Coda Octopus Reports 9.2% Revenue Growth to $7.72 Million for Q3 2026

Coda Octopus Group, Inc. reported a consolidated net revenue of $7.72 million for the three months ended July 31, 2026, marking a 9.2% increase from $7.06 million in the same period last year. The company’s gross profit for the quarter was $5.05 million, up from $4.82 million, resulting in a gross profit margin of 65.4%, down from 68.3% in the previous year. The increase in revenue was primarily driven by the Defense Engineering Services Business, which saw a significant rise in demand, while the Marine Technology Business experienced a decline due to geopolitical uncertainties affecting customer demand in the Middle East and Asia.

For the nine months ended July 31, 2026, Coda Octopus reported total revenues of $21.33 million, a 10.6% increase from $19.29 million in the prior year. The Defense Engineering Services segment generated $7.04 million, a 38.5% increase, while the Acoustics Sensors and Materials Business (PAL) saw a 16% rise in revenue to $4.72 million. However, the Marine Technology Business reported a decrease of 5.6%, with revenues falling to $9.57 million, attributed to reduced demand from customers in the Middle East.

The company’s operating expenses for the quarter increased by 2.1% to $3.52 million, with research and development costs rising significantly due to strategic initiatives within the PAL segment. Notably, Coda Octopus recognized a contingent consideration expense of $438,588 related to the acquisition of Precision Acoustics Limited, reflecting management's assessment of the earn-out obligations. The net income for the quarter was $1.39 million, an 8.3% increase from $1.28 million in the previous year, despite a higher tax provision.

Coda Octopus reported total assets of $68.85 million as of July 31, 2026, compared to $64.49 million at the end of the previous fiscal year. The company’s cash and cash equivalents increased to $31.71 million, up from $28.68 million. The total liabilities decreased to $6.12 million from $6.38 million, contributing to a stockholders' equity of $62.73 million, an increase from $58.12 million. The company continues to maintain a strong liquidity position, with cash provided by operating activities amounting to $3.43 million for the nine-month period.

Looking ahead, Coda Octopus anticipates that geopolitical developments, particularly in the Middle East, will continue to impact customer demand and project timelines. The company remains focused on strategic growth initiatives, particularly in its PAL segment, and expects to leverage its strong cash position to navigate potential market challenges. The management's outlook reflects cautious optimism, emphasizing the importance of adapting to changing market conditions and customer needs.