Evolv Technologies Q1 Earnings Call Highlights

Key Points

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- Evolv Technologies posted strong Q1 results, with revenue rising 45% year over year to $46.3 million and ARR increasing 20% to $127.3 million. Adjusted EBITDA also improved to $3.9 million, and the company raised its full-year 2026 revenue guidance to $175 million to $180 million.

- Demand broadened across key end markets, including education, healthcare, sports and entertainment, and enterprise workplaces. Evolv added nearly 50 new customers in the quarter and now serves about 1,300 customers globally, including more than 30 Fortune 500 companies.

- Management highlighted growth in eXpedite and a shift in business mix, with more customers adopting its AI-based bag screening product alongside Express. The company said this shift toward purchase subscriptions is pressuring near-term gross margin but should improve long-term revenue, gross profit, and cash flow, with cash flow positivity still expected in the second half of 2026.

Evolv Technologies (NASDAQ:EVLV) reported first-quarter revenue growth of 45% year over year and raised its full-year 2026 revenue outlook, citing continued demand across education, healthcare, sports and entertainment, and enterprise workplaces.

President and CEO John Kedzierski said the company is continuing to execute against its operating plans while scaling what he described as a “hardware-enabled subscription business.” He said customers are seeking security solutions that are effective, scalable and operationally reliable amid elevated threat levels in schools, healthcare facilities, workplaces and public venues.

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Revenue for the quarter was $46.3 million, up from the prior-year period. Annual recurring revenue, or ARR, was $127.3 million at March 31, 2026, an increase of 20% year over year. Adjusted EBITDA was $3.9 million, compared with $2.1 million in the first quarter of last year, and adjusted EBITDA margin expanded to 8.5% from 6.4%.

Company Raises 2026 Revenue Outlook

Evolv raised its full-year 2026 revenue guidance to a range of $175 million to $180 million, up from its prior forecast of $172 million to $178 million. The updated outlook implies year-over-year growth of approximately 20% to 23%.

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Kedzierski said Evolv continues to expect to end 2026 with “comfortably over 10,000 units deployed.” CFO Chris Kutsor said the higher revenue outlook reflects a higher mix of purchase subscriptions, incremental contributions from short-term rental subscriptions and continued strength in pricing and average revenue per unit trends.

The company maintained its expectation to exit 2026 with ARR of approximately $145 million to $150 million, representing growth of 20% to 25% year over year. Kutsor said Evolv still expects to be cash flow positive in the second half of 2026.

- First-quarter revenue: $46.3 million, up 45% year over year.

- ARR: $127.3 million, up 20% year over year.

- Remaining performance obligation: $299 million, up 18% year over year.

- Adjusted EBITDA: $3.9 million, with an 8.5% adjusted EBITDA margin.

- Full-year revenue guidance: $175 million to $180 million.

Customer Growth Broadens Across End Markets

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Kedzierski said Evolv added nearly 50 new customers during the quarter and now serves approximately 1,300 customers globally. He described demand as steady across the company’s core markets.

In education, Evolv added more than 12 new customers, including K-12 districts and municipalities across Arkansas, California, Michigan, Mississippi, New Mexico, New York, North Carolina, Pennsylvania, Tennessee and Texas. Kedzierski also cited instances in which Evolv systems flagged firearms and knives during student arrival screening, allowing school staff and law enforcement to intervene before weapons entered school buildings.

In healthcare, the company added customers including BronxCare Health System and the West Virginia University Health System. Kedzierski said additional wins with regional systems and community hospitals expanded the company’s footprint in the sector.

In sports and live entertainment, Evolv added Subaru Park, a professional soccer stadium, along with what Kedzierski described as one of professional football’s most established franchises and a major multi-use arena in the Western U.S. He said Evolv served as the weapons screening partner for 50% of all playoff teams across professional basketball and hockey as the spring playoffs began.

The company also reported momentum in enterprise workplaces, including corporate campuses, headquarters, manufacturing facilities and distribution centers. Kedzierski said Evolv added several large-scale enterprise customers during the quarter, including one of the world’s most valuable technology companies and another Fortune 500 corporation. He said Evolv now serves more than 30 Fortune 500 companies.

eXpedite Adoption Continues to Increase

Evolv highlighted continued adoption of eXpedite, its autonomous AI-based bag screening product. Kedzierski said customers increasingly want bag screening to be part of a single integrated security workflow alongside Evolv Express, the company’s walk-through weapons screening platform.

The company now has more than 75 eXpedite customers, representing about 6% of its customer base, up from roughly 1% a year ago. In the first quarter, 19% of new customers purchased eXpedite, “almost always” alongside Express, Kedzierski said.

Kedzierski cited one school deployment of Express and eXpedite in which a customer reported an average eXpedite alert rate of less than 2% across more than 300,000 scanned bags over six months.

During the question-and-answer portion of the call, Kedzierski said there are other X-ray bag screening products in the market, but he argued Evolv’s product is differentiated by its autonomous AI model, faster conveyor speed, integration with the company’s broader platform and single cloud portal. He said eXpedite was designed for environments with significant bag usage, particularly where bags contain items such as laptops.

Purchase Subscription Mix Affects Margins and Revenue Timing

Kutsor said adjusted gross margin was 52% in the first quarter, down from 61% in the same period last year. He attributed the decline to Evolv’s shift toward directly fulfilling purchase subscriptions, which creates an initial gross margin headwind but is expected to produce better long-term returns, including higher total gross profit, higher revenue and ARR, and better cash flow than the prior distribution approach.

In response to analyst questions, Kedzierski said the company expects the 2026 mix to be about 55% purchase subscriptions and 45% full subscriptions. Kutsor said Evolv expects adjusted gross margin to be closer to the mid-50% range for the full year, while noting that gross margin will depend on customer mix.

Kutsor said the company expects a sequential revenue decline in the second quarter because a prior-year purchase subscription backlog was largely shipped in the first quarter. He said that dynamic reflects timing and mix, not weaker demand. Evolv expects second-half revenue to be modestly higher than first-half revenue, with ARR growth outpacing revenue growth in the second half.

Operations, AI and Long-Term Margin Potential

Kedzierski said Evolv remains on track with its strategic partnership with Plexus, its new global contract manufacturing partner, and expects onboarding to be completed by the end of the quarter. He said the partnership should support expanded production capacity, global reach and operational resilience.

The company also said it has largely mitigated semiconductor supply constraints and expects to maintain near-term delivery plans. Kedzierski said Evolv had already incorporated assumptions about premium component pricing into its guidance.

Kedzierski said Evolv is using generative AI internally to improve efficiency, automate routine tasks and support faster product development, while also implementing governance and guardrails. He emphasized that Evolv controls its hardware, software and AI model stack in-house.

Both Kedzierski and Kutsor said the company now sees the potential for greater long-term adjusted EBITDA leverage than the 10% to 15% target discussed at Evolv’s 2023 Investor Day. The company plans to provide more detail on its strategy, product innovation and long-term financial framework at its Investor Day on June 9, 2026.

About Evolv Technologies (NASDAQ:EVLV)

Evolv Technologies, Inc is a publicly traded American security technology company that develops and markets AI-driven weapons detection and screening solutions. The company’s proprietary platform combines advanced sensors, computer vision software and machine learning algorithms to identify potential threats—such as firearms and knives—while minimizing false positives and preserving high throughput. Evolv’s systems are designed to replace or supplement traditional metal detectors and manual bag checks in high-traffic venues.

The company’s flagship product, Evolv Express, integrates seamlessly into existing security checkpoints, allowing guests to pass through without stopping or emptying their pockets.

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