Group 1 - Alarum Technologies held a conference call to discuss the results of Q2 2025, featuring CEO Shachar Daniel and CFO Shai Avnit [1][3] - The call included an overview of the quarter by the CEO, followed by a financial review from the CFO, and concluded with a Q&A session [3] Group 2 - The conference call may contain forward-looking statements regarding the company's plans, objectives, and future performance [4][5] - Discussions included guidance on future strategy, sustainable growth potential, estimated margins, and long-term profitability [5]

Alarum Technologies (ALAR) Q2 2025 Earnings Call August 28, 2025 08:30 AM ET Company ParticipantsKenny Green - Investor RelationsShachar Daniel - Co-Founder, CEO & DirectorShai Avnit - CFOBrian Kinstlinger - MD, Director - Research & Head - Technology ResearchKingsley Crane - MD - Equity ResearchOperatorLadies and gentlemen, thank you for standing by. Welcome to the Alarm Technologies Conference Call for the Second Quarter twenty twenty five. During today's presentation, all parties will be in a listen only ...

Financial Data and Key Metrics Changes - The company reported second quarter revenue of $8.8 million, a slight decrease from $8.9 million in the same period last year, attributed to a shift in customer mix towards the AI segment [16][19] - Non-IFRS gross margin for 2025 was 63%, down from 78% in 2024, reflecting the impact of strategic investments and lower margins from new projects [17] - Non-IFRS net profit was $300,000 for 2025, compared to a net loss of $400,000 in 2024 [19] - Adjusted EBITDA for 2025 was $1 million, down from $3.4 million in 2024 [19] Business Line Data and Key Metrics Changes - The company is experiencing significant growth in the AI segment, which is replacing customers from other segments, leading to a net retention rate (NRR) of 0.98 [16] - The company has launched new projects with major AI and e-commerce platforms, indicating a shift towards larger deal sizes and more significant revenue potential [7][8] Market Data and Key Metrics Changes - The demand for data collection services is increasing, driven by the need for training data for AI models, positioning the company favorably within the evolving market landscape [6][9] - The company is focusing on expanding its customer base, which now includes major tech giants and emerging startups, indicating a broadening market reach [7] Company Strategy and Development Direction - The company is strategically reinvesting earnings into scaling operations, expanding infrastructure, and broadening its IP proxy network to capture long-term value from major AI-driven customers [16][13] - The focus is on building a robust talent pool and developing a cooperative field of data collection products designed for the AI era, aiming to cross-sell to existing customers [11][13] Management's Comments on Operating Environment and Future Outlook - Management highlighted the dynamic and unpredictable nature of the AI market, urging investors to evaluate the company's performance over multiple quarters rather than on a quarter-by-quarter basis [12] - The company anticipates revenue for 2025 to range from $12.8 million, representing a 78% year-over-year increase, with adjusted EBITDA expected to be around $1.1 million [22] Other Important Information - The company has a strong balance sheet with cash and liquid investments of approximately $25 million, allowing for strategic investments while maintaining a focus on sustainable value creation [14][21] - The company is currently experiencing a transition phase, with operating expenses increasing to $5.4 million due to higher employee-related costs, particularly in R&D [18] Q&A Session Summary Question: Clarification on the large customer ramp in Q3 - Management explained that lower margins are due to the new product's infrastructure costs, which are currently high due to the scale of the project [27][28] Question: Infrastructure costs and margin recovery - Management indicated that significant volume increases would be necessary to recover margins, and improvements in cost structure are expected as the project scales [31][32] Question: Broader customer base usage trends - Management noted a significant increase in demand from AI and data-driven customers, with a strong pipeline of new logos expected [36][38] Question: Customer lifetime value and stability - Management expressed optimism that the new AI-driven customer base could lead to higher customer lifetime value and stability over time [42][47] Question: Contribution of the large customer to Q2 results - Management confirmed that the large customer has been ramping up and is already contributing a respectable amount to revenues [51] Question: Visibility into projected revenues - Management stated that there is a level of confidence in the projected $3 million revenue for Q3, with ongoing demand expected [56][57]

