Energy Focus, Inc. Reports Second Quarter 2026 Financial Results (Form 8-K)

Energy Focus, Inc. Reports Second Quarter 2026 Financial Results

SOLON, Ohio, August 11, 2026 -- Energy Focus, Inc. (NASDAQ: EFOI) (the "Company" or "Energy Focus"), a leader in sustainable, energy-efficient lighting and control system products for the commercial market and military maritime market ("MMM"), today announced its financial results for the second quarter ended June 30, 2026.

Second Quarter 2026 Financial Highlights:

•Net sales of $3.7 million, an increase of 228.0% compared with the second quarter of 2025, reflecting an increase of approximately $1.1 million, or 328.4%, of growth in military sales period-over-period and an increase of approximately $1.5 million, or 191.6%, of growth in commercial sales. Sequentially, net sales increased 295.0% compared with the first quarter of 2026, primarily reflecting increases of approximately $1.9 million in commercial sales and $0.9 million in military sales. The net sales increase in the second quarter was primarily driven by higher commercial sales resulting from initial shipments under the Energy Storage Systems ("ESS") business to a new customer in Australia, together with increased sales of MMM products due to improved demand compared to the prior year period.

•Gross profit margin was (6.8)% in the second quarter of 2026, compared with 12.9% in the second quarter of 2025 and 23.3% in the first quarter of 2026. The decrease was primarily driven by an increase in inventory reserves.

•Loss from operations of $0.9 million in the second quarter of 2026, compared with $0.2 million in the second quarter of 2025 and $0.1 million in the first quarter of 2026. The higher loss from operations was primarily due to higher allowance for credit losses and business travel expenses.

•Net loss was $0.9 million, or $(0.14) per basic and diluted share of common stock, in the second quarter of 2026, compared with a net loss of $0.2 million, or $(0.04) per basic and diluted share, in the second quarter of 2025 and a net loss of $0.1 million, or $(0.02) per basic and diluted share, in the first quarter of 2026

•Cash was $1.1 million as of June 30, 2026, unchanged from December 31, 2025 and up from $0.5 million as of June 30, 2025. The increase was primarily due to proceeds of $0.9 million from short-term borrowings, partially offset by a $0.4 million cash advance related to an investment in a joint venture.

•On May 29, 2026, the Company entered into a securities purchase agreement with Euka Power Japan Co., Ltd., pursuant to which the Company agreed to issue and sell, in a private placement, an aggregate of 65,789 shares of its common stock, par value $0.0001 per share, for a purchase price of $3.80 per share, for aggregate gross proceeds of approximately $250,000 (the "May 2026 Private Placement"). Additional details regarding the May 2026 Private Placement are available in the Company's Current Report on Form 8-K filed with the Securities and Exchange Commission on June 3, 2026.

Second Quarter 2026 Financial Results:

Net sales were $3.7 million in the second quarter of 2026, an increase of $2.6 million, or 228.0%, compared with $1.1 million in the second quarter of 2025. The increase primarily reflected a $1.5 million, or 191.6%, increase in

32000 Aurora Road, Solon, OH 44139 • www.energyfocus.com • 800.327.7877

commercial sales, driven by initial shipments to a new customer in Australia through the ESS business, and a $1.1 million, or 328.4%, increase in MMM product sales due to improved demand compared with the prior-year period.

Gross loss was $0.3 million, representing a gross margin of (6.8)% of net sales, in the second quarter of 2026, compared with gross profit of $0.1 million, representing a gross margin of 12.9% in the second quarter of 2025. The year-over-year decrease in gross profit margin was primarily attributable to increased inventory reserves.

Adjusted gross margin, as defined under "Non-GAAP Measures" below, was 4.5% in the second quarter of 2026, compared with 16.7% in the second quarter of 2025. The decrease was primarily attributable to lower variable margins in the second quarter of 2026. Sequentially, adjusted gross margin decreased from 31.0% in the first quarter of 2026 to 4.5% in the second quarter of 2026, representing a decrease of 26.5 percentage points. The decline was primarily attributable to a less favorable product mix and higher inventory reserves recognized during the quarter.

Operating loss was $0.9 million in the second quarter of 2026, an increase of $0.6 million compared with operating loss of $0.2 million in the second quarter of 2025, and an increase of $0.7 million compared with $0.1 million in the first quarter of 2026. The year-over-year and sequential increases were primarily due to higher allowance for credit losses and increase in business travel expenses. Net loss was $0.9 million, or $(0.14) per basic and diluted share of common stock, in the second quarter of 2026, compared with a net loss of $0.2 million, or $(0.04) per basic and diluted share, in the second quarter of 2025 and net loss of $0.1 million, or $(0.02) per basic and diluted share, in the first quarter of 2026.

Adjusted EBITDA, as defined under "Non-GAAP Measures" below, was $(0.9) million in the second quarter of 2026, compared with $(0.3) million in the second quarter of 2025 and $(0.1) million in the first quarter of 2026. The decrease in the second quarter of 2026, as compared to the second quarter of 2025, was primarily driven by higher inventory reserves.

Net cash used in operating activities was $0.8 million in the six months ended June 30, 2026. Net loss in the six months ended June 30, 2026 was $1.0 million, adjusted for non-cash items, including depreciation, provisions for inventory, warranty, accounts receivable reserves and working capital changes. During the six months ended June 30, 2026, significant working-capital changes included a $2.2 million change in accounts receivable due to the specific timing of customer collections, which was offset by a $2.8 million change in related party accounts payable due to the timing of inventory receipts and payments.

About Energy Focus

Energy Focus is a leader in energy-efficient light-emitting diode ("LED") lighting and energy infrastructure solutions. As the creator of the first flicker-free LED lamps, Energy Focus develops high quality LED lighting products and controls that provide extensive energy and maintenance savings, as well as aesthetics, safety, health and sustainability benefits over conventional lighting. Energy Focus is headquartered in Solon, Ohio. For more information, visit our website at www.energyfocus.com. The Company routinely posts important updates on its website.

32000 Aurora Road, Solon, OH 44139 • www.energyfocus.com • 800.327.7877