{"success":true,"data":{"pressRelease":{"id":"35636","rtpr_id":"nGNX78cy8M","ticker":"ZSPC","exchange":"OTC","all_tickers":["ZSPC"],"title":"zSpace Reports First Quarter 2026 Financial Results","author":"Globe Newswire","published_at":"2026-05-14T20:05:06.711Z","article_body":"SAN JOSE, Calif., May 14, 2026 (GLOBE NEWSWIRE) -- zSpace, Inc. (OTC: ZSPC)\n(“zSpace” or the “Company”), a leading provider of augmented and\nvirtual reality (AR/VR) solutions for education and workforce development, is\nannouncing its financial results for the three months ended March 31, 2026.\n\n“Our first quarter results reflect solid execution and early signs of\nstabilization across the education market following a disruptive 2025, as\ncustomers continue to recognize the value of our platform through both new\nwins and strong software renewals,” said Paul Kellenberger, CEO of zSpace.\n“First quarter bookings increased over 80% sequentially following a soft\nfourth quarter driven by the U.S. federal government shutdown. Additionally,\nrevenue grew 8% sequentially, even as late-quarter bookings shifted into the\nsecond quarter and geopolitical events tied to the Iran war delayed key\ninternational deals in the Middle East. Gross margins also expanded 570 basis\npoints compared to last year, supported by the continued mix shift toward\nhigher software and services revenue as we increased company-owned software\ncontent. While macro and funding dynamics remain fluid, we’re encouraged by\nthe momentum we are seeing and remain confident in the long-term potential of\nour business, our ability to continue executing with discipline, and our\ncommitment to controlling what we can control. At the same time, we recognize\nthat our current valuation does not fully reflect the strength of our\nplatform, which is why the Board has initiated a formal review of strategic\nalternatives to ensure we are doing everything we can to maximize long-term\nvalue for our shareholders.”\n\nFirst Quarter 2026 Financial Summary vs. Same Year-Ago Period\n* Revenue of $5.3 million vs. $6.8 million\n* Software and services comprised 47% of revenue vs. 43%\n* Gross margin of 53% vs. 47%\n* Net loss between ($5.9) million and ($6.9) million vs. ($5.8) million\n* Adjusted EBITDA of ($2.1) million vs. ($4.4) million\nRecent Business Highlights\n* On April 1, 2026, zSpace highlighted its partnership with Kansas\nWorkforceONE, expanding immersive career exploration and workforce development\nacross nearly all 96 counties in Kansas by deploying and scaling mobile zSpace\nInspire laptops for K-12 students and adult learners with hands-on career\nawareness, reskilling and job transition support.\n* On April 21, 2026, zSpace showcased the launch of a mobile learning lab in\npartnership with Colorado River BOCES and Briggs & Stratton, bringing a\nbranded CTE trailer powered by immersive AR/VR technology to students across\nwestern Colorado, enabling interactive, industry-aligned career exploration in\nmechanics, power equipment, agriculture and industrial technology.\n* On April 28, 2026, zSpace announced the expansion of its immersive learning\ndeployment across Danbury Public Schools, scaling from a pilot to full\nclassroom sets of 30 devices per school and extending access into alternative\nand expulsion programs to deepen equitable STEM and career-connected learning\nwhile integrating AI-driven career insights.\n* On May 5, 2026, zSpace expanded its international footprint in Poland,\nopening a new immersive 3D STEM laboratory at Bieruń High School, equipping\nthe school with zSpace Inspire 2 AR/VR laptops, enabling interactive,\ninquiry-based STEM exploration.\nFirst Quarter 2026 Financial Results\n\nRevenue in the first quarter of 2026 was $5.3 million compared to $6.8 million\nin the first quarter of 2025. The decrease was driven by orders for EMEA that\nwere delayed and returned as a result of the Iran war.\n\nGross margins increased 570 basis points to 53% compared to the first quarter\nof 2025. The increase was driven by improvements in hardware cost profiles and\nmore Company-owned software content.\n\nAnnualized Contract Value (“ACV”) of renewable software at March 31, 2026,\nwas $10.1 million, representing a 13% decrease compared to a year ago, and a\n2% increase compared to December 31, 2025.\n\nNet Dollar Revenue Retention (NDRR) at March 31, 2026, was 65% for customers\nwith over $50,000 of ACV, compared with the same customers as of March 31,\n2025. Excluding the impact of two key customer losses in the third quarter of\n2025, normalized NDRR was 82%.