PAR Technology (NYSE:PAR) reported second-quarter fiscal 2026 results that exceeded its prior outlook, led by subscription growth, elevated hardware sales and continued operating expense discipline. The company raised its full-year revenue and adjusted EBITDA guidance while reiterating expectations for faster annual recurring revenue growth in the second half.
Total revenue rose 19% year over year to $133 million, including subscription service revenue of $83 million, up 16%. PAR reported a net loss of $17 million, or $0.41 per share, compared with a net loss of $21 million, or $0.52 per share, a year earlier. Non-GAAP net income was $7.5 million, or $0.18 per diluted share, versus $0.6 million, or $0.01 per diluted share, in the prior-year period.
ARR Growth and Platform Adoption
PAR exited the quarter with approximately $338 million in annual recurring revenue, up more than 17% year over year, including 12.3% organic growth. Management said the company expects ARR growth to accelerate during the second half as deployments progress for Burger King and Papa Johns, alongside other restaurant and retail implementations.
CEO Savneet Singh said nearly all new engagements during the quarter involved multiple PAR products, including point of sale, loyalty, ordering, payments and back-office capabilities. The company cited new multi-product wins with Guthrie’s Chicken, Sarku Japan, Newk’s, Burgerville, Phil Brady’s and Bad Ass Coffee.
Singh said PAR POS remained ahead of plan on Burger King activations and that the company completed key development milestones ahead of Papa Johns’ planned platform deployment. PAR OPS, meanwhile, activated nearly 700 locations during the quarter, its strongest quarter to date, according to management.
In the ordering business, PAR closed six new deals during the quarter, including three customers that migrated from what Singh described as the market’s largest legacy ordering provider. Every ordering deal also included other PAR products, he said. Catering capabilities were included in two of the six wins, reflecting demand following product investments made last year.
AI Rollout and Retail Expansion
PAR continued to emphasize its artificial intelligence strategy, which centers on using data across its connected restaurant and retail platform. The company ended the quarter with roughly 20,000 live PAR Intelligence sites and plans to add more than 20,000 sites in the third quarter. Management said it remains on track to reach 50,000 live sites during fiscal 2026.
Singh characterized 2026 as an adoption year for PAR Intelligence, with monetization expected to become more meaningful in 2027 through premium features, deeper product attachment and customer engagement. In response to an analyst question, he said PAR expects to evaluate subscription-based commercialization models, potentially as an add-on to back-office or loyalty offerings.
Within retail, PAR launched Bolla Energy and two additional enterprise retailers during the quarter. The PAR Intelligence footprint expanded to approximately 17,000 retail sites, exceeding the company’s initial adoption objective, management said. PAR Retail also rolled out agentic AI tools to its developers to support engineering productivity and product development.
The company also highlighted progress at Bridg, the data-intelligence business it acquired in late March. Since the transaction closed, Bridg added more than $1.3 million in committed ARR from two signed customers, including an existing PAR restaurant customer. Both agreements extend through 2029, Singh said.
Looking ahead, PAR plans to launch an AI-native kitchen display system and AI-powered drive-thru audio technology for restaurants. In retail, the company said customers are engaging it on technology expansion initiatives across forecourt and backcourt systems.
Margins, Cash Flow and Guidance
Hardware revenue increased 31% year over year to $35 million, representing PAR’s strongest hardware sales quarter in at least a decade, according to Menar. The growth reflected refresh activity and an expanded partnership with a legacy customer, as well as hardware attachment to software customers. Hardware gross margin was 20%, down from 27% a year ago, amid tariffs and supply-chain constraints. Management expects hardware margins to remain in the low 20% range.
Professional services revenue increased 10% to $15 million. Subscription-service gross margin was 55.2%, essentially flat from 55.3% a year earlier. On a non-GAAP basis, subscription-service margin was 65.1%, compared with 66.4%, with Menar attributing the decline primarily to product mix and a full quarter of Bridg operations.
Operating expenses, excluding non-GAAP adjustments, declined 5% year over year to $51 million. Non-GAAP operating expenses represented 38% of total revenue, improving from 48% in the prior-year quarter. Management attributed the improvement to restructuring actions, operating realignment and increased use of AI tools.
PAR ended June with $77 million in cash and cash equivalents. Free cash flow was $3 million, improving $11.5 million from the prior-year quarter.
- Third-quarter 2026 outlook: Revenue of $128 million to $132 million and adjusted EBITDA of $13.5 million to $14.5 million.
- Full-year 2026 revenue outlook: $516 million to $523 million, raised from $500 million to $515 million.
- Full-year 2026 adjusted EBITDA outlook: $50 million to $53 million, raised from $44 million to $47 million.
Management said it expects hardware revenue to normalize in the second half after the elevated second-quarter refresh activity, while subscription growth is expected to strengthen as major customer rollouts advance. Singh said future growth should increasingly come from both new site additions and higher revenue per customer as multi-product adoption expands.
About PAR Technology (NYSE:PAR)
PAR Technology Corp is a provider of enterprise software and hardware solutions for the hospitality, foodservice and retail industries. The company’s platforms are designed to streamline front- and back-of-house operations, covering point-of-sale (POS) systems, kitchen display and dispatch, inventory and labor management, and reporting tools. PAR’s integrated approach enables operators of full-service restaurants, quick-service chains, bars, hotels, casinos and retail outlets to centralize data and automate workflows across multiple sites.
Key offerings include PAR Brink, a cloud-native POS application that supports touchscreen, mobile and tablet devices; PAR Cloud Services, which delivers software updates, reporting and analytics through a subscription model; and hardware solutions such as payment terminals, handheld devices and self-service kiosks.
