Net sales rose 149% year over year to $105.1 million and included initial license fees from Samsung
Strengthened balance sheet with cash, cash equivalents and restricted cash rising to $327.7 million at quarter-end
IRVINE, Calif., Nov. 10, 2026 /PRNewswire/ -- Netlist, Inc. (OTCQB: NLST), a leading innovator in advanced memory and storage solutions, today reported financial results for the third quarter ended September 26, 2026.
Third Quarter 2026 Highlights:
- Net sales for the third quarter of 2026 were $105.1 million, an increase of 149% compared to the third quarter of 2025
- License fee revenue of $44.9 million was recognized in the third quarter of 2026 pursuant to the Samsung License Agreement, consisting of amortization of the upfront license fee and the first quarterly license fee.
- Net product sales for the third quarter of 2026 were $60.2 million, an increase of 43% compared to the third quarter of 2025.
- Gross margin for the third quarter of 2026 was 65.5%, an increase of over 61 percentage points compared to 4.4% in the third quarter of 2025, primarily reflecting license fee revenue, which has no associated cost of sales, and higher product gross margin.
- Operating income in the third quarter of 2026 was $40.6 million, which improved from an operating loss of $7.2 million in the third quarter of 2025.
- Net income for the third quarter of 2026 was of $85.4 million, or $0.22 per diluted share, compared to a net loss of $7.0 million, or $(0.02) per share, in the third quarter of 2025.
- Cash, cash equivalents and restricted cash rose to $327.7 million at September 26, 2026 from $40.7 million at June 27, 2026, primarily due to the initial cash payment of $200 million and first quarterly payment of $27.5 million by Samsung.
"We are pleased to report our third consecutive quarter of significant year-over-year revenue growth and improved profitability led by both product sales and the recognition of license revenue under our Samsung agreement," said Chief Executive Officer, C.K. Hong. "Year-over-year product revenue growth was driven by strong demand from customers in AI and data center applications."
"Gross margins improved and was driven by our focus on higher margin opportunities," said Gail Sasaki, Chief Financial Officer. "During the quarter, we substantially strengthened our balance sheet with the initial proceeds from our Samsung agreement and generated operating cash flow of $245 million."
Conference Call Information
C.K. Hong, Chief Executive Officer, and Gail Sasaki, Chief Financial Officer, will host an investor conference call today, November 10, 2026 at 5:00 p.m. Eastern Time to review Netlist's results for the third quarter ended September 26, 2026. The live webcast and archived replay of the call can be accessed for 90 days in the Investors section of Netlist's website at www.netlist.com.
About Netlist
Netlist is a leading innovator in advanced memory and storage solutions. With a rich portfolio of patented technologies, Netlist's inventions are foundational to the advancement of AI computing. To learn more about Netlist, please visit www.netlist.com.
Safe Harbor Statement
This news release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements contained in this news release include, without limitation, statements about Netlist's positioning to capitalize on next generation memory products, expected license revenue under its agreements with Samsung and Micron, and evaluations, implications of future growth or profitability and judgements regarding Netlist's products and intellectual property portfolio. Forward-looking statements are statements other than historical facts and often address future events or Netlist's future performance. They reflect management's present expectations regarding future events and are subject to known and unknown risks, uncertainties and other factors that could cause actual results to differ materially from those expressed in or implied by any forward-looking statements. These risks, uncertainties and other factors include, among others, risks: Netlist may not be able to collect amounts owed to it pursuant to its agreements with Samsung and Micron and the amount of quarterly license fees payable under the revenue-based formula, which may be subject to adjustment; Netlist may suffer adverse outcomes in its litigation with Google or in its various other active proceedings to defend the validity of its patents; related to Netlist's plans for its intellectual property, including its strategies for monetizing, licensing, expanding, and defending its patent portfolio, which efforts may not be successful; that other patent infringement litigation initiated by Netlist, or by others against Netlist, may not be successful or resolve favorably for Netlist, particularly given the costs and unpredictability of any such litigation; associated with Netlist's product sales, including whether and how long the current market and demand for products sold by Netlist will persist or persist as expected and whether Netlist may successfully develop and launch new products that are attractive to the market; whether Netlist will continue to acquire components or products for resale on favorable terms; associated with the competitive landscape of Netlist's industry, general economic, political and market conditions, factory slowdowns and/or shutdowns, and changes in international trade and tariff policies. All forward-looking statements reflect management's present assumptions, expectations and beliefs regarding future events and are subject to known and unknown risks, uncertainties and other factors that could cause actual results to differ materially from those expressed in or implied by any forward-looking statements. These and other risks and uncertainties are described in Netlist's Annual Report on Form 10-K for the fiscal year ended December 27, 2025, filed with the SEC on March 19, 2026, Quarterly Report on Form 10-Q for the quarter ended June 27, 2026, filed with the SEC on August 11, 2026, and the other filings it makes with the U.S. Securities and Exchange Commission from time to time, including any subsequently filed quarterly and current reports. In light of these risks, uncertainties and other factors, these forward-looking statements should not be relied on as predictions of future events. These forward-looking statements represent Netlist's assumptions, expectations and beliefs only as of the date they are made, and except as required by law, Netlist undertakes no obligation to revise or update any forward-looking statements for any reason.