\n\nBookings in the first quarter of 2026 were $6.1 million, down 8%\nyear-over-year. The backlog of unfulfilled orders as of March 31, 2026 was\n$3.8 million.\n\nOperating expenses, excluding stock-based compensation expense, in the first\nquarter of 2026 were $5.2 million compared to $7.6 million in the first\nquarter of 2025.\n\nNet loss in the first quarter of 2026 was between ($5.9) million and ($6.9)\nmillion compared to ($5.8) million in the first quarter of 2025.\n\nAdjusted EBITDA loss was ($2.1) million compared to ($4.4) million in the\nfirst quarter of 2025.\n\nBalance Sheet\n\nAs of March 31, 2026, zSpace had approximately $2.9 million in cash, cash\nequivalents and restricted cash, compared to $1.1 million in cash, cash\nequivalents and restricted cash as of March 31, 2025.\n\nStrategic Review\n\nThe Company’s Board of Directors has initiated a formal review of strategic\nalternatives to ensure shareholders realize the full value of the business.\nThis review will consider a broad range of potential strategic opportunities,\nwhich may include, among other things, strategic partnerships, business\ncombinations, the sale of all or part of the company, or other strategic or\nfinancial transactions. There is no deadline or definitive timetable for the\nreview, and there can be no assurance that the process will result in any\nspecific transaction or outcome. In authorizing this process, the Board of\nDirectors plans to work with independent financial and legal advisors. The\nCompany does not intend to provide additional updates unless and until the\nBoard approves a definitive course of action or determines that further\ndisclosure is warranted.\n\nConference Call\n\nzSpace will host a conference call at 5:00 p.m. ET / 2:00 p.m. PT on Thursday,\nMay 14, 2026, with the Company’s Chief Executive Officer, Paul Kellenberger,\nand the Company’s Chief Financial Officer, Erick DeOliveira. A live webcast\nof the call will be available on the Events and Presentations\n(https://www.globenewswire.com/Tracker?data=Ycmm8Zfsf_wjh910lk2sTGznDM94QGn9uIZjUhgSskaH4uNamso5obvT2MVQ0e4I5iFw_MybVxDl_CbqE8DGjGWeQp5kYLf8r2lkMjK2XuYk22MyPxNx1TSjTlWS6xE191cp9eEjd2uA0Y6EpOHNqg==)\nsection of zSpace’s investor relations website.\n\nTo access the call by phone, please use this registration link\n(https://www.globenewswire.com/Tracker?data=BhPpC6lMjqJfoab0RX8PF93fMtn9jO9tQ_UzADsonHQE5UfcXmBl-UxwXKnoeZqhgzxybyJ7Kbra4hLFhYVGzi6YgCb8bZlFTE9ApMJE8E78sB0775vfYDh2TLHEurLtCTeYBmxyYiUbTPvQQxoDs9_rlnuHxBdvCzHnetJpgSY=)\nand you will be provided with dial-in details.\n\nTo avoid delays, participants are encouraged to dial into the conference call\n15 minutes ahead of the scheduled start time. A replay of the webcast will\nalso be available for a limited time on the Company’s website.\n\nAbout zSpace\n\nzSpace, Inc. (OTC: ZSPC) delivers innovative augmented and virtual reality\n(AR/VR) experiences that drive achievement in STEM, CTE, and career readiness\nprograms. Trusted by over 3,500 school districts, technical centers, community\ncolleges, and universities, zSpace enables hands-on \"learning by doing\"\nexperiences proven to improve engagement and student outcomes. Headquartered\nin San Jose, California, zSpace holds more than 80 patents, with research\npublished in the Journal of Computer Assisted Learning (2021) validating the\nimpact of 3D virtual reality technologies on student knowledge gains.\n\nKey Metric Definitions\n\nWe monitor the following key metrics to help us evaluate our business,\nidentify trends affecting our business, formulate business plans and make\nstrategic decisions. The calculation of the key metrics discussed below may\ndiffer significantly from other similarly titled metrics used by other\ncompanies, analysts, investors and other industry participants.\n\nWe reference bookings in this press release, which is an internal operational\nmeasure of the business. Bookings represent customer orders that have\nhardware, software and service components. Bookings indicate future revenue,\nwhich lags based on product shipping date, monthly recognition of certain\nsubscription revenue and service delivery completion.\n\nWe reference Annualized Contract Value (ACV) in this press release, which is\nan internal operational measure of the business. To monitor our ability to\nretain and grow our customer base for our software we monitor the annualized\ncontract value of active renewable software licenses.