Genasys (US:GNSS)2025-02-11 22:04Financial Performance - Revenues for the first quarter of fiscal 2025 were $6,940, an increase from $4,361 in the first quarter of fiscal 2024, with software revenue of $2,313 increasing by $898 and hardware revenue of $4,627 increasing by $1,681 over the prior year quarter[178]. - The company reported a net loss of $4,078 for the first quarter of fiscal 2025, or $(0.09) per share, compared to a net loss of $6,724, or $(0.15) per share, for the same quarter in the prior year[178]. - Total revenues increased by $2,579, or 59%, to $6,940,000 for the three months ended December 31, 2024, compared to $4,361,000 for the same period in 2023[194]. - Gross profit rose by $1,699, or 115%, to $3,178,000, with gross profit as a percentage of sales increasing due to a favorable mix of higher hardware and software revenue[197][198]. - Adjusted EBITDA for Q4 2024 was $(4,813) thousand, an improvement from $(6,055) thousand in Q4 2023, reflecting a reduction in net loss and improved operational performance[207]. Revenue Breakdown - Product sales accounted for $4,144,000, representing 59.7% of total revenue, while contract and other revenues were $2,796,000, or 40.3% of total revenue[194]. - Software segment revenue increased by $898 thousand, or 63.5%, compared to the prior year, driven by a 69% increase in recurring revenue[210]. - Hardware segment revenue rose by $1,681 thousand, or 57.1%, attributed to a higher backlog at the start of the fiscal year[211]. - International revenue surged by 209.2% to $2,279,000, while U.S. revenue increased by 28.6% to $4,661,000[194]. Expenses and Cash Flow - Operating expenses in the quarter ended December 31, 2024, increased by 4.7% to $9,119 compared to $8,709 in the same period in the prior year[178]. - Research and development expenses increased by $94, or 4%, totaling $2,285,000, reflecting an increase in engineering resources[202]. - The company used $19,454 of cash in fiscal 2024 due to delays in hardware orders and continued investment in software[179]. - Cash and cash equivalents as of December 31, 2024, were $8,469 thousand, up from $4,945 thousand as of September 30, 2024[212]. - Net cash provided by operating activities was $947 thousand for the three months ended December 31, 2024, a significant recovery from $(5,729) thousand in the same period last year[215]. - Net cash provided by investing activities was $2,633 thousand, primarily due to maturities of investments in marketable securities[218]. Contracts and Agreements - The company secured a three-year, $3.35 million follow-on maintenance agreement for LRAD systems deployed by the Indian Navy[177]. - A new, larger multiyear program for Long Range Acoustic Devices was approved by Congress in late March 2024, with revenues anticipated to begin after the current fiscal year[179]. - The company anticipates a majority of revenue from a contract of up to $75,000 to engineer, procure, and build an Early Warning System for Puerto Rico will be realized in fiscal years 2025 and 2026[179]. Strategic Investments and Market Position - The company continues to invest in the Genasys Protect software platform, with significant wins in multiple counties including Los Angeles County[179]. - The company plans to continue pursuing domestic and international business opportunities, particularly in government and law enforcement sectors[186]. - The company is investing in enhancing its Genasys Protect platform to meet the needs of target markets and is pursuing certifications for government contracts[187][188]. - The company has a history of delivering innovative products and solutions for mission-critical situations, pioneering the acoustic hailing device market since 2002[158]. Challenges and Risks - The company is facing inflationary pressures, including increased costs from suppliers and logistics, which may impact future gross margins if not offset by price adjustments[190]. - The company anticipates additional expenditures for tooling and equipment during the remainder of fiscal year 2025[218]. Deferred Revenue and Accounts Receivable - The company had aggregate deferred revenue of $3,192,000 for extended warranty obligations and software support agreements as of December 31, 2024[196]. - The company had accounts receivable of $3,017 thousand as of December 31, 2024, which can vary significantly based on sales volume and timing of shipments[217]. Operating Losses - Operating loss in the software segment decreased by $1,325 thousand, or 32.2%, due to increased revenue and lower operating expenses[210]. - Operating loss in the hardware segment increased by $36 thousand, or 1.2%, despite higher revenue due to increased professional services expenses[211].