Financial Performance - Intrusion Inc. (INTZ) reported a fourth-quarter 2025 loss of 14 cents per share, an improvement from a loss of 36 cents per share in the previous year, but wider than the Zacks Consensus Estimate of a loss of 9 cents [1] - Quarterly revenues reached $1.5 million, reflecting a decline of 12% year over year and 25% sequentially, primarily due to postponed funding for a key U.S. government contract [2] - Consulting revenues in the fourth quarter were $1.1 million, down from $1.3 million in the prior-year quarter, while Shield revenues totaled $0.4 million, an increase of $0.1 million year over year [5] - Operating loss totaled $2.9 million, compared to an operating loss of $1.9 million in the prior-year quarter [7] Strategic Initiatives - The company is intensifying its focus on government and public safety markets, launching the P.O.S.S.E initiative in partnership with PortNexus, which provides Shield On-Premise solutions to sheriff departments [3] - The rollout of Shield Stratus aims to block known threats instantly, facilitating quicker adoption cycles and lower entry barriers, while Shield Cloud is now available on Microsoft Azure and AWS Marketplace to enhance accessibility [4] Market Performance - Following the weak financial performance, INTZ's shares fell by 7.96%, closing at $1.04 on March 24, with a further decline of 6% in pre-market trading [5] - Over the past year, shares of the company have decreased by 19.4%, contrasting with a 32.3% growth in the Zacks Computer-Networking industry [5] Operational Metrics - The gross profit margin was reported at 74%, slightly lower than the 75% from the prior-year quarter, attributed to varying product mixes [6] - Operating expenses in the fourth quarter were $4 million, an increase of $0.3 million sequentially and $0.8 million year over year, mainly due to higher sales and marketing costs [6] Balance Sheet - As of December 31, 2025, INTZ had total cash and cash equivalents of $3.6 million, up from $2.5 million as of September 30, 2025 [10]

Core Insights - Fiscal 2025 revenue increased by 23% year-over-year to $7.1 million, primarily due to contract expansion with the U.S. Department of War for critical infrastructure protection [1] - Fourth quarter revenue experienced a 12% decline year-over-year, attributed to an unexpected delay in a contract extension caused by U.S. government shutdown constraints and administrative backlogs [1] - Management indicates that the Q4 performance dip is solely due to timing, as operational expenses for the delayed contract were already incurred while revenue recognition has shifted to 2026 [1] Financial Position - The company successfully eliminated all outstanding debt and Series A preferred stock early in the year, significantly strengthening the balance sheet for future growth [1] Strategic Initiatives - A strategic pivot towards cloud accessibility was achieved by launching Shield Cloud on both AWS and Microsoft Azure marketplaces, expanding sales reach beyond direct channels [1] - The partnership with PortNexus is a key strategic move into the education and law enforcement sectors, utilizing Shield technology for school safety and public safety networks [1] - Management views the rise of AI as a tailwind, arguing that AI-driven attacks increase the necessity for real-time, packet-level network monitoring solutions like Shield [1]

Financial Data and Key Metrics Changes - Total revenues for 2025 were $7.1 million, representing a 23% year-over-year increase, primarily driven by contract expansion with the U.S. Department of War [11] - Fourth quarter revenue was $1.5 million, a decrease of 25% sequentially and 12% year-over-year due to delayed funding of a major U.S. government contract [12][16] - Gross profit margin for the fourth quarter was 74%, slightly down from the prior year, while the full year gross profit margin was 76%, down approximately 93 basis points compared to 2024 [17] Business Line Data and Key Metrics Changes - Consulting revenues totaled $1.1 million in the fourth quarter, down from $1.5 million in the prior quarter and $1.3 million in the prior year quarter [16] - Shield revenues were $0.4 million in the fourth quarter, compared to $0.5 million in the prior quarter and $0.3 million in the fourth quarter of 2024 [16] Market Data and Key Metrics Changes - The company has expanded its Shield Cloud offering on both AWS and Microsoft Azure platforms, enhancing customer access and sales reach [9] - The partnership with PortNexus for the MyFlare Alert safety technology is being deployed in schools across several states, indicating a growing market for cybersecurity solutions in education [10] Company Strategy and Development Direction - The company aims to enhance its sales efforts and go-to-market strategy to expand its customer base across private and government sectors [8] - The critical infrastructure solution is viewed as a key driver for future growth, especially as cyber threats increase [8] - The company plans to seek small debt financing to support growth initiatives [19] Management's Comments on Operating Environment and Future Outlook - Management expressed disappointment over the delay in contract funding but remains optimistic about recognizing this revenue in the first half of 2026 [7][19] - The company is focused on creating sustainable growth and long-term profitability, with expectations