About Genasys Inc. Genasys Inc. (NASDAQ: GNSS) is the global leader in Protective Communications Solutions and Systems, designed around one premise: ensuring organizations and public safety agencies are "Ready when it matters™." The company provides the Genasys Protect platform, the most comprehensive portfolio of preparedness, response, and analytics software and systems, as well as Genasys Long Range Acoustic Devices (LRAD®) that deliver directed, audible voice messages with intelligible vocal clarity fro ...

Financial Performance - Revenues for the second quarter of fiscal 2024 were $5.739 million, a decrease from $11.213 million in the same quarter of fiscal 2023, with software revenue increasing by $887, while hardware revenue decreased by $6.361 million [195]. - The company reported a net loss of $6.938 million for the second quarter of fiscal 2024, or $(0.16) per share, compared to a net loss of $3.403 million, or $(0.09) per share, for the same quarter in the prior year [195]. - Total revenues decreased by $5,474, or 49%, to $5,739 in Q2 FY2024 compared to $11,213 in Q2 FY2023 [214]. - Product sales dropped to $3,209, representing 55.9% of total revenues, down from $9,940, or 88.6%, in the prior year [214]. - Gross profit fell by $2,748, or 56%, to $2,177, with gross profit margin decreasing to 37.9% from 43.9% [216]. - Net loss for Q2 FY2024 was $6,938, compared to a net loss of $3,403 in Q2 FY2023, attributed to lower revenues [222]. - Total revenues for the six months ended March 31, 2024, decreased by $11,600, or 53.5%, to $10,100 compared to $21,700 in the same period of 2023 [224]. - Net loss for the first six months of fiscal 2024 was $13,662, compared to a net loss of $6,910 in the prior year, reflecting lower revenue and higher operating expenses [232]. - Adjusted EBITDA for the six months ended March 31, 2024, was $(11,794), compared to $(4,683) in the same period of 2023 [235]. Revenue Breakdown - Hardware revenue decreased by $6,361, while software revenue increased by $887, with a 123% rise in recurring software revenue [215]. - Hardware revenue decreased by $13,000, or 65.2%, while software revenue increased by $1,400, or 79.8% [225]. - Software segment revenue increased by 104% year-over-year, driven by a 123% increase in recurring revenue [238]. - Hardware segment revenue decreased by $6,361, or 61%, primarily due to lower backlog compared to the previous year [239]. - Software segment revenue increased 80% year-over-year, with a 105% increase in recurring revenue compared to the same period last year [243]. - Hardware segment revenue decreased by $13,000, or 65%, primarily due to lower backlog compared to the previous year [245]. Expenses - Selling, general and administrative expenses increased by $586, or 10%, totaling $6,640, primarily due to higher compensation and commission expenses [218]. - Research and development expenses rose by $250, or 11%, to $2,531, reflecting an increase in engineering personnel [220]. - Selling, general and administrative expenses increased by $719, or 4.3%, primarily due to higher compensation-related costs and amortization expenses from the Evertel acquisition [228]. - Research and development expenses increased by $506, or 12.0%, due to increased compensation-related costs associated with hiring more engineers [230]. - Operating loss increased by $1,081 in the six-month period due to higher compensation costs and amortization expenses from the Evertel acquisition [244]. Contracts and Opportunities - The company has recognized revenue under a $110 million U.S. Army program for long-range acoustical devices, with final deliveries completed in the fourth quarter of fiscal 2023 [196]. - A new contract of up to $75 million was awarded to engineer, procure, and build an emergency notification system for Puerto Rico, with anticipated revenue beginning in fiscal year 2025 [196]. - The company expanded Genasys Protect EVAC coverage to include all of Los Angeles County, CA, under a five-year contract [196]. - The company completed the acquisition of Evertel Technologies, now rebranded as Genasys Protect CONNECT, enhancing its cross-agency collaboration capabilities [196]. - A $2 million contract was awarded under a multi-phase program to deploy LRADs on naval ships and shore installations of a Middle Eastern country [196]. - The company partnered with Ladris Technologies, Inc. to deliver comprehensive disaster evacuation modeling solutions across North America and Europe [196]. - The company believes there are strong market opportunities for its products in defense, public safety, emergency warning, and critical event management sectors due to increasing threats [197]. - The company plans to pursue domestic and international business opportunities, including U.S. military contracts and emergency management systems [202]. - The company is investing in enhancing its Genasys Protect platform and pursuing certifications for government bidding opportunities [204]. Cash Flow and Financial Position - Cash and cash equivalents decreased to $3,544 as of March 31, 2024, down from $8,665 as of September 30, 2023 [247]. - Net cash used in operating activities was $(12,496) for the six months ended March 31, 2024, compared to $(7,466) for the same period in 2023 [249]. - The company had accounts receivable of $2,820 as of March 31, 2024, down from $5,952 as of September 30, 2023 [252]. - Working capital decreased to $10,331 as of March 31, 2024, from $13,949 as of September 30, 2023, primarily due to net loss and decreased accounts receivable [253]. - Net cash used in investing activities was $3,347 for the six months ended March 31, 2024, compared to net cash provided of $918 for the same period in 2023 [254]. - The company received $10,318 through financing activities for the six months ended March 31, 2024, compared to $41 for the same period in 2023 [255]. - As of March 31, 2024, $3.0 million was available for share repurchase under the company's buyback program [257].

