Innovotech Inc. (TSX Venture Exchange: IOT; OTCQB: IOTCF) reported a 44% decline in revenue for the first quarter of 2026, driven by a shift in activities for a large project with a major customer. The life sciences services and technology company posted revenue of $648,140 for the three months ended March 31, 2026, down from $1.16 million in the same period last year.
Gross profit fell to $202,231, with a gross margin of 31.2% compared to 53.6% in Q1 2025. The company attributed the margin compression to underutilized capacity, as it maintained staffing and operational readiness in anticipation of executing the planned customer work. Innovotech recorded a net loss of $401,295 for the quarter, reversing net income of $63,523 in the prior year.
Operating expenses increased year-over-year, reflecting the integration of Keystone Labs and Innovotech Labs, relocation of former Keystone operations to a new facility, and investments in a stronger sales organization. The company has been executing a strategic transformation, including strengthening its leadership and commercial teams and completing its OTCQB listing in the United States.
“Management remains committed to investing in a more diversified, resilient, and scalable platform,” said CEO Craig Milne in a statement. “The Company is continuing to execute its transformation strategy with a focus on the operational and commercial initiatives required to support long-term growth and reduce revenue concentration risk.”
The revenue decline was almost entirely attributable to a change in activities for a major customer project that had been expected to continue through 2026. Management is expanding service offerings and capabilities to generate consistent recurring revenue and mitigate client concentration risk. Innovotech operates with a strong liquidity position and maintains a meaningful equity base, providing flexibility to manage near-term volatility while executing its longer-term strategy.
The company’s unaudited consolidated financial statements and Management’s Discussion and Analysis have been filed on SEDAR+ and OTCIQ.
Innovotech is a recognized leader in biofilm science and antimicrobial testing, providing advanced laboratory services supporting medical device, pharmaceutical, and industrial product development. The company combines deep scientific expertise with proprietary methodologies, including its widely used MBEC Assay platform for high-throughput antimicrobial testing. It operates through ISO-certified and GMP-accredited laboratories, supporting clients across multiple sectors and geographies, and delivering data aligned with regulatory expectations such as those of the U.S. Food and Drug Administration and Health Canada.