of breaking even operations in 2026 [21][100] Other Important Information - Operating expenses for the fourth quarter totaled $4 million, an increase driven by higher sales and marketing expenses [17] - The net loss for the fourth quarter was $2.8 million, compared to a net loss of $2 million for the same period in 2024 [18] Q&A Session Summary Question: Can you provide more granularity on the unit economics of the P.O.S.S.E. program? - The average contract value for a sheriff's department deployment ranges from a few thousand dollars to tens of thousands, depending on network bandwidth needs [24] Question: Did you say that had you not had the delay from the government contract during the quarter, that we would have seen sequential revenue growth? - Yes, that is correct [27] Question: Is the sales and marketing expense the highest quarterly level of spend? - The company will continue to invest in sales and marketing, with the first quarter approximating the run rate but expecting increases [33] Question: Did you say for the delayed contract that some of your expenses have already flown through the P&L? - Yes, all expenses associated with that have been recognized, but revenue is not yet recognized [41] Question: Can you give us a general sense of what kind of customer the critical infrastructure solution is protecting? - The solution is currently protecting critical water infrastructure in the Asia PAC region, and the customer is very satisfied with the results [53] Question: Why isn't everyone adopting the school safety solution? - The company is marketing the solution through events and partnerships, emphasizing its affordability and effectiveness [61] Question: When do you expect to have break-even operations? - The timeline for break-even operations depends on new contracts signed, with optimism for 2026 [100]

Financial Data and Key Metrics Changes - Total revenues for 2025 were $7.1 million, representing a 23% year-over-year increase, primarily driven by contract expansion with the U.S. Department of War [11] - Fourth quarter revenue was $1.5 million, a decrease of 25% sequentially and 12% year-over-year due to delayed funding of a major U.S. government contract [12][15] - Gross profit margin for the fourth quarter was 74%, slightly down from the prior year, while the full year gross profit margin was 76%, down approximately 93 basis points compared to 2024 [17] Business Line Data and Key Metrics Changes - Consulting revenues totaled $1.1 million in the fourth quarter, down from $1.5 million in the prior quarter and $1.3 million in the prior year quarter [16] - Shield revenues were $0.4 million in the fourth quarter, compared to $0.5 million in the prior quarter and $0.3 million in the fourth quarter of 2024 [16] Market Data and Key Metrics Changes - The company has expanded its Shield Cloud offering on both AWS and Microsoft Azure platforms, enhancing customer access and sales reach [9] - The P.O.S.S.E. program, launched in partnership with PortNexus, has shown high adoption rates among law enforcement agencies [10] Company Strategy and Development Direction - The company aims to enhance its sales efforts and go-to-market strategy to expand its customer base across private and government sectors [8] - The critical infrastructure solution is viewed as a key driver for future growth, especially in light of increasing cyber threats [8] Management's Comments on Operating Environment and Future Outlook - Management expressed disappointment over the delay in contract funding but remains optimistic about recognizing this revenue in the first half of 2026 [7] - The company plans to seek small debt financing to support growth initiatives and has begun initial discussions regarding this [19] Other Important Information - Operating expenses for the fourth quarter totaled $4 million, reflecting strategic investments in sales and marketing [17] - The net loss for the fourth quarter was $2.8 million, compared to a net loss of $2 million for the same period in 2024 [18] Q&A Session Summary Question: Can you provide more granularity on the unit economics of the P.O.S.S.E. program? - The average contract value for a sheriff's department deployment ranges from a few thousand dollars to tens of thousands, depending on network bandwidth needs [24] Question: Did you say that had you not had the delay from the government contract during the quarter, that we would have seen sequential revenue growth? - Yes, that is correct [27] Question: Is the sales and marketing expense the highest quarterly level of spend? - The company will continue to invest in sales and marketing, with some increases expected [33] Question: Did you say that some of your expenses have already flown through the P&L for the delayed contract? - Yes, all expenses associated with that have been recognized, but revenue is not yet recognized [42] Question: Can you give a general sense of the critical infrastructure customer? - The solution is protecting critical water infrastructure in the Asia PAC region, and the customer is very happy with the solution [53] Question: Why isn't everyone adopting the school safety solution? - The company is marketing the solution through events and partnerships, and it is very inexpensive, making it accessible for local funding [61]

