NAPATECH
1ST QUARTER 2026
INTERIM MANAGEMENT STATEMENT
MANAGEMENT'S REPORTDear Readers,
2026 has started with solid execution. We continue to advance Napatech's strategy to become an indispensable acceleration platform for the AI data center era - strengthening our technology leadership, expanding our ecosystem, and building a foundation for scalable, long-term growth.
In Q1 2026, revenue was $5.7M (DKK 36.6M), corresponding to 69% growth in USD and 53% growth in DKK versus Q1 2025. Gross margin was 70%, unchanged year-over-year.
Key figures in the quarter included:
EBITDA of negative DKK 18.1M (improved from negative DKK 29.1M in Q1 2025)
Free cash flow of negative DKK 5.8M (improved from negative DKK 29.4M in Q1 2025)
Net working Capital reduced from DKK 83.2M to DKK 72.8M
Cash available of DKK 120.6M (down from DKK 127.6M in Q4 2025)
We continue to invest in product development and customer engagements, while maintaining disciplined cost control. Staff costs and other external costs were DKK 44.5M in Q1 2026, down from DKK 48.9M in Q1 2025.
We remain focused on executing our strategy in AI, storage, networking, cybersecurity, and fintech, and on converting our pipeline into revenue through continued customer engagement and partner collaboration.
Our teams continue to meet demanding customer requirements, supporting design wins and strengthening our position in both the Core Infrastructure and AI Infrastructure segments.
We continue to build our ecosystem with partners to extend our reach and deliver complete solutions to customers.
Design wins remain a key driver of our future revenue, and we stay focused on building and converting our design-win pipeline.
We continue to strengthen our organization to support the next phase of growth, ensuring we have the capabilities required to scale with customer demand.
Looking ahead, our 2026 guidance remains unchanged. We will continue to execute with discipline, invest in key growth initiatives, and navigate a market environment that includes ongoing uncertainty-while focusing on long-term value creation.
We remain focused on the priorities that will drive performance through 2026.
Thank you for your continued support and belief in our vision. The best is yet to come! Best regards,
Kartik Srinivasan
Chief Executive Officer
Highlights Q1:Revenue in USD amounted to 5.7M in Q1 2026, an increase of 69% compared to Q1 2025. In DKK, revenue amounted to DKK 36.6M in Q1 2026, an increase of 53% compared to Q1 2025.
The gross margin in Q1 2026 was 70%, compared to 70% Q1 2025.
Staff costs and Other external costs in Q1 2026 amounted to DKK 44.5M compared to DKK 48.9M in Q1 2025.
EBITDAC1 in Q1 2026 amounted to negative DKK 18.9M compared to negative DKK 32.1M in Q1 2025.
EBITDA in Q1 2026 amounted to negative DKK 18.1M compared to negative DKK 29.1M in Q1 2025.
Depreciation, amortization, and impairment for Q1 2026 were DKK 3.3M compared to DKK 6.5M in Q1 2025.
Net Cash flow from operating activities in Q1 2026 was negative DKK 4.8M compared to negative DKK 25.7M in Q1 2025.
Net cash used in investing activities in Q1 2026 amounted to DKK 1.0M compared to DKK 3.7M in Q1 2025.
Q 1 2026 | Q 1 2025 | |
Revenue USD M | 5.7 | 3.4 |
Growth YoY USD M | 69% | 8% |
Revenue DKK M | 36.6 | 23.8 |
Growth YoY DKK M | 53% | 11% |
Gross Margin | 70% | 70% |
EBITDAC DKK M | -18.9 | -32.1 |
EBITDA DKK M | -18.1 | -29.1 |
Net Cash Flow from Operating Activities DKK M | -4.8 | -25.7 |
Net Working Capital, end of period DKK M | 72.8 | 97.2 |
Cash and cash equivalents, end of period DKK M | 99.1 | 34.6 |
Unused credit facilities, end of period DKK M | 21.5 | 1.0 |
Cash available, end of period DKK M | 120.6 | 35.6 |
Napatech is a Danish tech company developing high-performance, programmable network interface cards and software for programmable NICs. The Napatech software suite ensures broad compatibility and seamless integration for our family of FPGA-based SmartNICs. With support for all major systems and a common API that easily integrates with custom-developed, open source, or commercial applications, we enable significantly reduced time-to-market for new products.
Additional information is available at https://www.napatech.cominvestor.