\n\nWe reference Net Dollar Revenue Retention (NDRR) in this press release, which\nis an internal operational measure of the business. We calculate our NDRR as\nof a given period end by starting with the ACV from all customers with\ncontracts of at least $50,000 of ACV as of 12 months prior to such period end\n(“Prior Period ACV”) and calculating the ACV from these same customers as\nof the current period end (“Current Period ACV”). Current Period ACV\nincludes any upsells and is net of contraction or attrition over the trailing\n12 months but excludes revenue from new customers in the current period. We\nthen divide the total Current Period ACV by the total Prior Period ACV to\narrive at our NDRR.\n\nWe reference Adjusted EBITDA in this press release, which we calculate\nAdjusted EBITDA as GAAP net loss adjusted for interest expense, depreciation\nand amortization expense, stock-based compensation, change in fair value of\nconvertible debt, loss on debt extinguishment and income tax expense. We\nbelieve this measure provides our management and investors with consistency\nand comparability with our past financial performance and is an important\nindicator of the performance and profitability of our business.\n\nBookings, ACV, and NDRR are non-GAAP financial measures (U.S. generally\naccepted accounting principles). These non-GAAP measures may not be comparable\nto similarly titled measures being disclosed by other companies. Management\nbelieves that presenting these non-GAAP financial measures provide investors\nwith additional analytical tools which are useful in evaluating our operating\nresults and the ongoing performance of our underlying businesses because they\n(i) provide meaningful supplemental information regarding financial\nperformance by excluding impact of one-time items and other items affecting\ncomparability between periods, (ii) permit investors to view performance using\nthe same tools that management uses to budget, make operating and strategic\ndecisions, and evaluate our core operating performance across periods, and\n(iii) otherwise provide supplemental information that may be useful to\ninvestors in evaluating our financial results. We do not, nor do we suggest\nthat investors, consider such non-GAAP financial measures in isolation from,\nor as a substitute for, financial information prepared in accordance with\nGAAP.\n\n\n\nForward-Looking Statements\n\nCertain statements contained in this press release about future expectations,\nplans and prospects, as well as any other statements regarding matters that\nare not historical facts, may constitute \"forward-looking statements\" within\nthe meaning of the Private Securities Litigation Reform Act of 1995. These\nstatements include, but are not limited to, statements relating to the\nstabilization of the education market, the long-term potential of our\nbusiness, and ability to execute with discipline. The words \"anticipate,\"\n\"believe,\" \"continue,\" \"could,\" \"estimate,\" \"expect,\" \"intend,\" \"may,\" \"plan,\"\n\"potential,\" \"predict,\" \"project,\" \"should,\" \"target,\" \"will,\" \"would\" and\nsimilar expressions are intended to identify forward-looking statements,\nalthough not all forward-looking statements contain these identifying words.\nActual results may differ materially from those indicated by such\nforward-looking statements as a result of various important factors, including\nthe uncertainties related to market conditions and other factors discussed in\nthe \"Risk Factors\" section of the Company's filings with the SEC. For these\nreasons, among others, investors are cautioned not to place undue reliance\nupon any forward-looking statements in this press release. Any forward-looking\nstatements contained in this press release speak only as of the date hereof,\nand zSpace, Inc. specifically disclaims any obligation to update any\nforward-looking statement, whether as a result of new information, future\nevents or otherwise, except as required by law.\n\nContacts\n\nPress Contact:\nAmanda Austin\npress@zspace.com\n408-498-4050\n\nInvestor Relations Contact:\nGateway Group\nCody Slach, Greg Robles \n949.574.3860\nZSPC@gateway-grp.com\n\n\n\nGlobeNewswire, Inc. 2026","article_body_html":"","raw_payload":{"data":{"id":"nGNX78cy8M","title":"zSpace Reports First Quarter 2026 Financial Results","author":"Globe Newswire","ticker":"ZSPC","created":"2026-05-14T20:05:06.711Z","tickers":["ZSPC"],"exchange":"OTC","article_body":"SAN JOSE, Calif., May 14, 2026 (GLOBE NEWSWIRE) -- zSpace, Inc. (OTC: ZSPC)\n(“zSpace” or the “Company”), a leading provider of augmented and\nvirtual reality (AR/VR) solutions for education and workforce development, is\nannouncing its financial results for the three months ended March 31, 2026.