Financial Data and Key Metrics Changes - Total revenues for 2025 were $7.1 million, representing a 23% year-over-year increase, primarily driven by contract expansion with the U.S. Department of War [11] - Fourth quarter revenue was $1.5 million, a decrease of 25% sequentially and a 12% decrease compared to the prior year period due to delayed funding of a major U.S. government contract [12][16] - Gross profit margin for the fourth quarter was 74%, slightly down from the prior year, while the full year gross profit margin was 76%, down approximately 93 basis points from 2024 [17] Business Line Data and Key Metrics Changes - Consulting revenues totaled $1.1 million in the fourth quarter, down from $1.5 million in the prior quarter and $1.3 million in the prior year quarter [16] - Shield revenues were $0.4 million in the fourth quarter, compared to $0.5 million in the prior quarter and $0.3 million in the fourth quarter of 2024 [16] Market Data and Key Metrics Changes - The company has expanded its Shield Cloud offering on both AWS and Microsoft Azure platforms, enhancing customer access and sales reach [9] - The P.O.S.S.E. program, launched in partnership with PortNexus, has shown high adoption rates among law enforcement agencies [10] Company Strategy and Development Direction - The company aims to enhance its sales efforts and go-to-market strategy to expand its customer base across private and government sectors [8] - The critical infrastructure solution is viewed as a key driver of future growth, especially in light of increasing cyber threats [8] Management's Comments on Operating Environment and Future Outlook - Management expressed disappointment over the delay in contract funding but remains optimistic about recognizing this revenue in the first half of 2026 [7] - The company plans to seek small debt financing to support growth initiatives and has begun initial discussions regarding this [19] Other Important Information - Operating expenses for the fourth quarter totaled $4 million, an increase of $0.3 million sequentially and $0.8 million year-over-year, driven by higher sales and marketing expenses [17][18] - The net loss for the fourth quarter was $2.8 million, or $0.14 per share, compared to a net loss of $2 million for the same period in 2024 [18] Q&A Session Summary Question: Can you provide more granularity on the unit economics of the P.O.S.S.E. program? - The average contract value for a sheriff's department deployment ranges from a few thousand dollars to tens of thousands, depending on network bandwidth needs [24] Question: Did you say that had you not had the delay from the government contract during the quarter, that we would have seen sequential revenue growth? - Yes, that is correct [27][29] Question: Is the sales and marketing expense the highest quarterly level of spend? - The company will continue to invest in sales and marketing, with some increases expected in 2026 [33] Question: Did you say that some of your expenses have already flown through the P&L for the delayed contract? - Yes, all expenses associated with that have been recognized, but revenue is not yet recognized [41][42] Question: Can you give a general sense of the critical infrastructure customer? - The solution is protecting critical water infrastructure in the Asia PAC region, and the customer is very happy with the solution [53]

Financial Data and Key Metrics Changes - Fourth quarter revenues decreased by 12% year-over-year due to a delayed contract extension for critical infrastructure technology [6][12] - Total revenues for 2025 were $7.1 million, representing a 23% increase year-over-year [11] - Fourth quarter revenue was $1.5 million, a decrease of 25% sequentially [12] - Net loss for the fourth quarter was $2.8 million, or $0.14 per share, compared to a net loss of $2 million for the same period in 2024 [18] - Net loss for the full year was $9.1 million, or $0.46 per share, an increase of $1.3 million from the prior year [19] Business Line Data and Key Metrics Changes - Consulting revenues totaled $1.1 million in the fourth quarter, down from $1.5 million in the prior quarter [16] - Shield revenues were $0.4 million in the fourth quarter, compared to $0.5 million in the prior quarter [16] - The company anticipates future growth from the sale of its OT Defender solution and the integration of Shield technology into PortNexus's MyFlare Alert solution [16] Market Data and Key Metrics Changes - The delay in contract funding was attributed to U.S. government shutdown constraints, affecting the ability to approve and initiate new contract actions [15] - The company is targeting expansion in both private sector and government markets to enhance its customer base [8] Company Strategy and Development Direction - The company aims to enhance its sales efforts and go-to-market strategy to expand its customer base across various sectors [8] - A partnership with PortNexus was established to provide secure network protection for schools and law enforcement agencies [5][10] - The company plans to seek small debt financing to support growth initiatives [19] Management's Comments on Operating Environment and Future Outlook - Management expressed disappointment over the delay in contract funding but remains optimistic about recognizing this revenue in the first half of 2026 [7][19] - The company views the critical infrastructure solution as a key driver for future growth amid increasing cyber threats [8] - Management is focused on