BOS Better Online Solns Reports Q2 2026 Results: Full Earnings Call Transcript

BOS Better Online Solns (NASDAQ: BOSC ) held its second-quarter earnings conference call on Thursday. Below is the complete transcript from the call. APIs provide real-time access to earnings call transcripts and financial data. Visit to learn more.

The full earnings call is available at Summary BOS Better Online Solns reported a 29% year-over-year revenue growth in Q2 2026, offsetting a weaker Q1 and aligning trailing 12-month revenue with the record levels of 2025. The company maintains a record backlog of $31 million, with $20 million scheduled for delivery by year-end, representing 91% of the full year 2025 revenue. 6 million achieved in 2025, despite increased operating expenses due to currency devaluation. BOS Better Online Solns holds $10 million in cash, facilitating potential M&A activities, with several opportunities under evaluation.

The RFID division saw a 17% revenue growth in the first half of the year, driven by a recovery in the Israeli commercial market. Operational efficiency improvements and AI deployment are underway to enhance gross margins and offset increased operational costs. Future guidance suggests exceeding $51 million in 2026 revenue, with a focus on capitalizing on defense, automation, and supply chain modernization trends. Management is exploring a potential rebranding to 'BOSC', aligning with its stock ticker, to address concerns over the current company name.

Full Transcript OPERATOR Ladies and gentlemen, welcome to BOS Better Online Solns Investor Summit. Thank you for joining us today. Before we begin, a brief reminder that this call contains forward-looking statements relating to BOS Better Online Solns' business, financial condition, and results of operations. These statements are subject to risks and uncertainties that could cause actual results to differ materially from those anticipated.

Such statements include, but are not limited to, matters relating to product demand, pricing, market acceptance, economic conditions, and technology development, as further detailed in the Company's filings with the various securities authorities. Before I turn things over to management, I would like to give a brief recap of the results we just released. The growth momentum continued. Second quarter 2026 revenue grew 29% year over year, helping offset a softer first quarter of 2026 and bringing trailing 12-month revenue to the same level as our record 2025 revenue.

We anticipate that full year 2026 revenue will exceed full year 2025 revenue. Our backlog remained at a record $31 million as of the end of the second quarter of 2026. Approximately $20 million of the backlog is scheduled for delivery by year end. Together with first half revenue, this amount represents approximately 91% of our full year 2025 revenue.

6 million we achieved in year 2025. Our balance sheet is solid. 9 million and cash stands at $10 million. That gives us the flexibility to capitalize on organic and M&A opportunities.

BOS is a company with a growing backlog, accelerating revenues, a clean balance sheet, and exposure to some of the strongest structural trends in the global economy: defense spending, automation, and supply chain modernization. And yet BOS currently has a market capitalization of approximately $31 million and its enterprise value (market cap less cash) is approximately $21 million. For comparison, the Russell Microcap Index trades at approximately 2x book value versus BOS Better Online Solns trading at 1x book value, and the Russell Microcap Index price-to-earnings ratio is roughly 16x compared to our roughly 9x. Thank you for watching.

Now I will turn the call over to Eyal Cohen, CEO. Eyal Cohen, CEO Good morning. Great to see you again in our quarterly conference. Joining me today is Moshe, our Chief Financial Officer.

I'm pleased to see the strong participation today, including many new names following the recent virtual conferences we participated in during May, June, and July. Let me start by sharing a few thoughts on how the business is progressing. I am very pleased with our financial performance, financial position, management team, board members, and the growth opportunities in front of us. This has given us the confidence to grow year after year, and we remain focused on continuing that trend.

I am pleased that the commercial market in Israel has recovered, as reflected in 17% growth in the RFID revenue in the first half of the year as compared to the comparable period. Demand in the defense segment continues to be strong, as reflected in our record backlog, most of which relates to our supply chain division. The penetration of our robotics division into more factories in the defense segment is going very well. We are successfully implementing AI within BOS for internal use to improve our operational efficiency and in software development for commercial use, commercial sales.

I believe these steps will yield improved operational margins and support our revenue. On the financial front, despite 30% growth in the total revenue between Q1 2026 and Q2 2026, cash remained roughly unchanged at $10 million. We grew without needing to burn cash, which is a strong indication of highly efficient cash management, with our vendors helping to finance our clients. We will deploy this cash to support our external growth through M&A.

On the M&A front, we have several opportunities on the table that we have been evaluating carefully. On the IR side, in May we presented at the MicroCap Club Virtual Summit and in June we participated in the iAccess Alpha Virtual Summit. In July we hosted our first investor webinar. We are going to participate in the Sidoti conference scheduled for the end of September.