\n\n“Our first quarter results reflect solid execution and early signs of\nstabilization across the education market following a disruptive 2025, as\ncustomers continue to recognize the value of our platform through both new\nwins and strong software renewals,” said Paul Kellenberger, CEO of zSpace.\n“First quarter bookings increased over 80% sequentially following a soft\nfourth quarter driven by the U.S. federal government shutdown. Additionally,\nrevenue grew 8% sequentially, even as late-quarter bookings shifted into the\nsecond quarter and geopolitical events tied to the Iran war delayed key\ninternational deals in the Middle East. Gross margins also expanded 570 basis\npoints compared to last year, supported by the continued mix shift toward\nhigher software and services revenue as we increased company-owned software\ncontent. While macro and funding dynamics remain fluid, we’re encouraged by\nthe momentum we are seeing and remain confident in the long-term potential of\nour business, our ability to continue executing with discipline, and our\ncommitment to controlling what we can control. At the same time, we recognize\nthat our current valuation does not fully reflect the strength of our\nplatform, which is why the Board has initiated a formal review of strategic\nalternatives to ensure we are doing everything we can to maximize long-term\nvalue for our shareholders.”\n\nFirst Quarter 2026 Financial Summary vs. Same Year-Ago Period\n* Revenue of $5.3 million vs. $6.8 million\n* Software and services comprised 47% of revenue vs. 43%\n* Gross margin of 53% vs. 47%\n* Net loss between ($5.9) million and ($6.9) million vs. ($5.8) million\n* Adjusted EBITDA of ($2.1) million vs. ($4.4) million\nRecent Business Highlights\n* On April 1, 2026, zSpace highlighted its partnership with Kansas\nWorkforceONE, expanding immersive career exploration and workforce development\nacross nearly all 96 counties in Kansas by deploying and scaling mobile zSpace\nInspire laptops for K-12 students and adult learners with hands-on career\nawareness, reskilling and job transition support.\n* On April 21, 2026, zSpace showcased the launch of a mobile learning lab in\npartnership with Colorado River BOCES and Briggs & Stratton, bringing a\nbranded CTE trailer powered by immersive AR/VR technology to students across\nwestern Colorado, enabling interactive, industry-aligned career exploration in\nmechanics, power equipment, agriculture and industrial technology.\n* On April 28, 2026, zSpace announced the expansion of its immersive learning\ndeployment across Danbury Public Schools, scaling from a pilot to full\nclassroom sets of 30 devices per school and extending access into alternative\nand expulsion programs to deepen equitable STEM and career-connected learning\nwhile integrating AI-driven career insights.\n* On May 5, 2026, zSpace expanded its international footprint in Poland,\nopening a new immersive 3D STEM laboratory at Bieruń High School, equipping\nthe school with zSpace Inspire 2 AR/VR laptops, enabling interactive,\ninquiry-based STEM exploration.\nFirst Quarter 2026 Financial Results\n\nRevenue in the first quarter of 2026 was $5.3 million compared to $6.8 million\nin the first quarter of 2025. The decrease was driven by orders for EMEA that\nwere delayed and returned as a result of the Iran war.\n\nGross margins increased 570 basis points to 53% compared to the first quarter\nof 2025. The increase was driven by improvements in hardware cost profiles and\nmore Company-owned software content.\n\nAnnualized Contract Value (“ACV”) of renewable software at March 31, 2026,\nwas $10.1 million, representing a 13% decrease compared to a year ago, and a\n2% increase compared to December 31, 2025.\n\nNet Dollar Revenue Retention (NDRR) at March 31, 2026, was 65% for customers\nwith over $50,000 of ACV, compared with the same customers as of March 31,\n2025. Excluding the impact of two key customer losses in the third quarter of\n2025, normalized NDRR was 82%.\n\nBookings in the first quarter of 2026 were $6.1 million, down 8%\nyear-over-year. The backlog of unfulfilled orders as of March 31, 2026 was\n$3.8 million.\n\nOperating expenses, excluding stock-based compensation expense, in the first\nquarter of 2026 were $5.2 million compared to $7.6 million in the first\nquarter of 2025.