Exyn Technologies reported a substantial improvement in second-quarter gross margin despite lower revenue as a growing contribution from software and subscription sales shifted the company’s business mix toward higher-margin offerings.
Second-quarter revenue declined to $950,000 from $1.4 million in the prior-year period, down about 32%.
The decline reflected the timing of customer deployments and project revenue recognition.
Cost of revenue fell even faster, declining 37.4% to $504,000 from $806,000.
Gross profit was $445,000 compared with $552,000, while gross margin expanded to 46.9% from 40.6%, an improvement of 630 basis points.
Exyn said the higher margin reflected improved project mix and lower cost of revenue relative to sales.
Management also pointed to a growing contribution from higher-margin software and subscription revenue as the company works toward a more recurring, scalable revenue model.
ExynAI is a hardware-agnostic autonomy platform designed to enable robots to operate independently in GPS-denied, communications-contested and other complex environments.
The company can license its autonomy technology to third-party manufacturers through software development kits and APIs, potentially allowing Exyn to scale software revenue across hardware platforms it does not manufacture itself.
That strategy is increasingly being applied to defense markets.
Exyn recently rebranded its government operation as Exyn Defense and began the Green UAS certification process for its Nexys autonomous mapping platform.
It also entered the defense sustainment market through an agreement supporting autonomous aircraft inspection and digital-twin initiatives at the U.S. Air Force’s Warner Robins Air Logistics Complex.
Nexys was also selected by a U.S. government research and engineering organization following a competitive evaluation against commercial LiDAR systems.
During the first half, Exyn secured new contracts across mining, infrastructure and U.S. government markets on three continents, including work with the U.S. Army Corps of Engineers.
The improved gross margin has not yet translated into bottom-line profitability.
Net loss widened to $6.9 million from $2.9 million. Exyn ended June with approximately $7.8 million in cash, compared with $812,000 at the end of 2025 following its May IPO.
KEY QUOTE:
“While second-quarter revenue reflected the timing of customer deployments, we continued to increase the contribution of higher-margin software and subscription revenue, driving gross margin expansion and reinforcing our strategy of building a scalable, recurring revenue business.”
Ben Williams, Chief Operating Officer of Exyn Technologies
