Q2 2024 WidePoint Corp Earnings Call

Operator: and more. Thanks for watching!

Operator: Good afternoon, ladies and gentlemen, and thank you for your patience. Your conference will begin shortly. Once again, thank you for your patience. Your conference will begin shortly.

Operator: Good afternoon, ladies and gentlemen, and thank you for your patience. Your conference will begin shortly. Once again, thank you for your patience. Your conference will begin shortly. Thank you for your patience. Your conference will begin shortly. [music]............... Good afternoon.

Speaker Change: Good afternoon, ladies and gentlemen, and thank you for your patience. Your conference will begin shortly.

Speaker Change: Once again, thank you for your patience. Your conference will begin shortly. Thank you for your patience. Your conference will begin shortly.

Speaker Change: Scott Buck, Barry Sine, Jin Kang, Robert George, Barry Sine, Jin Kang, Robert George, Barry Sine, Jin Kang,

Robert George: Repeat. My name is Robert George.

Operator: Good afternoon. Welcome to WidePoint's second quarter, 2024, earnings conference call.

Matthew: Welcome to WidePoint's second quarter 2024 earnings conference call. My name is Matthew, and I will be your operator for today's call. Joining us for today's presentation are WidePoint's President and CEO, Jin Kang, Chief Revenue Officer, Jason Holloway, and Chief Financial Officer, Robert George. Following their remarks, we will open up the call for questions from WidePoint's publishing analysts and major investors. If your questions were not taken today and you'd like additional information, please contact WidePoint's Investor Relations Team at wyy.gateway-grp.com.

Matthew: Good afternoon. Welcome to WidePoint's second quarter 2024 earnings conference call. My name is Matthew and I will be your operator for today's call.

Operator: My name is Matthew, and I will be your operator for today's call.

Operator: Joining us for today's presentation are WidePoint's President and CEO, Jin Kang, Chief Revenue Officer, Jason Holloway, and Chief Financial Officer, Robert George. Following the remarks, we will open up the call for questions from WidePoint's publishing analysts and major investors. If your questions were not taken today and you like additional information, please contact WidePoint's Investor Relations team at WYY at gateway-grp.com.

Speaker Change: Joining us for today's presentation are White Point's President and CEO, Jin Kang, Chief Revenue Officer, Jason Holloway, and Chief Financial Officer, Robert George.

Speaker Change: Following their remarks, we will open up the call for questions from White Point's publishing analysts and major investors.

Speaker Change: If your questions were not taken today and you'd like additional information, please contact WidePoint's Investor Relations Team at wyy.gateway-grp.com.

Operator: Before we begin the call, I'd like to provide WidePoint's Safe Harbor Statement that includes cautions regarding forward-looking statements made during this call. The matters discussed in this conference call may include forward-looking statements regarding future events and the future performance of WidePoint Corporation that involve risks and uncertainties that could cause actual results to differ materially from those anticipated. These risks and uncertainties are described in the company's Form 10-Q filed with the Securities and Exchange Commission.

Matthew: Before we begin the call, I'd like to provide WidePoint's Safe Harbor Statement that includes cautions regarding forward-looking statements made during this call. The matters discussed in this conference call may include forward-looking statements regarding future events and the future performance of WidePoint Corporation that involve risks and uncertainties that could cause actual results to differ materially from those anticipated. These risks and uncertainties are described in the company's Form 10-Q, filed with the Securities and Exchange Commission.

Matthew: Finally, I'd like to remind everyone that this call will be made available for replay via a link in the Investor Relations section of the company's website at www.widepoint.com. Now, I'd like to turn the call over to WidePoint's President and CEO, Mr. Jin Kang. Please proceed.

Speaker Change: Before we begin the call, I'd like to provide WidePoint's Safe Harbor Statement that includes cautions regarding forward-looking statements made during this call.

Speaker Change: The matters discussed in this conference call may include forward-looking statements regarding future events and the future performance of White Point Corporation that involve risks and uncertainties that could cause actual results to differ materially from those anticipated.

Speaker Change: These risks and uncertainties are described in the company's Form 10-Q, filed with the Securities and Exchange Commission.

Operator: Finally, I'd like to remind everyone that this call will be made available for replay via a link in the Investor Relations section of the company's website. Now I would like to turn the call over to WidePoint's President and CEO, Mr. Jin Kang.

Speaker Change: Finally, I'd like to remind everyone that this call will be made available for replay via a link in the Investor Relations section of the company's website at www.widepoint.com.

Jin Kang: Sir, please proceed. Thank you, operator, and good afternoon to everyone. Thank you for joining us today to review our financial results for the second quarter and the June 30, 2024. I am pleased to share that we have continued to build on the momentum from previous quarters, having finished Q2 ahead of forecast for the second consecutive time and seeing significant year-over-year improvements in revenue, adjusted EBITDA, and free cash flow. Our revenue for second quarter was 36 million, and our six month revenue and the June 30, 2024, was 70 million, both a 35% increase from the same period in 2023 and a testament to our team's ability to execute our sales and marketing strategy.

Jin Kang: Now I'd like to turn the call over to WidePoint's President and CEO, Mr. Jin Kang. Sir, please proceed.

Jin Kang: Thank you, Operator, and good afternoon to everyone. Thank you for joining us today to review our financial results for the second quarter ended June 30, 2024. I am pleased to share that we have continued to build on the momentum from previous quarters, having finished Q2 ahead of forecast for the second consecutive time and seeing significant year-over-year improvements in revenue, adjusted EBITDA, and free cash flow. Our revenue for the second quarter was $36 million, and our six-month revenue ended June 30, 2024, was $70 million, both a 35% increase from the same period in 2023 and a testament to our We achieved our 28th consecutive quarter of positive adjusted EBITDA, concluding with $811,000, or a 479% increase from the same period last year.

Jin Kang: Thank you, Operator, and good afternoon to everyone. Thank you for joining us today to review our financial results for the second quarter ended June 30, 2024.

Jin Kang: For the six months ended June 30, 2024, our adjusted EBITDA was approximately 1.4 million, which is a 764% increase from the same period last year. We also achieved a third consecutive quarter of positive free cash flow, sequentially improving from $310,000 in Q4 2023 and $566,000 in Q4 2021, thousand and 800,000 in the first and second quarters of 2024, respectively. Compared to where we were last year, our position in the capital markets has improved significantly, thanks to our team's dedication to executing our organic growth strategy.

Speaker Change: I am pleased to share that we have continued to build on the momentum from previous quarters having finished Q2 ahead of forecast for the second consecutive time and seeing significant year-over-year improvements in revenue, adjusted EBITDA and free cash flow.

Speaker Change: Our revenue for second quarter was $36 million, and our six-month revenue ended June 30, 2024, was $70 million.

Speaker Change: Both a 35% increase.

Speaker Change: from the same period in 2023, and a testament to our team's ability to execute our sales and marketing strategy.

Jin Kang: We achieved our 28th consecutive quarter of positive adjusted EBITDA, concluding with 811,000 or 479% increase from the same period last year. For the six months ended June 30, 2024, our adjusted EBITDA was approximately 1.4 million, which is a 764% increase from the same period last year. We also achieved a third consecutive quarter of positive free cash flow, sequentially improving from 310,000 in Q4 2023 and 566,000 and 800,000 in the first and second quarter of 2024, respectively. Compared to where we were last year, our position in the capital markets has improved significantly, thanks to our team's dedication to executing our organic growth strategy.

Speaker Change: We achieved our 28th consecutive quarter of positive adjusted EBITDA, concluding with $811,000, or 479% increase from the same period last year.

Speaker Change: For the six months ended June 30, 2024, our adjusted EBITDA was approximately $1.4 million, which is a 764% increase from the same period last year.

Speaker Change: We also achieved a third consecutive quarter of positive free cash flow, sequentially improving from $310,000 in Q4 2023 and $566,000 and $800,000 in the first and second quarter 2024, respectively.

Speaker Change: Compared to where we were last year, our position in the capital markets has improved significantly, thanks to our team's dedication to executing our organic growth strategy.

Jin Kang: Our sales and marketing team continues to deliver and capture new high-margin contracts that have positioned us well for potential positive earnings per share for 2025. Additionally, all of our capital investments and fixed costs have been paid for, and we continue to aggressively manage our costs, supporting our future bottom line results, margin improvements, and profitability projections. As evidenced by our consecutively improving three cash flow figures, we're heading in the right direction. Our strategic partnerships and investments, particularly in our different business solutions, have played an incremental role in driving our sales growth and have significantly contributed to our top line performance over the past several quarters.

Jin Kang: Our sales and marketing team continues to deliver and capture new high-margin contracts that have positioned us well for potential positive earnings per share for 2025. Additionally, all of our capital investments and fixed costs have been paid for, and we continue to aggressively manage our costs, supporting our future bottom line results, margin improvements, and profitability projections. As evidenced by our consecutively improving free cash flow figures, we're heading in the right direction.

Speaker Change: Our sales and marketing team continues to deliver and capture new high-margin contracts that have positioned us well for potential positive earnings per share for 2025.

Speaker Change: Additionally, all of our capital investments and fixed costs have been paid for and we continue to aggressively manage our costs, supporting our future bottom-line results, margin improvements, and profitability projections.

Speaker Change: As evidenced by our consecutively improving three cash flow figures, we're heading in the right direction.

Jin Kang: Our strategic partnerships and investments, particularly in our different business solutions, have played an incremental role in driving our sales growth and have significantly contributed to our top-line performance over the past several quarters. These efforts, along with our certifications and accreditation, superior and diverse suite of offerings, as well as the recently announced mobile anchor digital credential solution, have positioned us well to be able to successfully target our competitors' business. WidePoint is now in a strong position where our strategic partners seek us out and want to work with us, a significant shift from a few years ago when we were the ones pursuing them.

Speaker Change: Our strategic partnerships and investments, particularly in our different business solutions, have played an incremental role in driving our sales growth and have significantly contributed to our top-line performance over the past several quarters.

Jin Kang: These efforts, along with our certification and accreditation, superior and diverse suite of offerings, as well as recently announced mobile anchor digital credential solution, have positioned us well to be able to successfully target our competitors' business. Why Point is now in a strong position where our strategic partners seek us out and want to work with us, a significant shift from a few years ago when we were the ones pursuing them.

Speaker Change: These efforts, along with our certification and accreditation, superior and diverse suite of offerings, as well as recently announced mobile anchor digital credential solution, have positioned us well to be able to successfully target our competitors' business.

Speaker Change: WidePoint is now in a strong position where strategic partners seek us out and want to work with us. A significant shift from a few years ago when we were the ones pursuing them.

Jin Kang: The investments and efforts we have made over the years are paying off, and we are excited to continue building on this upward momentum towards profitable return for our value shareholders. Moving on to some second quarter contract highlights and operational developments. The standout this quarter was our $2.7 billion Spiral 4 contract award, where we were one of seven companies, including the U.S. Big Three wireless carriers, to provide a full range of wireless and telecommunication services to military personnel and federal civilian employees stationed within the country and U.S. territories. We also received a contract modification adding $254 million to the ceiling of the CWMS 2.0 contract with DHS.

Jin Kang: The investments and efforts we have made over the years are paying off, and we are excited to continue building on this upward momentum towards profitable return for our value shareholders.

Speaker Change: The investments and efforts we have made over the years are paying off, and we are excited to continue building on this upward momentum towards profitable return for our value shareholders.

Jin Kang: Moving on to some second quarter contract highlights and operational developments, the standout this quarter was our $2.7 billion spiral for contract award, where we were one of seven companies, including the US big three wireless carriers, to provide a full range of wireless and telecommunication services to military personnel and federal civilian employees stationed within the country and the US territories. We also received the contract modification adding $254 million to the ceiling of the CWMS 2.0 contract with DHS. S. Specifically, with Spyro 4, we have started receiving initial RFQs and are in the process of setting up administrative arrangements with the U.S.

Jin Kang: Specifically, with Spiral 4, we have started receiving initial RFQs and are in the process of setting up administrative arrangements with the U.S. Navy, as well as establishing vendor agreements for services and equipment. We have a differentiated set of offerings for the Navy and believe that we will be able to successfully compete with previous incumbents on this contract. We look forward to sharing more good news with you on this front during our future calls. Our CWMS 2.0 contract with DHS is an indefinite delivery, indefinite quantity, or IDIQ contract valued at $754 million, reflecting an increase of $254 million, which represents nearly a 55% increase from the original contract value.

Speaker Change: Moving on to some second quarter contract highlights and operational developments.

Speaker Change: The standout this quarter was our $2.7 billion.

Speaker Change: Spiral 4 Contract Award, where we were one of seven companies, including the U.S. Big Three wireless carriers, to provide a full range of wireless and telecommunication services to military personnel and federal civilian employees stationed within the country and the U.S. territories.

Speaker Change: We also received a contract modification adding $254 million to the ceiling of the CWMS 2.0 contract with DHS.

Speaker Change: Specifically with Spiral 4, we have started receiving initial RFQs and are in the process of setting up administrative arrangements with the U.S. Navy, as well as establishing vendor agreements for services and equipment.

Jin Kang: Navy, as well as establishing vendor agreements for services and equipment. We have a differentiated set of offerings for the Navy and believe that we will be able to successfully compete with previous incumbents on this contract. We look forward to sharing more good news with you on this front on our future calls. Our CWMS 2.0 contract with DHS is an indefinite delivery, indefinite quantity, or IDIQ contract, valued at $754 million, reflecting an increase of $254 million, which represents nearly a 55% increase from the original contract value. And, as announced in our previous earnings call, we have begun to receive additional task order requests for quotes from DHS since the contract ceiling increase.

Speaker Change: We have a differentiated set of offerings for the Navy and believe that we will be able to successfully compete with previous incumbents on this contract. We look forward to sharing more good news with you on this front on our future calls.

Speaker Change: RCW-MS 2.0 contract with DHS is an indefinite delivery, indefinite quantity or IDIQ contract.

Speaker Change: valued at $754 million, reflecting an increase of $254 million, which represents nearly a 55% increase from the original contract value.

Jin Kang: And, as announced in our previous earnings call, we have begun to receive additional task order requests or quotes from DHS since the contract ceiling increased. We should see the results from these new task order awards that will improve our top-line and bottom-line results. Additionally, as many of you have seen in our press release, we made a strategic hire by bringing on Michelle Richards, who is now our lead for the CWMS program.

Speaker Change: And, as announced in our previous earnings call, we have begun to receive additional task order requests for quotes from DHS since the contract ceiling increase.

Jin Kang: We should see the results from these new task order awards that will improve our top line and bottom line results.

Speaker Change: We should see the results from these new task order awards that will improve our top-line and bottom-line results.

Jin Kang: Additionally, as many of you have seen in our press release, we made a strategic hire by bringing on Michelle Richards, who is now our lead for the CWMS program. Michelle has an extensive background working within the DHS community and brings to WidePoint over three decades of experience in the mobile telecommunication industry and over 15 years of federal government contracting experience. Michelle's industry stature will help WidePoint enhance her commercial and federal presence and impact, and her expertise will be invaluable in preparing for and capturing significant portions of the spiral for contract. We are excited to have her on board, and with her vision and mission perfectly aligned with WidePoints, we look forward to the immense value she will be providing.

Speaker Change: Additionally, as many of you have seen in our press release, we made a strategic hire by bringing on Michelle Richards, who is now our lead for CWMS program.

Jin Kang: Michelle has an extensive background working within the DHS community and brings to WidePoint over three decades of experience in the mobile telecommunications industry and over 15 years of federal government contracting experience. Her industry stature will help WidePoint enhance its commercial and federal presence and impact, and her expertise will be invaluable in preparing for and capturing significant portions of the Spiral 4 contract. We are excited to have her on board, and with her vision and mission perfectly aligned with WidePoint, we look forward to the immense value she will be providing.

Michelle Richards: Michelle has an extensive background working within the DHS community and brings to WidePoint over three decades of experience in the mobile telecommunication industry and over 15 years of federal government contracting experience.