\n\nNet loss in the first quarter of 2026 was between ($5.9) million and ($6.9)\nmillion compared to ($5.8) million in the first quarter of 2025.\n\nAdjusted EBITDA loss was ($2.1) million compared to ($4.4) million in the\nfirst quarter of 2025.\n\nBalance Sheet\n\nAs of March 31, 2026, zSpace had approximately $2.9 million in cash, cash\nequivalents and restricted cash, compared to $1.1 million in cash, cash\nequivalents and restricted cash as of March 31, 2025.\n\nStrategic Review\n\nThe Company’s Board of Directors has initiated a formal review of strategic\nalternatives to ensure shareholders realize the full value of the business.\nThis review will consider a broad range of potential strategic opportunities,\nwhich may include, among other things, strategic partnerships, business\ncombinations, the sale of all or part of the company, or other strategic or\nfinancial transactions. There is no deadline or definitive timetable for the\nreview, and there can be no assurance that the process will result in any\nspecific transaction or outcome. In authorizing this process, the Board of\nDirectors plans to work with independent financial and legal advisors. The\nCompany does not intend to provide additional updates unless and until the\nBoard approves a definitive course of action or determines that further\ndisclosure is warranted.\n\nConference Call\n\nzSpace will host a conference call at 5:00 p.m. ET / 2:00 p.m. PT on Thursday,\nMay 14, 2026, with the Company’s Chief Executive Officer, Paul Kellenberger,\nand the Company’s Chief Financial Officer, Erick DeOliveira. A live webcast\nof the call will be available on the Events and Presentations\n(https://www.globenewswire.com/Tracker?data=Ycmm8Zfsf_wjh910lk2sTGznDM94QGn9uIZjUhgSskaH4uNamso5obvT2MVQ0e4I5iFw_MybVxDl_CbqE8DGjGWeQp5kYLf8r2lkMjK2XuYk22MyPxNx1TSjTlWS6xE191cp9eEjd2uA0Y6EpOHNqg==)\nsection of zSpace’s investor relations website.\n\nTo access the call by phone, please use this registration link\n(https://www.globenewswire.com/Tracker?data=BhPpC6lMjqJfoab0RX8PF93fMtn9jO9tQ_UzADsonHQE5UfcXmBl-UxwXKnoeZqhgzxybyJ7Kbra4hLFhYVGzi6YgCb8bZlFTE9ApMJE8E78sB0775vfYDh2TLHEurLtCTeYBmxyYiUbTPvQQxoDs9_rlnuHxBdvCzHnetJpgSY=)\nand you will be provided with dial-in details.\n\nTo avoid delays, participants are encouraged to dial into the conference call\n15 minutes ahead of the scheduled start time. A replay of the webcast will\nalso be available for a limited time on the Company’s website.\n\nAbout zSpace\n\nzSpace, Inc. (OTC: ZSPC) delivers innovative augmented and virtual reality\n(AR/VR) experiences that drive achievement in STEM, CTE, and career readiness\nprograms. Trusted by over 3,500 school districts, technical centers, community\ncolleges, and universities, zSpace enables hands-on \"learning by doing\"\nexperiences proven to improve engagement and student outcomes. Headquartered\nin San Jose, California, zSpace holds more than 80 patents, with research\npublished in the Journal of Computer Assisted Learning (2021) validating the\nimpact of 3D virtual reality technologies on student knowledge gains.\n\nKey Metric Definitions\n\nWe monitor the following key metrics to help us evaluate our business,\nidentify trends affecting our business, formulate business plans and make\nstrategic decisions. The calculation of the key metrics discussed below may\ndiffer significantly from other similarly titled metrics used by other\ncompanies, analysts, investors and other industry participants.\n\nWe reference bookings in this press release, which is an internal operational\nmeasure of the business. Bookings represent customer orders that have\nhardware, software and service components. Bookings indicate future revenue,\nwhich lags based on product shipping date, monthly recognition of certain\nsubscription revenue and service delivery completion.\n\nWe reference Annualized Contract Value (ACV) in this press release, which is\nan internal operational measure of the business. To monitor our ability to\nretain and grow our customer base for our software we monitor the annualized\ncontract value of active renewable software licenses.\n\nWe reference Net Dollar Revenue Retention (NDRR) in this press release, which\nis an internal operational measure of the business. We calculate our NDRR as\nof a given period end by starting with the ACV from all customers with\ncontracts of at least $50,000 of ACV as of 12 months prior to such period end\n(“Prior Period ACV”) and calculating the ACV from these same customers as\nof the current period end (“Current Period ACV”). Current Period ACV\nincludes any upsells and is net of contraction or attrition over the trailing\n12 months but excludes revenue from new customers in the current period. We\nthen divide the total Current Period ACV by the total Prior Period ACV to\narrive at our NDRR.