Company Demonstrates Meaningful Progress on Strategic Transformation While Expanding Recurring Revenue Streams
ALPHARETTA, Ga., Aug. 27, 2026 /PRNewswire/ -- Mynd.ai, Inc. (the "Company" or "Mynd.ai") (NYSE American: MYND), a global leader in interactive technology solutions for education and enterprise, today reported financial results for the first half of 2026, highlighting continued progress on its operational transformation, improved profitability metrics, and strengthened liquidity flexibility.
The first half of 2026 reflected continued execution against Mynd.ai's operating transformation: stronger gross margin, materially lower operating expenses, improved Adjusted EBITDA, and reduced cash used to fund operations, while the Company continued to build recurring revenue through services and software-as-a-service ("SaaS"). Management believes these actions are creating a more efficient operating model and positioning the Company to pursue sustainable growth as market conditions improve.
Key highlights for the first half of 2026 compared with the first half of 2025:
-- Gross margin expanded 220 basis points to 24% from 22% in the prior-year
period
-- Total operating expenses reduced 35% to $31.5 million from $48.5 million
in the prior-year period
-- Net loss narrowed 30% to $20.2 million from $28.9 million in the
prior-year period
-- Adjusted EBITDA1 improved 52% to a loss of $9.1 million from a prior-year
loss of $19.0 million
-- Net cash used in operating activities improved 36%, or $14.8 million,
compared to the prior-year period
-- Free cash flow1 improved 36%, or $15.4 million, compared to the
prior-year period
-- Service and SaaS revenue grew year-over-year, demonstrating continued
momentum in recurring revenue streams despite lower total revenue in the
period
"Our first half results show that our structural transformation is delivering measurable progress," said Arthur Giterman, Chief Executive Officer and Chief Financial Officer. "Despite a challenging demand environment across the education technology sector, we expanded gross margins, reduced operating expenses by 35%, narrowed net loss by 30%, improved Adjusted EBITDA by 52%, and significantly reduced operating cash usage. We remain focused on disciplined execution, liquidity management, and continued growth in our SaaS and services businesses."
Strategic Updates
During the first half of 2026, the Company enhanced its financial flexibility through a strategic inventory financing arrangement with its majority shareholder, NetDragon Websoft Holdings Limited, providing access to up to $50.0 million in revolving inventory financing. As of the date of this release, approximately $25.7 million remained available under the facility. In April 2026, the Company fully paid off the Bank of America revolving facility and in July 2026, the Company finalized the termination of the facility, eliminating all associated obligations and guarantees and simplifying the Company's financing structure.
____________________________
(1) Non-GAAP financial measure. Reconciliations to the most directly
comparable U.S. GAAP financial measure are provided in "Supplemental
Financial Information" section below. Also see "Discussion of Non-GAAP
Financial Measures" below.
About Mynd.ai, Inc.
Alpharetta-based Mynd.ai is a global leader in interactive technology offering best-in-class hardware and software solutions that help organizations create and deliver dynamic content; simplify and streamline teaching, learning, and communication; and facilitate real-time collaboration. Our award-winning interactive displays and software can be found in more than 1 million learning and training spaces in over 125 countries. Our global distribution network of more than 1,000 reseller partners and our dedicated sales and support teams around the world enable us to deliver the highest level of service to our customers. Learn more at www.mynd.ai.
Forward-Looking Statements
This press release contains "forward-looking statements," within the meaning of Section 27A of the Securities Act of 1933, as amended and Section 21E of the Securities Exchange Act of 1934, as amended. Forward-looking statements reflect Mynd's current expectations and projections about future events at the time, and thus involve uncertainty and risk. The words "believe," "expect," "anticipate," "will, " "could," "would," "should," "may," "plan," "estimate," "intend," "predict," "potential," "continue," "optimistic," and the negatives of these words and other similar expressions generally identify forward looking statements. Such forward-looking statements are subject to various risks and uncertainties, including those described under the section entitled "Risk Factors" in Mynd's Annual Report on Form 20-F, filed with the Security and Exchange Commission ("SEC") on May 29, 2026, as such factors may be updated from time to time in Mynd's periodic filings with the SEC, which are accessible on the SEC's website at www.sec.gov and on the Company's website at www.mynd.ai. Accordingly, there are or will be important factors that could cause actual outcomes or results to differ materially from those indicated in these statements, including, but not limited to, statements regarding the Company's compliance plan, expected liquidity, anticipated cost savings, and future performance. While forward-looking statements reflect Mynd's good faith beliefs, they are not guarantees of future performance. Mynd.ai disclaims any obligation to publicly update or revise any forward-looking statement to reflect changes in underlying assumptions or factors, new information, data or methods, future events or other changes after the date of this press release, except as required by applicable law.
Discussion of Non-GAAP Financial Measures
We believe that providing the non-GAAP ("Generally Accepted Accounting Principles") information to investors, in addition to the GAAP presentation, allows investors to view the financial results in the way management views the operating results. We further believe that providing this information allows investors not only to better understand our financial performance, but more importantly, to evaluate the efficacy of the methodology and information used by management to evaluate and measure such performance. The non-GAAP information included in this press release should not be considered superior to, or a substitute for, financial statements prepared in accordance with GAAP.