Michelle Richards: Michelle's industry stature will help WidePoint enhance her commercial and federal presence and impact, and her expertise will be invaluable in preparing for and capturing significant portions of the Spiral 4 contract.

Speaker Change: We are excited to have her on board, and with her vision and mission perfectly aligned with Why Points, we look forward to the immense value she will be providing.

Jin Kang: In addition to these two IDIQ contracts, we have two more exciting milestone deals currently in the works. First is the CWMS 3.0 RFI, a 10-year and approximately 1.5 to $2 billion contract. Our systems and processes are closely integrated with DHS systems, and our strong track record for past performance positions us in the best spot to rewind this contract. We hold certification and creditions that our competitors cannot match, and our pending FedRAM authorized status will further strengthen our competitive edge.

Jin Kang: In addition to these two IDIQ contracts, we have two more exciting milestone deals currently in the works. First is the CWMS 3.0 RFI, a 10-year and approximately $1.5 to $2 billion contract. Our systems and processes are closely integrated with DHS systems, and our strong track record for past performance positions us in the best spot to rewind this contract. We hold certifications and accreditations that our competitors cannot match, and our pending FedRAMP authorized status will further strengthen our competitive edge. Additionally, we are pursuing the Soup 6 contract with NASA. This opportunity is a 10-year, $60 billion government-wide acquisition contract for GWAC that can be utilized by every government agency.

Speaker Change: In addition to these two IDIQ contracts, we have two more exciting milestone deals currently in the works.

Speaker Change: First is the CWMS 3.0 RFI, a 10-year and approximately $1.5 to $2 billion contract.

Speaker Change: Our systems and processes are closely integrated with DHS systems, and our strong track record for past performance positions us in the best spot to re-win this contract.

Speaker Change: We hold certification and accreditations that our competitors cannot match, and our pending FedRAMP authorized status will further strengthen our competitive edge.

Jin Kang: Additionally, we are pursuing the soup six contract with NASA. This opportunity is a 10-year, 60 billion dollar government-wide acquisition contract or GWAC that can be utilized by every government agency. This contract scope of work includes all manners of IT products and services. We believe that we have the qualification, the certifications, and accreditation to be a winner on this contract. We will also be positioned well with a differentiated set of products and services to capture a significant amount of work under this contract.

Speaker Change: Additionally, we are pursuing the SUP 6 contract with NASA. This opportunity is a 10-year, 60 billion dollar, government-wide acquisition contract for GWAC.

Jin Kang: This contract's scope of work includes all manners of IT products and services. We believe that we have the qualifications, the certifications, and accreditations to be a winner on this contract. We will also be positioned well with a differentiated set of products and services to capture a significant amount of work under this contract. To maximize our ability to capture significant work under these outstanding IDIQ contracts, we have recently implemented a Project Management Office Model, or PMO.

Speaker Change: that can be utilized by every government agency. This contract scope of work include all manners of IT products and services.

Speaker Change: We believe that we have the qualification, the certifications and accreditations to be a winner on this contract.

Speaker Change: We will also be positioned well with a differentiated set of products and services to capture a significant amount of work under this contract.

Jin Kang: To maximize our ability to capture significant work under these outstanding IDIQ contracts, we have recently implemented a Project Management Office model or PMO. This model will aid why point in outperforming our competitors in capturing work under these IDIQ contracts. The PMO model takes a team approach to managing large programs, ensuring that there is no single point of failure and a model that has worked well in our other marquee programs: Rams. We will continue to leverage this PMO model and are excited to see our team capture additional work to further drive our top and bottom on growth.

Speaker Change: To maximize our ability to capture significant work under these outstanding IDIQ contracts, we have recently implemented a Project Management Office Model, or PMO.

Jin Kang: This model will aid WidePoint in outperforming its competitors in capturing work under these IDIQ contracts. The PMO model takes a team approach to managing large programs, ensuring that there is no single point of failure and a model that has worked well in our other marquee programs.

Speaker Change: This model will aid WidePoint in outperforming our competitors in capturing work under these IDIQ contracts. The PMO model takes a team approach to managing large programs, ensuring that there is no single point of failure, and a model that has worked well in our other marquee programs.

Jin Kang: We will continue to leverage this PMO model and are excited to see our team capture additional work to further drive our top and bottom line growth. These billion-dollar IDIQ contracts we pursue, such as the $2.7 billion Spiral 4 and the $60 billion Soup 6 contracts, are crucial to our company's long-term growth strategy. These contracts provide a target-rich environment offering a unique competitive advantage for WidePoint's sales and marketing team. Many companies aspire to operate in such a target-rich, lucrative ecosystem, but very few have the opportunity.

Speaker Change: We will continue to leverage this PMO model and are excited to see our team capture additional work to further drive our top and bottom line growth.

Jin Kang: These billion dollar IDIQ contracts we pursue, such as the $2.7 billion Spiral Four and the $60 billion Soup Six contracts, are crucial to our company's long term growth strategy. These contracts provide a target-rich environment offering a unique competitive advantage for WidePoint sales and marketing team. Many companies aspire to operate in such a target-rich, lucrative ecosystem, but very few have the opportunity. With our recent strategic investments, partnerships, certifications and accreditations, and application of the PMO model, we continue to aggressively invest in our sales and marketing efforts to position ourselves the maximizer ability to capture work and, more importantly, the opportunity to even do so in the first place.

Speaker Change: These billion-dollar IDIQ contracts we pursue, such as the $2.7 billion Spiral 4 and the $60 billion Soup 6 contracts, are crucial to our company's long-term growth strategy.

Speaker Change: These contracts provide a target-rich environment offering a unique competitive advantage for WidePoint's sales and marketing team.

Speaker Change: Many companies aspire to operate in such a target-rich lucrative ecosystem.

Jin Kang: With our recent strategic investments, partnerships, certifications, and accreditations, and application of the PMO model, we continue to aggressively invest in our sales and marketing efforts to position ourselves to maximize our ability to capture work, and more importantly, the opportunity to even do so in the first place. This proactive approach aims to ensure that WidePoint secures a meaningful portion of these contracts; even capturing a small percentage of the billion-dollar opportunity from these two contracts alone could substantially elevate our growth trajectory. In the commercial sector, we are seeing pilot projects launched and strategic partnerships consummated with systems integrators, which are resulting in new opportunities.

Speaker Change: but very few have the opportunity.

Speaker Change: With our recent strategic investments, partnerships, certifications, and accreditations, and application of the PMO model, we continue to aggressively invest in our sales and marketing efforts to position ourselves to maximize our ability to capture work, and more importantly, the opportunity to even do so in the first place.

Jin Kang: This proactive approach aims to ensure that WidePoint secures a meaningful portion of these contracts. Even capturing a small percentage of the billion-dollar opportunity from these two contracts alone could substantially elevate our growth trajectory.

Speaker Change: This proactive approach aims to ensure that YPoint secures a meaningful portion of these contracts.

Speaker Change: even capturing a small percentage of the billion-dollar opportunity from these two contracts alone could substantially elevate our growth trajectory.

Jin Kang: In the commercial sector, we are seeing pilot projects launched and strategic partnerships consummated with systems integrators, which are resulting in new opportunities. We are pursuing sizable opportunities with Fortune 100 companies and look forward to providing you with news of contract awards later this year. In the second quarter alone, we saw contractual actions across all WidePoint solution lines, including our managed mobility services, identity and access management, IT as a service, and interactive billing and analytics. These new opportunities are the high margins, SaaS contracts, our sales and marketing team is aggressively pursuing, which are expected to contribute greatly to our bottom line performance.

Speaker Change: In the commercial sector, we are seeing pilot projects launched and strategic partnership consummated with systems integrators, which are resulting in new opportunities. We are pursuing sizable opportunities with Fortune 100 companies and look forward to providing you with news of contract awards later this year.

Jin Kang: We are pursuing sizable opportunities with Fortune 100 companies and look forward to providing you with news of contract awards later this year. In the second quarter alone, we saw contractual actions across all WidePoint solution lines, including our managed mobility services, identity and access management, IT as a service, and interactive billing and analytics. These new opportunities are the high-margin SaaS contracts our sales and marketing team is aggressively pursuing, which are expected to contribute greatly to our bottom line performance. We begin the third quarter with approximately $320 million in federal contract backlog.

Speaker Change: In the second quarter alone, we saw contractual actions across all WidePoint solution lines, including our Managed Mobility Services, Identity and Access Management, IT as a Service, and Interactive Billing and Analytics.

Speaker Change: These new opportunities are the high-margin SaaS contracts our sales and marketing team is aggressively pursuing, which are expected to contribute greatly to our bottom-line performance.

Jin Kang: We begin the third quarter with approximately 320 million in federal contract backlog. Additionally, our current qualified sales pipeline is healthier than it has ever been.

Speaker Change: We begin the third quarter with approximately $320 million in federal contract backlog. Additionally, our current qualified sales pipeline is healthier than it has ever been.

Jin Kang: Additionally, our current qualified sales pipeline is healthier than it has ever been. To provide you with some additional color on our sales pipeline, I will now hand the mic over to Jason, who will dive deeper into our sales and marketing efforts and recent technological developments, specifically our new proprietary mobile anchor digital credential solution.

Jason Holloway: To provide you some additional color on our sales pipeline, I will now hand the mic over to Jason, who will dive deeper into our sales and marketing efforts and recent technological developments, specifically our new proprietary mobile anchor digital credential solution.

Jason Holloway: To provide you some additional color on our sales pipeline, I will now hand the mic over to Jason, who will dive deeper into our sales and marketing efforts and recent technological developments, specifically our new proprietary mobile anchor digital credential solution. Jason?

Jason Holloway: Jason. Thanks, Jen, and good afternoon, everyone. As Jen just mentioned, we successfully developed, tested, and authenticated our new proprietary mobile anchor digital credential. This digital credential solution no longer requires a smart card, but instead is deployed directly onto smart mobile devices, providing the highest level of security for mobile digital credentials available while ensuring that cyber interactions use the most secure identity management. This is a technology breakthrough and places WidePoint ahead of our competition in the cyber identity world. We have already successfully deployed mobile anchor in a federal agency and are actively marketing it to other federal and commercial agencies that currently use the traditional smart card-based credential.

Jason Holloway: Thanks, Jin, and good afternoon, everyone. As Jin just mentioned, we successfully developed, tested, and authenticated our new proprietary mobile anchor digital credential. This digital credential solution no longer requires a smart card but instead is deployed directly onto smart mobile devices, providing the highest level of security for mobile digital credentials available while ensuring that cyber interactions use the most secure identity management solutions on the market today. This is a technological breakthrough and places WidePoint ahead of its competition in the cyber identity world.

Jason Holloway: Thanks, Jin, and good afternoon, everyone.

Jason Holloway: As Jin just mentioned, we successfully developed, tested, and authenticated our new proprietary mobile anchor digital credential.

Jason Holloway: This digital credential solution no longer requires a smart card, but instead is deployed directly onto smart mobile devices.

Speaker Change: providing the highest level of security for mobile digital credentials available while ensuring that cyber interactions use the most secure identity management solutions on the market today.

Speaker Change: This is a technology breakthrough and places WidePoint ahead of our competition in the cyber identity world.

Jason Holloway: We have already successfully deployed MobileAnchor in a federal agency and are actively marketing it to other federal and commercial agencies that currently use traditional smart card-based credentials. We continue to establish our competitive edge, and this new product will enable us to win business from our competitors as they do not offer similar solutions. This coincides with our strategy to win work away from our competitors in the IDM sector. We're excited to continue marketing this new product and look forward to potentially implementing it within our pipeline of deals currently in the works. On a related note, Mobile Anchor has traction within the Department of Education. As you are aware, we've been aggressively pursuing K-12 at the district level.

Speaker Change: We have already successfully deployed MobileAnchor in a federal agency and are actively marketing it to other federal and commercial agencies that currently use the traditional smart card based credentials.

Jason Holloway: We continue to establish our competitive edge, and this new product will enable us to win business from our competitors as they do not offer similar solutions. This coincides with our strategy to win work away from our competitors in the IDM sector. We're excited to continue marketing this new product and look forward to potentially implementing it within our pipeline of deals currently in the works. On a related note, Mobile Anchor has traction within the Department of Education. As you are aware, we've been aggressively pursuing K-12 at the district level. Now we are seeing a shift in getting closer to securing the necessary customer funding to move this initiative forward.

Speaker Change: We continue to establish our competitive edge, and this new product will enable us to win business from our competitors, as they do not offer similar solutions.

Speaker Change: This coincides with our strategy to win work away from our competitors in the IDM sector.

Speaker Change: We're excited to continue marketing this new product and look forward to potentially implementing it within our pipeline of deals currently in the works.

Speaker Change: On a related note, MobileAnchor has traction within the Department of Education. As you are aware, we've been aggressively pursuing K-12 at the district level. Now we are seeing a shift in getting closer to securing the necessary customer funding to move this initiative forward.

Jason Holloway: Now we are seeing a shift in getting closer to securing the necessary customer funding to move this initiative forward. Even though WidePoint has been at the forefront of identity and access management since the inception of PKI, it takes time to reconfigure our solution to address a market such as K-12. We will keep you posted as MobileAnchor gains traction within the Department of Education. As Jin mentioned earlier, SOUP 6 is a very exciting opportunity for WidePoint.

Jason Holloway: Even though WidePoint has been at the forefront of identity and access management since the inception of PKI, it takes time to reconfigure our solution to address a market such as K-12. We will keep you posted as Mobile Anchor gains traction within the Department of Education.

Speaker Change: Even though WidePoint has been at the forefront of identity and access management since the inception of PKI.

Speaker Change: It takes time to reconfigure our solution to address a market such as K-12. We will keep you posted as MobileAnchor gains traction within the Department of Education.

Jason Holloway: As Jen mentioned earlier, Soup Six is a very exciting opportunity for WidePoint. Due to its 10-year $60 billion ceiling, WidePoint is uniquely positioned to provide our managed mobility services as well as gain additional market share for our proprietary platform, Intelligent Technology Management System. Along with the impending FedRAM authorized status, we are cautiously optimistic that WidePoint will be positioned to capitalize once the soup six has been awarded. As I've stated previously, we are optimistic regarding our pipeline, and there are many opportunities that we are aggressively working. That being said, we are proactively hiring additional strategic resources in anticipation of these contract awards, as well as pursuing additional sales opportunities.

Speaker Change: As Jin mentioned earlier, SOUP 6 is a very exciting opportunity for WidePoint.

Jason Holloway: Due to its 10-year, $60 billion ceiling, WidePoint is uniquely positioned to provide its managed mobility services as well as gain additional market share for its proprietary platform, the Intelligent Technology Management System. Along with the impending FedRAMP authorized status, we are cautiously optimistic that WidePoint will be positioned to capitalize once SOUP 6 has been awarded. As I've stated previously, we are optimistic regarding our pipeline, and there are many opportunities that we are aggressively working on.

Speaker Change: Due to its 10-year, $60 billion ceiling, White Point is uniquely positioned to provide our managed mobility services as well as gain additional market share for our proprietary platform, Intelligent Technology Management System.

Speaker Change: Along with the impending FedRAMP authorized status, we are cautiously optimistic that WidePoint will be positioned to capitalize once the SOUP 6 has been awarded.

Speaker Change: as I've stated previously, we are optimistic regarding our pipeline and there are many opportunities that we are aggressively working.

Jason Holloway: That being said, we are proactively hiring additional strategic resources in anticipation of these contract awards as well as pursuing additional sales opportunities. We have established our Program Management Offices, or PMOs, for both the DHS 3.0 Recompete effort and the Spiral 4 contract. We will also be utilizing the same PMO model for SOUP 6.

Speaker Change: That being said, we are proactively hiring additional strategic resources in anticipation of these contract awards as well as pursuing additional sales opportunities.

Jason Holloway: We have established our Program Management Offices or PMO for both the DHS 3.0 recompete effort and the Spiral Four contract. We will also be utilizing the same PMO model for Soup Six.

