SmartRent's 98% Q2 Booking Jump May Matter More Than the 4% Revenue Line

Units booked, not the headline revenue line, were the clearest Q2 signal

At first glance, SmartRent's second-quarter report looked modest because Total Revenue of $39.8 million was up 4% from a year earlier. That is the headline bears will focus on.

The more interesting signal was at the property level: Units Booked in the second quarter totaled 48,254, up 98%. For a property-technology company, that matters because it shows whether customers are actually choosing the platform now, not just carrying it forward from prior periods.

Why investors should look beyond the top line

The headline growth rate was only part of the story. Core Revenue totaled $38.4 million, up 14%, which looks healthier than the 4% total-revenue figure. Even more important, Units Booked for the trailing twelve-months increased by 40% to 112,560, suggesting demand has been stronger over the last year than a single quarter may imply.

That is why the market is split. Bears can argue 4% total revenue growth is still too slow for a valuation reset. Bulls can argue adoption often accelerates at the property level before it shows up cleanly in revenue.

SmartRent's installed base and recurring revenue still look credible

The better question is not whether the growth headline looks clean. It is whether property managers still find SmartRent useful enough to keep using.

Traction is visible in deployments and customer quality

SmartRent ended the quarter with 929,487 Total Units Deployed, up 10%, and management says its platform serves 15 of the top 20 multifamily owners and operators. That kind of traction does not solve the valuation debate by itself, but it does suggest the installed base is broadening among serious customers.

Recurring revenue is becoming a larger part of the business

SmartRent also reported Annual Recurring Revenue ("ARR") increased by 13% to $64.5 million, representing 40% of Total Revenue. That means a large and growing share of the business is repeatable rather than dependent on one-off projects. For a company selling hardware into apartments, that is a constructive sign.

Why revenue still looks less clean than demand

The cautious view is still reasonable because recent history muddied the revenue picture.

2025 distorted the comparison

Full-year 2025 Total Revenue of $152.3 million, down 13% from prior year, primarily due to 2024 bulk hardware sales with no current year counterpart. That makes recent revenue growth look weaker than the underlying demand picture may be.

Q1 2026 added more noise

In the first quarter, total revenue fell 6%, helped by a $2.6 million reduction in non-cash hub amortization revenue and weaker hardware sales versus a strong prior-year quarter. That is why the first read on revenue can be misleading.

What to watch next

The cleaner check is whether software and recurring revenue continue to hold up as hardware volatility fades. In Q1, SaaS Revenue -- $0.2 million, up 9% year over year, now comprising 39% of total revenue. Management also said there were 600 customers in the base. Taken together with near-term deployment growth, that supports the view that SmartRent is becoming more of a sticky operating tool than a commodity hardware seller.

The next one to two quarters need to confirm the turn

This no longer looks like a pure "does the product matter?" story. The more practical question is whether better demand starts showing up in revenue growth and profitability over the next few quarters.

What would support a more bullish read

A stronger next quarter would likely show a mix of:

• better total revenue growth than yesterday's 4% total revenue growth
• continued ARR expansion after 13% ARR growth in fourth-quarter 2025
• further progress against the 929,487 Total Units Deployed base

Why the repair case still has credibility

There is already some improvement evidence. SmartRent's fourth quarter of 2025 showed 13% ARR growth, positive adjusted EBITDA, a lower net loss, and cash that increased by $4.5 million. In Q2, Gross Margin aggregated 40.7%, up 760 basis points and Adjusted EBITDA totaled $0.7 million, an $8.0 million improvement. That does not prove a full turn, but it does suggest the business is cleaning up.

What would weaken the thesis

The setup weakens if:

• the Q2 booking spike does not carry forward
• deployed-unit growth slows materially
• recurring revenue growth fades
• margin improvement comes mostly from cost cuts rather than mix