A2Z Cust2Mate Solutions Corp. (NASDAQ: AZ) reported second-quarter 2026 revenue of $5.9 million, a substantial increase from $1.2 million in the same period last year. The surge was driven by a near doubling of Smart Cart deliveries sequentially, from 500 units in the first quarter to 950 units in the second quarter. Smart Cart revenue rose 80% quarter-over-quarter to $4.41 million, while gross profit climbed to $2.5 million from $0.3 million, and gross margin improved to 42.6% from 23.3%. The company also narrowed its net loss to $7.3 million from $12.6 million in the prior-year quarter.
These results underscore the growing traction of A2Z's AI-powered Smart Cart platform, which transforms traditional shopping carts into connected commerce devices that enhance the in-store experience. As of June 30, the company had delivered a total of 3,350 units, and its year-to-date performance, combined with its backlog and visibility, supports its target of 10,000 deliveries by the end of 2026. The company projects $25 million in Smart Cart revenue for the second half of 2026, with the bulk weighted toward the fourth quarter, as its dedicated manufacturing facility in China increases delivery capacity.
To support this growth, A2Z secured a $30 million credit line with Bank Leumi to fund inventory and expansion. Additionally, the company is implementing cost-management initiatives expected to reduce annual operating expenses by approximately $7 million. These measures are designed to improve operational efficiency and accelerate the path to profitability.
Looking ahead, A2Z expects its Smart Carts to be deployed with at least two retailers outside Israel within the next six months, marking a significant step in its international expansion. The company has 19,000 deliveries scheduled by the end of 2027 based on existing purchase orders and contracted backlog, indicating strong demand and a clear growth trajectory.
The implications of these results are far-reaching. A2Z's Smart Cart technology addresses key pain points for retailers, including operational efficiency, loss prevention, and personalized shopper engagement. By providing real-time data and targeted retail media opportunities, the platform helps retailers increase revenue and optimize store operations at scale. The company's ability to nearly double deliveries sequentially and improve margins demonstrates the commercial viability of its offering.
Moreover, the international deployments and robust backlog signal that A2Z is moving beyond its home market and establishing a global footprint. This expansion could position the company as a leader in the emerging smart retail sector, potentially reshaping how retailers interact with customers at the point of purchase. As the retail industry increasingly adopts digital solutions, A2Z's innovations may become integral to modernizing the in-store shopping experience.
Investors and industry observers will be watching closely to see if A2Z can sustain its momentum and meet its ambitious targets. With strong revenue growth, improved margins, and a clear strategic plan, the company appears well-positioned for continued success in the coming quarters.