1 EBITDAC: Earnings before depreciation, amortization and impairment, and cost transferred to development projects
2 Definitions: Gross Margin is calculated as 'Gross Profit' / 'Revenue'; EBITDAC is calculated as 'Earnings Before Interest, Taxes, Depreciation and Amortization' before staff costs transferred to capitalized development costs; EBITDA is calculated as 'Earnings
Before Interest, Taxes, Depreciation and Amortization'; Net working capital represents the value of inventories, trade receivables and other current operating assets less trade payables and other current operating liabilities. Cash and cash equivalents and income tax receivable or payable are not part of the net working capital; Cash flows from operating activities are profit or loss before tax added or deducted changes in the net working capital, added or deducted changes in provisions and added the yearly depreciation and amortization; Free cash flow is net cash flow from operating activities added or deducted investing activities.
Revenue and Gross MarginQ1
Napatech reports revenue of DKK 36.6M in Q1 2026 compared to DKK 23.8M in the same period in 2025, equivalent to an increase of 53%. In USD, revenue was up 69% compared to Q1 2025.
The gross margin in Q1 2026 was 70% compared to 70% in Q1 2025.
CostsQ1
Staff costs and Other external costs in Q1 2026 amounted to DKK 44.5M, compared to DKK 48.9M in Q1 2025.
Operating expenses after transfer of staff costs to capitalized development costs in Q1 2026 amounted to DKK 43.7M, compared to DKK 45.8M in Q1 2025.
EBITDAC and EBITDAQ1
EBITDAC amounted to negative DKK 18.9M in Q1 2026 compared to negative DKK 32.1M in Q1 2025.
EBITDA in Q1 2026 was negative DKK 18.1M compared to negative DKK 29.1M in Q1 2025.
Depreciation, amortization, and impairmentQ1
Depreciation, amortization, and impairment in Q1 2026 were DKK 3.3M compared to DKK 6.5M in Q1 2025.
Financial ItemsQ1
Financial items for Q1 2026 are positive DKK 0.0M compared to negative DKK 1.3M in Q1 2025.
TaxesQ1
Taxes for Q1 2026 amounted to a cost of DKK 0.0M compared to an income of DKK 0.0M in Q1 2025.
InvestmentsQ1
Total net cash used in investing activities in Q1 2026 was DKK 1.0M, of which DKK 0.8M were related to new product development. In Q1 2025 total net cash used in investing activities was DKK 3.7M, of which DKK 3.4M was related to new product development.
Cash FlowQ1
Net cash flow from operating activities in Q1 2026 was negative DKK 4.8M compared to negative DKK 25.7M in Q1 2025.
Free cash flow in the quarter amounted to negative DKK 5.8M compared to negative DKK 29.4M in Q1 2025.
Net cash from financing activities in Q1 2026 was negative DKK 22.7M, compared to positive DKK 0.5M in Q1 2025 due to the short-term credit facilities not being drawn.
Outlook for 20262026 guidance remains unchanged:
Target in DKK million Guidance
Units sold 8,700-10,700
Revenue 200-240
Gross margin 60-70%
Staff costs & Other external costs 170-180
Staff costs transferred to capitalized 5-8
development costs
With performance in the middle of the guided ranges, EBITDA would be negative around DKK 25M, and units sold would be around 9,700.
The Company is exposed to risks that might affect our ability to reach our goals, such as currency fluctuations, general market uncertainty, and material changes in our large OEMs' needs for Napatech's products.
Additionally, in 2025 and ongoing in 2026, we have seen increasing market uncertainty, particularly related to potential trade barriers, including tariff increases in the United States. With our products manufactured in the US and the majority of our customers also located in the US, the group is not significantly exposed. However, the lack of predictability and uncertainty surrounding tariff increases is a concern, and we will be monitoring the development closely. Further, we have seen an elevated risk driven by a supply-constrained, high-volatile environment across several key areas. This leads to extended and volatile lead times as well as increased prices for certain components.
Disclaimer:
This report may contain statements regarding the future in connection with Napatech growth initiatives, profit figures, outlook, strategies, and objectives. All statements regarding the future are subject to inherent risks and uncertainties, and many factors can lead to actual profits and developments deviating substantially from what has been expressed or implied in such statements.