Investor Relations Contacts:
Monica Gould
The Blueshirt Group
[email protected]
Mike Smargiassi
The Plunkett Group
[email protected]
(212) 739-6729
Gail M. Sasaki
Netlist, Inc., Chief Financial Officer
[email protected]
(949) 435-0025
NETLIST, INC. AND SUBSIDIARIES | ||||||||
CONDENSED CONSOLIDATED BALANCE SHEETS | ||||||||
(In thousands) (Unaudited) | ||||||||
September 26, | December 27, | |||||||
2026 | 2025 | |||||||
ASSETS | ||||||||
Current assets: | ||||||||
Cash and cash equivalents | $ | 317,685 | $ | 31,782 | ||||
Restricted cash | 10,000 | 10,300 | ||||||
Accounts receivable, net | 4,969 | 2,411 | ||||||
Inventories | 16,778 | 3,383 | ||||||
Prepaid expenses and other current assets | 11,536 | 332 | ||||||
Total current assets | 360,968 | 48,208 | ||||||
Property and equipment, net | 285 | 300 | ||||||
Operating lease right-of-use assets | 1,154 | 541 | ||||||
Deferred income taxes | 89,088 | — | ||||||
Other assets | 38,343 | 428 | ||||||
Total assets | $ | 489,838 | $ | 49,477 | ||||
LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT) | ||||||||
Current liabilities: | ||||||||
Accounts payable | $ | 71,145 | $ | 20,612 | ||||
Revolving line of credit | — | 1,788 | ||||||
Accrued payroll and related liabilities | 1,320 | 852 | ||||||
Deferred revenue | 78,405 | 30,570 | ||||||
Other current liabilities | 650 | 818 | ||||||
Total current liabilities | 151,520 | 54,640 | ||||||
Deferred revenue, noncurrent | 179,641 | — | ||||||
Operating lease liabilities | 716 | 23 | ||||||
Other liabilities | 17 | 17 | ||||||
Total liabilities | 331,894 | 54,680 | ||||||
Commitments and contingencies | ||||||||
Stockholders' equity (deficit): | ||||||||
Preferred stock | — | — | ||||||
Common stock | 379 | 308 | ||||||
Additional paid-in capital | 424,581 | 357,001 | ||||||
Accumulated deficit | (267,016) | (362,512) | ||||||
Total stockholders' equity (deficit) | 157,944 | (5,203) | ||||||
Total liabilities and stockholders' equity | $ | 489,838 | $ | 49,477 | ||||
NETLIST, INC. AND SUBSIDIARIES | |||||||||
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS | |||||||||
(In thousands, except per share amounts) (Unaudited) | |||||||||
Three Months Ended | Nine Months Ended | ||||||||
September 26, | September 27, | September 26, | September 27, | ||||||
2026 | 2025 | 2026 | 2025 | ||||||
Net product sales | $ 60,194 | $ 42,234 | $ 274,931 | $ 112,915 | |||||
License fee | 44,910 | — | 44,910 | — | |||||
Net sales | 105,104 | 42,234 | 319,841 | 112,915 | |||||
Cost of sales(1) | 36,247 | 40,396 | 205,712 | 108,385 | |||||
Gross profit | 68,857 | 1,838 | 114,129 | 4,530 | |||||
Operating expenses: | |||||||||
Research and development(1) | 1,054 | 822 | 3,205 | 2,548 | |||||
Intellectual property legal fees | 16,211 | 5,035 | 41,938 | 15,542 | |||||
Selling, general and administrative(1) | 11,021 | 3,131 | 18,511 | 9,604 | |||||
Total operating expenses | 28,286 | 8,988 | 63,654 | 27,694 | |||||
Operating income (loss) | 40,571 | (7,150) | 50,475 | (23,164) | |||||
Other income, net: | |||||||||
Interest income, net | 864 | 106 | 945 | 459 | |||||
Other income, net | 31 | 34 | 94 | 130 | |||||
Total other income, net | 895 | 140 | 1,039 | 589 | |||||
Income (loss) before income tax benefit | 41,466 | (7,010) | 51,514 | (22,575) | |||||
