Ultralife Corporation (ULBI): Business Model Canvas [Dec-2025 Updated]

You're right to look closely at Ultralife Corporation (ULBI) now; integrating Electrochem and navigating defense shifts makes their business model fascinating. This isn't just about selling batteries-it's about delivering mission-critical power and comms systems, backed by $39.9 million in Q3 energy product sales and a hefty $90.1 million backlog. I've broken down the entire structure, from their specialized cell tech to their defense customer relationships, so you can see the precise engine driving their strategy-dive in below to see the full picture.

Ultralife Corporation (ULBI) - Canvas Business Model: Key Partnerships

You're looking at the ecosystem of suppliers and collaborators that keep Ultralife Corporation running, especially in their mission-critical segments. These relationships are key to securing the big defense dollars and getting new medical tech qualified.

U.S. Defense Logistics Agency (DLA) for Military Battery Awards

The relationship with the U.S. Government's Defense Logistics Agency (DLA) remains a bedrock for Ultralife Corporation. This partnership provides stable, high-volume business for their power solutions.

In September 2025, Ultralife Corporation secured a new award from the DLA valued at approximately $5.2 million for their BA-5390 military batteries. Shipments under this specific award are scheduled mostly throughout 2026, aiming for completion in early 2027. This follows a significant multi-year indefinite-delivery/indefinite-quantity contract received in 2021 that was valued up to $9.9 million. The Government & Defense sector is a major revenue driver, accounting for 42% of consolidated sales in the first quarter of fiscal year 2025. Furthermore, for the nine-month period ending September 30, 2025, government/defense sales within the Battery & Energy Products segment saw a 44.3% increase.

Key Medical Device Partners for New Wearable Product Qualifications

The medical wearable space is about hitting regulatory milestones with partners before volume production starts. This is where qualification timelines dictate revenue recognition.

A key partner achieved both FDA and EU MDR certifications for their back-office system supporting a medical wearable product in the fourth quarter of 2024. This clearance allows for hospital deployment, and Ultralife Corporation anticipated production orders by mid-2025, with limited shipments expected later in 2025. Still, the medical battery sales side has seen some pressure, with commercial sales in that area decreasing by 12.3% in Q1 2025 organic growth. Ultralife's subsidiary, Accutronics Ltd, actively supports this market, showcasing custom and off-the-shelf batteries at medical technology shows.

Global Prime Defense Contractors for Integrated Communications Systems

For the Communications Systems segment, Ultralife Corporation often works indirectly through larger prime contractors who manage entire defense programs, like equipping a soldier for a new mission. Ultralife positions itself as a supplier of commercial and military off-the-shelf goods that primes can quickly integrate.

Ultralife Corporation has a history of supplying products into the UK's Bowman programme, which involves tactical radios used on the frontline. The company emphasizes providing a through-life management plan to support these prime contractors with repair or replacement services.

Suppliers for Raw Materials, Managing Tariff and Quality Issues

Managing the supply chain involves navigating global economics, including tariffs and material quality, which directly impacts gross margins.

In the third quarter of 2025, the Battery & Energy Products gross margin stood at 22.1%, a drop from 24.7% in the prior year period. A primary reason cited for this margin compression was manufacturing inefficiencies stemming from quality issues associated with some incoming raw materials, which lowered factory throughput. The company has been executing targeted supply chain strategies to reduce material costs and actively manage tariff developments.

• Tariff impact noted as a potential risk in Q1 2025 commentary.
• Quality issues with incoming raw materials lowered factory throughput in Q3 2025.
• Targeted supply chain strategies are being used to reduce material costs.

Technology Partners for New Product Development

Ultralife Corporation maintains relationships for developing and showcasing new technologies, often through its specialized subsidiaries.

The company is currently advancing several new products into qualification and production, specifically focusing on large, multi-year programs to secure future growth. While specific data on 'advanced speakers' partners isn't present, Ultralife's subsidiary, SouthWest Electronic Energy, is presenting on advancements in lithium battery technologies for underwater vehicles in December 2025. This presentation compares chemistries like lithium manganese dioxide (LiMnO₂) and lithium thionyl chloride (LiSOCl₂).