achieving sustainable growth and long-term profitability, with a goal to break even operations in 2026 [21][101] Other Important Information - The gross profit margin for the fourth quarter was 74%, slightly down from the prior year [17] - Operating expenses for the fourth quarter totaled $4 million, reflecting strategic investments in sales and marketing [17] Q&A Session Summary Question: Can you provide more granularity on the unit economics of the POSSE program? - The average contract value for a sheriff's department deployment ranges from a few thousand dollars to tens of thousands depending on bandwidth needs [24] Question: Did you say that had you not had the delay from the government contract during the quarter, that we would have seen sequential revenue growth? - Yes, that is correct [27][30] Question: Is the sales and marketing expense the highest quarterly level of spend? - The company will continue to invest in sales and marketing, with some increases expected [33] Question: Did you say for the delayed contract that some of your expenses have already flown through the P&L? - Yes, all expenses associated with that have been recognized, but revenue is pending [42] Question: Can you give us a general sense of what kind of customer the critical infrastructure solution is protecting? - The solution is currently protecting critical water infrastructure in the Asia PAC region, and the customer is very satisfied [54] Question: How are you marketing the school safety solution? - The company is attending events where school administrators look for technology and marketing to local law enforcement agencies [62] Question: When do you expect to have break-even operations? - The timeline depends on new contracts signed, with optimism for 2026 [101]

Financial Data and Key Metrics Changes - Total revenues for 2025 were $7.1 million, representing a 23% year-over-year increase, primarily driven by contract expansion with the U.S. Department of War [10] - Fourth quarter revenue was $1.5 million, a decrease of 25% sequentially and 12% year-over-year due to delayed funding of a major U.S. government contract [14][11] - Gross profit margin for the fourth quarter was 74%, slightly down from the prior year, while the full year gross profit margin was 76%, down approximately 93 basis points compared to 2024 [16] Business Line Data and Key Metrics Changes - Consulting revenues totaled $1.1 million in the fourth quarter, down from $1.5 million in the prior quarter and $1.3 million in the prior year quarter [15] - Shield revenues were $0.4 million in the fourth quarter, compared to $0.5 million in the prior quarter and $0.3 million in the fourth quarter of 2024 [15] Market Data and Key Metrics Changes - The company is expanding its Shield Cloud offering on both AWS and Microsoft Azure platforms, enhancing customer access and sales reach [8] - The partnership with PortNexus is expected to provide distribution access to hundreds of sheriff's departments, schools, and government facilities, which will support future revenue growth [9] Company Strategy and Development Direction - The company aims to enhance its sales efforts and go-to-market strategy to expand its customer base across private and government sectors [7] - The critical infrastructure solution is viewed as a key driver of future growth, especially as cyber threats become more sophisticated [7] Management's Comments on Operating Environment and Future Outlook - Management expressed disappointment over the delay in contract funding but remains optimistic about recognizing this revenue in the first half of 2026 [6] - The company plans to seek small debt financing to support growth initiatives and has begun initial discussions regarding this [18] Other Important Information - Operating expenses for the fourth quarter totaled $4 million, an increase of $0.3 million sequentially and $0.8 million year-over-year, driven by higher sales and marketing expenses [16] - The net loss for the fourth quarter was $2.8 million, or $0.14 per share, compared to a net loss of $2 million for the same period in 2024 [17] Q&A Session Summary Question: Can you provide more granularity on the unit economics of the POSSE program? - The average contract value for a sheriff's department deployment ranges from a few thousand dollars to tens of thousands, depending on network bandwidth needs [23] Question: Did you say that had you not had the delay from the government contract during the quarter, that we would have seen sequential revenue growth? - Yes, that is correct [26] Question: Is the sales and marketing expense the highest quarterly level of spend ever? - The company will continue to invest in sales and marketing, with some increases expected in 2026 [32] Question: Did you say that some of your expenses have already flown through the P&L already for the delayed contract? - Yes, all expenses associated with that have been recognized, but revenue cannot be recognized yet [40] Question: Can you give a general sense of what kind of customer the critical infrastructure solution is protecting? - The solution is currently protecting critical water infrastructure in the Asia PAC region, and the customer is very satisfied with the work [52] Question: What about the cost structure for the PortNexus solution in schools? - The cost is per classroom, and the solution can be funded by local PTAs if necessary [66]