Speaker Change: We have established our Program Management Offices, or PMO, for both the DHS 3.0 ReCompete effort and the Spiral 4 contract. We will also be utilizing the same PMO model for SOUP 6.

Jason Holloway: Lastly, for Q3 and onward, we plan to continue advancing our efforts to enhance WidePoint's overall capabilities. The ongoing innovation in our technological capabilities is critical for strengthening and maintaining our competitive position. By improving our technological capabilities, we aim to offer more solutions and better meet the needs of our clients. This strategic focus on technology will significantly enhance our ability to secure new contracts and expand our marketing presence in the future. We are confident that these efforts will play a vital role in driving our long-term growth and success, and we look forward to announcing relevant developments as they arise.

Jason Holloway: Lastly, for Q3 and onward, we plan to continue advancing our efforts to enhance WidePoint's overall capability. The ongoing innovation in our technological capabilities is critical for strengthening and maintaining our competitive position. By improving our technological capabilities, we aim to offer more solutions and better meet the needs of our clients. This strategic focus on technology will significantly enhance our ability to secure new contracts and expand our marketing presence in the future. We are confident that these efforts will play a vital role in driving our long-term growth and success, and we look forward to announcing relevant developments as they arise. With that, I will now turn the call over to Bob to discuss our second quarter financial results. Bob?

Speaker Change: Lastly, for Q3 and onward, we plan to continue advancing our efforts to enhance WidePoint's overall capabilities.

Speaker Change: The ongoing innovation in our technological capabilities is critical for strengthening and maintaining our competitive position.

Speaker Change: By improving our technological capabilities, we aim to offer more solutions and better meet the needs of our clients.

Speaker Change: This strategic focus on technology will significantly enhance our ability to secure new contracts and expand our marketing presence in the future.

Speaker Change: We are confident that these efforts will play a vital role in driving our long-term growth and success, and we look forward to announcing relevant developments as they arise.

Robert George: With that, I will now turn the call over to Bob to discuss our second quarter financial results.

Speaker Change: With that, I will now turn the call over to Bob to discuss our second quarter financial results.

Robert George: Bob? Thank you, Jason, and thanks to everyone for joining us today. I'm pleased to share the details of our financial results for the second quarter in the first half of 2024. We deliver strong three and six plus 2024 results. And I'm happy to report that we are turning towards the higher end of our guidance rate. Court of Revenue for the Quarter were 36 million, an increase of 9.3 million to 35% from 26.8 million reported for the same period last year. Revenue for the first half of 24 were 70.2 million and an increase of 18.2 million to 35% from the 52 million in the same period last year.

Robert George: Thank you, Jason, and thanks to everyone for joining us today. I'm pleased to share the details of our financial results for the second quarter and first half of 2024. We delivered strong three and six-month 2024 results, and I'm happy to report we are trending toward the higher end of our guidance range. Total revenues for the quarter were $36 million, an increase of $9.3 million, or 35% from $26.8 million reported for the same period last year.

Bob: Thank you, Jason, and thanks to everyone for joining us today. I'm pleased to share the details of our financial results for the second quarter and first half of 2024. We delivered strong three- and six-month 2024 results, and I'm happy to report we are trending toward the higher end of our guidance range.

Speaker Change: Total revenues for the quarter were $36 million, an increase of $9.3 million, or 35% from $26.8 million reported for the same period last year.

Robert George: Revenues for the first half of 24 were $70.2 million, an increase of $18.2 million, or 35% from the $52 million in the same period last year. Now provide a further breakdown over second quarter and first half 2024 revenue. Our carrier services revenue for the quarter was $20.4 million, an increase of $6.2 million compared to the same period in 2023. Carrier services revenue for the first half of 2024 was $39.8 million, an increase of $11.9 million compared to the same period last year.

Speaker Change: Revenues for the first half of 24 were $70.2 million, an increase of $18.2 million, or 35%, from the $52 million in the same period last year.

Robert George: Now, provided further breakdown were second quarter and first half of 2024 revenues. Our carrier services revenue for the quarter was 20.4 million, an increase of 6.2 million compared to the same period in 2023. Hair services revenue for the first half of 24 was 39.8 million, an increase of 11.9 million compared to the same period last year. Our managed services revenue for the quarter were 9.2 million and an increase of 2.3 million or 25% compared with the same period in 2023. For the first half of 24, our managed services revenues were 17.9 million and an increase of 4.1 million, or 23%, from the same period last year.

Speaker Change: Now we'll provide a further breakdown of our second quarter and first half 2024 revenues.

Speaker Change: Our carrier service is revenue for the quarter, it was 20.49, an increase of 6.2 million compared to the same period in 2023.

Speaker Change: Hair Services Revenue to the first half of 24 was 39.8 million in increase of 11.9 million compared to the same period last year.

Robert George: Our managed services revenue for the quarter was $9.2 million, an increase of $2.3 million, or 25%, compared with the same period in 2023. For the first half of 2024, our managed services revenues were $17.9 million, an increase of $4.1 million, or 23% from the same period last year. The increase in both carrier and managed services revenue is principally due to new federal and commercial customers signed in the third and fourth quarter of 2023, which are not reflected in the comparison periods last year, and also due to growth within several existing federal customers.

Speaker Change: Our managed services revenue for the quarter were $9.2 million, an increase of $2.3 million, or 25%, compared with the same period in 2023. For the first half of 2024, our managed services revenues were $17.9 million, an increase of $4.1 million, or 23% from the same period last year.

Robert George: The increase in both carrier and managed services revenue is principally due to new federal and commercial customers signing in the third and fourth quarter of 2023, which are not reflected in the comparison periods last year, and also due to growth within several existing federal customers. Buildable services fees for the quarter were 1.2 million and a decrease of 618,000 compared to the same period in 2023. For the first half of 2024, buildable services fees were 2.4 million and a decrease of 678,000 in the same period last year. The second quarter in the first half of 2024, the decrease was due to comparatively less project work at a US government customer.

Speaker Change: The increase in both carrier and managed services revenue is principally due to new federal and commercial customers signing in the third and fourth quarter of 2023, which are not reflected in the comparison periods last year, and also due to growth within several existing federal

Robert George: Billable services fees for the quarter were $1.2 million, a decrease of $618,000 compared to the same period in 2023. For the first half of 2024, billable services fees were $2.4 million, a decrease of $678,000 compared to the same period last year.

Speaker Change: Billable services fees for the quarter were $1.2 million, a decrease of $618,000 compared to the same period in 2023.

Speaker Change: For the first half of 2024, billable services fees were $2.4 million, a decrease of $678,000 in the same period last year.

Robert George: In the second quarter, in the first half of 2024, the decrease was due to comparatively less project work than a U.S. government customer. Reselling and other services in the second quarter were $5.2 million, an increase of $1.5 million from the same period last year. For the first half of 2024, reselling and other services were $10.2 million, an increase of $2.9 million from the same period last year. The increase for both periods was due to increased demand and sales activity for items that we sell to our federal and commercial customers.

Speaker Change: The second quarter, in the first half of 2024, the decrease was due to comparatively less project work and a U.S. government custom.

Robert George: Reselling the other services in the second quarter were 5.2 million and increase of 1.5 million from the same period last year. For the first half of 2024, reselling and other services were 10.2 million, an increase of 2.9 million from the same period last year. The increase for both periods was due to increased demand and sales activity for items that we sell to our federal and commercial customers. In reminder, reselling and other services are transactional in nature, and the amount and timing of revenue may vary significantly from period to period. Gross profit for the second quarter was 4.9 million, or 14% of revenues, compared to 3.9 million, or 15% of revenues, in the same period in 2023.

Speaker Change: Reselling and other services in the second quarter were 5.2 million, an increase of 1.5 million from the same period last year.

Speaker Change: For the first half of 2024, reselling and other services were $10.2 million, an increase of $2.9 million from the same period last year. The increase for both periods was due to increased demand and sales activity for items that we sell to our federal and commercial customers.

Robert George: As a reminder, reselling, and other services are transactional in nature, and the amount and timing of revenue may vary significantly from period to period. Gross profit for the second quarter was $4.9 million, or 14% of revenues, compared to $3.9 million, or 15% of revenues in the same period in 2023. Gross profit for the first half of 2024 was $9.5 million, or 14% of revenues, compared to $7.7 million, or 15% of revenues in 2023.

Speaker Change: A reminder, reselling and other services are transactional in nature, and the amount and timing of revenue may vary significantly from period to period.

Speaker Change: Gross profit for the second quarter was 4.9 million or 14% of revenues compared to 3.9 million or 15% of revenues in the same period in 2023.

Robert George: Gross profit for the first half of 2024 was 9.5 million, or 14% of revenues, compared to 7.7 million, or 15% of revenues in 2023. The more significant metric of gross profit percentage excluding carrier services was 31% in the second quarter, which is consistent from the same period last year. For the first half of 2024, gross profit percentage excluding carrier services was 31% compared to 32% in the same period last year. Slightly lower gross margin percentage, excluding carrier services, is impacted by a revenue mix and increased depreciation and amortization related to our completed delivery platforms. Our growth profit percentage will vary from period to period based on a revenue mix.

Speaker Change: [inaudible]

Robert George: A more significant metric of gross profit percentage excluding carrier services was 31% in the second quarter, which is consistent from the same period last year. For the first half of 2024, gross profit percentage excluding carrier services was 31% compared to 32% in the same period last year.

Speaker Change: The more significant metric of gross profit percentage excluding carrier services was 31% in the second quarter, which is consistent from the same period last year. For the first half of 2024, gross profit percentage excluding carrier services was 31% compared to 32% in the same period last year.

Robert George: Slightly lower gross margin percentage, excluding carrier services, is impacted by revenue mix and increased depreciation and amortization related to our completed delivery platforms. Our gross profit percentage will vary from period to period based on our revenue mix. Sales and marketing expenses in the second quarter were $600,000, or 2% of revenue, compared to $500,000 and also 2% of revenue in the same period last year.

Speaker Change: Slightly lower gross margin percentage excluding carrier services is impacted by a revenue mix and increased depreciation and amortization related to our completed delivery platforms. Our gross profit percentage will vary from period to period based on our revenue mix.

Robert George: Sales and marketing expenses in the second quarter were 600,000 or 2% of revenue, compared to 500,000 and also 2% of revenues in the same period last year. In the first half of 2024, sales and marketing expenses were 1.2 million or 2% of revenues, compared to 1.1 million and 2% of revenues in the same period last year. We expect to see further dollar increases in sales and marketing expenses because we continue to invest in sales and marketing efforts. Though we expect sales and marketing to be constant and slightly lower as a percentage of revenue. General administrative expenses in the second quarter are 4.5 million or 12% of revenues, compared to 3.8 million or 15% of revenues in the same period of 2023.

Speaker Change: Sales and marketing expenses in the second quarter were $600,000 or 2% of revenue compared to $500,000 and also 2% of revenues in the same period last year.

Robert George: In the first half of 2024, sales and marketing expenses were $1.2 million, or 2% of revenues compared to $1.1 million and 2% of revenues in the same period last year. We expect to see further dollar increases in sales and marketing expenses as we continue to invest in sales and marketing efforts. Though we expect sales and marketing to be constant to slightly lower as a percentage of revenue, general administrative expenses in the second quarter were $4.5 million, or 12% of revenues, compared to $3.8 million, or 16% of revenues in the same period of 2023.

Speaker Change: In the first half of 2024, sales and marketing expenses were $1.2 million or 2% of revenues compared to $1.1 million and 2% of revenues in the same period last year.

Speaker Change: We expect to see further dollar increases in sales and marketing expenses because we continue to invest in sales and marketing efforts, though we expect sales and marketing to be constant to slightly lower as a percentage of revenue.

Speaker Change: General administrative expenses in the second quarter are $4.5 million, or 12% of revenues compared to $3.8 million, or 16% of revenues in the same period of 2023.

Robert George: General administrative expenses in the first half of 2024 are 8.9 million or 13% of revenue, compared to 7.8 million or 15% of revenue in 2023. The increase in absolute dollars relates primarily to the increase in share-based compensation expenses. Net loss for the second quarter decreased by 342,000 to a net loss of 500,000, where a loss of 5 cents per share compared to a net loss of 842,000, or a loss of 10 cents per share to the same period last year. Net loss for the first half of 2024 decreased by 600,000, the net loss of 1.2 million or a loss of 13 cents per share compared to a net loss of 1.8 million, where a loss of 20 cents per share in the same period last year.

Robert George: General and administrative expenses in the first half of 2024 will be $8.9 million, or 13% of revenue, compared to $7.8 million, or 15% of revenue, in 2023. The increase in absolute dollars relates primarily to an increase in share-based compensation. The net loss for the second quarter decreased by $342,000 to a net loss of $500,000, or a loss of $0.05 per share, compared to a net loss of $842,000, or a loss of $0.10 per share, for the same period last year.

Speaker Change: General and administrative expenses in the first half of 2024 are $8.9 million, or 13% of revenue, compared to $7.8 million, or 15% of revenue in 2023. The increase in absolute dollars relates primarily to an increase in share-based compensation expenses.

Speaker Change: Net loss for the second quarter decreased by $342,000 to a net loss of $500,000 or a loss of $0.05 per share compared to a net loss of $842,000 or a loss of $0.10 per share for the same period last year.

Robert George: The net loss for the first half of 2024 decreased by $600,000 to a net loss of $1.2 million, or a loss of $0.13 per share, compared to a net loss of $1.8 million, or a loss of $0.20 per share, in the same period last year. Moving to the balance sheet, we ended the quarter with $4 million in cash, which in our view is a significant decrease compared to $6.9 million at December 31st, 2023. This is significant, particularly considering our strong free cash flow metrics over the last three quarters. The decrease in cash was primarily due to new customer implementations, which have temporarily impacted billings and, accordingly, our cash position.

Speaker Change: Net loss for the first half of 2024 decreased by 600,000 to a net loss of 1.2 million with a loss of $0.13 per share compared to a net loss of 1.8 million with a loss of $0.20 per share in the same period last year.

Robert George: Moving to the balance sheet, we enter the quarter with 4 million in cash, which in our view is the significant decrease compared to the 6.9 million at December 31, 2023. This is significant, particularly considering our strong free cash flow metrics over the last three quarters. The decrease in cash was primarily due to new customer implementations, which have temporarily impacted buildings and accordingly our cash position. We want to highlight that we have different liquidity options available with our revolving line of credit facility, with 4 million of potential borrowing capacity; although we do not anticipate having to rely on that facility.

Robert George: We want to highlight that we have additional liquidity options available with our revolving line of credit facility with four million of potential borrowing capacity, although we do not anticipate having to rely on that facility. Furthermore, we don't expect these issues to persist and are actively working to resolve them to improve our cash position in the coming quarters. This completes my financial summary. For more detailed analysis of our financial results, please refer to our Form 10-Q, which was filed prior to this call. With that, I'll turn the call back over to Jim.

Speaker Change: Moving to the balance sheet, we ended the quarter with $4 million in cash, which in our view is a significant decrease compared to the $6.9 million at December 31, 2023. This is significant, particularly considering our strong free cash flow metrics over the last three quarters.

Speaker Change: The decrease in cash was primarily due to new customer implementations which have temporarily impacted billings and accordingly our cash position.

Speaker Change: We want to highlight that we have a different liquidity options available with our revolving line of credit facility with 4 million potential borrowing capacity. Although we do not anticipate having to rely on that facility.

Robert George: Further, we don't expect these issues to persist and are actively working to resolve them to prove our cash position in coming quarters.

Speaker Change: Further, we don't expect these issues to persist and are actively working to resolve them to improve our cash position in the coming quarters. This completes my financial summary. For more detailed analysis of our financial results, please refer to our Form 10-Q, which was filed prior to this call.

Robert George: This completes my financial summary.

Robert George: For more detailed analysis or financial results, please refer to our Form 10-Q, which was filed prior to this call.

Jin Kang: With that, I'll turn the call back over to Jim. Thank you, Bob and Jason.