Income tax benefit | (43,982) | — | (43,982) | — | |||||
Net income (loss) | $ 85,448 | $ (7,010) | $ 95,496 | $ (22,575) | |||||
Loss per common share: | |||||||||
Basic | $ 0.24 | $ (0.02) | $ 0.29 | $ (0.08) | |||||
Diluted | $ 0.22 | $ (0.02) | $ 0.26 | $ (0.08) | |||||
Weighted-average common shares outstanding: | |||||||||
Basic | 356,097 | 292,557 | 331,046 | 280,229 | |||||
Diluted | 393,420 | 292,557 | 368,377 | 280,229 | |||||
(1) Amounts include stock-based compensation expense as follows: | |||||||||
Cost of sales | $ 2 | $ 12 | $ 49 | $ 62 | |||||
Research and development | 97 | 93 | 378 | 438 | |||||
Selling, general and administrative | 6,774 | 655 | 8,211 | 2,244 | |||||
Total stock-based compensation | $ 6,873 | $ 760 | $ 8,638 | $ 2,744 | |||||
NETLIST, INC. AND SUBSIDIARIES | |||||||
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS | |||||||
(In thousands, except per share amounts) (Unaudited) | |||||||
Nine Months Ended | |||||||
September 26, | September 27, | ||||||
2026 | 2025 | ||||||
Cash flows from operating activities: | |||||||
Net income (loss) | $ | 95,496 | $ | (22,575) | |||
Adjustments to reconcile net income (loss) to net cash provied by (used in) operating activities: | |||||||
Depreciation and amortization | 216 | 212 | |||||
Non-cash lease expense | 386 | 418 | |||||
Gain on forgiveness of payables | (94) | (630) | |||||
Stock-based compensation | 8,638 | 2,744 | |||||
Deferred income taxes | (89,088) | — | |||||
Changes in operating assets and liabilities: | |||||||
Accounts receivable | (2,558) | (2,483) | |||||
Inventories | (13,395) | (14,821) | |||||
Prepaid expenses and other assets | 154 | (11,031) | |||||
Accounts payable | 17,672 | (5,024) | |||||
Accrued payroll and related liabilities | 468 | 57 | |||||
Deferred revenue | 227,476 | 26,934 | |||||
Other liabilities | (380) | (1,796) | |||||
Net cash provided by (used in) operating activities | 244,991 | (27,995) | |||||
Cash flows from investing activities: | |||||||
Acquisition of property and equipment | (185) | (25) | |||||
Net cash used in investing activities | (185) | (25) | |||||
Cash flows from financing activities: | |||||||
Net borrowings (repayments) under line of credit | (1,788) | 2,207 | |||||
Payments on notes payable | (438) | (537) | |||||
Proceeds from issuance of common stock, net | 1,000 | 12,571 | |||||
Proceeds from exercise of stock options and warrants | 42,023 | 75 | |||||
Payments for taxes related to net share settlement of equity awards | — | (59) | |||||
Net cash provided by financing activities | 40,797 | 14,257 | |||||
Net change in cash, cash equivalents and restricted cash | 285,603 | (13,763) | |||||
Cash, cash equivalents and restricted cash at beginning of period | 42,082 | 34,607 | |||||
Cash, cash equivalents and restricted cash at end of period | $ | 327,685 | $ | 20,844 | |||
Reconciliation of cash, cash equivalents and restricted cash at end of period: | |||||||
Cash and cash equivalents | $ | 317,685 | $ | 10,544 | |||
Restricted cash | 10,000 | 10,300 | |||||
Cash, cash equivalents and restricted cash at end of period | $ | 327,685 | $ | 20,844 | |||
SOURCE Netlist, Inc.
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