Quantum Corporation reported fiscal Q2 FY2026 results that included $62.7 million in revenue, a GAAP net loss of $46.5 million, and a GAAP gross margin of 37.6 percent—down from 42.7 percent a year earlier but up from 35.3 percent sequentially. Non‑GAAP adjusted EBITDA turned positive at $0.5 million, while the non‑GAAP adjusted net loss per share was $‑0.54, missing the consensus estimate of $‑0.25 by $0.29.
Revenue fell 12 percent sequentially to $62.7 million from $64.3 million in Q1 FY2026 and 12 percent year‑over‑year to $71.8 million in Q2 FY2025. The decline reflects weaker demand for legacy hardware and a shift toward higher‑margin subscription services. Gross margin contraction from 42.7 percent to 37.6 percent YoY is offset by a 2.3‑percentage‑point sequential improvement, driven by cost‑control measures and a more favorable product mix.
Management highlighted a $5 million reduction in non‑GAAP operating expenses, a 6 percent sequential cut in operating costs, and a broader $5 million year‑over‑year expense reduction. These savings stem from the company’s restructuring program, which eliminated redundant platforms and streamlined supply‑chain operations, thereby supporting the margin expansion seen in the current quarter.
Guidance for fiscal Q3 FY2026 now projects revenue of $67 million, plus or minus $2 million, and adjusted EBITDA of $1 million, plus or minus $1 million—up from the prior guidance of $66 million and $1.7 million. The revised outlook reflects management’s confidence in continued demand for AI‑driven data‑management solutions and the expected benefits of the debt‑exchange transaction, which converts $52 million of term debt into senior secured convertible notes, reducing net leverage and averting a covenant violation slated for September 2025.
The market reacted negatively, with Quantum’s shares falling 9.22 percent after the announcement. Investors cited the EPS miss, year‑over‑year revenue decline, and margin contraction as primary concerns, despite the company’s positive adjusted EBITDA, growing backlog of over $25 million, and debt‑restructuring progress. The Altman Z‑Score of –8.54 underscores the company’s ongoing financial distress risk, tempering enthusiasm for the forward‑looking guidance.
CEO Hugues Meyrath emphasized that the quarter’s results demonstrate the early benefits of the company’s transformation from a legacy hardware business to a subscription‑based, high‑margin data‑management provider. CFO Laura Nash noted the sequential expense reductions and the positive EBITDA, while highlighting the need to continue scaling the new product portfolio. Meyrath also announced the appointment of Geoff Barrall as Chief Product Officer to oversee the product portfolio review, signaling a continued focus on streamlining platforms and improving pricing power.
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