ACTELIS NETWORKS INC Q4 FY2024 earnings call

• 2024 was transformative with 38% revenue growth, 125% gross margin improvement, and 67% reduction in loss per share. • Progress in key markets: federal/military (150% YOY new orders), software/services (tripled new orders), MDU (GigaLine 900 gaining traction), smart city/transportation (major deployments). • Introduced MetaShield solution, prioritizing its integration into installed base for recurring revenue. • Strengthening go-to-market through industry presence and strategic partnerships. • Focus on operational efficiency, reducing operating expenses by 13%, and evaluating debt facilities to fund initiatives. • Board enhanced with two industry veterans.

Total revenue for 2024 increased 38% to $7.8 million from $5.6 million in 2023. North American revenues saw a 134% increase, representing a larger portion of the business. Gross margin improved dramatically to 55% from 34% in 2023. Software and services new orders tripled. In the federal/military sector, new orders grew 150% YOY. The GigaLine 900 solution family for multi-dwelling units is gaining market traction, and the smart city and transportation space secured major deployments in cities like Washington, DC and European municipalities.

• Prioritize MetaShield into installed base globally for recurring revenue through subscriptions. • Strengthen go-to-market execution via industry events and strategic partnerships. • Focus on operational efficiency and evaluate selective debt facilities to fund growth without excessive equity dilution. • Expect continued growth in core markets: federal, IoT/smart city, and MDU.

• Lumpy bookings and shipments leading to revenue unpredictability within the year. • Potential equity dilution if debt facilities are not secured to fund growth initiatives. • Market unpredictability in timing of large orders and deployments.

Q: What's the driver for sequential revenue decline in Q4 and is it something to expect in the future?

A: Tuvia Barlev said opportunities are lumpy, with larger orders coming in at different times, and growth is expected to continue as they seed large markets.

Q: Concern about reverse split for stock?

A: Tuvia Barlev stated there's no current plan, and growth perspective should improve share value.

Q: Future outlook, dilution, projects, partnerships?

A: Tuvia Barlev discussed growth in federal, IoT/smart city, and MDU markets, mentioned potential equity dilution but looking to raise debt first, and ongoing partnerships with integrators and advisors.

Q: Previous deals and MetaShield revenue?

A: Tuvia Barlev said QIND deal not struck, MetaShield expected to generate revenue in 2025 second half.

Q: Update on NRTS project and dollar value?

A: Tuvia Barlev said NRTS is a large UK highways project, first phase was several million, next phases dependent on UK government, hard to predict timing or dollar value.

Q: Expectation of 2025 profitability?

A: Tuvia Barlev said they'd love to be profitable but can't guarantee, loss per share has reduced significantly, but large contracts' timing is uncertain.