Core Insights - Alarum Technologies Ltd. reported Q2 2025 revenues of $8.8 million, a slight decrease from $8.9 million in Q2 2024, with a net profit of $0.3 million and Adjusted EBITDA of $1.0 million [1][9][13] Business Highlights - The company is experiencing strong demand for data from major global players in the AI segment, leading to expanded collaborations with significant AI and e-commerce companies [2][3] - Alarum is investing in infrastructure and operations to support market demand while maintaining operational efficiency [4] - The company anticipates substantial revenue growth in Q3 2025, driven by a new large-scale AI data project expected to contribute approximately $3 million [5][15][16] Financial Performance - For the first half of 2025, total revenue was $15.9 million, down from $17.3 million in H1 2024, primarily due to reduced consumption from large customers [9] - Gross profit for Q2 2025 was $5.4 million, compared to $6.8 million in Q2 2024, with operating expenses increasing to $5.4 million from $4.2 million [11][12] - As of June 30, 2025, shareholders' equity increased to $29.1 million from $26.4 million at the end of 2024 [14] Market Dynamics - The AI market is undergoing significant transformation, with many companies still defining their business models, which may lead to fluctuations in demand for Alarum's services [5][22] - The company is witnessing a shift in customer segments, with strong growth in the AI vertical, while other segments are declining, resulting in a Net Retention Rate of 0.98 [7][29] Future Outlook - The company expects Q3 2025 revenues to be approximately $12.8 million, representing a 78% year-over-year increase, with Adjusted EBITDA projected at around $1.1 million [15] - Alarum's strategic collaborations with major technology players are seen as a significant step to strengthen its position in the AI data collection market [17]

Core Viewpoint - Alarum Technologies Ltd. is set to release its financial results for the second quarter of 2025 on August 28, 2025, before the Nasdaq market opens, indicating a focus on transparency and communication with investors [1]. Financial Results Announcement - The financial results will be discussed in a conference call hosted by the CEO and CFO on August 28, 2025, at 8:30 a.m. ET, followed by a Q&A session, highlighting the company's commitment to engaging with stakeholders [2]. - Participants are required to register before joining the call, which emphasizes the company's organized approach to investor relations [2][3]. Company Overview - Alarum Technologies Ltd. is a global provider of web data collection solutions, utilizing a hybrid proxy network that ensures data collection is conducted anonymously and at scale from public sources [4]. - The company's infrastructure is designed to guarantee privacy, quality, stability, and speed, showcasing its technological advancements in the industry [4].

Core Viewpoint - Alarum Technologies Ltd. has revised its revenue and Adjusted EBITDA outlook for Q2 2025, reflecting increased demand and usage of its data collection products and services from existing customers [1][2]. Revenue Outlook - The company now estimates Q2 2025 revenue to be approximately $8.8 million ±3%, an increase from the previous estimate of $7.9 million ±3% [2]. - This represents a revenue increase of about 11.4% from the prior estimate [2]. Adjusted EBITDA Outlook - Alarum expects to report adjusted EBITDA ranging from $1.0 million to $1.5 million, up from the previous range of $0.5 million to $0.8 million [2]. - This indicates a potential increase of 100% to 200% in adjusted EBITDA compared to the earlier guidance [2]. Market Dynamics - The market in which Alarum operates is described as highly dynamic and unpredictable, with ongoing volatility expected [2]. - The company is preparing for potential fluctuations in market conditions [2]. Financial Reporting - The company is unable to reconcile its estimated adjusted EBITDA to net profit due to uncertainties regarding certain expenses [3]. - The financial impact of these expenses is dependent on various factors and could be material to the company's financial statements [3]. Update Policy - This update is in accordance with the company's internal policy to issue updates when quarterly revenue outlooks deviate by at least 10% from previous estimates [4].

