KULR Technology Group (NYSEAMERICAN:KULR) reported second-quarter 2026 revenue of $2.1 million, a significant decline from both the prior-year period and the first quarter, as supply-chain bottlenecks, execution constraints and delayed production capacity affected deliveries of its battery products.
Chief Executive Officer Michael Mo said the company recorded a gross loss during the quarter and acknowledged that the results fell short of management’s expectations. He said KULR’s priorities for 2026 remain product-revenue growth, gross-margin improvement and cost discipline.
Supply Chain, Program Load and Capacity Delays Weighed on Results
Mo identified four main challenges during the quarter: long lead times for components in new programs, too many customer programs relative to available engineering and manufacturing resources, management disruption from board and leadership changes, and the lack of contribution from KULR’s new Texas facility.
New parts required for newer battery programs created supply-chain bottlenecks that delayed planned second-quarter shipments, according to Mo. The company is also reviewing customer engagements and directing engineering and manufacturing resources toward programs with the strongest expected economics and strategic value.
Despite the quarterly decline, Mo said KULR’s energy management platform business was broadly stable for the first half. Revenue from that platform was $4.76 million in the first six months of 2026, compared with $4.73 million a year earlier. Total first-half revenue was $6.03 million, compared with $6.1 million in the prior-year period.
Second-quarter product sales were principally driven by two large orders from new customers involving new battery configurations, Mo said. He described that mix as evidence that the company is bringing products into new accounts as its KULR ONE platform scales.
Company Shifts Resources to Core Battery Operations
Management said it has taken steps since quarter-end to simplify operations and concentrate capital on its core battery business. The company exited Bitcoin mining, repaid its $20 million credit facility using proceeds from Bitcoin sales, and did not issue shares through its at-the-market program during the first half of 2026.
Chief Financial Officer Mike Kimel said KULR used proceeds from the sale of 333 Bitcoin to repay its Coinbase loan in full, releasing 565 Bitcoin that had been pledged as collateral. The company also terminated its mining services agreement, eliminating about $2.1 million in remaining operating-expense commitments in exchange for a $150,000 termination fee.
The board has authorized management to sell any and all remaining Bitcoin holdings, Kimel said. KULR had approximately $60 million on its balance sheet and no debt following the repayment, according to Mo.
Kimel said the company’s approximately $51 million first-half net loss included about $31.4 million of non-cash mark-to-market changes related to its digital asset holdings. He said that movement was unrelated to the operating performance of the battery business.
“The principle behind these decisions is simple: support the operating business, preserve flexibility, and remain mindful of dilution,” Kimel said.
Cost Reduction and Operating Review Underway
KULR said selling, general and administrative expense declined about 9% year over year in the second quarter and approximately 5% in the first half. First-half research and development expense was about 3% lower, Kimel said.
Management is conducting a company-wide operating review focused on standardizing data, improving workflows, increasing use of existing enterprise resource planning functionality and strengthening management’s operational visibility. The company is also reviewing professional-services relationships and evaluating whether to bring certain work in-house, renegotiate terms or change providers.
Kimel said the company is adapting its operating structure as it moves from historically research-and-development-focused and customized lower-volume work toward larger-scale, repeatable production.
Texas Facility and Defense-Drone Demand Seen Supporting Second Half
KULR expects its approximately 25,000-square-foot Texas facility and automated production lines for cylindrical and pouch cells to become operational during the third quarter. The company signed the lease in May and is building design, prototyping, testing, certification, manufacturing, battery-management software and electronics capabilities at the site.
Mo said KULR has increased raw-material inventory by roughly five times from the end of 2025 and expects inventory to rise further in the second half as it prepares for anticipated demand. The company is also pursuing multiple sources for components and using its cell-agnostic architecture to qualify different chemistries and form factors.
Management cited U.S. defense and drone procurement as a potential source of growth. During the second quarter, KULR secured initial defense-drone battery orders from a U.S. drone maker participating in the Department of Defense’s Drone Dominance initiative, an opportunity Mo said exceeds $5 million.
The company also demonstrated its KULR ONE Air system with next-generation solid-state cells at more than 350 watt-hours per kilogram and said it was selected by Axiom Space as a battery provider for an orbital transport mission. KULR is sampling NDAA-compliant 6S chargers, has completed an 18S charger prototype, and expects to ship NDAA-compliant chargers to U.S. customers by the end of 2026.
For the second half, management expects delayed shipments to recover, the Texas production lines to contribute to operations, and battery-pack volumes to begin ramping. Mo said the company will continue to measure progress through product revenue growth, gross-margin improvement and cost discipline.
About KULR Technology Group (NYSEAMERICAN:KULR)
KULR Technology Group, Inc, through its subsidiary, KULR Technology Corporation, develops and commercializes thermal management technologies for electronics, batteries, and other components applications in the United States. It provides lithium-ion battery thermal runaway shields; automated battery cell screening and test systems; cellchecks; safecases; fiber thermal interface materials; phase change material heat sinks; internal short circuit devices; and CRUX cathodes. The company's technologies are used in electric vehicles, energy storage, battery recycling transportation, cloud computing, and 5G communication devices.
