Actelis Revenue Jumps 68% to $1.1M, Gross Margin Hits 40%

Actelis Networks, Inc. (OTCQB: ASNS) reported on 10 November 2026 that third-quarter revenue rose 68% year over year to $1.1 million, up from $0.64 million, marking a third straight quarter of year-over-year growth. Gross margin climbed to 40% from 28%, and net loss narrowed 37% to $1.2 million, or $(0.04) per share, from $2.0 million, or $(1.68) per share. North American revenue rose 170%.

Context — why this quarter matters for Actelis

The company framed the quarter as evidence that a leaner cost base and a wider sales footprint are converting into revenue. The report's own comparable is the third quarter of 2025, when revenue was $0.64 million and gross margin was 28%. Actelis said operating expenses fell to $1.9 million, the lowest level of any quarter in 2026, with sales and marketing down 24% and general and administrative costs down 14%. Excluding $73 thousand of government grant income booked in the prior-year quarter, operating expenses declined 13%.

The company said the revenue gain came from deliveries to federal and intelligent transportation customers in the United States, plus growth in Asia-Pacific. For the first nine months of 2026, revenue rose 38% to $3.2 million from $2.3 million, with North American revenue up 56% and EMEA and Asia-Pacific each up 13%.

Actelis attributed the improvement in gross margin partly to software revenue mix. Software and services carry different economics than hardware, and the company said it continued delivering upgraded software and services to a leading North American carrier under a renewal contract. That mix shift, rather than unit volume alone, is what lifted gross profit to $0.43 million from $0.18 million.

Management tied the quarter to a broader push into federal and military networking. Chief Executive Tuvia Barlev said the company's work for the U.S. Marine Corps shows why military customers choose Actelis: using a base's existing wiring, the company said it brought fiber-grade, cyber-hardened VoIP service to 65 buildings in days at a fraction of the cost and time of laying new fiber.

Data — the numbers behind the quarter

The headline comparison is revenue of $1.1 million in the third quarter of 2026 against $0.64 million a year earlier, a 68% increase. Gross profit more than doubled to $0.43 million from $0.18 million, while gross margin moved to 40% from 28%. Cost of revenues rose to $0.65 million from $0.46 million, which the company tied to higher sales volume and software revenue mix.

Operating loss narrowed 23% to $1.5 million from $1.9 million. Net loss fell 37% to $1.2 million from $2.0 million. Adjusted EBITDA loss, a non-GAAP measure the company reconciles to net loss, was $1.4 million, or 130.1% of revenue, compared with $1.8 million, or 283.2% of revenue, a year earlier. For the first nine months, Adjusted EBITDA loss was $4.7 million, or 148.4% of revenue, against $5.2 million, or 227.2%.

Metric	Q3 2026	Q3 2025
Revenue	$1.1M	$0.64M
Gross margin	40%	28%
Operating expenses	$1.9M	$2.1M
Net loss	$1.2M	$2.0M

Cash, cash equivalents and restricted cash stood at $4.8 million as of 30 September 2026, versus $1.8 million a year earlier. Total current assets were $8.5 million against total current liabilities of $2.7 million. The company carried no credit line or short-term loan balance at quarter-end, down from $479 thousand and $350 thousand respectively at 31 December 2025.

Analysis — what the numbers mean for the sector

The report positions Actelis in cyber-hardened networking for IoT and broadband, a niche that overlaps with larger infrastructure and defense-communications suppliers. Its growth is being driven by federal programs, intelligent transportation systems and carrier broadband buildouts in remote regions, notably Alaska, where regional carriers placed orders to extend business-class broadband to schools and healthcare facilities over existing infrastructure. The company said it sees a fit with more than 15 federal programs of record and that a growing number of major partners are trialing its solutions for larger programmatic deployments.

The clearest limitation is scale. At $1.1 million of quarterly revenue, the company remains far below the size at which fixed costs are covered; Adjusted EBITDA loss was 130.1% of revenue even after the improvement. The company also cited unfavorable foreign exchange rate fluctuations as a partial offset to cost savings in research and development, sales and marketing, and general and administrative lines. Those currency effects are outside management's control and can reverse.

A second risk sits in the capital structure. Other financial income was $243 thousand in the quarter, driven by gains from the change in fair value of pre-funded warrants and common warrants classified as liabilities. Those gains are non-cash and can swing to expense if the underlying assumptions move against the company. Interest expense was $12 thousand in the quarter, down from $27 thousand.

For positioning, the report points to a company still dependent on equity-linked financing. The company amended its $30 million equity line of credit in July 2026 so it can be drawn while shares trade on the OTCQB, and shareholders approved a reverse stock split within a 1-for-10 to 1-for-25 range in April 2026, with the Board having until April 2027 to decide whether and when to implement it. That overhang is a live consideration for anyone holding the stock into a potential relisting.

Outlook — what to watch next

The company named several catalysts. It plans to introduce a new GL800 Gigabit-speed product in the fourth quarter of 2026 for transportation and smart-city applications. It is pursuing M&A with a cyber and AI focus as a means of accelerating growth and scale, though the company did not disclose targets, terms or timing. Relisting on Nasdaq remains a stated strategic priority, with the reverse split decision resting with the Board until April 2027.

Investors watching the name should track whether the federal and military pipeline converts into recognized revenue, since the company said major partners are trialing rather than deploying at scale. The Alaska carrier orders and the carrier software renewal are nearer-term revenue signals. Gross margin is the other line to watch: the move to 40% from 28% was the single largest contributor to the narrower loss, and holding that level depends on software and services mix.

Frequently Asked Questions

Why did Actelis Networks' net loss shrink in Q3 2026?

The company attributed the 37% reduction in net loss, to $1.2 million from $2.0 million, to higher sales, gross margin improving to 40% from 28%, and continued cuts to operating expenses. A $243 thousand swing in other financial income, mainly from fair value gains on pre-funded and common warrants classified as liabilities, also helped. Some of those gains are non-cash and can reverse in future periods.

What does the Nasdaq relisting plan mean for ASNS shareholders?

Actelis said relisting on Nasdaq remains a strategic priority. Shareholders approved a reverse stock split in a 1-for-10 to 1-for-25 range in April 2026, and the Board has until April 2027 to decide whether and when to act. The company also amended its $30 million equity line in July 2026 so it can be used while shares trade on the OTCQB.

How large is Actelis Networks relative to its cost base?

Third-quarter revenue was $1.1 million against total operating expenses of $1.9 million, so the company still spends more than it brings in. Adjusted EBITDA loss was $1.4 million, or 130.1% of revenue, improved from 283.2% a year earlier. Cash and restricted cash of $4.8 million at quarter-end funds operations while management works to convert federal and carrier pipeline into revenue.

Bottom Line

Actelis grew revenue 68% and lifted gross margin to 40%, but at $1.1 million a quarter it still spends nearly twice what it earns.

Disclaimer: This article is for informational purposes only and does not constitute investment advice. CFD trading carries high risk of capital loss.