The company's overall structure involves several brands, including Accutronics, Electrochem, Excell, and SWE, which function as specialized technology centers within the Ultralife Corporation ecosystem.

Finance: review the impact of the $5.2 million DLA award on Q4 2025 revenue recognition by next Tuesday.

Ultralife Corporation (ULBI) - Canvas Business Model: Key Activities

You're looking at the core engine of Ultralife Corporation (ULBI) right now, which is heavily focused on integrating its recent acquisition while driving revenue from its established lines. The primary activity here is the manufacturing and selling of Battery & Energy Products. For the third quarter ending September 30, 2025, this segment generated revenues of $39.9 million. This shows the segment is the dominant revenue driver, though the company faced gross margin compression due to supply chain quality issues in that quarter.

Here's a quick look at some of the key financial results tied to these activities for Q3 2025:

A significant chunk of operational focus is dedicated to new product development (R&D). Ultralife Corporation is actively investing in platforms like thin-cell technology and amplifier solutions. For Q3 2025, the recorded expense for this innovation pipeline was $2.9 million. This investment is defintely aimed at securing future, potentially higher-margin, revenue streams, especially as they look toward 2026 shipments for some new programs.

The company is deep in operational restructuring and integration of Electrochem Solutions, which it acquired in late 2024 for approximately $48.022 million in cash, inclusive of working capital adjustments. This activity included completing the Electrochem ERP system transition, which was targeted for Q2 2025. Furthermore, management is consolidating operations, evidenced by the planned closure of the Calgary facility, which incurred a $0.5 million charge in Q3 2025 and is expected to generate annual savings of roughly $0.8 million starting in 2026. The final services transition for Electrochem also contributed a $1.1 million one-time adjustment to the Q3 operating loss.

Managing future revenue visibility is key, which means managing a high-confidence order backlog is a critical activity. As of the end of the third quarter of 2025, the total backlog stood at $90.1 million. This represents a healthy increase from the $84.5 million reported at the end of the second quarter of 2025. The backlog is split with commercial customers at about 55% and government defense at 45%.

Finally, a strategic activity is executing vertical integration to use Electrochem cells in pack assemblies. This was a core rationale for the acquisition, intended to drive gross margin expansion through supply chain efficiencies. Management reiterated that leveraging this vertical integration to incorporate the newly acquired Electrochem cells into their pack assemblies remains a priority for the remainder of 2025.

Ultralife Corporation (ULBI) - Canvas Business Model: Key Resources

The Key Resources for Ultralife Corporation (ULBI) as of late 2025 are anchored in proprietary technology, strategic physical assets, and human capital acquired through recent transactions.

Specialized primary lithium and ultracapacitor cell technology forms a core asset. Ultralife Corporation's leading-edge primary Thin Cell® battery chemistry utilizes high energy Lithium Manganese Dioxide (Li-MnO2) in a pouch cell format, allowing cells to be manufactured as thin as 1.1mm (0.043 inches). This technology boasts an energy density around 500Wh/l and 400Wh/Kg. The October 2024 acquisition of Electrochem Solutions, Inc. added a complimentary portfolio including expertise in primary lithium metal and ultracapacitor cells, alongside highly-engineered thionyl, sulfuryl, and bromine chloride cells and packs.

The company maintains a Global manufacturing and operations footprint across three continents, supporting its mission-critical customer base. Manufacturing operations are located in North America and Asia, with the company actively consolidating its footprint.

Liquidity for operations and investment is supported by a strong balance sheet. As of the second quarter of 2025, Ultralife Corporation reported working capital of $69.1 million and a current ratio of 3.3, with zero draw on its revolver. The company has also prioritized debt reduction, reducing acquisition-related debt principal by $3.4 million year-to-date in 2025 against a required annual amortization of $2.8 million.

