PowerFleet reported a standout QQ1 2026 quarter, underscored by a sharp shift toward a SaaS-centric revenue mix via its Unity platform. Services revenue grew 53% YoY and 6% QoQ to $86.5 million, representing 83% of total revenue, as the company benefits from recurring software-enabled monetization and higher attach rates. The quarter featured a 6% sequential increase in service revenue, highlighting SaaS momentum and improved predictability. Adjusted EBITDA reached $21.6 million, up 58% YoY, with margins expanding 300 basis points to 67% driven by services mix and SYNERGY savings of $11 million annualized against an $18 million FY26 target. Management cited lean transformation, synergies, and platform consolidation as key enablers of profitability, while continuing to invest in growth through go-to-market expansion and indirect channels.
The quarter demonstrated commercial traction across both direct and indirect channels, including high-value deals over $100k ARR across 11 sectors, a 14% sequential rise in new logo wins, and AI video bookings up 52% QoQ. Strategic wins with MTN (Africa-wide white-labeled Unity deployment) and SIXT Rental Mexico, along with a Holcim safety-analytics case (83% reduction in critical safety events), validate Unity’s enterprise-grade value proposition and data-centric defensibility. While near-term product revenue faced tariff-related headwinds and capex moderation, the company remains confident in delivering a higher SaaS mix with 85%+ of total revenue from SaaS-related streams over the longer term.
On the balance sheet, PowerFleet ended QQ1 with a net debt/EBITDA of 2.97x and net debt of roughly $23.6 million, with a stated goal to stay under 2.25x by year-end. Cash flow remained positive from operations ($4.72 million), albeit with negative free cash flow (-$3.39 million) as investments and acquisitions continue to front-load platform and system upgrades. The roadmap emphasizes continued margin expansion, a higher services contribution, and selective reinvestment in go-to-market to accelerate top-line growth while maintaining disciplined cost management.