Financial Data and Key Metrics Changes - Total revenues for Q3 2025 were $2.0 million, representing a 5% increase sequentially and a 31% increase year over year, driven by contract expansion with the Department of Defense [11][15] - Gross profit margin for Q3 was 77%, down 58 basis points year over year, consistent with expected variability based on product and service mix [16] - Net loss for Q3 2025 was $2.1 million, or $0.10 per share, unchanged from the net loss of $2.1 million in Q3 2024 [17] Business Line Data and Key Metrics Changes - Consulting revenue was $1.5 million, up $0.1 million sequentially and $0.4 million year over year [15] - Shield revenues totaled $0.5 million, relatively flat sequentially but up approximately $0.1 million year over year, primarily reflecting work under the DoD contract [15] Market Data and Key Metrics Changes - The company shipped over 230 units of its Critical Infrastructure device as part of a contract with the Department of Defense, indicating strong demand for protecting critical infrastructure from cyber threats [9][10] - The partnership with Port Nexus is seeing strong demand for Shield Endpoint embedded within their MyFlare solution, particularly among school districts [10][41] Company Strategy and Development Direction - The launch of Shield Cloud on the AWS Marketplace is expected to drive long-term growth by expanding customer access to Shield Technology [7][8] - The company is preparing to launch Shield Cloud on Microsoft's Azure platform, further expanding its reach to potential customers [8] - The focus remains on disciplined spending while investing in product development and sales and marketing to accelerate customer base growth [16] Management's Comments on Operating Environment and Future Outlook - Management remains optimistic about closing new agreements in the government sector once the current government shutdown is resolved, while also seeing an expanding pipeline of non-government opportunities [12][14] - The company is confident in its ability to deliver stronger performance over time, supported by ongoing investments and improved customer engagement [19] Other Important Information - Cash and cash equivalents as of September 30, 2025, were $2.5 million, with short-term investments in U.S. treasuries of $2 million, and an additional $3 million received post-quarter end related to the DoD contract extension [17] Q&A Session Summary Question: Infrastructure work with the DoD and future opportunities - Management indicated that the initial project has opened doors for further discussions about deployment in other locations, with significant potential for additional contracts in both government and private sectors [23][24] Question: Experience on AWS and initial feedback - The company has received positive feedback from initial beta customers and is making updates to improve configuration and installation, with expectations for accelerated adoption [26][28] Question: Revenue opportunity with OT Defender - Management highlighted that OT Defender presents larger sales opportunities compared to other products, with significant market potential in underinvested cybersecurity areas [54][55] Question: Revenue opportunity with Port Nexus school safety offering - The solution is expected to become critical in schools, with strong interest from school administrators due to its simplicity and effectiveness in enhancing situational awareness during incidents [58][60] Question: Shield Cloud revenue opportunity - Management expressed optimism about the growth potential in the cloud market, emphasizing the need for effective execution of marketing and demand generation plans [63]

Core Viewpoint - Intrusion Inc. (INTZ) is expected to report a significant revenue increase of 46.5% year-over-year for Q1 2025, with a consensus estimate of $1.7 million, while the company is projected to incur a loss of 18 cents per share, unchanged from previous estimates [1][2]. Group 1: Financial Performance - The Zacks Consensus Estimate for revenues in Q1 2025 is $1.7 million, reflecting a 46.5% increase from the previous year [1]. - The expected loss per share for Q1 2025 is 18 cents, consistent with estimates from the past 30 days, compared to a loss of 94 cents per share in the same quarter last year [1]. - INTZ has beaten the Zacks Consensus Estimate in three of the last four quarters, with an average surprise of 4.7% [2]. Group 2: Business Drivers - Strong demand for INTZ's cybersecurity solutions, particularly in the U.S. and Asia Pacific, is anticipated to support revenue growth in Q1 [3]. - The launch of the Shield Cloud product on the AWS Marketplace is expected to drive significant growth for the company [3]. - The introduction of new products like Intrusion Shield Sentinel and Intrusion Shield Command Hub is likely to enhance the company's offerings and contribute positively to revenue [4]. Group 3: Cost Management and Investments - INTZ has implemented disciplined cost management strategies, including reducing 16 permanent roles and utilizing more affordable sales and marketing services, which likely lowered expenses [6]. - However, increased investment in R&D to enhance product offerings and address evolving cybersecurity challenges may impact profit margins [7]. - The company is also expanding its footprint in the government sector, which is seen as a positive growth factor [5].