In September we will also join a non-deal roadshow to ThinkEquity clients. During July and August we released three announcements on a major contract. In recent months, we have become active online on Facebook, LinkedIn, X, and via email, and we plan to increase our investment in those channels. I will send you the link to our pages and you are welcome to follow and share.

We are hopeful those activities will help close the gap in our valuation. With that, I want to thank you again for your continued confidence and support in BOS as we carry this momentum into the second half of the year. Thank you for listening. We will now be happy to open the call for questions.

Please unmute yourself if you want to ask questions. Todd Good morning, Eyal. Good morning, Moshe. Congratulations on a fantastic quarter.

Regarding one of your recent orders, it was in the semiconductor industry. Is that kind of a one-time order, or do you see more orders occurring from that industry? Eyal Cohen, CEO We have to understand that once we announce a contract that relates to the supply chain division, on the back of it, there is a design work of embedding our components into the client's product that is in development process. Actually we worked on that order a year ago.

So once the product starts the mass production, then we start to get the orders. So we expect as long as the product is alive, the orders will follow. Todd Okay, and can you kind of give an update on your progress in India? I know that's becoming a large part of your revenues.

And where do you see that progressing over the next year? Eyal Cohen, CEO Yeah, we are very pleased with the progress of our team in India. They are doing a very good job. They are reaching to clients that we have never been in contact with.

And I am sure that it will yield additional—It will support the growth of BOS Better Online Solns in India in year 2026. Todd Okay, and my final question is referring to M&A. Do you still plan to make any M&A activity non-dilutive to shareholders and finance that with existing cash and bank loans? Is that correct?

Eyal Cohen, CEO That's correct. Actually we are planning to do an M&A. But as you know, in the recent two or three years we have not succeeded to close the deal because it doesn't match to our criteria, especially the first criteria that it should be a very—company with a solid history of profits and positive outlook. We have several opportunities on the table.

We are checking it and we are in negotiations with several companies. Hopefully one of them will be closed. And of course we have the financial policy how to finance. We have the policy how to finance those deals.

As I mentioned before, we have like $10 million in cash in hand. So if we are buying a profitable company, there is no reason why the bank won't participate at 50% of the financing. So we actually can reach to maximum acquisition value of $20 million. So we are set.

Todd Well, thank you. I'll hop back in the queue. Congratulations again on a great quarter. Eyal Cohen, CEO Thank you, Todd.

I'm looking forward to meet you in Israel. Todd Thank you. Scott Weiss Good morning, Eyal, it's Scott Weiss. How are you?

Eyal Cohen, CEO Fine, thank you, Scott. Scott Weiss Good, thanks. Nice quarter. My question is on the RFID division.

It was up a nice 17 and a half percent year over year. It bounced back. Was that a function of the easy comp year over year, or are you seeing some kind of a positive change there? Eyal Cohen, CEO Yeah, we see a positive change.

We actually were expecting that and it happened. A little bit silent here in Israel—and it seems there is a rebound in the market. You know, the demand starts very strong. We see a recovery.

Hopefully it will continue for a long time after three years of, like, to be in hold position. So for year 2026 it looks very—I'm bullish on year 2026 for the RFID division. Scott Weiss And the same question for the supply chain segment. Revenues were down 6% or so.

Is there any insight you can give us as to why it was down? Eyal Cohen, CEO As you saw, the fluctuations in this division are significantly high. You know, as you remember, in the first quarter we were below the comparable quarter last year by about, if I remember correctly, like 17% less. And then here in the second quarter we succeeded to close the gap.

So we know that our clients in the defense segment will buy our component, but we are not controlling the rate of consumption. So there could be fluctuation. Because of that, I'm not giving importance to the 5% decrease. More than this, we have a very strong backlog—$31 million, which is a record backlog, by the way.

Despite 30% growth in revenues from Q1 to Q2, the backlog still remained at the same level of $31 million it was at the end of the first quarter. Scott Weiss Consolidated. Eyal Cohen, CEO Yeah, consolidated, sure. So out of the $31 million, we have $20 million for delivery by the year end.

So we did the calculation, and based on that we provided positive outlook that we will exceed $51 million in year 2026. Scott Weiss Okay, great. Thank you. Eyal Cohen, CEO Thank you, Scott.

Hi. OPERATOR You can go ahead. It's okay. Okay.

Eyal Cohen, CEO Who's going to be the first one? Kevin? Yes, please, Kevin. Kevin Okay.

Hi. Hi, this is Kevin from Alliance School of Partners. Thanks for taking our questions. As a follow-up on M&A, could you speak to what are kind of the gating factors in it?

