Lantronix NASDAQ: LTRX has repositioned its business around “edge intelligence” products that combine computing and connectivity, with aerospace and defense, critical-infrastructure monitoring and enterprise markets serving as its three primary verticals, President and CEO Saleel Awsare said during a Canaccord Genuity discussion.
Awsare, who has been with the company for about 2.5 years, said the aerospace and defense business is currently Lantronix’s fastest-growing vertical. The company is focused primarily on unmanned systems, including drones, while also pursuing opportunities involving ground systems, unmanned surface vessels and counter-drone applications.
Compute Platforms for Unmanned Systems
Lantronix supplies Open-Q system-on-modules, or SOMs, that Awsare described as the compute platform or “brains” used for cameras and computer-vision systems in drones. The modules can be incorporated into a drone’s payload, camera or gimbal, he said.
Awsare said Lantronix is NDAA and TAA certified and is “99.9% out of China” for its manufacturing, while noting that printed circuit boards still need to come from China and that the company is working on that issue. The company is expanding warehouse, testing and capacity operations in Plymouth, Minnesota, with the goal of increasing U.S.-based final testing and ultimately working toward U.S. country-of-origin status.
“Having a trusted supplier based in the United States, headquartered here with the software development happening in North America, is a big plus for us,” Awsare said.
He said Lantronix’s first lead drone customer was Red Cat’s Teal Drones unit, where the company is designed into the Teal Black Widow short-range reconnaissance drone. Lantronix began working with Red Cat in November 2024 and began first shipments in July 2025, according to Awsare.
The transition from development kits to production can take as little as six to eight months or as long as 12 to 18 months, depending on the customer’s progression from low-rate initial production to volume production, he said.
Lantronix has also introduced a Drone Reference Platform, intended to provide equipment for camera, computer-vision and flight-control development. Awsare said the company expects to announce a second version of the platform and is awaiting final Department of War approval for Blue UAS certification for its SOMs.
Edge AI and Drone Dominance Opportunity
Awsare said edge computing is increasingly important for unmanned systems that must operate in GPS-denied or communications-constrained environments. Lantronix’s modules can run third-party models locally, allowing devices to analyze data and make decisions without relying on cloud connectivity, he said.
He said the company is working with multiple vendors participating in the government’s Drone Dominance Program. While earlier program phases involved less sophisticated drones, Awsare said Lantronix expects its strongest opportunity to be in a later phase requiring greater intelligence at the edge.
The company is preparing to support larger order volumes by securing supplies of Qualcomm chips, memory, ASICs and printed circuit boards, Awsare said. Lantronix is ready to supply tens of thousands of SOM units per month if needed, he added.
Awsare said the company is also building an ecosystem of Western suppliers. Lantronix announced a memorandum of understanding with Unusual Machines, under which he said Unusual Machines could provide drone bodies while Lantronix provides computing capabilities. The company has also announced relationships with Safe Pro and other software providers that can run intellectual property on Lantronix modules.
Lantronix works with drone original equipment manufacturers, gimbal makers and video-module providers rather than competing directly for Pentagon contracts, Awsare said. He cited Red Cat, PDW and Trillium as examples of companies in those channels.
Ukraine and Revenue Growth
Awsare said Ukraine represents an early-stage opportunity as drone makers seek alternatives to Chinese components. Lantronix has announced a partnership with an Estonian-Ukrainian company identified as DoD to integrate a Lantronix-based solution into a camera module, and it has announced an MOU with Swarmer, a Ukrainian and Texas-based company, to develop a board using Lantronix’s compute SOM.
Lantronix began fiscal 2026 with drone revenue near zero, Awsare said. The company raised its drone-revenue outlook three times during the fiscal year ended June 30 and had previously forecast revenue of between $10 million and $14 million. At the midpoint of that range, drone revenue would represent about 10% of the company, he said.
Infrastructure Monitoring and Enterprise Operations
Lantronix’s second vertical, critical-infrastructure monitoring, includes 5G hardware and recurring-revenue offerings. Awsare said the company’s acquisition of Vecima’s Nero IoT tracking software business added approximately $5.5 million in revenue, much of it recurring, for a purchase price of about $11.5 million.
The acquired business includes about 125,000 device tags and software for asset tracking and device management, including fleet-management and restoration-equipment applications. Awsare said the business has gross margins above 60% and was accretive from day one.
Lantronix also sees an opportunity to cross-sell its 5G modems and gateways into the acquired customer base, which previously used third-party hardware, he said.
In enterprise markets, the company sells Power-over-Ethernet switches, device servers and media converters to government agencies and other customers. Awsare said Lantronix has shifted its enterprise model toward a JDM approach, reducing research and development spending on commoditized hardware while investing in software, device management and application layers. The company is also adding compute capabilities to PoE switches and routers to make those products smarter edge devices, he said.
About Lantronix (NASDAQ:LTRX)
Lantronix, Inc is a provider of secure data access and management solutions designed to simplify the deployment, monitoring and control of devices and equipment across a wide range of industries. Headquartered in Irvine, California, the company develops hardware and software products that enable connectivity for smart devices, industrial machinery, IT infrastructure and other systems in the Internet of Things (IoT) ecosystem.
Founded in 1989, Lantronix was among the early innovators in serial-to-Ethernet device networking and has since expanded its portfolio to include secure console servers, device servers, gateways and embedded modules.
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