Lantronix launched Spotter, a low-power board combining edge AI computing, vision processing, sensor fusion and flight control; customer evaluations are expected, with shipments planned by the end of calendar 2026.

The company also launched MediaTek-based system-on-modules delivering 10 TOPS of AI performance at under four watts, and introduced the FOX5 Edge-to-Cloud serial gateway for remote monitoring and predictive maintenance.

Beyond drones, Lantronix pointed to opportunities in counter-drone systems, industrial and commercial computer vision, construction, robotics and edge AI, as well as demand for out-of-band management in AI infrastructure.

Lantronix held approximately $51.5 million in cash, cash equivalents and short-term marketable securities as of September 30, 2026; inventory increased from about $26 million in June to $31 million as the company prepared for longer component lead times and anticipated demand.

Management flagged industry-wide memory availability and pricing pressure tied to AI infrastructure and data-center demand, alongside risks involving inventory, softer sequential IoT System Solutions revenue, customer deployment timing and execution on new products.