\n\nWe reference Adjusted EBITDA in this press release, which we calculate\nAdjusted EBITDA as GAAP net loss adjusted for interest expense, depreciation\nand amortization expense, stock-based compensation, change in fair value of\nconvertible debt, loss on debt extinguishment and income tax expense. We\nbelieve this measure provides our management and investors with consistency\nand comparability with our past financial performance and is an important\nindicator of the performance and profitability of our business.\n\nBookings, ACV, and NDRR are non-GAAP financial measures (U.S. generally\naccepted accounting principles). These non-GAAP measures may not be comparable\nto similarly titled measures being disclosed by other companies. Management\nbelieves that presenting these non-GAAP financial measures provide investors\nwith additional analytical tools which are useful in evaluating our operating\nresults and the ongoing performance of our underlying businesses because they\n(i) provide meaningful supplemental information regarding financial\nperformance by excluding impact of one-time items and other items affecting\ncomparability between periods, (ii) permit investors to view performance using\nthe same tools that management uses to budget, make operating and strategic\ndecisions, and evaluate our core operating performance across periods, and\n(iii) otherwise provide supplemental information that may be useful to\ninvestors in evaluating our financial results. We do not, nor do we suggest\nthat investors, consider such non-GAAP financial measures in isolation from,\nor as a substitute for, financial information prepared in accordance with\nGAAP.\n\n\n\nForward-Looking Statements\n\nCertain statements contained in this press release about future expectations,\nplans and prospects, as well as any other statements regarding matters that\nare not historical facts, may constitute \"forward-looking statements\" within\nthe meaning of the Private Securities Litigation Reform Act of 1995. These\nstatements include, but are not limited to, statements relating to the\nstabilization of the education market, the long-term potential of our\nbusiness, and ability to execute with discipline. The words \"anticipate,\"\n\"believe,\" \"continue,\" \"could,\" \"estimate,\" \"expect,\" \"intend,\" \"may,\" \"plan,\"\n\"potential,\" \"predict,\" \"project,\" \"should,\" \"target,\" \"will,\" \"would\" and\nsimilar expressions are intended to identify forward-looking statements,\nalthough not all forward-looking statements contain these identifying words.\nActual results may differ materially from those indicated by such\nforward-looking statements as a result of various important factors, including\nthe uncertainties related to market conditions and other factors discussed in\nthe \"Risk Factors\" section of the Company's filings with the SEC. For these\nreasons, among others, investors are cautioned not to place undue reliance\nupon any forward-looking statements in this press release. Any forward-looking\nstatements contained in this press release speak only as of the date hereof,\nand zSpace, Inc. specifically disclaims any obligation to update any\nforward-looking statement, whether as a result of new information, future\nevents or otherwise, except as required by law.\n\nContacts\n\nPress Contact:\nAmanda Austin\npress@zspace.com\n408-498-4050\n\nInvestor Relations Contact:\nGateway Group\nCody Slach, Greg Robles \n949.574.3860\nZSPC@gateway-grp.com\n\n\n\nGlobeNewswire, Inc. 2026"},"type":"article","timestamp":"2026-05-14T20:05:06.772074845Z","server_sent_at_ms":1778789106772},"received_at":"2026-05-14T20:05:06.865Z","source_url":"https://www.globenewswire.com/news-release/2026/05/14/3295369/0/en/zSpace-Reports-First-Quarter-2026-Financial-Results.html"},"analysis":{"id":"25084","press_release_id":"35636","analysis_json":{"industry":{"label":"Software","sector":"Information Technology"},"redFlags":["Revenue declined 22% YoY","Net loss widened despite EBITDA improvement","ACV declined 13% YoY, indicating software churn or contraction","Cash position of $2.9M is low for a pre-profitability company","Strategic review initiated, signaling potential distress or desire to exit"],"eventType":"earnings","narrative":"zSpace reported Q1 2026 revenue of $5.3 million, a 22% decline year-over-year, driven by delayed EMEA orders due to geopolitical events in the Middle East. Net loss widened to between $5.9 million and $6.9 million, though Adjusted EBITDA improved significantly to a $2.1 million loss from $4.4 million a year ago.