Core Insights - Genasys Inc. announced a $2.7 million order for LRAD systems from the U.S. Navy, part of the Navy's initiative to replace first-generation LRADs with upgraded LRAD 1000Xi systems [1][2] Group 1: Company Overview - Genasys Inc. is a leader in Protective Communications Solutions, focusing on ensuring organizations and public safety agencies are "Ready when it matters™" [3] - The company offers the Genasys Protect platform and Long Range Acoustic Devices (LRAD®), which can deliver clear voice messages from close range to 5,500 meters [3] - Genasys serves various sectors, including state and local governments, education, critical industries like oil and gas, and federal governments [3] Group 2: Product and Market Applications - LRAD systems have been utilized by the Navy for over 20 years to enhance over-the-water communications and self-protection [2] - The LRAD 1000Xi system provides audible communications over distances up to 3,000 meters (approximately 1.9 miles), aiding in threat assessment and de-escalation [2] - Genasys' solutions have diverse applications, including emergency warnings, critical event management, and real-time threat detection [3]

Financial Data and Key Metrics Changes - The company reported a total revenue of $5.7 million for the second quarter, a decrease of 49% from the prior year, which included $5.7 million from a completed program [29] - Adjusted EBITDA was negative $5.7 million, compared to negative $2.3 million in the previous year, primarily due to lower hardware revenues [30] - Gross profit margin declined to 38%, a drop of 6 percentage points from the prior year, attributed to reduced hardware revenue [12] Business Line Data and Key Metrics Changes - Software revenue for the quarter was $1.7 million, reflecting a 123% growth in recurring revenue year-over-year [12] - Hardware revenue decreased by 61% to $4 million, significantly below the prior year period [12] - Software bookings included a $4 million contract with Los Angeles County, with expectations for continued strong performance in software bookings [10] Market Data and Key Metrics Changes - The company expects to receive up to $75 million from the Puerto Rico dam project, with contract terms being finalized [7] - The hardware backlog was exceptionally low at the start of fiscal 2024, impacting revenue recognition [12] - International orders and shipments to the U.S. Department of Defense are anticipated to play a key role in future revenue [9] Company Strategy and Development Direction - Genasys is focusing on expanding its presence in public safety and critical infrastructure protection, supported by a fortified balance sheet and new board members with relevant expertise [28] - The company aims to aggressively pursue opportunities in mass notification and has successfully transitioned from military applications to broader markets [27] - The strategy includes leveraging software capabilities developed through acquisitions to enhance hardware offerings [11] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the company's prospects, indicating that the outlook for the next few years has dramatically improved [28] - The company anticipates significant revenue from the Puerto Rico and CROW 16 projects, estimating nearly $200 million in highly profitable revenue in the coming years [51] - Management acknowledged that while the second quarter was financially disappointing, the software business remains strong and is expected to continue growing [45] Other Important Information - The company closed a $15 million debt financing to strengthen its balance sheet [6] - Cash and cash equivalents totaled $6.6 million as of March 31, 2024, down from $10.1 million at the fiscal year-end [13] - Operating expenses increased by 10% to $9.2 million, largely due to the acquisition of Evertel and increased professional services [30] Q&A Session Summary Question: Clarity on CROW revenue and funding timeline - Management indicated that initial funding is beginning to flow, with more clarity expected after the kickoff meeting scheduled for June [15] Question: Revenue expectations from Puerto Rico deal - Management noted that the contract value has increased to approximately $75 million, with further clarity expected in the next conference call [35] Question: Impact of civil disobedience on LRAD device sales - Management acknowledged that while major police forces already have LRADs, current events may highlight the need for more units, potentially leading to increased sales [42]

