INTRUSION INC Q3 FY2025 earnings call

• Sixth consecutive quarter of sequential topline growth.
• Near 0 customer churn, demonstrating value of offerings.
• Launch of Shield Cloud on the AWS marketplace, with further expansion planned to Microsoft's Azure Cloud platform.
• Rollout of critical infrastructure solutions, having shipped over 230 units under a DoD contract.
• Strong momentum from solution partner PortNexus with their MyFlare Alert platform.
• Modest increase in operating expenses due to strategic investments in growth, including sales and marketing and product development.

Total revenues for the third quarter were $2.0 million, representing a 5% increase compared to the previous quarter and a 31% increase on a year-over-year basis. Consulting revenue was $1.5 million, up $0.1 million sequentially and $0.4 million year-over-year. Shield revenues totaled $0.5 million, relatively flat sequentially but up approximately $0.1 million year-over-year. Consulting revenue contributed $1.5 million (75% of total revenues) and Shield revenues contributed $0.5 million (25% of total revenues).

• Shield Cloud expected to contribute positively to financial results in Q4 2025 and FY2026.
• Anticipation of additional government contracts once the government shutdown is resolved.
• Intention to continue investing in product development and sales and marketing to accelerate customer base growth, which may lead to higher operating expenses.

• Impact of government shutdown on government contract conversations, though no meaningful effect seen yet.
• Variability in gross profit margin due to product and service mix.

Q: Scott Buck asked about the infrastructure work with the DoD and when additional work might be secured.

A: Already in progress, with conversations about deployment in other locations and potential private sector opportunities.

Q: Scott Buck inquired about AWS experience and feedback.

A: AWS rollout has had updates based on beta customer feedback, with more updates coming to ease configuration.

Q: Edward Woo asked about PortNexus and translating opportunities to other partners.

A: PortNexus partnership is successful due to endpoint security in education/law enforcement, and opportunities exist to extend to other endpoint solutions.

Q: Howard Brous asked about OT Defender revenue opportunity.

A: OT environment is underinvested in cybersecurity, with big market opportunities and a proven cost-effective solution.

Q: Howard Brous asked about PortNexus school safety offering revenue in 2026.

A: Excited about the opportunity but execution needed.

Q: Unknown Attendee asked if intellectual property could be worth multiples of current stock price and if products could integrate with larger cybersecurity companies.

A: Yes to both.