Jin Kang: Thank you, Bob and Jason. One ongoing initiative we'd like to update you on is our FedRAMP certification status. We have submitted responses to all of GSA's questions, and they are currently under review. While we are still in the in-process stage, we expect to achieve FedRAMP authorized status by the end of 2024. This certification is one of the key technological advancements that Jason mentioned, which will diversify our offerings and capture business from competitors while enhancing WidePoint's competitive edge and position in the market. With the upcoming federal election cycle, budget discussions are expected to take center stage once again. A change in administration could lead to delays in federal budgets, regardless of which party wins the presidency.

Speaker Change: With that, I'll turn the call back over to Jim.

Jin Kang: One ongoing initiative we'd like to update you on is our Fed Ram certification status. We have submitted responses to all of TSA's questions, and they are currently under review. While we are still in the in process stage, we expect to achieve Fed Ram authorized status by the end of 2024. This certification is one of the key technological advancements that Jason mentioned, which will diversify our offerings and capture business from competitors while enhancing why points competitive edge and position in the market.

Jim: Thank you, Bob and Jason.

Speaker Change: One ongoing initiative we'd like to update you on is our FedRAMP certification status. We have submitted responses to all of GSA's questions, and they are currently under review.

Speaker Change: While we are still in the in-process stage, we expect to achieve FedRAMP authorized status by the end of 2024.

Speaker Change: This certification is one of the key technological advancements that Jason mentioned, which will diversify our offerings and capture business from competitors while enhancing White Point's competitive edge and position in the market.

Jin Kang: With the upcoming federal election cycle, budget discussions are expected to take center stage once again. A change in administration could lead to delays in federal budgets, regardless of which party wins the presidency. We will closely monitor the situation as it unfolds. Currently, we anticipate minimal or no impact from the administration change, given that we operate in the critical sector of cybersecurity and mobility management. These areas are essential services that will remain in high demand for the foreseeable future.

Speaker Change: With the upcoming federal election cycle, budget discussions are expected to take center stage once again. A change in administration could lead to delays in federal budgets, regardless of which party wins the presidency.

Jin Kang: We will closely monitor the situation as it unfolds. Currently, we anticipate minimal or no impact from the administration change, given that we operate in the critical sector of cybersecurity and mobility management. These areas are essential services that will remain in high demand for the foreseeable future. Lastly, I'd like to reiterate our guidance, where we expect revenues to range between $120 million and $133 million. Adjusted EBITDA ranged between $2.1 million and $2.4 million.

Speaker Change: We will closely monitor the situation as it unfolds.

Speaker Change: Currently, we anticipate minimal or no impact from the administration change, given that we operate in the critical sector of cybersecurity and mobility management.

Speaker Change: These areas are essential services that will remain in high demand for the foreseeable future.

Jin Kang: Lastly, I'd like to reiterate our guidance, where we expect revenues to range between 120 million and 133 million, adjusted EBITDA range between 2.1 million and 2.4 million. Additionally, we expect free cash flow to range between 2 million and 2.3 million. I'm happy to report that we have been ahead of our forecast for the past two quarters and are trending towards the higher end of our guidance for the full year. Our sales and marketing efforts, technological advancements, and the deals currently in the pipeline are strong indicators of improvements in our bottom line and margin for the upcoming quarters.

Jin Kang: Additionally, we expect free cash flow to range between $2 million and $2.3 million. I'm happy to report that we have been ahead of our forecast for the past two quarters and are trending towards the higher end of our guidance for the full year. Our sales and marketing efforts, technological advancements, and the deals currently in the pipeline are strong indicators of improvements in our bottom line and margin for the upcoming quarter. Our team continues to aggressively push for profitable operations in the fourth quarter, and we anticipate achieving positive earnings per share in 2025. Our executive team maintains a positive outlook on our future, as evidenced by several board members and executives acquiring additional shares in the open market.

Speaker Change: Lastly, I'd like to reiterate our guidance where we expect revenues to range between $120 million and $133 million.

Speaker Change: adjusted EBITDA range between 2.1 million and 2.4 million. Additionally, we expect free cash flow to range between 2 million and 2.3 million.

Speaker Change: I'm happy to report that we have been ahead of our forecast for the past two quarters and are trending towards the higher end of our guidance for the full year.

Operator: Good afternoon, ladies and gentlemen, and thank you for your patience. Your conference will begin shortly. Once again, thank you for your patience. Your conference will begin shortly. Good afternoon.

Speaker Change: Our sales and marketing efforts, technological advancements, and the deals currently in the pipeline are strong indicators of improvements in our bottom line and margin for the upcoming quarters.

Jin Kang: Our team continues to aggressively push for profitable operations in the fourth quarter, and we anticipate achieving positive earnings per share in 2025. Our executive team maintains a positive outlook on our future, as evidenced by several board members and executives acquiring additional shares in the open market. We remain dedicated to unlocking sustainable growth and delivering strong returns for our valued shareholders.

Speaker Change: Our team continues to aggressively push for profitable operations in the fourth quarter, and we anticipate achieving positive earnings per share in 2025.

Speaker Change: Our executive team maintains a positive outlook on our future, as evidenced by several board members and executives acquiring additional shares in the open market.

Jin Kang: We remain dedicated to unlocking sustainable growth and delivering strong returns for our valued shareholders. That concludes our prepared remarks, and now we'll take questions from our analysts and major shareholders. Operator, will you please open the call for questions? Everyone will be conducting a question and answer session at this time. If you have any questions or comments, please press star 1 on your phone at this time. We do ask that while you're posing your question, please pick up your handset if you're listening on speakerphone to provide optimum sound quality. Once again, if you have any questions or comments, please press star 1 on your phone. Your first question is coming from Barry Sine from Litchfield Hills Research. Your line is live. Hey. Good evening, gentlemen.

Speaker Change: We remain dedicated to unlocking sustainable growth and delivering strong returns for our valued shareholders.

Operator: That concludes our prepared remarks, and now we'll take questions from our analysts and major shareholders.

Speaker Change: That concludes our prepared remarks and now we'll take questions from our analysts and major shareholders. Operator, will you please open the call for questions?

Operator: Operator, will you please open the call for questions? Certainly. Everyone at this time, we're conducting a question-and-answer session. If you have any questions or comments, please press star one on your phone at this time. We do ask the well-posing your question. Please pick up your handset if you're listening on speaker phone to provide optimum sound quality. Once again, if you have any questions or comments, please press star one on your phone.

Speaker Change: Certainly. Everyone at this time will be conducting a question and answer session. If you have any questions or comments, please press star 1 on your phone at this time. We do ask that while posing your question, please pick up your handset, if you're listening on speakerphone, to provide optimum sound quality.

Speaker Change: Once again, if you have any questions or comments, please press star 1 on your phone.

Barry Sine: Your first question is coming from Barry Sine from Litchfield Hills Research. Your line is live.

Speaker Change: Your first question is coming from Barry Sine from Litchfield Hills Research. Your line is live.

Barry Sine: Hey, good evening, gentlemen. First question is on CWMS. I don't think my hand was writing fast enough to get all the details down. So it sounds like this visibility on letting out 3.0.

Barry Sine: The first question is on CWMS. I don't think my hand was writing fast enough to get all the details down. So it sounds like there's visibility on letting out 3.0. If you could just repeat, you know, the dollar amount, give us any sense of the timing on that. And then, just to put that in some perspective, obviously, you won 2.0.

Barry Sign: Hey, good evening gentlemen. First question is on CWMS.

Speaker Change: I don't think my hand was writing fast enough to get all the details down.

Barry Sign: So it sounds like...

Barry Sine: If you could just repeat the dollar amount, give us any sense of the timing on that. Then just to put that in some perspective, obviously you won 2.0. You recently had a very significant increase in the ceiling on that. Then I remember vividly 2.0 just took forever to get extended, so the government works pretty fully. I guess we shouldn't be expecting a fast decision on 3.0.

Speaker Change: There's visibility on letting out 3.0.

Speaker Change: If you could just repeat the dollar amount, give us any sense of the timing on that.

Speaker Change: And then just to put that in some perspective, obviously you won 2.0. You recently had a very significant increase in the ceiling on that. And then I remember vividly.

Barry Sine: You recently had a very significant increase in the ceiling on that. And then I vividly remember 2.0 just took forever to get extended. So the government works pretty slowly. So I guess we shouldn't be, you know, expecting a fast decision on 3.0. Hi Barry.

Speaker Change: 2.0 just took forever to get extended, so the government works pretty slowly, so I guess we shouldn't be expecting a fast decision on 3.0.

Jin Kang: Hi, Barry. This is Jen. It's good to hear from you again.

Jin Kang: This is Jin. It's good to hear from you again. The answer is yes, but it will probably take longer than anticipated. Right now, the timeline for the 3.0 award is going to, they want to get it done by the end of 2015. I mean 2025, sorry.

Matthew: Welcome to WidePoint's second quarter, 2024, earnings conference call. My name is Matthew and I will be your operator for today's call. Joining us for today's presentation are WidePoint's President and CEO, Jin Kang, Chief Revenue Officer, Jason Holloway, and Chief Financial Officer, Robert George. Following the remarks, we will open up the call for questions from WidePoint's Publishing Analysts and Major Investors. If your questions were not taken today and you like additional information, please contact WidePoint's Investor Relations team at WYY at gateway-grp.com.

Jin Kang: The answer is yes. It will probably take longer than anticipated. Right now, the timeline for the 3.0 award is going to, they want to get it done by the end of 2015. I mean, 2025, sorry. And the reason for them upping the cap on the contract is because they have already reached the ceiling on the contract with the task orders that were already awarded under 2.0. And I believe also that the additional dollars will also provide an overlap between the 2.0 and 3.0 so that they can eat smoothly transition from the 2.0 and the 3.0.

Speaker Change: Hi, Barry. This is Jin. It's good to hear from you again. The answer is yes. It will probably take longer than anticipated.

Speaker Change: Right now the timeline for the 3-0 award, they want to get it done by the end of 2015.

Jin Kang: And the reason for them increasing the cap on the contract is that they have already reached the ceiling on the contract with task orders that were already awarded under 2.0. And I believe also that the additional dollars will also provide an overlap between the 2.0 and 3.0 so that they can smoothly transition from the 2.0 to the 3.0. And so we believe that this contract now is going to go from a five-year contract to a 10-year contract.

Speaker Change: I mean 2025, sorry. And the reason for them, you know, upping the cap on the contract is because they have already reached the ceiling on the contract with, you know, task orders that were already awarded under 2.0.

Operator: Before we begin the call, I'd like to provide WidePoint's Safe Harbor Statement that includes cautions regarding forward-looking statements made during this call. The matters discussed in this conference call may include forward-looking statements regarding future events and the future performance of WidePoint Corporation that involve risk and uncertainties that could cause actual results to differ materially from those anticipated. These risk and uncertainties are described in the company's form 10Q filed with the Securities and Exchange Commission.

Speaker Change: And I believe also that the additional dollars will also provide an overlap between the 2.0 and 3.0 so that they can smoothly transition from the 2.0 and the 3.0.

Jin Kang: And we did sort of a mathematical extrapolation to come up with the $1.2 to $1.5 billion ceiling. And so based upon where we are today, we're at $750 million. So if you multiply that by two for a 10-year period, that will put you at like $1.5 billion in delegated procurement authority. And so that's what we're seeing.

Jin Kang: And so we believe that this contract now is going to go from a 5-year contract to a 10-year contract. And we did sort of a mathematical extrapolation to come up with the 1.2 to 1.5 million dollar ceiling. And so based upon where we are today, we're at 750 or so million. So if you multiply that by 2 for a 10-year period, that will put you at like 1.5 billion dollars in a delegated procurement authority. And so that's what we're seeing. Again, we feel like we are ahead of our competition in our software platform, our subject matter expertise, and our past performance with the DHS.

Speaker Change: And so, we believe that this contract now is going to go from a five-year contract to a ten-year contract.

Speaker Change: and we did sort of a mathematical extrapolation to come up with the 1.2 to $1.5 billion ceiling. And so based upon where we are today, we're at 750 or so million. So if you multiply that by two for a 10 year period, that will put you at like $1.5 billion in revenue.

Jin Kang: Finally, I'd like to remind everyone that this call will be made available for replay via a link in the Investor Relations section of the company's website at Now I would like to turn the call over to WidePoint's President and CEO, Mr. Jin Kang. Sir, please proceed. Thank you, operator, and good afternoon to everyone.

Jin Kang: Again, we feel like we are ahead of our competition in our software platform, our subject matter expertise, and our past performance with DHS. Just like when we competed for the 2.0, our systems and workflows are all integrated with DHS's processes and systems. And we have the security accreditations and certifications that others cannot match. So we feel pretty good about our prospect of winning the 3.0. But we're not sitting on our hands.

Jin Kang: Thank you for joining us today to review our financial results for the second quarter and the June 30, 2024. I am pleased to share that we have continued to build on the momentum from previous quarters, having finished Q2 ahead of forecast for the second consecutive time and seeing significant year over year improvements in revenue, adjusted EBITDA and free cash flow. Our revenue for second quarter was 36 million and our six month revenue and the June 30, 2024 was 70 million, both a 35% increase from the same period in 2023 and a testament to our team's ability to execute our sales and marketing strategy.

Speaker Change: a Delegated Procurement Authority.

Speaker Change: And so that's what we're seeing. Again, we feel like we are ahead of our competition.

Speaker Change: in our software platform, our subject matter expertise, and our past performance with DHS.

Jin Kang: Just like when we competed for the 2.0, our systems and workflows are all integrated with DHS processes and systems. And we have the security accreditations and certifications that others cannot match. So we feel pretty good about our prospect of winning the 3.0. But we're not sitting on our hands.

Speaker Change: just like when we competed for the 20, you know, our systems and workflows are all integrated with...

Jin Kang: We are constantly looking for improvements, constantly looking for value-add services that we can offer to DHS so that come award time for 3.0, we will be the one receiving the award. And just a few more points of clarification on CWMS. What is the official contract end date for 2.0? And then when that happens, last time, you know, it ended, they didn't renew, but you were made whole the whole time.

Speaker Change: DHS's processes and systems, and we have the security accreditations and certifications that others cannot match. So we feel pretty good about our prospect of winning the 3.0.

Jin Kang: We are constantly looking for improvements, constantly looking for value ad services that we can offer to DHS so that when the award time for 3.0 comes, we will be the one receiving the award.

Speaker Change: But we're not, you know, sitting on our hands. We are constantly looking for improvements, constantly looking for value-add services that we can offer to DHS so that come the award time for 3.0, we will be the one receiving the award.

Jin Kang: We achieved our 28th consecutive quarter of positive adjusted EBITDA, concluding with 811,000 or 479% increase from the same period last year. For the six months ended June 30, 2024, our adjusted EBITDA was approximately 1.4 million, which is a 764% increase from the same period last year. We also achieved a third consecutive quarter of positive free cash flow, sequentially improving from 310,000 in Q4 2023 and 566,000 and 800,000 in the first and second quarter of 2024, respectively.

Barry Sine: George. And just a few more points of clarification on CWMS. What is the official contract end date for 2.0? And then when that happens, at last time, you know, it ended; they didn't renew, but, you know, you were made whole the whole time. So I know there was investor angst, but you were made whole the whole time while they took an extended period to renew that.

Speaker Change: and just a few more points of clarification on CWMS.

Speaker Change: What is the official contract end date for 2.0? And then when that happens, last time, it ended, they didn't renew, but you were made whole the whole time, so I know there was investor angst.

Barry Sine: So I know there was investor angst, but you were made whole the whole time while they took an extended period to renew that. So could you give us the expiration date and then just remind us what happened previously? Hopefully, that's an indication of what may happen if they're late on issuing 3.0. Sure, sure. So the official end date for CWMS 2.0 is November 19th or 20th, 2015. And so, 25?

Jin Kang: So could you give us the expiration date? And they just remind us what did happen previously, and hopefully that's an indication of what may happen if they're late on issuing 3.0.

