Powerfleet’s first-quarter fiscal 2027 revenue rose 6.4% from a year earlier to $110.8 million, up from $104.1 million. Services revenue increased 9.1% to $94.3 million and accounted for 85% of total revenue.
Gross profit climbed to $61.2 million, with gross margin expanding to 55.2% from 54.2% in the prior-year quarter. Income from operations improved to $0.3 million from an operating loss of $2.0 million.
Net loss attributable to common stockholders narrowed to $8.4 million, or 6 cents per share, from $10.2 million, or 8 cents per share, a year earlier. Adjusted EBITDA increased 6.9% to $21.5 million from $20.1 million.
Operating cash flow jumped 79% to $8.4 million from $4.7 million. Free cash flow improved by $6.6 million year over year, reducing cash use to $0.5 million from $7.1 million.
The balance sheet showed total available liquidity of $62.7 million at June 30, including $32.8 million in cash and cash equivalents and $29.9 million of borrowing capacity. Total debt was $278.4 million, and net debt was $241.7 million. The adjusted net debt-to-trailing-12-month adjusted EBITDA ratio held at 2.5x.
Management cut full-year fiscal 2027 guidance. Revenue is now expected at $468 million to $473 million, versus prior expectations that implied a higher run rate, with midpoint growth of about 6%. Adjusted EBITDA is forecast at $111 million to $114 million, implying about 16% growth and a midpoint margin of roughly 24%. Free cash flow is now projected at $20 million to $23 million.
A key driver in the update was South Africa. Powerfleet said more than $27 million of ARR is expected for near-term activation under the South African National Treasury contract, up from original expectations of $20 million to $30 million of ARR ramping over 18 to 24 months. Vehicles mandated for immediate deployment increased to more than 70,000, about 7 times the original expectation of roughly 10,000 at this stage, and are expected to reach 80,000 to 90,000 over the next two quarters.
The company also said South African revenue was about $1.6 million lower in the quarter because of reprioritization, while $3.2 million of product revenue was delayed by a production issue tied to a compatibility problem with a new component. The market has reacted to these announcements by moving the company's shares -29.93% to a price of $3.09. If you want to know more, read the company's complete 8-K report here.
