Enovix revenue rises 38% to $11 million, beating third-quarter guidance
Key Facts
Enovix reported preliminary unaudited revenue of $11.0 million for the third quarter of 2026, up 38% from the same quarter a year earlier. Sales exceeded the company's quarterly guidance range of $9 million to $10 million, according to its preliminary results statement. Drone and defense customers accounted for about 70% of quarterly revenue, representing the largest share of the company's sales during the period. Enovix had reported second-quarter revenue of $9.0 million, up 21% year on year, according to that quarter's earnings statement. Sales thus rose from the previous quarter, while annual growth accelerated alongside the substantial contribution from drone and defense customers.
The combined pipeline of drone, defense and industrial business opportunities stood at about $216 million in the third-quarter update, according to the company. That combined pipeline was valued at about $183 million at the end of the second quarter, according to the previous earnings statement. Drone opportunities alone grew 48% to about $150 million within the pipeline, which also includes defense and industrial applications. Enovix defines the pipeline as an "estimate of peak annual production value for identified design opportunities," the definition it uses to assess business opportunities. The company said pipeline and design-win values do not represent customer purchase orders, backlog or committed revenue.
Despite sales growth and revenue exceeding guidance, the preliminary third-quarter operating loss under U.S. GAAP was about $39.3 million, according to Enovix. The adjusted operating loss was $29.2 million, according to Benzinga's report on the company's financial update. The adjusted loss was within Enovix's guidance range of $29 million to $32 million and near its lower end. In the previous quarter, operating activities used net cash of $21.8 million, according to the second-quarter earnings statement. The U.S. GAAP gross margin for that quarter was 14.4%, among the financial results preceding the preliminary third-quarter revenue and loss update.
On defense procurement, Enovix announced that its portfolio of batteries for drones and defense, manufactured in South Korea, complies with the U.S. Trade Agreements Act. The company said this compliance supports its ability to serve the government defense programs it is targeting with these batteries. Enovix believes demand for high-performance batteries meeting U.S. government procurement requirements "could materially exceed available supply through the end of the decade." Its Korean operations produce batteries using silicon-blended graphite anodes, according to the company's plant expansion statement. These products belong to a platform distinct from the silicon-anode battery platform Enovix is developing for phones and smart glasses.
To increase production capacity, Enovix is investing $19 million to expand its Korean plant, according to its update. The investment aims to double the plant's capacity as its pipeline of business opportunities in targeted applications expands. The expansion relies on land and buildings already owned by Enovix, rather than requiring the purchase of these assets. The plan also includes using available production equipment, and the company said using existing assets and equipment is intended to reduce the expansion's capital intensity. Enovix expects the additional production capacity in South Korea to come online in mid-2027, according to its announced project timetable.
The operational and financial update comes during a leadership transition at Enovix following Raj Talluri's resignation as chief executive officer and a board member. The resignation took effect on August 13, 2026, and the company said Talluri left to pursue another opportunity. The board appointed Chief Financial Officer Ryan Benton as interim chief executive while searching for a permanent CEO among internal and external candidates. As part of the leadership reorganization, the company promoted Steve Bakos to chief revenue officer and general manager, according to Benzinga. Enovix expects to announce its full results and hold an earnings call around November 12, 2026, according to the timing it provided when publishing the preliminary update.