Speaker Change: but you were made whole the whole time while they took an extended period to renew that. So, could you give us the expiration date and then just remind us what did happen previously and hopefully that's an indication of what may happen if they're late on issuing 3.0.

Jin Kang: Compared to where we were last year, our position in the capital markets has improved significantly thanks to our team's dedication to executing our organic growth strategy. Our sales and marketing team continues to deliver and capture new high margin contracts that have positioned us well for potential positive earnings per share for 2025. Additionally, all of our capital investments and fixed costs have been paid for and we continue to aggressively manage our costs, supporting our future bottom line results, margin improvements and profitability projections.

Jin Kang: Sure, sure.

Jin Kang: So the official end date for the CWMS 2.0 is November, I believe, 19th or 20th of 2015. And so, 25th, 20, 25. Yeah. Did I say 2015 again? I'm, you know, I'm, you know, looking back. But anyway, the, it is November 19th or 20th of 2025. And, and likely, it may be extended. And so, the last time what happened was, you know, the government came up to the end date, and they put in a bridge contract for a year. The contract was supposed to have been a five-year contract, and it ended up being 8. So they had extended the contract, you know, with a, like a 12 month contract.

Speaker Change: Sure, sure. So the official end date for the CWMS 2.0 is November, I believe 19th or 20th of 2015. And so... 25.

Jin Kang: 2025. Yeah. Did I say 2015 again? I'm, you know, I'm, you know, looking back.

Jin Kang: But anyway, the deadline is November 19th or 20th of 2025. And, and likely, it may be extended. And so the last time, what happened was, you know, the government came up to the end date, and they put in a bridge contract for a year. The contract was supposed to have been a five-year contract, but it ended up being eight. So they had extended the contract, you know, with a, like, 12-month contract. They put another bridge contract in for a year and a half. And then they exercised another option to go another six months beyond that, making it an eight-year contract for a five-year contract.

Speaker Change: 2025, yeah. Did I say 2015 again? I'm, you know, I'm, you know, looking back. But anyway, the, it is November 19th or 20th of 2025.

Speaker Change: and likely it may be extended.

Jin Kang: As evidenced by our consecutively improving three cash flow figures, we're heading in the right direction. Our strategic partnerships and investments, particularly in our different business solutions, have played an incremental role in driving our sales growth and have significantly contributed to our top line performance over the past several quarters. These efforts along with our certification and accreditation, superior and diverse suite of offerings, as well as recently announced mobile anchor digital credential solution, have positioned us well to be able to successfully target our competitors business. Why point is now in a strong position where our strategic partners seek us out and want to work with us, a significant shift from a few years ago when we were the ones pursuing them.

Speaker Change: and so the last time what happened was you know the government came up to the end date and they put in a bridge contract for a year.

Speaker Change: The contract was supposed to have been a five-year contract and it ended up being eight. So they had extended the contract, you know, with a like a 12-month contract. They put another bridge contract in for a year and a half.

Jin Kang: They put another bridge contract in for a year and a half, and then they exercised another option to go another six months beyond that, making it an eight-year contract for a five-year contract. So it is, it could be that, you know, the contract may have to be extended, but what they did with CWMS 2.0 is that they put in an option so that they can actually award task orders 12 months beyond the end of the official contract date. So the official contract date end is November 19th of 2025. So they can actually issue task orders that go until November 19th of 2026.

Speaker Change: And then they exercise another option to go another six months beyond that, making it an eight-year contract for a five-year contract. So it could be that...

Jin Kang: So it, it could be that, you know, the contract may have to be extended. But what they did with CWMS 2.0 is that they put in an option so that they can actually award task orders 12 months beyond the end of the official contract date. So the official contract date ends on November 19th of 2025. But they can actually issue task orders that go until November 19th of 2026. And if they need additional extensions, they can modify the contract to extend the contract further.

Speaker Change: The contract may have to be extended, but what they did with CWMS 2.0 is that they put in an option.

Speaker Change: so that they can actually award task orders.

Jin Kang: The investments and efforts we have made over the years are paying off and we are excited to continue building on this upward momentum towards profitable return for our value shareholders.

Speaker Change: 12 months beyond the end of the official contract date. So the official contract date end is November 19th of 2025, so they can actually issue task orders that go until November 19th of 2026.

Jin Kang: Moving on to some second quarter contract highlights and operational developments, the standout this quarter was our $2.7 billion spiral for contract award, where we were one of seven companies, including the US big three wireless carriers to provide a full range of wireless and telecommunication services to military personnel and federal civilian employees stationed within the country and the US territories. We also received the contract modification adding $254 million to the ceiling of the CWMS 2.0 contract with DHS.

Jin Kang: And if they need additional extensions, they can modify the contract to extend the contract further. They can also put a bridge contract in. So they have a lot of tools in their tool belt to be able to extend the contract if they do fall behind on their acquisition schedule. So we won't be left holding any unpaid bills or anything like that during the time the contract is going through the reconbie.

Speaker Change: and if they need additional extensions they can modify the contract to extend the contract further.

Jin Kang: They can also put in a bridge contract. So they have a lot of tools in their tool belt to be able to extend the contract if they do fall behind on their acquisition schedule. So we won't be left holding any unpaid bills or anything like that during the time the contract is going through the reimbursement. What is the deadline for you to submit your bid? Has that been given for CWMS 3.0? Not yet,

Speaker Change: they can also put a bridge contract in. So they have a lot of tools in their tool belt to be able to extend the contract if they do fall behind on their acquisition schedule. So we won't be left holding any unpaid bills or anything like that during the time the contract is going through the re-compete.

Barry Sine: What is the deadline for you to submit your bid for has that been given for CWMS 3.0? Not yet.

Speaker Change: What is the deadline for you to submit your bid for, has that been given for CWMS 3.0?

Jin Kang: S. Specifically, with Spyro 4, we have started receiving initial RFQs and are in the process of setting up administrative arrangements with the U.S. Navy, as well as establishing vendor agreements for services and equipment. We have a differentiated set of offerings for the Navy and believe that we will be able to successfully compete with previous incumbents on this contract. We look forward to sharing more good news with you on this front on our future calls.

Jin Kang: What was released was a request for information, and what that is is that they're looking around for qualified bidders for the contract. And we intentionally didn't put out a press release because we didn't want to publicize this information so we would get more competitors. But the deadline for the request for information had expired.

Jin Kang: The What was released was a request for information. And what that is, is that they're looking around for qualified bidders for the contract. And we intentionally didn't put out a press release because we didn't want to, you know, publicize this information. So, you know, we will get more competitors. But the deadline for the request for information had expired. I believe this was at the end of July sometime. And so we did all of our responses, and we sent it back in. And now we're, you know, letting people know that the RFI was, you know, out there on the street.

Speaker Change: Not yet. What was released was a request for information.

Nadia: And what that is, is that they're looking around for qualified bidders for the contract.

Speaker Change: And we intentionally didn't put out a press release because we didn't want to...

Jin Kang: I believe this was at the end of July or early August. And so we did all of our responses, and we sent it back in. And now we're letting people know that the RFI was out there on the street and that they're in the process of going through the recompete process. They have not put out the schedule for the award or when the proposals are due, but that will be released in the RFP as the government gets prepared to send out and receive the proposal, and I believe that contact is for ITMS, and ITMS is also the product that you're applying for FedR

Speaker Change: publicized this information so we would get more competitors.

Speaker Change: but the deadline for the request for information had expired. I believe this was at the end of July sometime and so we did all of our responses and we sent it back in and now we're letting people know that the RFI was out there on the street.

Jin Kang: Our CWMS 2.0 contract with DHS is an indefinite delivery, indefinite quantity, or IDIQ contract, valued at $754 million, reflecting an increase of $254 million, which represents nearly a 55% increase from the original contract value. And as announced in our previous earnings call, we have begun to receive additional task order requests for quotes from DHS since the contract ceiling increase. We should see the results from these new task order awards that will improve our top line and bottom line results.

Jin Kang: And that, you know, they're in the process of going through the reconbie process.

Barry Sine: They have not put out the schedule for the award or when the proposals are due. But it will be released in the RFP as, you know, as government gets prepared to send out and receive the. And I believe that contact is for ITMS. ITMS is also the product that you're applying for FedRAMP certification. That's on a product-by-product basis, not on a company-wide basis.

Speaker Change: and that, you know, they're in the process of going through the re-compete process.

Speaker Change: They have not put out the schedule for the award or when the proposals are due, but it will be released in the RFP as, you know, as government gets prepared to send out and receive the proposals.

Jin Kang: Additionally, as many of you have seen in our press release, we made a strategic hire by bringing on Michelle Richards, who is now our lead for CWMS program. Michelle has an extensive background working within the DHS community and brings to WidePoint over three decades of experience in the mobile telecommunication industry and over 15 years of federal government contracting experience. Michelle's industry stature will help WidePoint enhance her commercial and federal presence and impact, and her expertise will be invaluable in preparing for and capturing significant portions of the spiral for contract. We are excited to have her on board and with her vision and mission perfectly aligned with WidePoints, we look forward to the immense value she will be providing.

Speaker Change: and I believe that contact is for ITMS.

Speaker Change: And ITMS is also the product that you're applying for FedRAMP certification. That's on a product-by-product basis, not on a company-wide basis.

Barry Sine: That's on a product-by-product basis, not on a company-wide basis. How do you think the delays we're seeing with FedRAMP, and I mean, you won 2.0 without FedRAMP certification. So I assume it's nice to have, but not needed to have to win 3.0.

Barry Sine: How does, you know, the delays we're seeing with the FedRAMP and I mean, you want 2.0 without FedRAMP certification. So I assume it's nice to have, but not needed to have for to win the 3.0.

Speaker Change: How does, you know, the delays we're seeing with the FedRAMP and, I mean, you want 2.0 without FedRAMP certification. So I assume it's nice to have but not needed to have for to win the 3.0.

Jin Kang: Right. So that's a great question. The answer is ITMS is the product that is going through the FedRAMP certification process. As I said, we've answered all of the questions for GSA, and they had a list of questions, but most of them were pretty superficial questions.

Jin Kang: Right. So that's a great question.

Jin Kang: The answer is ITMS is the product that is going under the FedRAMP certification process. As I said, we've answered all of the questions for GSA, and they had an extensive list of questions, but most of them were pretty superficial questions. And I think, you know, we answered the mail on all of those things. But what I will tell you is that for DHS is that we had ATOs Authorization to Operate. Essentially, what that means is that we meet all of the cybersecurity requirements that the Department of Homeland Security requires. None of our competitors can say that.

Speaker Change: Right, so that's a great question. The answer is ITMS is the product that is going under the FedRAMP certification process.

Speaker Change: As I said, we've answered all of the questions for GSA, and they had an extensive list of questions, but most of them were pretty superficial questions. And I think we answered the mail on all of those things.

Jin Kang: In addition to these two IDIQ contracts, we have two more exciting milestone deals currently in the works. First is the CWMS 3.0 RFI, a 10 year and approximately 1.5 to $2 billion contract. Our systems and processes are closely integrated with DHS systems and our strong track record for past performance positions us in the best spot to rewind this contract. We hold certification and creditions that our competitors cannot match and our pending FedRAM authorized status will further strengthen our competitive edge.

Jin Kang: And I think we answered the mail on all of those things. But what I will tell you is that for DHS, we have ATOs, authorization to operate. Essentially, what that means is that we meet all of the cybersecurity requirements that the Department of Homeland Security requires. None of our competitors can say that.

Speaker Change: But what I will tell you is that for DHS, is that we had ATO's, Authorization to Operate. Essentially, what that means is that we meet all of the cybersecurity requirements that the Department of Homeland Security requires.

Jin Kang: And the last time around, they did not make the FedRAMP certification specifically a requirement because there weren't that many vendors that had the system that met the FedRAMP authorized status. And so this time around, it's probably going to be the same thing. Even if we do get our FedRAMP certification, because we might be the only company that has that certification, they need to open up the bidding to have some additional competitors. But what FedRAMP authorized status will do for us is that they will give us a higher score in the technical section so that we get extra points for having that capability. Okay, I got it.

Jin Kang: And the last time around, they did not make the FedRAMP certification specifically a requirement because there weren't that many vendors that had the system that met the FedRAMP authorized status. And so this time around is probably going to be the same thing. Even if we do get our FedRAMP certification, because we might be the only company that has that certification, they need to open up the bidding to have some additional competitors. But what FedRAM authorized status will do for us is that they will give us a higher point in the technical section so that we get extra points for having that capability.

Speaker Change: None of our competitors can say that.

Speaker Change: and the last time around they did not make the FedRAMP certification specifically a requirement because there weren't that many vendors that had the system that met the FedRAMP authorized status.

Jin Kang: Additionally, we are pursuing the soup six contract with NASA. This opportunity is a 10 year 60 billion dollar government wide acquisition contract or GWAC that can be utilized by every government agency. This contract scope of work include all manners of IT products and services. We believe that we have the qualification, the certifications and accreditation to be a winner on this contract. We will also be positioned well with a differentiated set of products and services to capture a significant amount of work under this contract.

Speaker Change: And so this time around it's probably going to be the same thing, even if we do get our FedRAMP certification, because we might be the only company that has that certification, they need to open up the bidding to have some additional competitors.

Speaker Change: But what FedRAMP Authorized Status will do for us is that they will give us a higher point in the technical section so that we get extra points for having that capability.

Barry Sine: Okay.

Barry Sine: And then switching gears to the SUP contract vehicle, I just want to clarify that it's S-E-W-P, not S-O-U-P. Okay, these acronyms, Solutions for Enterprise-Wide Procurement. I don't quite understand why NASA is the head of a government-wide contract and not GSA, but that's a topic for another call. So if you could give us, you know, some specifics on that. What is the deadline there for a contract award? And then also, I don't believe you were the prime minister previously.

Barry Sine: Got it. And then switching gears to the soup contract vehicle. I just want to clarify that's S-E-W-P, not so U-P. Correct. Okay.

Jin Kang: To maximize our ability to capture significant work under these outstanding IDIQ contracts, we have recently implemented a project management office model or PMO. This model will aid why point in outperforming our competitors in capturing work under these IDIQ contracts. The PMO model takes a team approach to managing large programs ensuring that there is no single point of failure and a model that has worked well in our other marquee programs. Rams. We will continue to leverage this PMO model and are excited to see our team capture additional work to further drive our top and bottom on growth.

Speaker Change: Okay, got it. And then switching gears to the soup contract vehicle, I just want to clarify that.

Barry Sine: These acronyms, solutions for enterprise-wide procurement.

Speaker Change: S-E-W-P, not S-O-U-P. Correct. Okay, these acronyms. Solutions for enterprise-wide procurement. I don't quite understand why...

Jin Kang: I don't quite understand why NASA is the head for a government-wide contract and not GSA, but that's a topic for another call. So if you could give us some specifics on that, what is the deadline there for a contract award? And then also, I don't believe you were the prime previously. Are you bidding to be the prime for Soup Six? Yes. We are bidding to be prime on Soup Six. We were partners with other contractors like Kerasop, and I think that there was one other where we were subcontractors too. But because we have a differentiated product set, we are now pursuing this as a prime contractor.

Speaker Change: NASA is the head for a government-wide contract and not GSA, but that's a topic for another call.

Speaker Change: So if you could give us some specifics on that.

Speaker Change: What is the deadline there for a contract award? And then also, I don't believe you were the prime previously. Are you bidding to be the prime for SOUP 6?

Jin Kang: Are you bidding to be the prime for SUP 6? Yes, we are bidding to be the Prime on SOUP 6. We were partners with other contractors, like Kerasoft. And I think that there was one other where we were subcontractors too. But because we have a differentiated product set, we are now pursuing this as a prime contractor. And so SOUP 6 and NASA have been going through this acquisition process for SOUP for, you know, now many years. This is the sixth iteration of this article.