Intellectual property for ruggedized, high-efficiency power and comms is evidenced by a history of innovation dating back to launching the world's longest-lasting lithium 9V battery in 1992. Key technologies like the Thin Cell® operate safely between -20°C & +60°C and offer a 10-year shelf life. The Communications Systems segment holds IP related to RF amplifiers and vehicle communications systems, evidenced by a recent $4.6 million purchase order for Vehicle Amplifier-Adaptors.

The acquisition of Electrochem Solutions, Inc. on October 31, 2024, for $50.0 million in cash brought critical human capital. This included long-tenured technical resources with over forty years of battery technology experience in critical applications, which Ultralife Corporation plans to utilize for progressing global new product initiatives.

• The Electrochem acquisition brought a blue-chip customer base with little or no overlap with existing Ultralife Corporation customers.
• The company's R&D and New Product Development teams work hand in hand to deliver standard and custom products.
• The Battery & Energy Products segment saw government/defense sales increase by 53.6% in Q1 2025, reflecting strong demand.
• The company has a portfolio of brands including Ultralife®, Lithium Power®, McDowell Research®, AMTI®, and ABLE™.
• The company's manufacturing facility in Newark, New York is ISO 9001 and ISO 13485 certified.

Ultralife Corporation (ULBI) - Canvas Business Model: Value Propositions

You're looking at the core promises Ultralife Corporation (ULBI) makes to its customers, backed by the numbers from their latest reports as of late 2025. This is what they sell, beyond just the physical product.

Mission-critical, high-performance power for defense applications.

Ultralife Corporation provides power solutions recognized for their long life, unsurpassed safety record and reliability under the toughest conditions, particularly for the U.S. military. This value proposition is evidenced by recent contract activity:

• Secured an award valued at approximately $5.2 million from the Defense Logistics Agency (DLA) for BA-5390 military batteries in September 2025.
• Government/defense sales within the Battery & Energy Products segment increased 19.0% in the third quarter of 2025, excluding the Electrochem acquisition contribution.
• A Department of Defense (DOD) contract in June 2025 for non-rechargeable batteries was awarded for $369,630.

Custom-engineered power solutions for demanding industrial environments.

The company emphasizes an engineering and collaborative approach to problem-solving for various sectors. While specific industrial contract dollar amounts aren't explicitly detailed, the overall financial health and backlog show sustained demand for their engineered products. The total backlog with high-confidence orders exiting the third quarter of 2025 stood at $90.1 million.

Smallest, lightest, and most power-efficient radio-agnostic amplifiers.

While specific power-efficiency metrics for radio-agnostic amplifiers aren't available in the latest financial releases, the company's focus on advanced battery development, such as the Lithium-Ion rechargeable Conformal Wearable Batteries designed to increase soldier mobility by reducing carried battery weight, speaks to this core competency in high-performance, compact power.

Reliability and long-life in specialized medical and oil & gas batteries.

The value proposition of reliability in specialized commercial markets is supported by the nature of the applications, though recent sales trends show some softness. Medical applications are considered 'necessary' with defined replacement cycles, with upcoming replacement needs for COVID-era devices expected to drive future demand. However, excluding the Electrochem acquisition, commercial sales, which include oil & gas and medical, decreased 5.7% in the third quarter of 2025.

Single source for both power solutions and communications systems.

Ultralife Corporation maintains two primary business segments, offering a combined portfolio of power and electronics systems. The Battery & Energy Products segment is the larger revenue driver, while the Communications Systems segment provides the complementary offering. Here's a look at the segment revenue contribution for the third quarter of 2025:

The trailing twelve-month revenue for Ultralife Corporation as of September 30, 2025, was $187M.

Ultralife Corporation (ULBI) - Canvas Business Model: Customer Relationships

Ultralife Corporation (ULBI) engages its customers through several distinct relationship channels, heavily weighted toward long-term government and defense partnerships, complemented by direct commercial OEM engagement.