INCOME STATEMENT For the period ended March 31, 2026 1st quarterDKK'000 | 2026 | 2025 |
Revenue | 36,588 | 23,849 |
Cost of goods sold | (11,065) | (7,078) |
Gross profit | 25,523 | 16,771 |
Staff costs | (33,143) | (35,059) |
Other external costs | (11,322) | (13,846) |
EBITDAC | (18,942) | (32,134) |
Transferred to capitalized development costs | 810 | 3,083 |
EBITDA | (18,132) | (29,051) |
Depreciation, amortization and impairment | (3,301) | (6,457) |
Operating result (EBIT) | (21,433) | (35,508) |
Finance income | 317 | 27 |
Finance costs | (299) | (1,334) |
Result before tax | (21,415) | (36,815) |
Income tax | (3) | 6 |
Result for the period | (21,418) | (36,809) |
DKK'000 | 2026 | 2025 |
Operating activities | ||
Income/Loss before tax | (21,415) | (36,815) |
Adjustments to reconcile profit before tax to net cash flow s | ||
Finance income | (317) | (27) |
Finance costs | 299 | 1,334 |
Depreciation, amortisation and impairment | 3,301 | 6,457 |
Share-based payment expense | 2,496 | 2,766 |
Working capital adjustments | ||
Change in inventories | (4,394) | (5,009) |
Change in trade and other receivables and prepayments | 13,962 | 2,528 |
Change in trade and other payables and contract liabilities | 1,311 | 3,564 |
Interest received | 263 | 27 |
Interest paid | (299) | (499) |
Income tax received, net | - | - |
Net cash flow s from operating activities | (4,793) | (25,674) |
Investing activities | ||
Purchase of tangible assets | (187) | (307) |
Investments in intangible assets | (813) | (3,439) |
Net cash used in investing activities | (1,000) | (3,746) |
Free cash flow | (5,793) | (29,420) |
Financing activities | ||
Capital increase | 281 | 300 |
Payment of financial lease liabilities | (801) | (909) |
Proceeds from borrow ings | - | 1,144 |
Repayment of borrow ings | (22,136) | - |
Net cash flow s from financing activities | (22,656) | 535 |
Net change in cash and cash equivalents | (28,449) | (28,885) |
Net foreign exchange difference | 32 | (858) |
Cash and cash equivalents at the beginning of the period | 127,470 | 64,341 |
Cash and cash equivalents at the end of the period | 99,053 | 34,598 |
DKK'000 | 31 Mar. 2026 | 31 Dec. 2025 | 31 Mar. 2025 |
Development projects, completed | 5,130 | 6,910 | 14,876 |
Development projects, in progress | 10,039 | 9,226 | 7,708 |
Patents | 626 | 691 | 947 |
Intangible assets | 15,795 | 16,827 | 23,531 |
Plant and equipment | 2,967 | 3,401 | 4,447 |
Right-of-use assets | 5,391 | 6,180 | 8,385 |
Leasehold improvements | 362 | 404 | 406 |
Tangible assets | 8,720 | 9,985 | 13,238 |
Leasehold deposits | 1,636 | 1,636 | 1,587 |
Other non-current assets | 1,636 | 1,636 | 1,587 |
Non-current assets | 26,151 | 28,448 | 38,356 |
Inventories | 61,072 | 56,678 | 74,885 |
Trade receivables | 24,116 | 37,733 | 14,549 |
Prepayments | 4,403 | 4,446 | 4,704 |
Other receivables | 12,503 | 12,350 | 26,118 |
Income tax receivable | 4,815 | 4,830 | 6,316 |
Cash and cash equivalents | 99,053 | 127,470 | 34,598 |
Current assets | 205,962 | 243,507 | 161,170 |
Total assets | 232,113 | 271,955 | 199,526 |
DKK'000 | 31 Mar. 2026 | 31 Dec. 2025 | 31 Mar. 2025 |
Share capital | 27,556 | 27,535 | 25,013 |
Share premium | 607,310 | 606,871 | 483,599 |
Treasury shares | (619) | (619) | (619) |
Foreign currency translation reserve | (999) | (1,387) | 20 |
Share-based payment reserve | 20,549 | 25,120 | 21,420 |
Retained earnings | (467,356) | (452,827) | (410,285) |
Equity | 186,441 | 204,693 | 119,148 |
Interest-bearing loans and borrow ings | 4,180 | 4,678 | 6,382 |
Other non-current financial liabilities | 4,314 | 4,652 | 4,540 |
Non-current lease liabilities | 2,533 | 3,349 | 5,619 |
Non-current contract liabilities | 1,945 | 1,344 | 1,764 |
Non-current liabilities | 12,972 | 14,023 | 18,305 |
Interest-bearing loans and borrow ings | 2,074 | 23,374 | 37,666 |
Current lease liabilities | 3,227 | 3,211 | 3,123 |
Trade payables | 12,335 | 8,109 | 7,337 |
Other payables | 10,142 | 12,712 | 10,706 |
Contract liabilities | 4,922 | 5,833 | 3,241 |
Current liabilities | 32,700 | 53,239 | 62,073 |
Total liabilities | 45,672 | 67,262 | 80,378 |
Total equity and liabilities | 232,113 | 271,955 | 199,526 |
Napatech A/S
Tobaksvejen 23A, 1 DK-2860 Søborg Denmark
CVR no. 10109124
Phone: +45 4596 1500
https://www.napatech.com