We utilize a number of different financial measures, both GAAP and non-GAAP, in analyzing and assessing the overall performance of the business, for making operating decisions and for forecasting and planning for future periods. Our annual financial plan is prepared both on a GAAP and non-GAAP basis, and the non-GAAP annual financial plan is approved by our board of directors. Continuous budgeting and forecasting for revenue and expenses are conducted on a consistent non-GAAP basis, in addition to GAAP, and actual results on a non-GAAP basis are assessed against the non-GAAP annual financial plan. In addition, and as a consequence of the importance of these measures in managing the business, we use non-GAAP measures and results in the evaluation process to establish management's compensation. For example, our annual bonus program payments are based in part upon the achievement of consolidated revenue and Adjusted earnings before interest, taxes, depreciation and amortization ("EBITDA") targets.
Reconciliations with respect to the Non-GAAP figures included in this press release to such Non-GAAP figure's most comparable GAAP figure are included in the financial tables below.
Financial Tables Follow
Mynd.ai, Inc. UNAUDITED CONSOLIDATED BALANCE SHEETS (in thousands of U.S.
dollars, except share and per share data, or otherwise noted)
June 30, 2026 December 31, 2025
--------------------- ---------------------
ASSETS
Current assets:
Cash and cash equivalents,
including restricted cash
of $220 and $0,
respectively $ 7,040 $ 18,481
Accounts receivable, net of
allowance for credit
losses of $232 and $614,
respectively 26,630 24,849
Inventories 23,030 29,713
Prepaid expenses and other
current assets 8,120 7,971
Due from related parties 3,626 3,095
--------------------- ---------------------
Total current assets 68,446 84,109
Non-current assets:
Goodwill 44,622 44,961
Property, plant, and
equipment, net 9,801 11,767
Intangible assets, net 36,149 36,185
Right-of-use assets, net 1,938 2,073
Deferred tax assets, net 89 87
Other non-current assets 3,260 3,345
--------------------- ---------------------
Total non-current assets 95,859 98,418
Total assets 164,305 182,527
--------------------- ---------------------
LIABILITIES AND
SHAREHOLDERS' EQUITY
(DEFICIT)
Current liabilities:
Accounts payable 32,064 37,947
Accrued expenses and other
current liabilities 25,286 34,836
Loans payable, current -- 2,897
Contract liabilities,
current 12,062 12,272
Accrued warranties 13,696 15,918
Lease liabilities, current 896 1,011
Due to related parties 23,980 5,343
--------------------- ---------------------
Total current liabilities 107,984 110,224
Non-current liabilities:
Loans payable, non-current 64,261 61,083
Contract liabilities,
non-current 18,095 17,971
Lease liabilities,
non-current 1,652 1,751
Deferred tax liabilities 9,000 9,000
--------------------- ---------------------
Total non-current
liabilities 93,008 89,805
Total liabilities 200,992 200,029
--------------------- ---------------------
Shareholders' deficit:
Ordinary Shares par value of
$0.001; 990,000,000 shares
authorized. 475,122,370
shares issued and
471,446,050 shares
outstanding as of June 30,
2026; 465,868,720 shares
issued and 462,192,400
shares outstanding as of
December 31, 2025.
10,000,000 shares, $0.001
par value, without
designation; none
authorized, issued and
outstanding as of June 30,
2026 and December 31,
2025. 474 465
Treasury shares, at cost,
3,676,320 as of June 30,
2026 and December 31,
2025 (454) (454)
Additional paid-in capital 488,275 487,481
Accumulated other
comprehensive income 3,810 3,648
Accumulated deficit (528,792) (508,642)
--------------------- ---------------------
Total shareholders' deficit (36,687) (17,502)
Total liabilities and
shareholders' equity $ 164,305 $ 182,527
===================== =====================
Mynd.ai, Inc. UNAUDITED CONSOLIDATED STATEMENTS OF OPERATIONS (in
thousands of U.S. dollars, except share and per share data, or otherwise
noted)
Six Months Ended June 30,
--------------------------------------------
2026 2025
--------------------- ---------------------
Revenue $ 73,369 $ 89,272
Cost of revenue 55,831 69,884
--------------------- ---------------------
Gross profit 17,538 19,388
Operating expenses, net:
General and administrative 9,671 14,928
Research and development 4,888 7,782
Sales and marketing 15,941 21,399
Transaction-related costs -- 53
Restructuring and other
expenses 985 4,353
--------------------- ---------------------
Total operating expenses 31,485 48,515
--------------------- ---------------------
Operating loss (13,947) (29,127)
Other income (expense):
Interest expense (5,139) (4,913)
Interest income 30 637
(Loss) gain on embedded
derivative (22) 2,143
Other (expense) income (992) 2,409
--------------------- ---------------------
Total other (expense)
income (6,123) 276
--------------------- ---------------------
Net loss before income taxes (20,070) (28,851)
Income tax expense (80) (41)
--------------------- ---------------------
Net loss $ (20,150) $ (28,892)
===================== =====================
Net loss per share, basic
and diluted $ (0.04) $ (0.06)
===================== =====================
Weighted average shares
outstanding, basic and
diluted 469,301,078 456,872,902
Mynd.ai. Inc.