Dedicated engineering support for collaborative problem-solving

Ultralife Corporation serves its government/defense and commercial customers across the globe through its engineering and collaborative approach to problem solving. The company is actively working to leverage vertical integration to incorporate Electrochem cells into pack assemblies, with benefits anticipated in the second half of 2026. The company is also qualifying cells with several oil and gas customers to enable this transition, expecting to see benefit of these efforts in 2026. This points to deep, ongoing technical collaboration beyond the initial sale.

Long-term, high-visibility contracts with government/defense customers

The relationship with government/defense customers is a core driver of financial performance, as evidenced by recent contract awards and segment performance. For example, on September 4, 2025, Ultralife Corporation received an award valued at approximately $5.2 million from the U.S. Government's Defense Logistics Agency ("DLA") for BA-5390 military batteries, with the majority of shipments scheduled throughout 2026 and completion in early 2027. This follows a pattern of securing high-value, multi-year support, such as the previous IDIQ contract from the U.S. Army for Conformal Wearable Batteries, which was not to exceed $168 million during its three-year base award period, with a potential for up to an additional $350 million. The segment's financial contribution reflects this focus:

The total company backlog, representing high-confidence orders, stood at $90.1 million at the end of Q3 2025, an increase of 6.5% from the $84.5 million reported in the previous quarter. The consolidated sales split between Commercial vs. Government Defense for the battery business was 68/32 in Q3 2025.

Direct sales and technical engagement with key commercial OEMs

Direct engagement is key for the commercial side, which includes medical, oil and gas, and other industrial Original Equipment Manufacturers (OEMs). While the overall Battery & Energy Products segment saw strong government demand, commercial sales within that segment faced headwinds. For the third quarter ended September 30, 2025:

• Commercial sales in the Battery & Energy Products segment decreased by 5.7%.
• Sales in the oil and gas sub-segment declined by 23.1%.
• Medical battery sales saw a decline of 39% due to order timing.

The company is actively working to expand addressable markets, noting opportunities in pipeline inspection and seismic telemetry, with management expecting to see benefit of these efforts in 2026.

Post-sale support for integrated communications systems

The Communications Systems segment, which provides integrated communication systems and accessories, relies on ongoing support for complex military installations. While this segment experienced significant volatility in order timing, the revenue base remains active:

• Communications Systems Revenue in Q3 2025 was $3.4 million.
• This represented an 8.2% increase from $3.2 million in Q3 2024.
• In contrast, Q2 2025 saw a 57.2% decline in this segment's sales to $2.7 million compared to the prior year period.

The relationship here is characterized by large, sometimes delayed, purchase orders for complex systems like radio frequency amplifiers and vehicle mounts, which necessitates robust post-sale technical engagement to manage integration and deployment.

Ultralife Corporation (ULBI) - Canvas Business Model: Channels

You're looking at how Ultralife Corporation moves its mission-critical power and communications gear to the end-user, which is a mix of direct engagement and established global pathways. This isn't a simple e-commerce setup; it's about deep relationships in defense and specialized commercial sectors.

Direct Sales Force and Key Customer Segments

Ultralife Corporation sells its products worldwide through several trade channels, emphasizing direct engagement with high-value customers. The direct sales force is key for penetrating the most demanding sectors.

• Direct sales force targets government & defense agencies globally.
• Direct sales also target large commercial Original Equipment Manufacturers (OEMs).
• The Communications Systems division primarily focuses on government and defense applications, though it is branching into industrial areas.

The Battery & Energy Products division serves a wide array of markets, including government and defense, medical, industrial, safety and security, robotics, IoT, and oil and gas. For instance, in Q3 2025, government/defense sales within the Battery & Energy Products segment rose by 19.0% year-over-year. The total revenue for the Battery & Energy Products segment in Q3 2025 was $39.95 million, which represented 92.1% of the total consolidated revenue of $43.4 million for that quarter.

