Ouster (NYSE:OUST) reported fourth-quarter 2025 results that management said capped “a year of exceptional execution,” highlighted by record sensor shipments, continued product revenue growth, and contributions from primarily one-time royalty revenue tied to long-term IP license contracts.
Fourth-quarter results driven by product momentum and one-time royalties
CEO Angus Pacala said fourth-quarter revenue totaled $62 million, including $41 million of product revenue, marking the company’s 12th consecutive quarter of product revenue growth. The company shipped more than 8,100 sensors in the quarter, a new quarterly record, spanning applications including warehouse automation, robotaxis, and mapping.
GAAP operating expenses were $37 million, down 6% from the prior-year quarter, primarily due to a favorable employment tax refund received during the period, according to Gianella. Adjusted EBITDA was positive $11 million, which management attributed to the impact of royalty payments.
Ouster ended the quarter with $211 million in cash equivalents, restricted cash, and short-term investments and no debt.
Full-year 2025: revenue growth, record bookings, and improved adjusted EBITDA
For full-year 2025, Gianella said Ouster generated $169 million in revenue, including approximately $23 million of royalty revenue that was also described as primarily one-time. The company said revenue grew 52% year over year, or 32% excluding royalties.
Ouster shipped more than 25,000 sensors in 2025, up 48% from 2024, and recorded bookings of $177 million, producing a product book-to-bill of 1.2x for the year.
GAAP gross margin for the year was 49%, up 13 points year over year, with royalties contributing eight points, the company said. GAAP operating expense was $157 million, up 9% from $145 million in 2024, reflecting increased investment to support the product roadmap, expenses tied to the Stereolabs acquisition, and operational and compliance tools; management said these were partially offset by the employment tax refund.
Adjusted EBITDA loss improved to $12 million from a $42 million loss in 2024, which Gianella attributed to royalty revenue and continued operational improvements.
Strategic updates: software attachment, product portfolio, and AI model training
Pacala said Ouster’s 2025 execution focused on three strategic priorities: scaling the software-attached business, transforming the product portfolio, and executing toward profitability.
- Software-attached growth: Pacala said software-attached bookings more than doubled in 2025 and represented over 15% of sensors shipped, up more than 120% year over year.
- Deployment scale: He said the company’s in-house trained AI models are running “24 hours a day” at more than 1,200 Gemini and BlueCity sites spanning over 65 million square feet of roadways and facilities.
- Customer wins: Pacala cited “significant Gemini renewals,” including a seven-figure annual license with a “leading global technology company,” and “landmark BlueCity agreements” in Tennessee, Utah, and New Jersey.
On product development, Pacala said Ouster introduced multiple software releases in 2025, including four new versions of its SDK. He highlighted on-sensor 3D Zone Monitoring, which embeds perception logic directly into 3D digital lidar to support collision avoidance warnings, deceleration, and emergency stops, as well as real-time localization for centimeter-level asset tracking, geofencing, and automatic speed limit enforcement without “expensive and complex infrastructure.”
Pacala also described continued investment in proprietary AI model training, including a “breakthrough multi-sensor AI model” for Gemini and BlueCity trained on millions of labeled objects collected from hundreds of sites across diverse environments and weather conditions. He said these improvements enabled support for large-scale installations of 40 lidar sensors at a single site.
In addition, Pacala said BlueCity advanced from prototype to real-world deployments with intelligent signal actuation, and Gemini added Cloud Portal and Event Server capabilities designed to simplify deployment management and enable no-code custom logic for use cases such as intrusion detection and zone occupancy.
Stereolabs acquisition: unified sensing and perception platform
Management repeatedly emphasized the strategic rationale for acquiring Stereolabs, which Pacala called a pioneer in AI camera vision and perception solutions. He said the combined company offers a unified sensing and perception platform that brings together digital lidar, cameras, AI compute, sensor fusion and perception software, and AI models, with synchronized and calibrated data “out of the box.”
Pacala said initial customer feedback has been “resoundingly positive,” adding that customers have expressed interest in buying combined systems spanning sensors, compute, and software. In the Q&A, Pacala said the company can make the unified sensing platform available “today,” noting that the platforms are already unified.
Gianella said Stereolabs is currently a small portion of overall revenue, but management expects it to be “high growth, high margin” and accretive to consolidated results over time. Following the acquisition, Ouster reiterated long-term targets of 30% to 50% annual revenue growth and 35% to 40% GAAP gross margin. He also noted Stereolabs’ historical revenue has been seasonally stronger in the second half of the year, with about 60% occurring in that period.
Outlook: Q1 guidance, royalty expectations, and 2026 priorities
For the first quarter of 2026, Ouster guided for total revenue of $45 million to $48 million, including approximately seven weeks of revenue from Stereolabs following the close of the transaction on Feb. 4.
On royalties, Gianella said total royalty revenue in 2026 is expected to be less than $5 million, with the majority recognized in the back half of the year. He characterized additional royalty revenue beyond that as expected to be “relatively modest” and included in guidance.
For 2026 operating expenses, Gianella said that including Stereolabs operating and integration expenses, Ouster anticipates GAAP operating expense growth of 5% to 8% from 2025 levels, with quarterly operating expenses expected to follow a similar profile as 2025.
Pacala outlined three priorities for 2026:
- Revolutionize lidar, camera, and AI compute products, including what he called the most significant product overhaul in company history and commercialization of next-generation sensors built on custom silicon.
- Extend leadership in Physical AI solutions, including expanding BlueCity across the U.S., launching pilots in Europe and the Middle East, and pursuing Gemini perimeter security pilots.
- Execute to profitability through sustained growth, margin performance, and disciplined cost management.
During Q&A, Pacala also addressed defense-sector interest, saying there is significant interest in battlefield automation but that fully autonomous systems remain largely in R&D, with a “number more years” expected before major shifts occur due to defense development cycles. He also discussed drones and humanoids as potential long-term opportunities, describing drones as more proven and humanoids as more emerging, with a longer and less certain timeline for scaling to impact revenue.
On liquidity and capital needs, Gianella said the company had “plenty of operating runway” even after the Stereolabs acquisition, and described maintaining cash as important for customers running multi-year programs. He added Ouster would evaluate future M&A opportunities if the “right strategic opportunity” arises.
About Ouster (NYSE:OUST)
Ouster, Inc is a leading provider of high-resolution digital lidar sensors, software and services designed to enable advanced perception capabilities across a range of industries. Headquartered in San Francisco, California, the company develops modular lidar solutions that capture precise three-dimensional data in real time, supporting applications from autonomous vehicles and robotics to mapping, smart infrastructure and industrial automation.
The company’s core product lineup features multi-beam digital lidar units available in various form factors, including compact models for robotics and drones and larger units for automotive and mapping systems.
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