Jin Kang: These billion dollar IDIQ contracts we pursue such as the $2.7 billion spiral four and the $60 billion soup six contracts are crucial to our company's long term growth strategy. These contract provides a target rich environment offering a unique competitive advantage for WidePoint sales and marketing team. Many companies aspire to operate in such a target rich lucrative ecosystem, but very few have the opportunity. With our recent strategic investments, partnerships, certifications and accredifications and application of the PMO model, we continue to aggressively invest in our sales and marketing efforts to position ourselves the maximizer ability to capture work and more importantly, the opportunity to even do so in the first place. This proactive approach aims to ensure that WidePoint secures a meaningful portion of these contracts. Even capturing a small percentage of the billion dollar opportunity from these two contracts alone could substantially elevate our growth trajectory.

Speaker Change: Yes, we are bidding to be prime on Soup 6. We were partners with, you know, other contractors like Kerasoft and I think that there was one other where we were subcontractors too.

Speaker Change: But because we have a differentiated, you know, product set, we were now, we are now pursuing this as a prime contractor. And so, Supe 6 and NASA, NASA has been, you know,

Jin Kang: And so Soup Six and NASA has been going through this acquisition process for Soup for now many years. This is the sixth iteration. So they've been doing this for a long time. And it's been a very successful contract for NASA, not only because they can get products and services for themselves. Because this contract is managed well, other government agencies have decided to forego their own acquisition cycle and go after using the soup vehicle to purchase.

Speaker Change: going through this acquisition process for SOOP for many years. This is the sixth iteration, so they've been doing this for a long time. It's been a very successful contract for NASA.

Jin Kang: So they've been doing this for a long time, and it's been a very successful contract for NASA. Not only because they can, you know, get products and services for themselves, but because this contract is managed well, other government agencies have decided to forego their own acquisition cycle and go after using the SOUP vehicle to purchase. There are other contracts that we are also pursuing, and we'll, you know, talk a little bit more about that on our future calls.

Speaker Change: Not only because they can, you know, get

Speaker Change: products and services for themselves, because this contract is managed well, other government agencies have decided to forego their own acquisition cycle and go after using the soup vehicle to purchase.

Jin Kang: There are other contracts that we are also pursuing, and we'll talk a little bit more about that or future calls. But the soup contract is a fairly large scope of work. And it has products and services that, again, cover the entire waterfront in information technology products and services. So it's a very general contract for anybody to come and use the contract vehicle. Because that's why they increase the delegated procurement authority to $60 billion. First. What was it previously? I believe the previous one was like 20 billion. Okay.

Speaker Change: There are other contracts that we are also pursuing and we'll, you know, talk a little bit more about that on our future, you know, calls, but

Jin Kang: But the SOUP contract is a fairly large scope of work, and it has products and services that go, you know, again, it covers the entire waterfront in information technology, products, and services. So it's a very, you know, general contract for anybody to come and use the contract vehicles. That's why they increased the delegated procurement authority to $60 billion. What was it previously? I believe the previous one was like $20 billion.

Jin Kang: In the commercial sector, we are seeing pilot projects launched and strategic partnership consummated with systems integrators which are resulting in new opportunities. We are pursuing sizable opportunities with Fortune 100 companies and look forward to providing you with news of contract awards later this year. In the second quarter alone, we saw contractual actions across all WidePoint solution lines, including our managed mobility services, identity and access management, IT as a service and interactive billing and analytics. These new opportunities are the high margins, SaaS contracts, our sales and marketing team is aggressively pursuing which are expected to contribute greatly to our bottom line performance.

Speaker Change: The soup contract is a fairly large scope of work.

Speaker Change: and it has...

Speaker Change: products and and services.

Speaker Change: Again, it covers the entire waterfront in information technology, products and services.

Speaker Change: general contract for anybody to come and use the contract vehicles. That's why they increased the Delegated Procurement Authority to $60 billion.

Speaker Change: What was it previously?

Speaker Change: I believe the previous one was like $20 billion.

Barry Sine: Okay. And switching gears to Navy Spiral 4, you had announced the win some time ago. How are we doing with task orders on Navy Spiral 4? Right now, we're in the initial stages where RFQs are coming out, and a lot of them are small and a lot of them are for renewal contracts, and so right now we're in the process of setting up our relationship with our resellers, getting all of our pricing, all of our items and services and products, get them all nailed down so when the RFQ comes out for our specific differentiated product set, we will be bidding on them.

Jin Kang: And switching gears to Navy Spyro 4, you had to match the wind some time ago. How are we doing with chest quarters on Navy Spyro 4? Right now, we're in the initial stages where RFQs are coming out, and a lot of them are small, and a lot of them are for renewal contracts. And so right now we're in the process of setting up our relationship with our resellers, getting all of our pricing, all of our items and services and products, get them all nailed out. So when the RFQ comes out for our specific differentiator products set, we will be bidding on them.

Speaker Change: Okay.

Speaker Change: And switching gears to Navy Spiral 4, you had announced the win some time ago. How are we doing with task orders on Navy Spiral 4?

Jin Kang: We begin the third quarter with approximately 320 million in federal contract backlog. Additionally, our current qualified sales pipeline is healthier than it has ever been.

Barry Sine: Okay, and then in Spiral 4, you announced a product called Mobile Anchor, which sounds like it'd be perfect for the Navy, but I guess it's not intended that way. Could you elaborate? There's a lot of jargon associated with Mobile Anchor, but essentially, my understanding is it allows the cell phone to be the computer processing engine for the security card rather than having a separate card.

Barry Sine: Right, so that was the mobile anchor product that as a differentiator set that we will be offering under soup. We will be offering it under, you know, Spiral, Spiral 4. There's one thing that I like to, you know, point out for all the listeners here today is that Spiral 3 doesn't officially end until September of this year, September 24, something like that. And so the task orders are starting to roll in, and hopefully, we'll see, you know, some that actually meet with our specialized products and service set. Getting back to the mobile anchor.

Speaker Change: Right now, we're in the initial stages where RFQs are coming out.

Jason Holloway: To provide you some additional color on our sales pipeline, I will now hand the mic over to Jason who will dive deeper into our sales and marketing efforts and recent technological developments specifically our new proprietary mobile anchor digital credential solution. Jason. Thanks Jen and good afternoon everyone. As Jen just mentioned, we successfully developed, tested and authenticated our new proprietary mobile anchor digital credential. This digital credential solution no longer requires a smart card, but instead is deployed directly onto smart mobile devices providing the highest level of security for mobile digital credentials available while ensuring that cyber interactions use the most secure identity management.

Speaker Change: And a lot of them are small and a lot of them are for renewal contracts. And so right now we're in the process of setting up our relationship with our resellers, getting all of our pricing, all of our items and services and products.

Speaker Change: get them all nailed down, so when the RFE comes out for our specific differentiated product set, we will be bidding on them.

Jin Kang: Okay. And then Spyro 4, you've announced the product called Mobile Anchor, which sounds like it'd be perfect for the Navy, but I guess that's not the intended way. Could you elaborate? There's a lot of jargon associated with Mobile Anchor, but essentially, my understanding is it allows the cell phone to be the computer processing engine for the security card rather than having a separate card. Right. So that was the Mobile Anchor product that is a differentiator set that we will be offering under Soup, we will be offering it under Spyro 4.

Speaker Change: Okay, and then...

Speaker Change: Aspira 4, you've announced a product called Mobile Anchor, which sounds like it'd be perfect for the Navy, but I guess that's not the, it's not intended that way. Could you elaborate? There's a lot of jargon associated with Mobile Anchor.

Speaker Change: But essentially, my understanding is it allows the cell phone to be the computer processing engine for the security card rather than having a separate card.

Jason Holloway: This is a technology breakthrough and places WidePoint ahead of our competition in the cyber identity world. We have already successfully deployed mobile anchor in a federal agency and are actively marketing it to other federal and commercial agencies that currently use the traditional smart card based credential. We continue to establish our competitive edge, and this new product will enable us to win business from our competitors as they do not offer similar solutions.

Speaker Change: Right, so that was the Mobile Anchor product that as a differentiator set that we will be offering under Soup. We will be offering it under, you know, Spiral 4. There's one one thing that I like to, you know, to, you know, point out for every all the listeners here today is that the Spiral 3 doesn't officially end until September of this year, September 24, something like that.

Jin Kang: There's one thing that I like to point out for every all the listeners here today, is that the Spyro 3 doesn't officially end until September of this year, September 24, or something like that. And so the task orders are starting to roll in, and hopefully we'll see some that actually meet with our specialized product and service set. Getting back to the Mobile Anchor, yes, we're going away from the traditional smart card form factor to the smartphones. And Jason can tell you a little bit more about that, our Mobile Anchor, and how that is differentiated from our competitors.

Jason Holloway: This coincides with our strategy to win work away from our competitors in the IDM sector. We're excited to continue marketing this new product and look forward to potentially implementing it within our pipeline of deals currently in the works.

Speaker Change: And so the task orders are starting to roll in, and hopefully we'll see some that actually meet with our specialized product and service set.

Jason Holloway: On a related note, Mobile Anchor has traction within the Department of Education. As you are aware, we've been aggressively pursuing K-12 at the district level. Now we are seeing a shift in getting closer to securing the necessary customer funding to move this initiative forward. Even though WidePoint has been at the forefront of identity and access management since the inception of PKI, it takes time to reconfigure our solution to address a market such as K-12. We will keep you posted as Mobile Anchor gains traction within the Department of Education.

Speaker Change: Getting back to the mobile anchor, yes, we're going away from the traditional, you know, smart card form factor to the smart smartphones.

Jin Kang: Yes, we're going away from the traditional, you know, smart card form factor to smart smartphones. And Jason can tell you a little bit more about that, our mobile anchor, and how that is differentiated from our competitors. Hey, Barry. How are you doing?

Speaker Change: and Jason can tell you a little bit more about that, our mobile anchor and how that is differentiated from our competitors.

Jason Holloway: As Jin mentioned, with MobileAnchor, historically, people have been using their smart card credentials. That's the credential that has the chip on it. And typically, what they're doing is they stick it into the side of their laptop, or they have a sled that's connected to the mobile device itself.

Jason Holloway: Yeah.

Jason Holloway: Hey, how you doing? As Jen mentioned, with Mobile Anchor, historically, people have been using their smart card credentials. That's the credential that has the chip on it. And typically what they're doing is they're sticking it into the side of their laptop or they have a sled that's connected to the mobile device itself. Historically, what some people have been doing to get what's called a derived credential, which all that means is that it allows you to do secure communications from your mobile device, is they've been using what's called a mobile device management container. But what that does is, without getting too technical on everybody, is that transmission and authentication is happening over the airways.

Jason Holloway: Hey Barry, how are you doing?

Jason Holloway: As Jin mentioned, with MobileAnchor, historically, people have been using their smart card credentials. That's the credential that has the chip on it.

Speaker Change: And typically what they're doing is they, you know, stick it into the side of their, you know, laptop or they have a sled that's connected to the mobile device itself.

Jason Holloway: As Jen mentioned earlier, soup six is a very exciting opportunity for WidePoint. Due to its 10-year $60 billion ceiling, WidePoint is uniquely positioned to provide our managed mobility services as well as gain additional market share for our proprietary platform, Intelligent Technology Management System. Along with the impending FedRAM authorized status, we are cautiously optimistic that WidePoint will be positioned to capitalize once the soup six has been awarded. As I've stated previously, we are optimistic regarding our pipeline and there are many opportunities that we are aggressively working.

Jason Holloway: Historically, what some people have been doing to get what's called a derived credential, which all that means is that it allows you to do secure communications from your mobile device, is they've been using what's called a mobile device management container. But what that does is, without getting too technical for everybody, is that transmission and authentication are happening over the airways. So essentially, there's no real security or authentication that's actually happening. So what WidePoint has figured out how to do is how to generate a net new digital credential on the device itself.

Speaker Change: Historically, what some people have been doing to get what's called a derived credential, which all that means is that it allows you to do secure communications from your mobile device.

Speaker Change: is they've been using what's called a mobile device management container.

Speaker Change: But what that does is, without getting too technical on everybody,

Speaker Change: is that transmission and authentication is happening over the airways. So, essentially...

Jason Holloway: So essentially, there's no real security or authenticating that's actually happening. So what why point has figured out how to do is is how to generate a net new digital credential on the device itself. And that's what makes it so game changing. So we've taken all of the vetting the identity of the card holder right of that person. So it'll be very signed. And then we've been able to derive that data and then put that information on the device itself. And then that allows you to be able to, you know, securely sign email transmissions and, you know, all of the things that are happening on the mobile device itself.

Speaker Change: There's

Speaker Change: There's no real security or authenticating that's actually happening. So what WidePoint has figured out how to do is how to...

Jason Holloway: That being said, we are proactively hiring additional strategic resources in anticipation of these contract awards as well as pursuing additional sales opportunities. We have established our program management offices or PMO for both the DHS 3.0 recompete effort and the spiral four contract. We will also be utilizing the same PMO model for soup six.

Jason Holloway: And that's what makes it so game-changing. So we've taken all of the vetting, the identity of the cardholder, right, of that person, so it would be Barry Sign, and then we've been able to derive that data and then put that information on the device itself. And then that allows you to be able to securely sign email transmissions and all of the things that are happening on the mobile device itself.

Speaker Change: generate

Speaker Change: a net new digital credential.

Speaker Change: on the device itself, and that's what makes it so game-changing.

Speaker Change: so we've taken all of the vatting, the identity.

Speaker Change: of the cardholder, right, of that person, so it would be Barry Sign.

Speaker Change: and then we've been able to derive that data and then put that information on the device itself, and then that allows you to be able to...

Jason Holloway: Lastly, for Q3 and onward, we plan to continue advancing our efforts to enhance WidePoint's overall capabilities. The ongoing innovation in our technological capabilities is critical for strengthening and maintaining our competitive position. By improving our technological capabilities, we aim to offer more solutions and better meet the needs of our clients. This strategic focus on technology will significantly enhance our ability to secure new contracts and expand our marketing presence in the future. We are confident that these efforts will play a vital role in driving our long-term growth and success in we look forward to announcing relevant developments as they arise.

Speaker Change: securely sign email transmissions and all of the things that are happening on the mobile device itself.

Jason Holloway: So it's, like I said on the call, it's a big time game changer. We know that a lot of the federal agencies are going to be very interested in this because they clearly understand that MDMs, using MDM containers over the airways, has been one of those good enough solutions. And I think all of our listeners will agree that good enough is just not good enough anymore.

Jason Holloway: So it's a, you know, like I said, on the call, it's a big time game changer. There's, you know, we know that a lot of the federal agencies are going to be very interested in this because they, you know, they clearly understand that, you know, MDM using MDM containers over the airways has been one of those, you know, good enough solutions. And I think, you know, all of our listeners will agree that, you know, good enough, it's just not, you know, it's not good enough anymore. So we're very happy to be in the position that we're in, as well as the timing.

Speaker Change: It's a, you know, like I said on the call, it's a big time game changer. There's, you know, we know that.

Speaker Change: A lot of the federal agencies are going to be very interested in this because they, you know, they clearly understand that, you know, MDMs, using MDM containers over the airways has been one of those, you know, good enough solutions.

Speaker Change: And I think, you know, all of our listeners will agree that, you know, good enough is just not, you know, it's not good enough anymore. So we're very happy to be in the position that we're in as well as the timing. So stay tuned and then we'll have more, you know, more good stuff for you.

Jason Holloway: So we're very happy to be in the position that we are in, as well as the timing. So stay tuned, and then we'll have more, you know, more good stuff for you. Okay. And then lastly, I'd like to put Bob in the hot seat with a couple of questions, and first, to compliment Bob on getting that cue. I'm already looking at it.

Jason Holloway: So stay tuned, and then we'll have more, you know, more good stuff for you.

