Financial Data and Key Metrics - Revenue for fiscal year 2024 was $293,000, down from $640,000 in 2023, primarily due to a shift from perpetual licenses to operational licenses with lower upfront revenue [30][31] - Administrative expenses decreased to $23.5 million from $55.2 million in 2023, driven by lower share-based compensation, employee expenses, and legal fees [32] - Operating loss for 2024 was $24.6 million, compared to $54.5 million in 2023, reflecting reduced administrative expenses [33] - Cash and cash equivalents at the end of fiscal year 2024 stood at $18.7 million, down from $44.5 million in 2023 [34] Business Line Data and Key Metrics - The company executed 13 contracts in 2024, up from 7 in 2023, with significant technical discussions held with 11 entities, including 8 telecom network operators [22] - A seven-figure multi-year contract with a Middle East governmental agency was executed, expected to generate annual recurring revenue starting in fiscal year 2025 [18][19] - The company engaged with Sparkle, a telecom network operator, to secure its Quantum-Safe network-as-a-Service product, with potential for license revenue as customers sign up [16] Market Data and Key Metrics - The telecom network, government, and military markets are key focus areas, with increasing engagement and contract wins [20][26] - The company is exploring opportunities in financial services and IP-rich industries, driven by concerns over quantum threats to data security [26][51] - The Middle East and U.S. government markets are showing strong interest in post-quantum encryption solutions, with potential for further contracts [42][44] Company Strategy and Industry Competition - The company is transitioning from perpetual licenses to operational licenses to build a recurring revenue model [30] - Focus is on converting technical engagements into material revenue contracts, particularly in telecom, government, and military markets [26] - The company is leveraging its compliance with NSA requirements and industry recognition to drive customer engagement [14] - AI is being integrated into the technology roadmap to enhance remediation and customer support [45][46] Management Commentary on Operating Environment and Future Outlook - The market for enhanced encryption is moving towards the company, with increasing awareness of quantum threats [11][36] - The company is focused on executing its sales strategy and converting opportunities into revenue, with a strong emphasis on customer fulfillment [9][27] - The company expects 2025 to bring increased dialogue around quantum computing and encryption, driven by market and media interest [11][12] Other Important Information - Headcount was reduced to 82 employees at fiscal year-end from 147 in 2023, with a focus on sales, engineering, and customer fulfillment [25] - Budgeted monthly operating costs for fiscal year 2025 have been reduced to $2.15 million, with cost-saving initiatives ahead of budget [24] - The company received additional capital investments from board members, providing confidence in its forward strategy [10] Q&A Session Summary Question: Revenue cadence for the Middle East deal - The revenue from the Middle East deal will be recognized ratably, starting in the current reporting period [40] Question: Additional government and enterprise contract opportunities in the Middle East - The Middle East deal is expected to catalyze further opportunities with governmental bodies and large enterprises in the region, driven by proactive legislation on post-quantum encryption [42] Question: Role of AI in the Quantum-Safe story - AI is being explored as a remediation tool to guide customers in addressing vulnerabilities and applying the company’s technology [45][46] Question: Focus verticals beyond government, telecom, and defense - Financial services and IP-rich industries are emerging as key verticals, with concerns over data security and quantum threats [51] Question: Operating leverage and cost structure - The company expects to deliver expected revenue in fiscal year 2025 with the current cost base, with minimal leverage anticipated [53] Question: Cash balance and recent capital raise - A portion of the capital raise ($1.8 million) was received in early October and not included in the fiscal year 2024 cash balance [55]

Financial Performance - Arqit generated revenue from its principal business operations in the fiscal year ended September 30, 2021, but continues to incur net losses, with a net loss of $23.977 million for the year ended September 30, 2024 [362][372]. - Cash used in operating activities was $34.126 million for the year ended September 30, 2024, compared to $32.825 million in 2023 and $26.720 million in 2022, indicating an increasing trend in operational cash outflows [370][372]. - Net cash generated from financing activities was $11.188 million for the year ended September 30, 2024, a significant decrease from $44.853 million in 2023 and $22.176 million in 2022 [370][375]. Capital Raising Activities - Arqit issued 48,803 shares under its ATM Program in the year ended September 30, 2024, generating approximately $0.467 million, while in 2023, it issued 312,579 shares for approximately $11.5 million [364]. - In February 2023, Arqit completed a registered direct offering, selling 400,000 ordinary shares and generating proceeds of approximately $20.0 million [365]. - The company has established an ATM Program with an aggregate offering price of up to $30.0 million, allowing for future capital raises depending on market conditions [364]. Risk Management - Arqit is exposed to foreign exchange risk primarily with respect to British pounds sterling and Euro, managing this risk by holding bank accounts in these currencies [356]. - The company has no significant concentration of credit risk, as it places surplus cash with banks that have a minimum credit rating of A3/A- [355]. - Arqit has been managing liquidity risk by continuously monitoring cash flows and maintaining funding headroom above forecast peak requirements [357]. Regulatory and Reporting Considerations - The company is evaluating the benefits of relying on reduced reporting requirements under the JOBS Act, which may exempt it from certain obligations until September 3, 2026 [359]. Development Costs and Valuation - As of September 30, 2024, the carrying amount of capitalized development costs was $1.939 million, down from $3.414 million at September 30, 2023, and significantly lower than $40.291 million at September 30, 2022 [383]. - Arqit uses a Binomial Option Pricing Model for the fair value measurement of warrants, with assumptions disclosed in the audited consolidated financial statements [382]. - The fair value of share-based compensation is estimated using a Black Scholes valuation model, with inputs including expected life, volatility, and dividend yield [384]. - Compensation expense for RSUs is based on the market price of shares on the grant date and is expensed over a vesting period of one to five years [386]. - Deferred tax assets are recognized based on the likelihood of generating sufficient taxable earnings in future periods, impacting the realization of net deferred tax assets [387]. Discontinuation of Operations - The decision to discontinue the satellite division involves increased judgment and estimation uncertainties regarding recognized provisions [388]. - Judgments are required to estimate the expected fair value of assets held for sale until a sale is contractually concluded, with potential material changes due to economic conditions [389].

