Some of the most interesting stock stories in 2026 aren’t coming from mega-cap tech at all. While the crowd argues over the next AI winner, a handful of smaller companies are quietly building real-world hardware advanced batteries, satellites, and defense systems, that could matter over the next decade.

Today we’re looking at two of them as stocks to watch: Amprius Technologies (AMPX), which is chasing a breakthrough in battery energy, and Redwire Corporation (RDW), which builds space and defense infrastructure. This is a fundamentals-first breakdown. We’ll walk through revenue, margins, losses, and cash in plain English, and explain what the numbers actually mean. To be clear up front: this is educational analysis, not a recommendation to buy or sell either one.

How to Read a Small, Fast-Growing Stock

Before the numbers, two quick definitions that will make everything below easier. Revenue is the money a company brings in from sales. Gross margin is the slice of each sale left after the direct cost of making the product a rising gross margin is one of the clearest signs that a manufacturer is starting to scale profitably. Both companies here are still losing money, which is normal for young hardware firms investing to grow. The job of an investor watching them is to judge whether the losses are shrinking in the right way while revenue climbs.

Amprius Technologies (AMPX): The Battery Bet

Amprius, founded in 2008 and based in Fremont, California, makes silicon-anode lithium-ion batteries. Here’s the simple version: most batteries use graphite to store energy; silicon can, in theory, hold much more, which means lighter batteries that last longer. Silicon has historically been hard to commercialize, and Amprius’s pitch is that it has solved enough of those problems to ship real products to drones, robotics, advanced electronics, and defense and aerospace customers.

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The latest results back up the momentum. In its first quarter of 2026, Amprius reported record revenue of $28.5 million, up about 153% from a year earlier (roughly 2.5x) and up 13% from the prior quarter. Crucially, profitability is moving the right way: gross margin turned positive at 20%, a big swing from negative 21% a year earlier, as its second-generation “SiCore” batteries drove sales. The net loss narrowed to $5.0 million (about $0.04 per share), a 46% improvement from a $9.4 million loss a year ago. On the back of that, management raised its full-year 2026 revenue guidance to at least $130 million and said it is targeting positive adjusted EBITDA (a rough measure of core operating profitability).

What to keep an eye on: Amprius funds a lot of its growth by issuing new shares, which can dilute existing owners, a normal but real risk for early-stage growth companies. The signposts that matter are whether gross margin keeps climbing and whether the company can fund its expansion without leaning too heavily on new stock.

Redwire Corporation (RDW): The Space & Defense Play

Redwire operates in a completely different arena: space systems, defense technology, and orbital infrastructure, everything from satellite components and lunar power systems to missile-defense work and drones. This is largely a contract-driven business tied to government and agency budgets rather than consumer demand, which can mean lumpier, less predictable quarters.

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Growth here is strong and getting a big boost from an acquisition. Q1 2026 revenue reached about $97 million, up roughly 58% year over year, split between a space segment (about $52.7 million) and a defense-tech segment (about $44.3 million). Much of the defense jump came from Redwire’s acquisition of drone-maker Edge Autonomy, now fully folded into the company. Redwire ended the quarter with a contracted backlog of about $498 million. Think of backlog as work already signed but not yet delivered, a useful gauge of future revenue, and it reaffirmed full-year 2026 guidance of $450–$500 million in revenue (around 42% growth at the midpoint).

The catch is profitability. Redwire posted a net loss of roughly $76 million in the quarter, far larger than a year ago. A big chunk of that, however, was non-cash: around $47 million tied to equity-based compensation plus costs from absorbing Edge Autonomy. Still, the company is burning cash as it scales, so the things to watch are whether that backlog converts into delivered revenue and whether losses start to shrink as the acquisition beds in.

The Counter-Argument (And Why It’s Serious)

Here’s the case for caution, and it deserves respect. Both of these are small, speculative companies with real execution risk. Amprius still has to prove it can scale silicon-anode batteries profitably against far larger battery makers, and its reliance on issuing shares can dilute investors. Redwire is leaning heavily on an acquisition and government contracts, both of which can create volatility, and a $76 million quarterly loss is not a rounding error even if much of it is non-cash. Small-cap stocks like these can swing violently on a single headline, and “exciting technology” does not automatically translate into a rising share price.

The balanced view: strong revenue growth and improving margins (at Amprius) and a large backlog (at Redwire) are genuine positives, but neither story is proven yet. That’s exactly why these belong on a watchlist you follow closely, tracking each quarter to see if the trend holds rather than treated as sure things.

The One Number to Watch

For Amprius, watch gross margin. It just crossed into positive territory at 20%; if it keeps climbing as revenue grows, that’s the clearest sign the business model is working. If it stalls or slips, the scaling story is in question.

Read: 3 AI and Tech Stocks to Watch in 2026

For Redwire, watch contracted backlog (about $498 million). Backlog is the pipeline of signed work; as long as it keeps growing and converting into delivered revenue, the top-line growth has fuel. A shrinking backlog would be the early warning.

Frequently Asked Questions

What does “stocks to watch” mean here?
It means these are companies worth monitoring for the reasons explained above, not a recommendation to buy them. Watching lets you learn how the story develops before making any decision of your own.

Why do both companies lose money if revenue is growing?
Young hardware companies spend heavily on research, factories, and staff to grow. The key is whether losses shrink relative to revenue over time, a sign the business is scaling which is exactly what Amprius’s improving margin and narrowing loss suggest.

Are small-cap stocks like these riskier?
Generally yes. Smaller, earlier-stage companies can be more volatile and are more sensitive to single events, financing needs, or contract timing. That’s a reason to watch and learn rather than chase headlines.

Disclaimer: Content on this site is for informational and educational purposes only and does not constitute financial, investment, or trading advice. I am not a licensed financial advisor. Always conduct your own research and consult a licensed professional before making investment decisions.