Amaero Q3 Earnings Call Highlights

Key Points

• Revenue grew 35% to $4.1 million in Q3 2026, but Amaero’s net loss widened to $9.1 million as production scale-up costs, lower yields, and operating inefficiencies drove a $4.4 million gross loss.
• Amaero forecast Q4 revenue of $4.5 million to $5.0 million, implying full-year revenue growth of 154% to 162%. Management expects higher production to improve operating leverage, though yield-related cost effects may persist into Q4.
• Backlog rose 180% year over year to $13.4 million, with most expected to convert to revenue by June 30, 2027. The company reported $19.3 million in cash and expects a fourth atomizer in 2027 to expand annual capacity.

Amaero NASDAQ: AMRO reported 35% revenue growth in the third quarter of 2026 and forecast further gains in the final three months of the year, as it works to increase production following a safety-related pause at its Tennessee facility.

The metal powder and manufacturing company reported third-quarter revenue of $4.1 million, near the top of its previously disclosed range. Its net loss attributable to stockholders widened to $9.1 million, or $0.38 per share, from $4.1 million, or $0.20 per share, a year earlier.

For the fourth quarter, Amaero expects revenue of $4.5 million to $5.0 million, representing growth of 121% to 146% from a year earlier. That forecast implies full-year revenue of $16.0 million to $16.5 million, up 154% to 162%.

The call was Amaero’s first as a Nasdaq-listed company and its first reporting results in U.S. dollars under U.S. generally accepted accounting principles, Chairman and CEO Hank Holland said. The company’s depositary interests continue to trade on the Australian Securities Exchange under the symbol 3DA.

Revenue Growth Accompanied by Wider Loss

Third-quarter metal powder revenue rose 19% to $3.2 million, while revenue from powder metallurgy hot isostatic pressing, or PM-HIP, increased 146% to $0.9 million. CFO Brett Paduch said the latter included the first revenue from Amaero’s low-rate initial production contract with BPMI.

Cost of revenue climbed to $8.5 million from $3.1 million a year earlier, resulting in a gross loss of $4.4 million. Paduch attributed the increase to the scale-up of the Tennessee operation and titanium production running below installed capacity after a late-July restart. He said work to optimize a new sieving system also reduced throughput and yields during the quarter.

Some production labor and fixed costs were expensed rather than absorbed into inventory, while lower yields increased the cost of titanium powder sold, Paduch said. Adjusted EBITDA was negative $7.1 million, compared with negative $3.1 million a year earlier. Operating cash use fell by $1 million year over year to $6.3 million.

Management expects higher production and revenue to improve operating leverage because the company’s fixed production costs are largely in place. Holland said gross margin should improve, but a roughly six-week inventory lag means some costs affected by third-quarter yields will carry into the fourth quarter. He said the more favorable trend is not expected to emerge until the next calendar year.

Production Restart and Backlog

Amaero paused titanium production for about six weeks following safety incidents earlier in the year. Holland said the company conducted a safety review with engineering firm Jensen Hughes, implemented improvements and resumed titanium production in late July. He said there were no order cancellations or employee departures as a result.

The company commissioned a titanium sieving system in August that, together with its third atomizer, doubled titanium throughput capacity. Holland told analysts that most parameter optimization was completed by early to mid-September, although small adjustments are expected to continue through year-end. He said yields should begin to approach longer-term expectations over the fourth quarter.

Backlog stood at $13.4 million as of September 30, up 180% from a year earlier and roughly equal to the company’s trailing 12-month revenue. It included $4.4 million attributable to a $4.5 million Department of War development contract for alternative refractory alloy powders.

Holland said all reported backlog consisted of funded, firm orders. He expects most of it to be recognized as revenue before June 30, 2027, except for two payments under the Department of War contract totaling about $700,000.

The initial BPMI production contract was worth about $350,000, Holland said. He expects additional PM-HIP production contracts to follow, but said they remain in the pipeline rather than backlog and did not provide a timeline.

Capacity and Cash Position

Amaero operates three atomizers with approximately 680 metric tons of annual capacity, including 480 metric tons for titanium and 200 metric tons for refractory alloys. A fourth atomizer expected in June 2027 would increase total capacity to 920 metric tons. The company also expects to bring an argon recycling system online in the first quarter of 2027.

Holland said Amaero received $17.0 million in aggregate net proceeds from its initial public offering and began Nasdaq trading on October 15. An amendment to its EXIM Bank credit agreement released $2.1 million of restricted cash and moved a liquidity covenant test to 2028. Cash and cash equivalents totaled $19.3 million as of October 31, after October operating cash use and capital expenditures.

About Amaero (NASDAQ:AMRO)

Amaero is an advanced materials company that produces high-performance metal powders for additive manufacturing and other industrial applications. Its products include titanium and refractory metal alloy powders, materials designed for demanding uses where strength, heat resistance or other specialized properties are important.

The company has developed manufacturing operations in the United States, including a facility in Tennessee, and focuses on supplying materials to sectors such as aerospace and defense.

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