Arqit Quantum Inc. Announces Financial and Operational Results for the Fiscal Year 2024 Exhibit 99.1 $293,000 in revenue generated for the full fiscal year Signed seven figure multi-year SKA-Platform enterprise license contract Commence fiscal year 2025 with annual recurring revenue backlog Cash position of $18.7 million at the end of the period London, UK – 5 December 2024 – Arqit Quantum Inc. (Nasdaq: ARQQ, ARQQW) ("Arqit" or the "Company"), a leader in quantum safe encryption, today announced its operati ...

Investors interested in Business Services stocks should always be looking to find the best-performing companies in the group. Has Arqit Quantum Inc. (ARQQ) been one of those stocks this year? Let's take a closer look at the stock's year-to-date performance to find out.Arqit Quantum Inc. is one of 303 individual stocks in the Business Services sector. Collectively, these companies sit at #4 in the Zacks Sector Rank. The Zacks Sector Rank includes 16 different groups and is listed in order from best to worst ...

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LONDON, Nov. 26, 2024 (GLOBE NEWSWIRE) -- Arqit Quantum Inc. (“Arqit”), a leader in quantum safe encryption, announced it will report financial results for the fiscal year ending September 30, 2024 on Thursday, December 5, 2024. In conjunction with this announcement, Arqit will host a conference call at 11:00 a.m. ET / 8:00 a.m. PT on December 5, 2024 with the Company’s CEO, Andy Leaver, and CFO, Nick Pointon. A live webcast of the call will be available on the “News & Events” page of the Company’s website ...

Leadership Transition - Arqit Quantum Inc. announced the appointment of Andy Leaver as the new CEO, effective immediately, while co-founder David Williams steps down from his role [1][2] - The leadership change signifies a shift from the company's early development phase to a focus on revenue and operational growth [1] Executive Experience - Andy Leaver brings extensive experience from senior roles at notable software companies such as Ariba, Bazaarvoice, and Workday, and has been an adviser to successful private software scale-ups [2] - Leaver has been consulting Arqit on its go-to-market strategy for the past six months, providing him with insights into the company's challenges and opportunities [2] Contributions of David Williams - David Williams played a crucial role in developing Arqit's symmetric key cryptography technology and establishing key partnerships [1] - Williams expressed confidence in Leaver's ability to lead the company into its next phase, highlighting the positive trajectory of Arqit [3] Company Overview - Arqit Quantum Inc. specializes in quantum-safe encryption, providing a unique encryption software service that secures communications against current and future encryption threats, including those posed by quantum computers [4] - The company's technology is compliant with NSA standards and is designed to create computationally secure encryption keys locally on endpoint devices [4] - Arqit has received multiple awards for its innovative technology, including recognition at the Mobile World Congress 2024 and the National Cyber Awards [4]

LONDON, June 20, 2024 (GLOBE NEWSWIRE) -- Arqit Quantum Inc. (NASDAQ:ARQQ, ARQQW))) (Arqit), a leader in quantum-safe encryption, announces the full commercial launch of a new feature of its Symmetric Key Agreement Platform, the "Encryption Intelligence" service. Encryption Intelligence assists organizations in identifying network risks and developing mitigation plans to enhance their security posture against current and evolving cybersecurity threats. Arqit secured its first paid contract for this feature ...

