Optical Cable (NASDAQ:OCC) reported a stronger start to fiscal 2026, citing higher demand across enterprise and specialty markets, improved gross margin, and a sharply higher sales order backlog and forward load. Management said momentum in targeted markets, particularly data centers, was building as the company entered the second fiscal quarter.
Quarterly results show higher sales and improved gross margin
For the first quarter ended Jan. 31, 2026, consolidated net sales increased 4.4% to $16.4 million, up from $15.7 million in the prior-year period, according to CFO Tracy Smith. The company reported growth in both its enterprise and specialty markets versus the same quarter last year, which management attributed to “general market improvements” in the industry and strength in its severe-duty market.
SG&A expenses were $5.6 million, compared with $5.5 million in the year-ago quarter, driven primarily by higher employee and contracted sales personnel costs and shipping costs. As a percentage of net sales, SG&A improved to 33.8% from 34.7%.
Optical Cable posted a net loss of $398,000, or $0.05 per basic and diluted share, compared with a net loss of $1.1 million, or $0.14 per basic and diluted share, in the prior-year quarter.
Backlog and forward load climb more than 50%
Management highlighted an increase in sales order backlog and forward load to $10.4 million at the end of the quarter, up from $6.6 million at the end of the first quarter of fiscal 2025. Smith added that backlog and forward load also increased from $7.3 million at fiscal 2025 year-end.
CEO Neil Wilkin said the company expects to build on the momentum, even as seasonality typically affects the first half of the fiscal year. He said the company was “seeing growing momentum in our targeted markets and, in particular, in our data center market” early in the second quarter.
Data center activity described as increasing, especially in January
In response to a shareholder question, Wilkin said the company remained optimistic about data center opportunities, specifically in multi-tenant and enterprise data center sectors. He said OCC saw “significant and growing activity and customer requests for quotes” in the data center sector during January, and that activity was continuing and growing entering fiscal Q2.
While the company said it generally does not provide detailed results by end market, management indicated that data center quoting activity and customer orders increased during the quarter, again emphasizing January. Wilkin said he believes this trend will continue and translate into greater data center-related revenues during the remainder of fiscal 2026.
Wilkin also addressed the sales cycle for data center opportunities, noting that data center cycles—particularly Tier II—tend to be longer than the company’s typical sales cycle. He said OCC’s team stays close to customers and other market participants daily to gauge demand signals and market dynamics.
Lightera collaboration: product breadth and expected opportunity creation
Management also discussed the company’s collaboration with Lightera (formerly OFS), describing it as an extension of a decades-long working relationship. Wilkin said the two teams “work well together and complement each other,” and added that OCC believes it is seeing benefits as it moves into fiscal 2026.
Asked what kinds of products OCC expects to sell alongside Lightera, Wilkin said the combined offering includes both cabling and connectivity. He cited specific Lightera product examples that are now part of OCC’s solutions:
- Lightera’s rollable ribbon fiber optic cable, which Wilkin said is particularly suited for data center applications.
- Lightera’s InvisiLight solutions, which he said are well-suited for passive optical LAN installations in existing buildings where traditional installations are more challenging.
On timing, management said that working with Lightera has already begun to generate additional opportunities and is expected to contribute to revenue growth in fiscal 2026 and beyond. When asked about the collaboration and details related to Lightera’s share purchase, Wilkin said it would not be appropriate to comment beyond what has already been disclosed, but added that he believes Lightera’s investment reflects confidence in OCC and the collaboration.
Management commentary on outlook, seasonality, hiring, and project delays
Wilkin said the company remains “very optimistic” about potential sales growth in fiscal 2026, while reiterating that seasonality often affects results in the first half, particularly the first quarter. He pointed to the more than 50% increase in backlog and forward load and increased quote activity in targeted sectors as support for expectations of sales growth.
In a live analyst question, Wilkin addressed prior comments about project delays, saying he could not think of anything “offhand that is being delayed at the moment.” While acknowledging delays can occur in any quarter, he said the company does not expect them to impact results this year.
Management also noted the company is hiring in manufacturing operations. Smith said OCC has been hiring to meet anticipated personnel needs for the fiscal year, recognizing the time required to train new manufacturing employees. She added that OCC benefits from skilled long-term employees and tends to have lower turnover than other companies, though it does experience some turnover that creates open positions.
The company did not provide revenue guidance for fiscal 2026 by year or quarter. However, management reiterated expectations that the remainder of fiscal 2026 would show further growth, including a stronger second half compared with the first half.
About Optical Cable (NASDAQ:OCC)
Optical Cable Corporation (NASDAQ: OCC) is a publicly traded designer and manufacturer of optical fiber and copper communications cable solutions. Headquartered in Roanoke, Virginia, the company develops a broad range of standard and custom cable assemblies, connectors, hardware and accessories. Its product portfolio addresses data transmission requirements in demanding environments, including long-haul telecommunications, industrial automation, defense systems and submersible applications.
The company’s offerings are organized across multiple product lines, encompassing outside-plant fiber optic cable for aerial and underground installations, indoor/outdoor copper connectivity and specialty engineered cable assemblies.