International Distribution Network and Geographical Split

Ultralife Corporation maintains a global footprint with strategic locations in the Americas, Europe, and Asia, supported by a distribution network of resellers, distributors, and agents. This network helps service customers across these regions.

Here is the geographical revenue split for the three-month period ending September 30, 2025:

For the nine-month period ending September 30, 2025, the United States accounted for 75% of total revenue. The company's total backlog stood at $90.1 million at the end of Q3 2025, up from $84.5 million at the end of Q2 2025, suggesting future channel fulfillment.

Industry Trade Shows for Product Showcasing

Industry trade shows are a critical channel for showcasing new and existing mission-critical technologies directly to defense delegations and industry partners. Ultralife Corporation actively participates in major defense and security events.

• Exhibited at the 2025 SHOT Show from January 21 to 24, 2025, in Las Vegas.
• Announced participation at Defence and Security Equipment International (DSEI) UK 2025, scheduled for September 9-12 at ExCel London, UK.

At DSEI 2025, the company planned to feature products like the conformal wearable battery and the A-2303 RF amplifier, which is designed to be repaired and calibrated in-country by international militaries. The Communications Systems segment President noted that DSEI offers unmatched access to international military delegations.

Ultralife Corporation (ULBI) - Canvas Business Model: Customer Segments

You're looking at the core customer base for Ultralife Corporation as of late 2025, which is heavily weighted toward mission-critical power and communications needs. Honestly, the split between government and commercial business dictates a lot of the operational focus right now.

The overall backlog gives you the clearest picture of near-term revenue visibility. As of the end of the third quarter of 2025, the total backlog stood at $90.1 million, which was an increase from $84.5 million in the prior quarter. This backlog is split between commercial and government defense customers.

The Battery & Energy Products segment, which is the larger revenue driver, shows a more granular split between its end-markets. For the quarter ending September 30, 2025, the sales split within this battery business was heavily skewed toward commercial users, though government demand is clearly growing.

• Battery & Energy Products segment sales split: Commercial at 70% versus Government Defense at 30%.
• Government Defense sales within the Battery & Energy Products segment grew by 19% year-over-year for Q3 2025.
• The domestic to international split for the Battery & Energy Products segment shifted to 72% domestic versus 28% international in Q3 2025, up from 56% domestic in the 2024 period, reflecting the impact of the Electrochem acquisition and domestic defense demand.

The specific commercial sub-segments face different dynamics. For instance, medical device manufacturers saw headwinds, but the company is expecting a rebound.

• Medical battery sales declined by 12.3% year-over-year in Q1 2025, with an expectation for recovery in the second half of 2025.
• Sales to the Industrial and Energy sectors, specifically oil & gas, contributed to a 5.7% decrease in overall commercial sales for the Battery & Energy Products segment in Q3 2025.
• The company is focusing on growth opportunities in areas like pipeline inspection and seismic telemetry, partly through the integration of the Electrochem acquisition.

The segment serving Global prime defense contractors is closely tied to the Government/Defense portion of the backlog. The strong year-over-year growth in government defense sales in Q3 2025 was specifically attributed to robust demand from the U.S.-based global prime.

The Communications Systems segment also serves government and defense customers, though its revenue contribution is smaller and more volatile based on order timing. For Q3 2025, this segment generated $3.4 million in revenue, an 8.2% increase from the prior year, but it was noted that expected larger purchase orders were delayed.

Here's a quick look at the revenue contribution by segment for Q3 2025:

Overall, the consolidated sales split for Q3 2025 was approximately 65% commercial and 35% government defense.

Ultralife Corporation (ULBI) - Canvas Business Model: Cost Structure

The Cost Structure for Ultralife Corporation is heavily influenced by the cost to produce its specialized power solutions, integration costs from the recent Electrochem acquisition, and ongoing investment in future technologies like thin-cell batteries.

