Unusual Machines First Quarter 2026 Shareholder Letter

About this update from Unusual Machines, Inc.

Conference call today at 4:30 p.m. ETORLANDO, FL / ACCESS Newswire / May 14, 2026 / Unusual Machines (NYSE American:UMAC) ("Unusual Machines" or the "Company"), a leading provider of NDAA-compliant drone components, today announced it filed its Form 10-Q with the U.S. Securities and Exchange Commission for the first quarter ended March 31, 2026 and provided the following letter to its shareholders from CEO Allan Evans.Dear Shareholders,This shareholder letter follows the completion of our first quarter of 2026.We continued to successfully execute our growth plan during the quarter.In the first quarter, we generated $8.1 million in revenue, reflecting a 296% year-over-year growth compared to the first quarter of 2025 and a 65% quarter-over-quarter growth over the fourth quarter of 2025. We are profitable and generated over $10 million in net income in the first quarter. Even after excluding unrealized gains from investments, we generated a net profit of $0.8M. At a very high level, we are doing something unusual - rapid growth without burning cash too quickly.The financial details reveal a comprehensive growth story in a very high-demand market. The growth in revenue is, in part, the result of the growth in headcount and capacity from last quarter. In Q4 of 2025, we grew from 38 to 81 employees. This subsequently contributed to the rapid revenue growth in Q1. This capacity growth continued through the first quarter as we went from 81 to 141 employees. This type of growth naturally has a negative impact on margins, as new manufacturing employees factor into our production costs and, eventually, into the cost of goods sold. Our gross margins followed this pattern and decreased to 32.8%, which we expect will recover to about 40% once growth eventually slows down.Growth also resulted in increased operating costs. Our total operating expenses for the quarter were approximately $9.9 million, resulting in a GAAP net operating loss of approximately $7.3 million. This includes non-cash expenses of approximately $4.0 million and other non-recurring expenses of approximately $1.1 million. This brings our operational net loss for the quarter to approximately $1.5 million. See the discussion of Non-GAAP Financial Measure below. This is the first quarter where our operational net loss has exceeded $1.0 million since we became a public company. These costs do not worry u...

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