Symbotic Inc. 10-Q Summary: Quarter Ended June 27, 2026
Business Context and Reporting Period
This report covers the quarterly period ended June 27, 2026 (Fiscal Q3 2026) and the nine months ended that date. Symbotic Inc. is an automation technology company developing solutions to improve supply chain operations, primarily through robotic systems for warehouses. The company operates as a single segment and maintains a significant commercial relationship with Walmart Inc. and a joint venture with SoftBank known as Exol.
Key Financial Metrics
| Metric | Three Months Ended June 27, 2026 | Nine Months Ended June 27, 2026 |
|---|---|---|
| Total Revenue | $720.8 million | $2.03 billion |
| Gross Profit | $160.9 million (22.3% margin) | $444.3 million (21.9% margin) |
| Operating Income | $32.9 million | $45.5 million |
| Net Income (GAAP) | $55.0 million | $77.8 million |
| Net Income Attributable to Common Stockholders | $11.7 million | $16.2 million |
| Adjusted EBITDA (Non-GAAP) | $95.2 million | $239.9 million |
| Cash and Cash Equivalents | $1.75 billion (as of June 27, 2026) | N/A |
| Free Cash Flow | $(164.6) million | $242.8 million |
| Backlog (Remaining Performance Obligations) | $22.5 billion | N/A |
Material Changes vs. Prior Period
- Revenue Growth: Total revenue increased 22% year-over-year (YoY) for the quarter and 24% for the nine-month period. Systems revenue grew 20% (quarter) and 23% (nine months), driven by an increase in systems in deployment (77 vs. 46 in the prior year quarter).
- Profitability: The company returned to profitability, reporting operating income of $32.9 million compared to an operating loss of $25.8 million in the prior year quarter. Gross margin improved to 22.3% from 18.9% YoY.
- Other Income: Other income, net, surged 262% YoY to $30.6 million, primarily due to fair value adjustments on strategic investments and higher interest income.
- Restructuring: Restructuring charges were minimal ($0.2 million) for the nine months ended June 27, 2026, compared to $16.4 million in the prior year period, reflecting the completion of workforce reductions initiated in fiscal 2025.
- Customer Concentration: One customer (Walmart) accounted for 90.5% of revenue in the quarter and 87.0% for the nine months.
Guidance, Outlook, and Risks
- Outlook: Management expects current cash and working capital to be sufficient for at least the next 12 months. The company anticipates recognizing approximately 15% of its $22.5 billion backlog as revenue in the next 12 months.
- Strategic Initiatives: The company continues to deploy systems under the Master Automation Agreement (MAA) with Walmart and the Commercial Agreement with Exol. A contingent promise to purchase 400 automated systems for online pickup and delivery could increase future backlog by over $5.0 billion.
- Internal Controls: Management concluded that disclosure controls and procedures were not effective due to a material weakness regarding the timing of cost of revenue recognition. A remediation plan is underway, including process redesign and ERP implementation.
- Legal Proceedings: The company is defending a securities class action lawsuit alleging false statements regarding revenue recognition and internal controls. The court granted-in-part and denied-in-part the company's motion to dismiss in July 2026.
- Warranty and Recall: In Q2 2026, the company initiated a replacement program for certain system components, recording a $34.3 million liability. No additional charges were recorded in Q3.
Investor Verification Checklist
- Customer Concentration: Verify the stability of the relationship with Walmart, which represents over 90% of quarterly revenue.
- Internal Control Remediation: Monitor progress on the material weakness regarding cost of revenue recognition and the timeline for ERP implementation.
- Backlog Realization: Assess the timeline and risks associated with converting the $22.5 billion backlog into recognized revenue, particularly regarding the Exol joint venture.
- Legal Exposure: Track the status of the securities class action lawsuit and potential financial impact.
- Warranty Costs: Review actual costs incurred for the component replacement program against the $34.3 million provision.
- Non-GAAP Adjustments: Scrutinize the reconciliation of GAAP net income to Adjusted EBITDA, specifically the exclusion of fair value adjustments on strategic investments ($21.0 million for the nine months).