Barry Sine: here. Okay, and then lastly, I'd like to put Bob in the hot seat with a couple of questions, and first to compliment Bob for getting that cue. I'm already looking at it. It's already filed, so thank you. That makes life a lot easier for us analyzing the company. The first question, Bob, you mentioned the decline in the cash balance is due to government ramp-ups. Have you issued bills, so does that show up in the Council receivable, or have you not yet issued bills, so those are receivables that will fill you, you know, come. And, you know, what are we looking at in terms of having Calcutta DSOs?

Robert George: With that, I will now turn the call over to Bob to discuss our second quarter financial results. Bob? Thank you Jason and thanks to everyone for joining us today.

Barry Sine: It's already filed, so thank you. That makes life a lot easier for us when analyzing the company.

Speaker Change: Okay and then lastly I'd like to put Bob in the hot seat with a couple of questions and first to compliment Bob for getting that cue. I'm already looking at it, it's already filed so thank you that makes life a lot easier for us analyzing the company.

Robert George: I'm pleased to share the details of our financial results for the second quarter in first half of 2024. We deliver strong three and six plus 2024 results. And I'm happy to report that we are turning towards the higher end of our guidance rate. Court of Revenue for the Quarter were 36 million, an increase of 9.3 million to 35% from 26.8 million reported for the same period last year. Revenue for the first half of 24 were 70.2 million and an increase of 18.2 million to 35% from the 52 million in the same period last year.

Robert George: The first question, Bob, you mentioned the decline in the cash balance is due to government ramp-ups. Have you issued bills, so does that show up in accounts receivable, or have you not yet issued bills, so those are receivables that will still come, and what are we looking at in terms of, I haven't calculated DSOs, are DSOs going up? DSOs have gone up, and in these ramp-ups, we essentially pre-agree the billing with the customer.

Speaker Change: The first question, Bob, you mentioned the decline in the cash balance.

Speaker Change: is due to, you know, government ramp-ups. Are those...

Speaker Change: have you issued bills so does that show up in accounts receivable or have you not yet issued bills so those are receivables that will still you know come and you know what are we looking at in terms of I haven't calculated DSOs are DSOs going up?

Robert George: Are DSOs going up? Yeah, DSOs have gone up. And, you know, in these ramp-ups, we essentially pre-agreed the billing with the customer. And, with our existing customers, where we're an ordinary course of business, you know, we send them the invoice that we explain the detail, and they approve it, we bill it, and they pay it very quickly. With these new customers, there's lots of discussion around the minutiae on these bills. One of them has, you know, eight different contract officers. So, you know, it's kind of, you know, a democracy process that has happened. So, once they do approve these bills, and it's been very excruciating, then we bill it, and we get paid.

Speaker Change: DSOs have gone up and in these ramp-ups we essentially pre-agree the billing with the customer.

Robert George: And with our existing customers, where we're an ordinary course of business, we send them the invoice, we explain the details, and they approve it, we bill them, and they pay it very quickly. But with these new customers, there's lots of discussion around the minutia on these bills. One of them has eight different contract officers. So, you know, it's kind of, you know...

Robert George: Now, provided further breakdown were second quarter and first half of 2024 revenues. Our carrier services revenue for the quarter was 20.4 million, an increase of 6.2 million compared to the same period in 2023. Hair services revenue for the first half of 24 was 39.8 million an increase of 11.9 million compared to the same period last year. Our managed services revenue for the quarter were 9.2 million and an increase of 2.3 million or 25% compared with the same period in 2023.

Speaker Change: And with our existing customers, where we're an ordinary course of business, you know, we send them the invoice, then we explain the detail, and they approve it, we bill it, and they pay it very quickly.

Speaker Change: With these new customers, there's lots of discussion around the minutiae on these bills. One of them has, you know, eight different contract officers, so, you know, it's kind of, you know.

Robert George: So once they do approve these bills, and this has been very excruciating, then we bill them, and we get paid. We've been paid; I think the last one was paid in less than a week, or maybe just a little over a week. But it's just been very hard to get the bills into an improved state.

Speaker Change: democracy process has happened. So once they do approve these bills, and it's been very excruciating, then we bill it and we get paid. We've been paid, I think the last one was paid in less than a week.

Robert George: We've been paid; I think the last one was paid in less than a week, or maybe just a little over a week, but it's just been very hard to get the bills into an approved state. We looked at, kind of, how quickly they're appealing off now. And, we think that, you know, by the end of the year, we'd be at a normal, steady state. A couple other ones are causing some difficulties. It's the same situation in the sense that the customers moved line counts and funding between different contracts or different agencies with NDHS. And so, you know, it's longer to sort that out.

Robert George: For the first half of 24, our managed services revenues were 17.9 million and an increase of 4.1 million or 23% from the same period last year. The increase in both carrier and managed services revenue is principally due to new federal and commercial customers signing the third and fourth quarter of 2023 which are not reflected in the comparison periods last year and also due to growth within several existing federal customers. Buildable services fees for the quarter were 1.2 million and decrease of 618,000 compared to the same period in 2023.

Speaker Change: or maybe just a little overweight, but it's just been very hard to get the bills into an improved state.

Robert George: We looked at how quickly they're peeling off now, and we think that by the end of the year, we should be at a normal steady state. A couple other ones are causing some difficulties. It's the same situation in the sense that customers moved line counts and funding between different agencies within DHS. And so it takes longer to sort that out. And once you sort it out, we send them the bill, and they pay very promptly. So, it sounds like there's three kinds of moving, related moving pieces.

Speaker Change: We looked at kind of how quickly they're peeling off now, and we think that by the end of the year we'd be at a normal steady state.

Speaker Change: A couple other ones that are causing some difficulties is the same situation in a sense that the customers moved line counts and funding between different agencies within DHS. And so it's

Robert George: And once you sort it out with some of the bill, they pay very promptly. So, it sounds like there's three kind of moving, related moving pieces. You know, first of all, a cancer receivable balance is up. Second, overall, DSOs are taking longer. And then third, it sounds like you still have undilled work, you know, that it's out there, that it's not on the receivable line yet. Is that correct?

Speaker Change: Longer to sort that out and once you sort it out, we send them the bill and they pay very promptly.

Robert George: For the first half of 2024, buildable services fees were 2.4 million and decrease of 678,000 in the same period last year. The second quarter in the first half of 2024, the decrease was due to comparatively less project work at a US government customer. Reselling the other services in the second quarter were 5.2 million and increase of 1.5 million from the same period last year. For the first half of 2024, reselling and other services were 10.2 million and increase of 2.9 million from the same period last year.

Speaker Change: So it sounds like there's three kind of moving, related moving pieces. You know, first of all, accounts receivable balance is up. Second, overall, PSOs are taking longer. And then third, it sounds like you still have unbilled work.

Barry Sine: You know, first of all, accounts receivable balances are up. Second, overall, DSOs are taking longer. And then third, it sounds like you still have unbilled work. You know that it's out there, but it's not on the receivables line yet. Is that correct?

Speaker Change: You know that it's out there that it's not that it's not on the receivables line yet. Is that correct?

Robert George: Well, it's on the unbilled receivable line. So, we do book an asset in a crude revenue, and we also crew, for most part, almost all the costs, because these are carry-end voices, which are causing the problems. And so, you know, we have an increase in the crude expenses and an increase in build and unbilled they are. Okay, so I see that 25.8 million in unbilled accounts receivable. Yeah. Okay, I got it. Okay. That's the good explanation. And I did not jot down the backlog number, and that's not in the queue. Could you give me the backlog number again?

Robert George: Well, it's on the unbilled receivable line. So we do book an asset and accrue revenue. And we also accrue, for the most part, almost all the costs because these are carrier invoices, which are causing the problems. And so, you know, we have an increase in accrued expenses and an increase in billed and unbilled receivables.

Speaker Change: Well, it's on the unbilled receivable line, so we do book an asset and accrue revenue, and we also accrue, for the most part, almost all the costs, because these are carrier invoices which are causing the problems. And so, you know, we have an increase in accrued expenses and an increase in billed and unbilled AR.

Robert George: The increase for both periods was due to increased demand and sales activity for items that we sell to our federal and commercial customers. In reminder, reselling and other services are transactional in nature and the amount and timing of revenue may vary significantly from period to period. Gross profit for the second quarter was 4.9 million or 14% of revenues compared to 3.9 million or 15% of revenues in the same period in 2023.

Robert George: Okay, so I see that $25.8 million in unbilled accounts receivable. Yep. Okay, I got it. Okay. That's a good explanation.

Speaker Change: Okay, so I see that $25.8 million in unbilled accounts receivable.

Robert George: And I did not jot down the backlog number and that's not in the queue. Could you give me the backlog number again? And then, you know, I always ask this, but remind me how long to expect that backlog to turn to revenue, The backlog number is 320, I think we said that in the call, and in terms of, you know, when it peels off, you know, a lot of that backlog is over the next two years because of the, you know, ending or the recompete on the CWMS 2.0, but, you know, I'd kind of say maybe an average life of that backlog is two years.

Speaker Change: I did not jot down the backlog number and that is not in the queue, could you give me the backlog number again and then I always ask this but remind me how long to expect that backlog to turn to revenue?

Robert George: And then, you know, I always ask this, but we mind me how long to expect that backlog to turn to revenue. The backlog number is 320. I think we said that in the call. And in terms of, you know, when it peels off, you know, a lot of that backlog is over the next two years, because of the, you know, ending, or the recompete on the CDMS20. But so, you know, I kind of say maybe an average life of that backlog is two years. And I know that front, Barry.

Robert George: Gross profit for the first half of 2024 was 9.5 million or 14% of revenues compared to 7.7 million or 15% of revenues in 2023. The more significant metric of gross profit percentage excluding carrier services was 31% in the second quarter, which is consistent from the same period last year. For the first half of 2024, gross profit percentage excluding carrier services was 31% compared to 32% in the same period last year. Slightly lower gross margin percentage, excluding carrier services, is impacted by a revenue mix and increased depreciation and amortization related to our completed delivery platforms.

Speaker Change: The backlog number is 320. I think we said that in the call. And in terms of when it peels off.

Speaker Change: You know, a lot of that backlog is over the next two years because of the, you know, ending or the re-compete on the CWMS 2.0, but you know, I'd kind of say maybe an average life of that backlog is two years.

Robert George: And on that front, Barry, I just want to, you know, make sure that I'm clear on this: the Department of Homeland Security cannot issue task orders beyond the contract's official end, but they can issue task orders before that date. In other words, they can issue a task order in October to go out until, you know, you know, November of 2020. But, I mean, if the whole thing hypothetically were to run out, the DHS's phones would stop working. So they're going to find a way to get that extended if they haven't let 3.0, so they will, and they did last. Yes, yeah. They have plenty of avenues to do that.

Robert George: I just want to, you know, make sure that I'm clear on this is that, you know, the Department of Homeland Security cannot issue task orders beyond the contract, you know, official end, but they can issue task orders, you know, before that date. In other words, they can issue a task order in October to go out until, you know, they're getting hypothetically where to run out. The DHS's phones would stop working, so they're going to find a way to get that extended if they haven't let 3.0. So, you know, they'll, and they did last time. Yes, yes.

Speaker Change: And on that front, Barry, I just want to, you know, make sure that I'm clear on this is that, you know, the Department of Homeland Security cannot issue task orders beyond the contract, you know, official end, but they can issue task orders, you know, before that,

Robert George: Our growth profit percentage will vary from period to period based on a revenue mix. Sales and marketing expenses in the second quarter were 600,000 or 2% of revenue compared to 500,000 and also 2% of revenues in the same period last year. In the first half of 2024, sales and marketing expenses were 1.2 million or 2% of revenues compared to 1.1 million and 2% of revenues in the same period last year. We expect to see further dollar increases in sales and marketing expenses because we continue to invest in sales and marketing efforts.

Barry Sign: In other words, they can issue a task order in October to go out until November of 2026.

Speaker Change: But, I mean, if the whole thing hypothetically were to run out, DHS's phones would stop working, so they're going to find a way to get that extended if they haven't let 3.0, and they did last time.

Barry Sine: You know, they have plenty of, you know, avenues to do that. So, you know, I'm not, we're not too concerned about, you know, them losing coverage or us holding the bag for any cost that it's not reimbursed, and they will, you know, extend the contract. And we're, you know, we're pretty confident that they will get the contract in place in time. Okay, you're an optimistic man, all right? Yes. And my question's on that. No, thank you. Thank you. All right. Thank you, Barry. Thank you.

Speaker Change: Yes, yes. You know, they have plenty of, you know, avenues to do that. So, you know, I'm not, we're not too concerned about, you know, them losing coverage or us holding the bag for any cost that it's not reimbursed.

Robert George: So, you know, I'm not, we're not too concerned about, you know, them losing coverage or us holding back for any cost that is not reimbursed. And they will, you know, extend the contract, and we're, you know, pretty confident that they will get the contract in place in time. Okay. You're an optimistic man.

Robert George: Though we expect sales and marketing to be constant and slightly lower as a percentage of revenue. General administrative expenses in the second quarter are 4.5 million or 12% of revenues compared to 3.8 million or 15% of revenues in the same period of 2023. General administrative expenses in the first half of 2024 are 8.9 million or 13% of revenue compared to 7.8 million or 15% of revenue in 2023. The increase in absolute dollars relates primarily to the increase in share-based compensation expenses.

Speaker Change: and they will extend the contract and we're pretty confident that they will get the contract in place in time.

Barry Sine: All right. We'll end my questions on that note. Thank you. Thank you. All right. Thank you, Barry.

Speaker Change: Okay, you're an optimistic man. We'll end my questions on that note. Thank you.

Operator: Thank you. At this time, this concludes our question and answer session. If your question was not taken, please contact WidePoint's IR team at wyy-gateway-grp.com. I'd now like to turn the call back over to Mr. Jin Kang for his closing remarks. Thank you, operator. We appreciate everyone taking the time to join us today. As the operator mentioned, if there were any questions that we did not address today, please contact our IR team.

Speaker Change: All right.

Operator: At this time, this concludes our question-and-answer session.

Barry Sign: Thank you, Barry.

Operator: If your question was not taken, please contact WythePoint's IR team at WYY at gateway-hyphen-grp.com.

Speaker Change: Thank you. At this time, this concludes our question and answer session. If your question was not taken, please contact WidePoint's IR team at

Jin Kang: I'd now like to turn the call back over to Mr. Jin Kang for his closing remarks. Great. Thank you, operator. We appreciate everyone taking the time to join us today. As the operator mentions, if there were any questions that we did not address today, please contact our IR team. You can find their full contact information at the bottom of today's earnings release.

Speaker Change: I'd now like to turn the call back over to Mr. Jin Kang for his closing remarks.

Operator: You can find their full contact information at the bottom of today's earnings release. Thank you again, and have a great evening. Thank you for joining us today for WidePoint's second quarter 2024 conference call. You may now disconnect.

Robert George: Net loss for the second quarter decreased by 342,000 to a net loss of 500,000 where a loss of 5 cents per share compared to a net loss of 842,000 or a loss of 10 cents per share to the same period last year. Net loss for the first half of 2024 decreased by 600,000, the net loss of 1.2 million or a loss of 13 cents per share compared to a net loss of 1.8 million where a loss of 20 cents per share in the same period last year.

Jin Kang: Great. Thank you, operator. We appreciate everyone taking the time to join us today. As the operator mentioned, if there were any questions that we did not address today, please contact our IR team. You can find their full contact information at the bottom of today's earnings release. Thank you again and have a great evening.

Jin Kang: I thank you again and have a great evening. Thank you for joining us today for WythePoint's second quarter 2024 conference call.

Operator: You may now disconnect.

Jin Kang: Thank you for joining us today for WidePoint's second quarter 2024 conference call. You may now disconnect.

Robert George: Moving to the balance sheet, we enter the quarter with 4 million in cash, which in our view is the significant decrease compared to the 6.9 million at December 31, 2023. This is significant, particularly considering our strong free cash flow metrics over the last three quarter. The decrease in cash was primarily due to new customer implementations which have temporarily impacted buildings and accordingly our cash position. We want to highlight that we have a different liquidity options available with our revolving line of credit facility with 4 million of potential borrowing capacity, although we do not anticipate having to rely on that facility. Further, we don't expect these issues to persist and are actively working to resolve them to prove our cash position coming quarters.