Would it be finding targets, price expectations, or the financing capacities? Eyal Cohen, CEO I'm not sure I got your question. Can you repeat? Because the line is not so clear.

Can you repeat please? Kevin Yeah, sure. As a follow up to the earlier M&A question, could you kind of speak to what are some of the gating factors on kind of closing a deal? Would that be finding targets, price expectations, or the financing capacity?

Eyal Cohen, CEO Yes. So the criteria are, as I mentioned, that the cap of acquisition—of investment—will be $20 million. The criteria that there should be a synergy to our core business. And, you know, the synergy could be a range of synergy—how much is 50% synergy, 100% fully synergy—so we have flexibility on that issue, on that criteria.

Regarding the financial position, the financial performance, or the performance of the company, we are checking that in the recent three to five years the company presented consecutive profits and there is positive outlook going forward. And regarding the multiple, the valuation, the things that we have on the table, the multiple on the EBITDA is between 5 to 6. This is the range of valuation we are talking about. Kevin Got it.

Thanks. 1 million from India and the US through May. 6 million range, which is flat to last year. Could you walk me through that bridge?

Is it incremental revenue being absorbed by shekel in the mix? And then specifically, what has to change—FX, pricing, or mix—for this momentum to break through to the bottom line in 2027? Eyal Cohen, CEO Yes. 6 million.

And usually we don't provide exact percentage of growth. 6 million. But still there is a challenge we are facing with the devaluation of the US dollar. As you saw, in the first half of the year it increased our operational expenses by about $600,000.

It increased the operational expenses by $600,000. 2 million. 6 million. So we can work on internal efficiency, and we are doing it mainly with the assistance of AI tools to improve our operational efficiency.

2 million a year, it will be very tough. So we are doing it by operational efficiency, by increasing the gross profit margin of our products in order to compensate, and we are increasing our revenues. 6 million. Kevin Got it.

Thanks a lot. Eyal Cohen, CEO Thank you, Kevin. Hi. James Kahn Hi.

James Kahn here. In a previous conference call, you suggested that you were open to the possibility of a new name for your company because Better Online Solutions is awkward at best and a little inaccurate and a little bit silly. So I've been working on this and giving it some thought and consulting with people. And I believe the best solution is an organic one, something that you're already known by.

So I suggest BOSC, your symbol, as the name for the company. Eyal Cohen, CEO I totally agree with you. I think—you know why BOSC? Because it's also BOSC on—so it's okay.

But I agree all the investors know the name BOSC, they know the ticker. I totally agree with you. And if I won't get any other recommendation from our shareholders that can send me emails and other suggestions, I think we will go for it. Thank you.

Great idea. Thank you. Any further questions? Igor Novgorodtsov Hi, this is Igor Novgorodtsov, and nice talking to you again, especially after a strong quarter.

I want to touch upon gross margins. So the gross margins—I don't have it really in front of me right now—but they seem to be kind of being a little bit flat while your revenue is growing. Is gross margin affected by RFID versus supply chain mix? Maybe you can guys give us—I know you don't disclose them exactly, but maybe you can walk us through a little bit through that.

Or are they affected by FX? Do you think the gross margins can improve while your revenue is growing? Eyal Cohen, CEO I think the gross margin—we are working that the gross margin will improve because what I just mentioned before, because we have to compensate on the effect of the devaluation of the US dollar. So we are working extensively with our clients to increase the sales price.

I have to tell you that since the beginning of the year we—on the sales team—increasing prices in order to compensate it. And I am following—we are following—month by month. So our expectation is that our gross profit margin going ahead will increase. But in certain cases there could be a huge transaction, especially in the supply chain, for a certain kind of product that the gross profit margin could be lower.

It's a matter of negotiation with a client. And I hope it won't decrease—it won't lower—the average of our gross profit margin that we expect. So in general we are expecting higher gross profit margins. Igor Novgorodtsov Does it apply to just supply chain or it also equally applies to RFID?

Eyal Cohen, CEO So I mentioned the supply chain because in the supply chain there are huge transactions. 5 million that can affect significantly on a specific quarter. In the RFID, the transactions are much lower. It could be like quarter million dollar, $100,000, half million dollar maximum.

So because of that I mentioned just the effect of certain transactions of the supply chain. Igor Novgorodtsov For RFID division, apart from obviously the issues that Israel has been in various stages of for in the last few years—you had specific companies. I remember that last year you were restructuring your RFID division. Is this restructuring over, or do we expect some significant further improvements, or how much did it change from the last year?

Eyal Cohen, CEO Yeah, it was important. It's not a company under the RFID, it's a unit under the RFID.