Q1 Revenue at $12M, Down from $15.7M YoY

Reports Q1 revenue $12M vs. $15.7M last year. "We had an encouraging start to the year and the progress we made across our businesses during the quarter positions us favorably for the next three quarters," commented Victor Dellovo, CEO. "While our services revenue grew 14.6% over the same prior year period, our product revenue comparison was impacted by several large, one-time orders during the first quarter of fiscal year 2025. At the beginning of this fiscal year, we devoted more resources to further drive our services revenue performance and these investments are already contributing to growth. Our service revenue generates significantly higher gross margin than our product revenue and the first quarter growth led to our overall significant gross margin increase. Our managed services practice performed well and the number of customers we added in the fiscal first quarter was among the highest in terms of net new engagements to kick-off the year, raising our full year optimism for the overall TS business. We are also generating positive developments within the AZT PROTECT offering as we added several new initial site customers during the fiscal first quarter. While the revenue contribution from these initial deployments is small, it aligns with our overall strategy to get a foot in the door to prove ourselves and drive revenue. This initiative has begun to bear fruit as we increased orders from existing customers and we now have several enterprises deploying AZT PROTECT at more than one location. We are focused on driving expansion of AZT PROTECT deployment through our distribution partners and further deepen our customer engagements as we move through the year, ensuring that our best-of-class AZT PROTECT is protecting the most sensitive infrastructures, including power and water. We believe the solution remains unmatched in its effectiveness to stop otherwise unprotected attacks on critical operating systems throughout the world."