Core Insights - The company reported a revenue of $7.1 million for Q1 2025, aligning with guidance, while net profit was $0.4 million and adjusted EBITDA reached $1.3 million, exceeding expectations [1][12] - The demand for scalable, high-quality data is accelerating, driven by the growth of AI technologies and eCommerce platforms [2][8] - The company is strategically investing in scalable infrastructure and next-gen technologies to meet rising demand for AI-ready data [1][3] Financial Performance - Q1 2025 revenue decreased by 15% year-over-year from $8.4 million in Q1 2024 [13] - Gross profit for Q1 2025 was $4.8 million, with a gross margin of 67.5%, down from 78.5% in Q1 2024 [9][13] - Total operating expenses increased to $4.5 million in Q1 2025 from $4.0 million in Q1 2024, primarily due to higher research and development costs [13] Market Position and Strategy - The company expanded strategic partnerships with major AI and eCommerce players, including a top Asian marketplace and a European AI firm, for large-scale data labeling and model fine-tuning [8] - Alarum is positioned to play a key role in the emerging market for high-quality, scalable data infrastructure, essential for AI model training [8][29] - The company aims to build a robust data access backbone for the AI era, focusing on long-term value delivery for stakeholders [4][8] Future Outlook - The company anticipates Q2 2025 revenues to be around $7.9 million, with adjusted EBITDA expected between $0.5 million and $0.8 million [12] - The net retention rate (NRR) reached 1.13 as of March 31, 2025, indicating strong customer revenue growth [8][25] - Early results from strategic investments and positive pipeline visibility support an optimistic outlook for the second quarter of 2025 [8][12]

Core Viewpoint - Alarum Technologies Ltd. is set to release its financial results for Q1 2025 on May 29, 2025, before the Nasdaq market opens, indicating a focus on transparency and communication with investors [1]. Financial Results Announcement - The financial results for the first quarter ended March 31, 2025, will be disclosed before the market opens on May 29, 2025 [1]. - A conference call will be hosted by the CEO and CFO on the same day at 8:30 a.m. ET to discuss the results and business outlook, followed by a Q&A session [2]. Conference Call Details - Participants can join the live call by dialing the provided toll-free or international numbers, with a reminder to connect five minutes prior to the start [3]. - A replay of the call will be available after 11:30 a.m. ET on the same day, accessible through the company's website [3]. Company Overview - Alarum Technologies Ltd. is a global provider of web data collection solutions, utilizing a hybrid proxy network for anonymous data collection from public web sources [4]. - The company's infrastructure is designed to ensure privacy, quality, stability, and speed, featuring proprietary reflection technology and a network of servers with ISP partners worldwide [4].

Core Viewpoint - Rosen Law Firm is reminding investors who purchased Alarum Technologies Ltd. securities during the specified Class Period of the upcoming lead plaintiff deadline on April 15, 2025 [1]. Group 1: Class Action Details - Investors who purchased Alarum securities between March 14, 2024, and August 26, 2024, may be entitled to compensation without any out-of-pocket fees through a contingency fee arrangement [2]. - A class action lawsuit has already been filed, and interested parties can join by submitting a form or contacting the law firm [3][6]. - The deadline to move the Court to serve as lead plaintiff is April 15, 2025, with the lead plaintiff acting on behalf of other class members [3]. Group 2: Law Firm Credentials - Rosen Law Firm emphasizes the importance of selecting qualified counsel with a successful track record in securities class actions, highlighting its own achievements, including the largest securities class action settlement against a Chinese company at the time [4]. - The firm has been ranked No. 1 by ISS Securities Class Action Services for the number of settlements in 2017 and has consistently ranked in the top 4 since 2013, recovering hundreds of millions for investors [4]. - In 2019, the firm secured over $438 million for investors, and its founding partner was recognized as a Titan of Plaintiffs' Bar by Law360 in 2020 [4]. Group 3: Case Allegations - The lawsuit alleges that Alarum made false and misleading statements regarding its effectiveness in retaining and expanding customer engagements, which impaired its ability to generate consistent revenue growth [5]. - It is claimed that Alarum's business and financial prospects were overstated, leading to materially false and misleading public statements throughout the Class Period [5]. - The lawsuit asserts that when the true details became known, investors suffered damages as a result [5].

Core Viewpoint - A class action lawsuit has been filed against Alarum Technologies Ltd. for alleged violations of securities laws, claiming the company made false and misleading statements regarding its customer engagements and revenue growth [1][4]. Group 1: Lawsuit Details - The lawsuit is based on violations of §§10(b) and 20(a) of the Securities Exchange Act of 1934 and Rule 10b-5 [1]. - Investors who purchased Alarum's securities between March 14, 2024, and August 26, 2024, are encouraged to participate in the lawsuit [2]. - The class has not yet been certified, meaning potential participants are not currently represented by an attorney [3]. Group 2: Allegations Against Alarum - The complaint alleges that Alarum failed to retain and expand customer engagements as effectively as claimed, impacting its ability to generate consistent revenue growth [4]. - The company's public statements during the class period are described as false and materially misleading, leading to investor damages when the truth was revealed [4].