Company Performance - Genasys reported a quarterly loss of $0.16 per share, which was worse than the Zacks Consensus Estimate of a loss of $0.12, and compared to a loss of $0.09 per share a year ago [1] - The quarterly report represented an earnings surprise of -33.33%, and the company had a previous loss of $0.15 per share against an expected loss of $0.10, resulting in a surprise of -50% [2] - Revenues for the quarter were $5.74 million, missing the Zacks Consensus Estimate by 18.55%, and down from $11.21 million year-over-year [3] Future Outlook - The sustainability of Genasys' stock price movement will depend on management's commentary during the earnings call and future earnings expectations [4] - The current consensus EPS estimate for the upcoming quarter is -$0.03 on revenues of $15.62 million, and for the current fiscal year, it is -$0.28 on revenues of $48.63 million [8] - The estimate revisions trend for Genasys is mixed, resulting in a Zacks Rank 3 (Hold), indicating expected performance in line with the market [7] Industry Context - Genasys operates within the Consumer Services - Miscellaneous industry, which is currently ranked in the bottom 33% of over 250 Zacks industries [9] - Empirical research indicates a strong correlation between near-term stock movements and trends in earnings estimate revisions, suggesting that industry outlook can significantly impact stock performance [6]

Exhibit 10.1 TERM LOAN AND SECURITY AGREEMENT by and among GENASYS INC., as Borrower, THE GUARANTORS NAMED HEREIN, as Guarantors, THE LENDERS FROM TIME TO TIME PARTY HERETO, as Lenders and CANTOR FITZGERALD SECURITIES, as Collateral Agent and Administrative Agent Dated as of May 13. 2024 TA B L E O F C O N T E N T S | 1 | . | D | E | F | I | N | I | T | I | O | N | S | A | N | D | C | O | N | S | T | R | U | C | T | I | O | N | . | 1 | 1.1 | D | e | fi | n | i | t | i | o | n | s | , | C | o | d | e | Te | ...

Core Insights - Genasys Inc. has secured a $15 million two-year senior secured term loan to support working capital and growth in its Software business, particularly for a project in Puerto Rico [1][2] - The loan is backed by the company's assets and features a 2% original issue discount, with interest payable quarterly at a rate of three-month SOFR plus 5% [2] - The company issued approximately 3.1 million five-year warrants to the investor, each convertible into one share of common stock at an exercise price of $2.53 [2] Financial Details - The loan is non-amortizing and is due on May 13, 2026, with the option for Genasys to prepay principal at 101% of par during the first year and at par thereafter [2] - Interest can be paid 50% in cash and 50% in common shares at a higher quarterly interest rate of three-month SOFR plus 6% [2] Company Overview - Genasys Inc. is a leader in Protective Communications Solutions, providing a comprehensive portfolio of software and systems for emergency preparedness and response [4] - The company serves various sectors, including government agencies, education, and critical industries like oil and gas, utilities, and manufacturing [4] - Genasys has a global reach, covering over 70 million people in more than 100 countries, including over 500 U.S. cities, counties, and states [4]

☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from to . UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-Q (Mark one) ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended December 31, 2023 or Commission File Number: 000-24248 GENASYS INC. (Exact name of registrant as specified in its charter) Delaware 87-0361799 (State or other jurisdiction ...

UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM 10-K ☒ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the fiscal year ended September 30, 2023 or ☐TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 Commission File Number 0-24248 GENASYS INC. (Exact name of registrant as specified in its charter) DELAWARE 87-0361799 (State or other jurisdiction of Incorporation or organization) (I.R.S. Employer Identif ...

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-Q (Mark one) ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended June 30, 2023 or ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from to . Commission File Number: 000-24248 GENASYS INC. (Exact name of registrant as specified in its charter) Delaware 87-0361799 (State or other jurisdiction of ...