zSpace’s stock surged 53.3% following Q1 results that showed signs of stabilization and early revenue improvement after a challenging 2025, driven by better software and services performance and new product launches that boosted investor confidence.

• Q1 2026 revenues totaled $5.3 million, down 22% year-over-year, reflecting ongoing headwinds but an 8% sequential revenue increase.
• Software and services revenue decline of 15% outpaced hardware, raising the software and services contribution to 47% of total revenue, up from 43% a year ago.
• New product introduction included the zStylus One and an updated zSpace Studio, enhancing the product roadmap with patented innovation and curriculum-aligned software enhancements.
• Customer engagements showed improvement with expansions in Danbury Public Schools, Kansas WorkforceONE, and Colorado mobile learning labs despite budget pressures.
• The Board initiated a formal strategic alternatives review, indicating management’s focus on unlocking shareholder value amid valuation concerns.