UNAUDITED CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS
(in thousands)
Six Months Ended June 30,
----------------------------------------
2026 2025
------------------- -------------------
Net loss $ (20,150) $ (28,892)
Other comprehensive loss, net
of tax of nil:
Change in foreign currency
translation reserve 162 256
------------------- -------------------
Total comprehensive loss $ (19,988) $ (28,636)
Mynd.ai, Inc.
UNAUDITED CONSOLIDATED STATEMENTS OF CASH FLOWS
(in thousands)
Six Months Ended June 30,
-----------------------------------------
2026 2025
-------------------- -------------------
CASH FLOWS FROM OPERATING
ACTIVITIES:
Net loss $ (20,150) $ (28,892)
Adjustments to reconcile net
loss to net cash used in
operating activities:
Depreciation and amortization 2,878 4,697
Deferred taxes -- (113)
Non-cash lease expense 565 766
Non-cash interest expenses 3,259 2,799
Loss (gain) on embedded
derivative 22 (2,143)
Share-based compensation 967 1,037
Amortization of RDEC credit (1,345) (1,005)
Net realizable value
adjustments to inventory 887 396
Changes in accounts receivable
provision 10 479
Other 53 24
Change in operating assets and
liabilities:
Accounts receivable (284) 1,030
Inventories 5,649 811
Prepaid expenses and other
assets 175 3,062
Due from related parties (556) (857)
Accounts payable (5,698) (5,075)
Accrued expenses and other
liabilities (9,824) (17,545)
Accrued warranties (2,126) (375)
Due to related parties -- 445
Contract liabilities 23 (129)
Lease obligations - operating
leases (945) (681)
-------------------- -------------------
Net cash used in operating
activities (26,440) (41,269)
-------------------- -------------------
CASH FLOWS FROM INVESTING
ACTIVITIES:
Acquisition of property, plant
and equipment (63) (33)
Internal-use software
development costs (833) (1,467)
-------------------- -------------------
Net cash used in investing
activities (896) (1,500)
-------------------- -------------------
CASH FLOWS FROM FINANCING
ACTIVITIES:
Repayment of Revolver (3,000) (11,000)
Proceeds from Revolver -- 8,000
Proceeds from related party
inventory financing agreement 18,637 --
Repayment of Paycheck
Protection Program Loan -- (82)
Share repurchase -- (110)
Taxes withheld and paid related
to net share settlement of
share-based compensation
awards (173) (49)
-------------------- -------------------
Net cash provided by (used in)
financing activities 15,464 (3,241)
-------------------- -------------------
Net change in cash, cash
equivalents, and restricted
cash (11,872) (46,010)
Cash, cash equivalents, and
restricted cash, beginning of
period 18,481 75,317
Exchange rate effects 431 (245)
Cash, cash equivalents and
restricted cash, end of
period $ 7,040 $ 29,062
==================== ===================
Supplemental disclosure of
non-cash investing and
financing transactions:
Lease assets acquired in
exchange for lease
liabilities $ 392 $ --
Forgiveness of related party
payables $ -- $ 5,217
Convertible notes issued in
exchange for accrued PIK
interest $ 1,789 $ 1,703
Supplemental disclosure of
cash transactions:
Cash paid for interest $ 3,397 $ 1,841
Cash (paid for taxes) received
for tax refunds, net $ (410) $ 1,450
Mynd.ai. Inc.
SUPPLEMENTAL FINANCIAL INFORMATION
Reconciliation of Adjusted EBITDA to Net Loss
Six Months Ended June 30,
----------------------------------------------
2026 2025
---------------------- ----------------------
(in thousands)
Net loss $ (20,150) $ (28,892)
Interest expense 5,139 4,913
Interest income (30) (637)
Income tax expense 80 41
Depreciation and
amortization 2,878 4,697
Share-based compensation 967 1,037
Loss (gain) on embedded
derivative 22 (2,143)
Other expense (income), net 992 (2,409)
Transaction-related costs -- 53
Restructuring and other
expenses (1) 985 4,353
---------------------- ----------------------
Adjusted EBITDA $ (9,117) $ (18,987)
====================== ======================
(1) Refers to employee severance costs, contract termination costs, facility
restructuring, and business restructuring efforts undertaken by management.
Reconciliation of Free Cash Flow to Net Cash Used in Operating Activities
Six Months Ended June 30,
----------------------------------------------
2026 2025
---------------------- ----------------------
(in thousands)
Net cash used in operating
activities $ (26,440) $ (41,269)
Internal-use software
development costs (833) (1,467)
Acquisition of property and
equipment, other than
internal-use software
development costs (63) (33)
---------------------- ----------------------
Free Cash Flow $ (27,336) $ (42,769)
====================== ======================
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