High Cost of Goods Sold (COGS) is a major cost driver, as evidenced by the gross margin performance in the third quarter ended September 30, 2025. The consolidated Gross Margin contracted to 22.2% of revenue for Q3 2025, down from 24.3% in the year-ago quarter. This margin compression was attributed to manufacturing inefficiencies in the Battery & Energy Products segment stemming from quality issues with incoming raw materials, which disrupted factory throughput, alongside a less favorable sales mix. Total Gross Profit for the quarter was $9.6 million on total sales of $43.4 million.

Operating Expenses (OpEx) for Q3 2025 totaled $10.6 million, representing 24.4% of revenue. This figure includes significant non-recurring charges. Excluding these one-time items, OpEx was 21.9% of revenue. These expenses cover the necessary investments in Research and Development (R&D) for new product pipelines, such as thin-cell batteries, alongside the costs associated with the sales and marketing infrastructure needed to support growth, including the inclusion of Electrochem operations.

The third quarter included substantial Non-recurring costs totaling $1.1 million. These one-time charges were related to several activities:

• A $0.5 million provision to close the Calgary facility.
• Costs associated with the Electrochem acquisition and transition to Ultralife systems.
• Litigation expenses incurred for a cyber insurance claim.

Ultralife Corporation expects the Calgary closure, which management plans to complete in the first quarter of 2026, to yield estimated annual savings of approximately $0.8 million thereafter.

Capital expenditures (CapEx) reflect investment in future production capacity. For the three months ended March 31, 2025, cash used for capital expenditures was $895 thousand, specifically noted as investments in equipment for new products transitioning to high-volume manufacturing, which would include items like thin-cell technology production equipment.

Financing costs are also a component, driven by the October 31, 2024, acquisition of Electrochem Solutions, Inc. for $50.0 million in cash. The 'Other expense' line item in Q3 2025 rose to $0.8 million, which management cited as being primarily due to interest on the Electrochem acquisition debt, alongside foreign currency fluctuations. In the first nine months of 2025, the company reduced its debt principal by $4.1 million.

Here is a breakdown of the key Q3 2025 cost and expense components:

The company is actively managing these costs through strategic facility consolidation and integration efforts. For instance, the Battery & Energy Products segment's gross margin was 22.1%, while Communications Systems segment gross margin was 23.3% in Q3 2025.

Ultralife Corporation (ULBI) - Canvas Business Model: Revenue Streams

You're looking at how Ultralife Corporation brings in the money as of late 2025, based on the latest reported figures. The revenue streams are clearly segmented, with a heavy reliance on the Battery & Energy Products side, especially government/defense work.

For the third quarter ending September 30, 2025, total revenue for Ultralife Corporation hit $43.4 million, which was a 21.5% increase year-over-year, partly due to the inclusion of Electrochem Solutions, Inc. sales. The core revenue drivers are detailed below.

The Battery & Energy Products segment is the powerhouse, but the composition of that revenue is shifting. Government/defense sales showed strong demand, with a 19.0% increase in Q3 2025. This contrasts with commercial sales within that segment, which saw a 5.7% decrease, mainly from the oil & gas and medical markets.

Revenue from long-term defense contracts forms a critical, predictable base. For instance, Ultralife Corporation secured a recent award from the U.S. Defense Logistics Agency (DLA) valued at $5.2 million for its BA-5390 military batteries, with shipments scheduled primarily for 2026. This continues a pattern, following a previous multi-year contract for the same battery type in 2021, which was worth up to $9.9 million.

Commercial sales to medical, industrial, and energy markets provide diversification, though they faced headwinds in Q3 2025. The company's backlog stood at $90.1 million at the end of Q3 2025, up 6.5% from the prior quarter, suggesting a healthy pipeline of future recognized revenue across these segments.

New product ramps are positioned to bolster future revenue streams, though the impact is expected in late 2025 or 2026. Management is actively focused on converting these development efforts into sales. These include:

• New thin-cell battery technology development.
• High-performance amplifiers, specifically radio-agnostic types.
• Ruggedized server cases.

The company is also advancing vertical integration in the oil & gas segment to capture more value there.