Genasys Inc. Q4 FY2025 earnings call

• Finished fiscal 2025 with positive operating income and adjusted EBITDA for the first time in 7 quarters.
• Had a backlog of over $60 million as of September 30, 2025.
• Puerto Rico project recognized $13.2 million in revenue in fiscal 2025, expected to be completed in 2027 with most work in 2026.
• Won a $9 million CROWS-AHD order.
• Hardware had orders like $1 million nuclear security follow-on and $1 million wildlife preservation.
• Software seeing traction with law enforcement and government agencies, partnered with Julie Parker Communication.

In the fourth quarter of fiscal 2025, Genasys generated $17 million in revenue, up 73% sequentially and 153% year-over-year, with a gross profit margin of 50.3%. For the full year 2025, total revenue was $40.8 million, up roughly 70% from 2024. Hardware revenues grew over 91% in fiscal 2025, including $13.2 million from the Puerto Rico project. Excluding Puerto Rico, Hardware revenues grew over 12%. Software revenue in 2025 grew 21% compared to 2024.

• Expect to be profitable in fiscal 2026.
• Anticipate margins of 50% throughout 2026.
• Entering fiscal 2026 with $60 million of addressable backlog.

Q: What was Software mix in the quarter? And on CROWS, any contribution in September quarter and expectations for linearity and follow-ons?

A: Cassandra said Software revenue in Q4 was ~$2.2 million, flat from prior quarter but expected to increase. Richard said CROWS will likely be a second half revenue generator, mostly in Q3.

Q: Visibility to CROWS follow-ons and pipeline details on international opportunities?

A: Richard said CROWS-AHD is part of a program of record with defense budget, visibility depends on budgeting process. International opportunities in APAC, Middle East, Europe with potential bookings.

Q: Government engagement momentum and commercial nuclear opportunities?

A: Richard said no significant decrease in demand, more nuclear and international opportunities.

Q: Pipeline projects and 2026 revenue growth/operating profitability?

A: Richard said projects similar to Puerto Rico, expects profitable FY2026, $60 million addressable backlog.

Q: Software business cash flow breakeven?

A: Richard said not this year, but expect to be on breakeven by following fiscal year, pipeline grew over 100% YOY.

Q: Competition and pricing power?

A: Richard said no new entrants in Software or Hardware, pricing in government customer base is subject to justification, can increase price but need to justify.

Q: Puerto Rico project profitability?

A: Richard said profitability expected to remain same.

Q: Debt service expectations and L.A. fires accolades?

A: Cassandra said cash flow expected to support debt service. Richard said negative press on L.A. fires was walked back, people know software performed well, leading to new business.