Solid State PLC lifts guidance as year-end trading beats expectations
Solid State PLC has closed FY25/26 with a flourish. Management now expects revenue to be ahead of consensus and not less than £150m, with adjusted profit before tax also set to beat market expectations. For context, the company published consensus estimates of £145.0m revenue and £7.2m adjusted profit before tax for FY25/26, so this is a genuine upgrade rather than a rhetorical flourish.
In plain English: demand was stronger than anticipated through Q4, execution held up, and the group enters the new financial year with a fatter orderbook and momentum across all three divisions.
What “ahead of consensus” means in numbers
Consensus is the market’s average forecast from covering brokers – in this case, Cavendish, Berenberg and Zeus. Solid State says FY25/26 revenue will be not less than £150m, which is above the £145.0m consensus. Adjusted profit before tax will be ahead of the £7.2m consensus, though the company has not disclosed the new figure.
Adjusted profit excludes non-cash and one-off items such as acquisition-related amortisation, share-based payments and reorganisation costs. It is a common way of showing the underlying trading performance.
| Metric | FY25/26 Consensus | Company Update |
|---|---|---|
| Revenue | £145.0m | Not less than £150m |
| Adjusted profit before tax | £7.2m | Ahead of consensus (not disclosed) |
| Open orderbook (31 Mar 2026) | n/a | c.£106.5m |
| Open orderbook (30 Nov 2025) | n/a | £97.0m |
| New Power orders since Dec update | n/a | c.$20m |
Division-by-division: what drove the beat
Components – design wins doing the heavy lifting
Components delivered a strong year-on-year improvement, buoyed by “exciting new design wins” in the UK and US. A design win is when a customer commits to use your component in their product design – once locked in, it typically drives multi-year revenue as that product ships. Better market conditions helped too.
Power – reorganisation paying off with autonomy and defence demand
The Power division benefited from a management re-organisation and capability investment. Demand from drones and other autonomous technologies has been strong, with “significant new and emerging defence opportunities” adding to the pipeline. Since December, order intake in Power alone amounts to approximately $20m – a big driver of the bigger group orderbook.
Systems – communications strength with mix improving ahead
Systems continued to see strong demand for communications products. The group is also building opportunities in antennas and integrated systems. Management notes these mix-enhancing opportunities are not fully reflected in the current period’s revenue, implying an improving margin and product mix in future periods if execution continues.
Orderbook momentum gives visibility, but lead times are stretching
The open orderbook at 31 March 2026 stands at approximately £106.5m, up from £97.0m at 30 November 2025. The increase is driven primarily by the Power division’s strong intake. Importantly, an initial order from a new Communications customer announced in Q3 is included, with shipments scheduled for Q1 26/27 – a helpful near-term catalyst.
Management expects the majority of the orderbook to be delivered over the next 18 months, subject to supply chain availability. There is a caveat: lead times for certain components have started to extend significantly, driven by AI-related demand and geopolitical instability. The group says it is proactively engaging with customers to manage any potential impact.
Why this matters: exposure to structural growth, with defence front and centre
Against heightened global tensions, governments are prioritising defence and security. That is directly relevant to Solid State, whose rugged computing, power and secure communications kit plays into sovereign technology ambitions in the UK and US. Management’s commentary is measured – demand is robust, but the team is keeping tight oversight on risk, governance and compliance.
Beyond defence, Solid State’s exposure to autonomy, industrial and energy markets provides diversified demand. That blend is useful in choppy macro conditions and underpins management’s talk of “sustainable mid-term performance and growth”.
Key positives and watch-outs
- Positive: Guidance upgrade – revenue not less than £150m and adjusted PBT ahead of expectations for FY25/26.
- Positive: Orderbook up to c.£106.5m with most to be delivered in 18 months, improving visibility.
- Positive: Divisional breadth – Components’ design wins, Power’s $20m intake, and Systems’ improving mix all reinforce the growth narrative.
- Watch-out: Component lead times are extending due to AI demand and geopolitics, which could affect phasing and working capital.
- Watch-out: The magnitude of the profit beat is not disclosed – we will need final results to gauge operating leverage and margins.
My take: a clean upgrade with credible drivers
This reads as a high-quality beat. It is not a single contract splash – it is broad-based across Components, Power and Systems, and underpinned by design-in momentum and defence-facing demand. The step-up in Power orders is particularly encouraging after the re-organisation and investment period.
The supply chain warning is real, especially for semiconductors pulled by AI and for specialist components affected by geopolitics. That said, the team has navigated similar terrain before and is engaging customers early. If lead times extend, delivery may slide between quarters, but the demand picture looks intact.
Near-term, I would watch for: the final FY25/26 results to quantify the profit beat and cash conversion; any colour on Systems’ antenna and integrated systems margin; and updates on the Q1 26/27 Communications shipments. For those who like to kick the tyres, the company is running investor site visits at Redditch – details are in the announcement.
Jargon buster
- Design win: when a customer selects your component or subsystem for their product design, usually leading to recurring revenue as that product ships.
- Orderbook: contracted orders not yet delivered. Offers visibility on future revenue.
- Adjusted profit before tax: profit measure excluding certain non-cash and one-off items to show underlying performance.
- Sovereign technology: domestically controlled technology and capability considered strategically important for national security and resilience.
At-a-glance summary
- FY25/26 revenue: not less than £150m, above £145.0m consensus.
- Adjusted profit before tax: ahead of £7.2m consensus (figure not disclosed).
- Open orderbook: c.£106.5m at 31 March 2026, up from £97.0m.
- Power division: c.$20m order intake since December update.
- Delivery horizon: majority of orderbook due over the next 18 months, supply chain permitting.
- Tailwinds: defence, autonomy, industrial and communications demand; improving Systems mix.
- Risks: component lead times extending due to AI demand and geopolitical instability.