Financial Data and Key Metrics - Revenue for the first half of fiscal year 2024 was $0.1 million, a modest result but supported by strong customer engagements [5] - Year-over-year revenue growth from $19,000 in 2023 to $119,000 in 2024, driven by increased contracts for the Symmetric Key platform [26] - Operating loss decreased to $16.6 million from $25.4 million in the same period last year, primarily due to cost reductions [29] - Cash balance at the end of the period was $21.3 million, down from $44.5 million at the end of fiscal year 2023 [30] Business Line Data and Key Metrics - The company experienced a 100% renewal rate for expiring contracts, particularly for the Symmetric Key Agreement platform and network secure firewall products [7] - Three additional major telcos agreed to launch or launched initial test installations of Arqit's SKA products, bringing the total to six major telcos engaging with the product [7] - The company secured its first seven-figure multi-year government contract, expected to be finalized in early summer [11] Market Data and Key Metrics - The company is engaged with about a dozen large-scale telecom operators, with Telecom Italia Sparkle completing the initial installation of Arqit's SKA platform [15][16] - The government market is showing significant interest, with growing opportunities in defense and enterprise sectors [12][13] - The enterprise market is slower to adopt, but 40% of respondents in a recent survey are planning to implement post-quantum cryptographic solutions within the next 12 months [21] Company Strategy and Industry Competition - The company is focusing on government contracts, telco partnerships, and OEM collaborations to drive revenue growth [12][17] - The integration with Intel's Xeon Scalable processors represents a significant market opportunity, with joint marketing efforts already underway [17][18] - The company is prioritizing cost control, with a 40% reduction in monthly operating costs expected by July 2024 [28] Management Commentary on Operating Environment and Future Outlook - Management expressed high conviction in the business trajectory, citing multiple contract awards and partnerships as evidence of market maturation [5][19] - Sales cycles are shortening, with customer engagements now taking three to four months, indicating a growing mainstream appreciation for quantum-safe encryption [20] - The company expects significant revenue flow in 2024, driven by government contracts, telco rollouts, and OEM partnerships [24][33] Other Important Information - The company announced further cost-saving initiatives, including headcount reductions and real estate rationalization, reducing employee count to 81 [28] - The collaboration with Intel is seen as a large-scale route to market, with significant potential for global revenue generation [17][18] Q&A Session Summary Question: Timing and revenue potential for the EMEA contract - The EMEA contract is a multi-year seven-figure deal, with first revenues expected in the current half-year [37] - Additional contracts and telco rollouts are also expected to contribute to revenue in the same timeframe [37] Question: Feedback from partners on contract renewals - Partners report that Arqit's products are easy to use, quick to deploy, and highly stable, with no network outages experienced [40] - The integration with Intel, Fortinet, and Juniper enhances ease of deployment and performance, providing a competitive advantage [41] Question: Cost control and potential for adding back infrastructure - Cost reductions have been achieved through exiting the satellite business and scaling back software development [43] - The company expects to maintain a stable cost base, with only modest additions in customer support and service as contracts ramp up [44]

Core Insights - Arqit Quantum Inc. reported $119,000 in revenue for the six months ending March 31, 2024, a significant increase from $19,000 in the same period in 2023, despite some expected deals slipping into the second half of the fiscal year [1][12] - The company has renewed or extended contracts with nine existing customers, indicating a stable customer base with potential for larger future revenue opportunities [1][12] - Arqit has initiated a cost reduction program aimed at decreasing monthly operating costs to approximately $1.8 million, down from $3.0 million, which is expected to result in a 40% reduction in costs starting July 2024 [1][3] Financial Performance - Revenue for the first half of fiscal 2024 was generated from Arqit SKA (PaaS)™, Arqit NetworkSecure™, and professional services, with nine customers increasing or renewing contracts [12] - Administrative expenses decreased to $16.8 million from $25.4 million in the comparable period in 2023, primarily due to reduced headcount [12][13] - The operating loss for the period was $16.6 million, an improvement from a loss of $25.4 million in the first half of fiscal 2023 [12][13] Operational Highlights - Arqit has re-branded its flagship product from QuantumCloud™ to SKA Platform™, emphasizing its focus on software without hardware components [2] - The company secured a seven-figure multi-year contract with a government customer in the EMEA region, marking its first such contract [2] - Arqit has established partnerships with major telecom operators and financial institutions, indicating growing market adoption of its technology [2][8] Market Position and Strategy - The company is focusing on delivering applications such as NetworkSecure™, TradeSecure™, and WalletSecure™, targeting governments, network operators, and financial institutions [8] - Arqit’s technology has been recognized for its compliance with NSA standards, enhancing its competitive advantage in the cybersecurity market [3][4] - The collaboration with Intel for post-quantum cryptography solutions is seen as a significant milestone, with commercial efforts already underway [2][7] Future Outlook - Arqit anticipates generating more consistent revenues by the end of the first half of the 2025 fiscal year, driven by increasing market awareness and demand for post-quantum cryptography [6][9] - The company is optimistic about the potential for its SKA Platform™ as organizations recognize the need for stronger encryption solutions [6][10]