Norwegian AI software company Elliptic Labs reported a 48% year-over-year decline in revenue for the second quarter of 2026, citing a strategic shift in its business mix. Total revenue fell to NOK 12.9 million from NOK 25.0 million in the same period last year, driven by a 74-percentage-point drop in laptop-related revenue to just 2% of the total. Smartphone revenue, which now accounts for 98% of sales, declined alongside weaker demand in that segment.
Shipments, however, painted a contrasting picture. Laptop sensor shipments surged 33% year-over-year to an index level of 299, based on a Q3 2023 baseline of 100. The company attributed the growth to increased adoption of its AI-powered sensor technology in laptops, with 33 new models launched in the quarter alone. Smartphone shipments, by contrast, fell 17% to an index level of 139, reflecting broader market trends.
The company’s cost-reduction program, implemented in Q1 2026, reduced its operating cost base by approximately 15% on an annualized run rate compared with the prior twelve months. Employee benefits expenses declined 39% to NOK 11.1 million, while non-recurring legal and patent expenses totaled NOK 1.0 million. Despite these efforts, EBITDA remained negative at NOK -5.1 million, compared with a positive NOK 1.1 million in Q2 2025.
Elliptic Labs’ cash position stood at NOK 59.0 million at the end of the quarter, down from NOK 74.0 million at the end of Q1. Operating cash outflows totaled NOK 8.5 million, with additional outflows of NOK 4.9 million for investments and NOK 2.0 million for financing activities. Total assets amounted to NOK 235 million, including NOK 90 million in cash and equivalents, while equity stood at NOK 211 million with no financial debt. Short-term liabilities fell to NOK 17 million from NOK 25 million in the prior quarter.
Management outlined a transition toward Edge AI, positioning its platform as "the operating layer for edge intelligence." The company expects the first commercial proof-of-concept launch for Edge AI in the second half of 2026, with material revenue impact anticipated from 2027. Elliptic Labs also cited projections of a tenfold expansion in the global Edge AI market, from $36 billion in 2025 to $386 billion by 2034.
The company’s shares traded at $2.39 at the time of the presentation, down nearly 13% from the prior close of $2.74 and near a 52-week low of $2.35, significantly below its 52-week high of $12.26.