\n\nGross margins expanded 570 basis points to 53%, supported by a shift toward higher-margin software and services, which now comprise 47% of revenue. Bookings were $6.1 million, down 8% YoY, but up over 80% sequentially following a soft Q4 caused by the U.S. federal government shutdown.\n\nThe Board has initiated a formal strategic review to maximize shareholder value, considering options including strategic partnerships, business combinations, or the sale of all or part of the company. The company holds $2.9 million in cash and reported an Annualized Contract Value (ACV) of $10.1 million.","sentiment":"mixed","agentHooks":{"shouldPost":true,"suggestedAngle":"zSpace misses on revenue but improves margins; Board launches strategic review for potential sale or partnership."},"keyFigures":{"eps":0,"epsBeat":0,"revenue":5300000,"drugName":"","guidance":"","revenueYoy":"-22%","dealValueUsd":0,"phaseOfTrial":"","offeringPrice":0,"sharesOffered":0,"customDimensions":{"acv":10100000,"ndrr":"65%","acv_yoy":"-13%","backlog":3800000,"bookings":6100000,"net_loss":"-5.9M to -6.9M","bookings_yoy":"-8%","gross_margin":"53%","adjusted_ebitda":"-2.1M","normalized_ndrr":"82%","cash_and_equivalents":2900000,"adjusted_ebitda_prior":"-4.4M","gross_margin_yoy_change":"570 bps","operating_expenses_ex_sbc":5200000}},"quotedText":"Our first quarter results reflect solid execution and early signs of stabilization across the education market following a disruptive 2025, as customers continue to recognize the value of our platform through both new wins and strong software renewals","namedEntities":{"people":[{"name":"Paul Kellenberger","role":"CEO"},{"name":"Erick DeOliveira","role":"CFO"}],"products":["zSpace Inspire","zSpace Inspire 2"],"companies":[{"name":"zSpace, Inc.","ticker":"ZSPC"},{"name":"Kansas WorkforceONE","relationship":"partner"},{"name":"Colorado River BOCES","relationship":"partner"},{"name":"Briggs & Stratton","relationship":"partner"},{"name":"Danbury Public Schools","relationship":"customer"},{"name":"Bieruń High School","relationship":"customer"},{"name":"Gateway Group","relationship":"investor relations advisor"}],"dollarAmounts":[{"amount":"$5.3 million","context":"Q1 2026 revenue"},{"amount":"$6.8 million","context":"Q1 2025 revenue"},{"amount":"$5.9 million","context":"lower bound of Q1 2026 net loss"},{"amount":"$6.9 million","context":"upper bound of Q1 2026 net loss"},{"amount":"$5.8 million","context":"Q1 2025 net loss"},{"amount":"$2.1 million","context":"Q1 2026 Adjusted EBITDA loss"},{"amount":"$4.4 million","context":"Q1 2025 Adjusted EBITDA loss"},{"amount":"$10.1 million","context":"Annualized Contract Value (ACV)"},{"amount":"$6.1 million","context":"Q1 2026 bookings"},{"amount":"$3.8 million","context":"backlog of unfulfilled orders"},{"amount":"$5.2 million","context":"Q1 2026 operating expenses excluding SBC"},{"amount":"$7.6 million","context":"Q1 2025 operating expenses excluding SBC"},{"amount":"$2.9 million","context":"cash, cash equivalents and restricted cash"},{"amount":"$1.1 million","context":"cash, cash equivalents and restricted cash (prior year)"},{"amount":"$50,000","context":"ACV threshold for NDRR calculation"}]},"materialImpact":{"score":3,"reasoning":"Revenue missed year-over-year expectations (-22%) and net loss widened, but gross margins expanded significantly and Adjusted EBITDA improved. The initiation of a formal strategic review (potential sale/M&A) adds a binary optionality that elevates the impact beyond a routine miss."},"tickerRelevance":{"others":[],"primary":"ZSPC"},"globalImportance":25,"audienceRelevance":30,"eventTypeSecondary":["m_and_a"],"importanceComponents":{"tickerTier":"micro-cap","eventGravity":"earnings_miss_plus_strategic_review","sectorWeight":"neutral","householdBrandBoost":"none","marketCapAdjustment":"low","retailFavoriteBoost":"low"}},"event_type":"earnings","event_type_secondary":["m_and_a"],"sentiment":"mixed","material_impact_score":3,"narrative":"zSpace reported Q1 2026 revenue of $5.3 million, a 22% decline year-over-year, driven by delayed EMEA orders due to geopolitical events in the Middle East. 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