Earnings Recap — Q2 FY2026
CY Q3 2026 · Reported July 30, 2026 · Beat 2 of last 5 quarters
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Netlist's strong quarter underscores the persistent DRAM supply-demand imbalance driven by AI infrastructure buildout, with constrained supply expected to continue through next year. The company's expanding IP enforcement against major memory suppliers and their customers (including NVIDIA, Google, and Super Micro) could reshape the cost and availability of HBM and DDR5 modules critical to AI servers. Netlist's progress on CXL and MRDIMM technologies positions it to benefit from next-generation AI memory architectures.
Netlist reported Q2 2026 revenue of $109.8 million, up 163% YoY, and gross profit of $22.9 million, up 1,544% YoY. Operating income was $1.3 million, an improvement of $8 million YoY. The company ended the quarter with $40.7 million in cash and minimal debt. Revenue was driven by resale of difficult-to-source DRAM products, but Netlist-branded products (Lightning DDR5) also grew to double-digit millions. The ITC instituted a second case against Samsung and its customers Google, NVIDIA, Super Micro, and Broadcom, based on newly issued patents covering HBM and DDR5/MRDIMM technologies.
Management expects Q3 2026 product revenue to be similar to Q2 2026, based on current bookings and shipping visibility. They highlighted continued robust demand and constrained memory supply, which analysts project will persist through next year. The company is advancing its CXL NVvault and MRDIMM development, with MRDIMM forecast to be a $100 billion market by 2030. On the IP front, they expect procedural schedules for the second ITC case in August, an evidentiary hearing in the first ITC case in late November, and a Federal Circuit oral argument in the Micron appeal on September 9. Management expressed confidence in the strength of their patent portfolio and the new ITC commissioners' commitment to IP enforcement.
“We believe they will take note of the biggest memory companies in the world that are making some of the highest profits recorded in the history of human commerce, and yet, continue to defy jury verdicts, hold out from licensing in order to get a free ride.”
on ITC enforcement
“We've had the supply agreement with hynix. We continue to get support from hynix on the supply, both for DDR4, which is in very short supply and also on DDR5. So we're relatively better off than most in our ability to procure tight DRAM -- short DRAM products.”
on Supply sourcing
“This patent's 15-year history of being subjected to serial IPRs has become a poster child in the IP community and at Capitol Hill for patent re-exam abuse and hold out by the biggest companies in the world.”
on Patent litigation
Chuck, maybe I can come back to the hynix agreement. I know it's post the 5-year anniversary of the prior license. I'm wondering if you could give us some color on the status today of the hynix license itself and maybe any renewal discussions and perhaps maybe broader renewal discussions.
We conduct discussions with our licensees as well as potential licensees on a regular basis. And I think we're making good progress across the board with all of these discussions. But I can't get into the specific details because they are privileged.
And then just curious from a litigation perspective, is there any connection between the court cases for Samsung and the ITC hearing for Samsung? Or are they -- I consider those separate in their efforts?
They are connected. We have a dozen outstanding cases against Samsung in the Eastern District of Texas, at the ITC, and in the District of Delaware. The relationship between all of these cases are the patents. Once ITC institutes their proceedings, the cases with the same patents in the Eastern District of Texas become stayed.
And then, Chuck, one last question. Your resale revenue is strong. Your guidance as per Gail was strong. Is there any risk to your ability to source these products given the supply constraints? Or can you just give a sense of how you're able to continue to source products in what is obviously a very tight market?
It helps that we've been in this industry for 25 years. We've got a very strong network throughout the world for sourcing products. We've had the supply agreement with hynix. We continue to get support from hynix on the supply, both for DDR4, which is in very short supply and also on DDR5. So we're relatively better off than most in our ability to procure tight DRAM products.