GRRR Stock Slumps 9% After-Hours Despite Doubling First-Half Revenue — What's Driving the Selloff?
Shares of Gorilla Technology (GRRR) slid about 9% in after-hours trading Monday, even after the company reported that first-half revenue had more than doubled, with investors focusing on wider losses and the steep cost of scaling multiple AI data-center projects.
The London-based provider of AI-powered security, networking and data-center solutions said first-half 2026 revenue rose 99% to $78.4 million from $39.3 million a year earlier. Second-quarter revenue climbed to $50.1 million, up 78% from the prior quarter and 138% from the same period last year. The company said it exceeded its revised second-quarter target because deliverables and milestones on contracted programs were completed earlier than expected.
The earnings picture, though, remained a concern. Gorilla reported an adjusted loss of $0.58 per share for the first half, missing estimates by a wide margin and reversing a profit of $0.32 per share in the year-earlier period. Heavy non-cash items, particularly about $25 million in stock-based compensation, along with ongoing infrastructure spending, weighed on profitability.
Management nevertheless raised its full-year 2026 revenue outlook to at least $200 million. It expects $48 million to $50 million in third-quarter revenue and is targeting approximately $60 million to $70 million in the fourth quarter.
Looking further out, Gorilla has set a 2027 revenue target of $450 million to $500 million, with improved margins. Chairman and CEO Jay Chandan said the numbers will only be reached if the company installs capacity, commissions projects and converts demand into contracts. “We're not expecting the calendars to produce the growth for us,” he said. “Our answer to all this will be execution.”
During the earnings call, Chandan said testing for the Yotta Phase 1 project, one of Gorilla's biggest AI data-center builds, is complete. Equipment is now arriving and installation has started.
The company is working on several sites simultaneously. In Indonesia and nearby Batam, it is developing a large facility expected to provide about 200 megawatts of computing power, with initial services slated to go live in mid-2027. A campus in Thailand is also moving forward, with land clearing already finished.
CFO Bruce Bower said that once the GPU-as-a-service offerings are running, a model in which Gorilla rents out powerful chips for AI workloads, they should produce profit margins of 75% or higher. He added that this could strengthen results in the second half and beyond.
The after-market pullback underscores a broader tension in Gorilla's story: revenue is expanding quickly, but the cost and execution risk of building out AI infrastructure are also rising. For some investors, the current valuation after a big year-to-date run may already reflect an optimistic scenario, leaving little room for earnings misses or future dilution.
On Stocktwits, retail sentiment around GRRR remained ‘extremely bullish’ over the past 24 hours, while message volume stayed ‘extremely high.’ One user pointed to the stock “hitting close to the overbought territory,” while another flagged concerns about potential dilution, noting AI projects require “a ton of upfront capital.”
GRRR shares have still gained about 45% year to date.