Robert George: This completes my financial summary.

Robert George: For more detailed analysis or financial results, please refer to our form 10Q, which was filed prior to this call.

Jin Kang: With that, I'll turn the call back over to Jim. Thank you, Bob and Jason.

Jin Kang: One ongoing initiative we'd like to update you on is our Fed Ram certification status. We have submitted responses to all of TSA's questions and they are currently under review. While we are still in the in process stage, we expect to achieve Fed Ram authorized status by the end of 2024. This certification is one of the key technological advancements that Jason mentioned, which will diversify our offerings and capture business from competitors while enhancing why points competitive edge and position in the market, with the upcoming federal election cycle, budget discussions are expected to take center stage once again.

Jin Kang: A change in administration could lead to delays in federal budgets, regardless of which party wins the presidency. We will closely monitor the situation as it unfolds. Currently, we anticipate minimal or no impact from the administration change, given that we operate in the critical sector of cybersecurity and mobility management. These areas are essential services that will remain in high demand for the foreseeable future.

Jin Kang: Lastly, I'd like to reiterate our guidance where we expect revenues to range between 120 million and 133 million, adjusted EBITDA range between 2.1 million and 2.4 million. Additionally, we expect free cash flow to range between 2 million and 2.3 million. I'm happy to report that we have been ahead of our forecast for the past two quarters and are trending towards the higher end of our guidance for the full year. Our sales and marketing efforts, technological advancements, and the deals currently in the pipeline are strong indicators of improvements in our bottom line and margin for the upcoming quarters.

Jin Kang: Our team continues to aggressively push for profitable operations in the fourth quarter and we anticipate achieving positive earnings per share in 2025. Our executive team maintains a positive outlook on our future as evidenced by several board members and executives acquiring additional shares in the open market. We remain dedicated to unlocking sustainable growth and delivering strong returns for our valued shareholders.

Operator: That concludes our prepared remarks and now we'll take questions from our analysts and major shareholders. Operator, will you please open the call for questions? Certainly. Everyone at this time, we're conducting a question and answer session. If you have any questions or comments, please press star one on your phone at this time. We do ask the well-posing your question. Please pick up your handset if you're listening on speaker phone to provide optimum sound quality. Once again, if you have any questions or comments, please press star one on your phone.

Barry Sine: Your first question is coming from Barry Sine from Litchfield Hills Research. Your line is live. Hey, good evening gentlemen. First question is on CWMS. I don't think my hand was writing fast enough to get all the details down. So it sounds like this visibility on letting out 3.0. If you could just repeat the dollar amount, give us any sense of the timing on that. Then just to put that in some perspective, obviously you won 2.0.

Barry Sine: You recently had a very significant increase in the ceiling on that. Then I remember vividly 2.0 just took forever to get extended so the government works pretty fully. I guess we shouldn't be expecting a fast decision on 3.0. Hi, Barry. This is Jen. It's good to hear from you again. The answer is yes. It will probably take longer than anticipated. Right now, the timeline for the 3.0 award is going to, they want to get it done by the end of 2015.

Barry Sine: I mean, 2025, sorry. And the reason for them upping the cap on the contract is because they have already reached the ceiling on the contract with the task orders that were already awarded under 2.0. And I believe also that the additional dollars will also provide an overlap between the 2.0 and 3.0 so that they can eat smoothly transition from the 2.0 and the 3.0. And so we believe that this contract now is going to go from a 5-year contract to a 10-year contract.

Barry Sine: And we did sort of a mathematical extrapolation to come up with the 1.2 to 1.5 million dollar ceiling. And so based upon where we are today, we're at 750 or so million. So if you multiply that by 2 for a 10-year period, that will put you at like 1.5 billion dollars in a delegated procurement authority. And so that's what we're seeing. Again, we feel like we are ahead of our competition in our software platform, our subject matter expertise, and our past performance with the DHS.

Barry Sine: Just like when we competed for the 2.0, our systems and workflows are all integrated with DHS processes and systems. And we have the security accreditations and certifications that others cannot match. So we feel pretty good about our prospect of winning the 3.0. But we're not sitting on our hands. We are constantly looking for improvements, constantly looking for value ad services that we can offer to DHS so that what come the award time for 3.0, we will be the one receiving the award.

Barry Sine: George. And just a few more points of clarification on CWMS. What is the official contract end date for 2.0. And then when that happens, at last time, you know, it ended, they didn't renew, but, you know, you were made whole the whole time. So I know there was investor angst, but you were made whole the whole time while they took an extended period to renew that. So could you give us the expiration date?

Barry Sine: And they just remind us what did happen previously, and hopefully that's a indication of what may happen if they're late on issuing 3.0. Sure, sure. So the official end date for the CWMS 2.0 is November, I believe, 19th or 20th of 2015. And so, 25th, 20, 25. Yeah. Did I say 2015 again? I'm, you know, I'm, you know, looking back. But anyway, the, it is November 19th or 20th of 2025. And, and likely, it may be extended.

Barry Sine: And so, the last time what happened was, you know, the government came up to the end date, and they put in a bridge contract for a year. The contract was supposed to have been a five year contract, and it ended up being 8. So they had extended the contract, you know, with a, like a 12 month contract. They put another bridge contract in for a year and a half, and then they exercised another option to go another six months beyond that, making it an eight year contract for a five year contract.

Barry Sine: So it is, it could be that, you know, the contract may have to be extended, but what they did with CWMS 2.0 is that they put in an option so that they can actually award task orders 12 months beyond the end of the official contract date. So the official contract date end is November 19th of 2025. So they can actually issue task orders that go until November 19th of 2026. And if they need additional extensions, they can modify the contract to extend the contract further.

Barry Sine: They can also put a bridge contract in. So they have a lot of tools in their tool belt to be able to extend the contract if they do fall behind on their acquisition schedule. So we won't be left holding any unpaid bills or anything like that during the time the contract is going through the reconbie. What is the deadline for you to submit your bid for has that been given for CWMS 3.0?

Barry Sine: Not yet. The what was released was a request for information. And what that is is that they're looking around for qualified bidders for the contract. And we intentionally didn't put out a press release because we didn't want to, you know, publicize this information. So, you know, we will get more competitors. But the deadline for the request for information had expired. I believe this was at the end of July sometime. And so we did all of our responses and we sent it back in.

Barry Sine: And now we're, you know, letting people know that the RFI was, you know, out there on the street. And that, you know, they're in the process of going through the reconbie process. They have not put out the schedule for the award or when the proposals are due. But it will be released in the RFP as, you know, as government gets prepared to send out and receive the and I believe that contact is for ITMS.

Barry Sine: ITMS is also the product that you're applying for FedRAMP certification. That's on a product-by-product basis, not on a company-wide basis. How does, you know, the delays we're seeing with the FedRAMP and I mean, you want 2.0 without FedRAMP certification. So I assume it's nice to have, but not needed to have for to win the 3.0. Right. So that's a great question. The answer is ITMS is the product that is going under the FedRAMP certification process.

Barry Sine: As I said, we've answered all of the questions for GSA and they had an extensive list of questions, but most of them were pretty superficial questions. And I think, you know, we answered the mail on all of those things. But what I will tell you is that for DHS is that we had ATOs authorization to operate. Essentially, what that means is that we meet all of the cybersecurity requirements that the Department of Homeland Security requires.

Barry Sine: None of our competitors can say that. And the last time around, they did not make the FedRAMP certification specifically a requirement because there weren't that many vendors that had the system that met the FedRAMP authorized status. And so this time around is probably going to be the same thing. Even if we do get our FedRAMP certification because we might be the only company that has that certification, they need to open up the bidding to have some additional competitors.

Barry Sine: But what FedRAM authorized status will do for us is that they will give us a higher point in the technical section so that we get extra points for having that capability. Okay. Got it. And then switching gears to the soup contract vehicle. I just want to clarify that's S-E-W-P, not so U-P. Correct. Okay. These acronyms, solutions for enterprise-wide procurement. I don't quite understand why NASA is the head for a government-wide contract and not GSA, but that's a topic for another call.

Barry Sine: So if you could give us some specifics on that, what is the deadline there for a contract award? And then also, I don't believe you were the prime previously. Are you bidding to be the prime for soup six? Yes. We are bidding to be prime on soup six. We were partners with other contractors like Kerasop, and I think that there was one other where we were subcontractors too. But because we have a differentiated product set, we are now pursuing this as a prime contractor.

Barry Sine: And so soup six and NASA has been going through this acquisition process for soup for now many years. This is the sixth iteration. So they've been doing this for a long time. And it's been a very successful contract for NASA, not only because they can get products and services for themselves. Because this contract is managed well, other government agencies have decided to forego their own acquisition cycle and go after using the soup vehicle to purchase.

Barry Sine: There are other contracts that we are also pursuing, and we'll talk a little bit more about that or future calls. But the soup contract is a fairly large scope of work. And it has products and services that, again, covers the entire waterfront in information technology, products and services. So it's a very general contract for anybody to come and use the contract vehicle. Because that's why they increase the delegated procurement authority to $60 billion.

Barry Sine: First. What was it previously? I believe the previous one was like 20 billion. Okay. And switching gears to Navy Spyro 4, you had to match the wind some time ago. How are we doing with chest quarters on Navy Spyro 4? Right now, we're in the initial stages where RFQs are coming out and a lot of them are small and a lot of them are for renewal contracts. And so right now we're in the process of setting up our relationship with our resellers, getting all of our pricing, all of our items and services and products, get them all nailed out.

Barry Sine: So when the RFQ comes out for our specific differentiator products set, we will be bidding on them. Okay. And then Spyro 4, you've announced the product called Mobile Anchor, which sounds like it'd be perfect for the Navy, but I guess that's not the intended that way. Could you elaborate? There's a lot of jargon associated with Mobile Anchor, but essentially, my understanding is it allows the cell phone to be the computer processing engine for the security card rather than having a separate card.

Barry Sine: Right. So that was the Mobile Anchor product that is a differentiator set that we will be offering under soup, we will be offering it under Spyro 4. There's one thing that I like to point out for every all the listeners here today, is that the Spyro 3 doesn't officially end until September of this year, September 24, or something like that. And so the task orders are starting to roll in and hopefully we'll see some that actually meet with our specialized product and service set.

Barry Sine: Getting back to the Mobile Anchor, yes, we're going away from the traditional smart card form factor to the smart phones. And Jason can tell you a little bit more about that our Mobile Anchor and how that is differentiated from our competitors. Yeah. Hey, how you doing? As Jen mentioned, with Mobile Anchor, historically, people have been using their smart card credentials. That's the credential that has the chip on it. And typically what they're doing is they sticking into the side of their laptop or they have a sled that's connected to the mobile device itself.

Barry Sine: Historically, what some people have been doing to get what's called a derived credential, which all that means is that it allows you to do secure communications from your mobile device is they've been using what's called a mobile device management container. But what that does is without getting too technical on everybody is that transmission and authentication is happening over the airways. So essentially, there's there's no real security or authenticating that's actually happening.

Barry Sine: So what why point has figured out how to do is is how to generate a net new digital credential on the device itself. And that's what makes it so game changing. So we've taken all of the vetting the identity of the card holder right of that person. So it'll be very signed. And then we've been able to derive that data and then put that information on the device itself. And then that allows you to be able to, you know, securely sign email transmissions and, you know, all of the things that are happening on the mobile device itself.

Barry Sine: So it's a, you know, like I said, on the call, it's a big time game changer. There's, you know, we know that a lot of the federal agencies are going to be very interested in this because they, you know, they clearly understand that, you know, MDM using MDM containers over the airways has been one of those, you know, good enough solutions. And I think, you know, all of our listeners will agree that, you know, good enough, it's just not, you know, it's not good enough anymore.

Barry Sine: So we're very happy to be in the position that we're in as well as the timing. So stay tuned and then we'll have more, you know, more good stuff for you, here. Okay, and then lastly, I'd like to put Bob in the hot seat with a couple of questions and first to compliment Bob for getting that cue. I'm already looking at it. It's already filed, so thank you. That makes life a lot easier for us analyzing the company.

Barry Sine: The first question, Bob, you mentioned the decline in the cash balance is due to government ramp-ups. Have you issued bills, so does that show up in the Council receivable, or have you not yet issued bills, so those are receivables that will fill you, you know, come. And, you know, what are we looking at in terms of having Calcutta DSOs? Are DSOs going up? Yeah, DSOs have gone up. And, you know, in these ramp-ups, we essentially pre-agreed the billing with the customer.

Barry Sine: And, with our existing customers, where we're an ordinary course of business, you know, we send them the invoice that we explain the detail and they approve it, we bill it, and they pay it very quickly. With these new customers, there's lots of discussion around the minutiae on these bills. One of them has, you know, eight different contract officers. So, you know, it's kind of, you know, a democracy process that has happened.

Barry Sine: So, once they do approve these bills, and it's been very excruciating, then we bill it, and we get paid. We've been paid, I think, the last one was paid in less than a week, or maybe just a little over a week, but it's just been very hard to get the bills into an approved state. We looked at, kind of, how quickly they're appealing off now. And, we think that, you know, by the end of the year, we'd be at a normal, steady state.

Barry Sine: A couple other ones are causing some difficulties. It's the same situation in the sense that the customers moved line counts and funding between different contract or different agencies with NDHS. And so, you know, it's longer to sort that out. And once you sort it out with some of the bill, they pay very promptly. So, it sounds like there's three kind of moving, related moving pieces. You know, first of all, a cancer receivable balance is up.

Barry Sine: Second, overall, DSOs are taking longer. And then third, it sounds like you still have undilled work, you know, that it's out there, that it's not on the receivable line yet. Is that correct? Well, it's on the unbilled receivable line. So, we do book an asset in a crude revenue, and we also crew, for most part, almost all the costs, because these are carry-end voices, which are causing the problems. And so, you know, we have an increase in the crude expenses and an increase in build and unbilled they are.

Barry Sine: Okay, so I see that 25.8 million in unbilled accounts receivable. Yeah. Okay, I got it. Okay. That's the good explanation. And I did not jot down the backlog number, and that's not in the queue. Could you give me the backlog number again? And then, you know, I always ask this, but we mind me how long to expect that backlog to turn to revenue. The backlog number is 320. I think we said that in the call.

Barry Sine: And in terms of, you know, when it peels off, you know, a lot of that backlog is over the next two years, because of the, you know, ending, or the recompete on the CDMS20. But so, you know, I kind of say maybe an average life of that backlog is two years, and I know that front, Barry. I just want to, you know, make sure that I'm clear on this is that, you know, the Department of Homeland Security cannot issue task orders beyond the contract, you know, official end, but they can issue task orders, you know, before that date.

Barry Sine: In other words, they can issue a task order in October to go out until, you know, they're getting hypothetically where to run out. The DHS's phones would stop working, so they're going to find a way to get that extended if they haven't let 3.0. So, you know, they'll, and they did last time. Yes, yes. You know, they have plenty of, you know, avenues to do that. So, you know, I'm not, we're not too concerned about, you know, them losing coverage or us holding the bag for any cost that it's not reimbursed, and they will, you know, extend the contract.

Barry Sine: And we're, you know, we're pretty confident that they will get the contract in place in time. Okay, you're an optimistic man, all right? Yes. And my question's on that. No, thank you. Thank you. All right. Thank you, Barry. Thank you. At this time, this concludes our question and answer session. If your question was not taken, please contact WythePoint's IR team at WYY at gateway hyphen grp.com. I'd now like to turn the call back over to Mr. Jin Kang for his closing remarks.

Barry Sine: Great. Thank you, operator. We appreciate everyone taking the time to join us today. As the operator mentions, if there were any questions that we did not address today, please contact our IR team. You can find their full contact information at the bottom of today's earnings release. I thank you again and have a great evening. Thank you for joining us today for WythePoint's second quarter, 2024 conference call. You may now disconnect.