Q2 2025 Intrusion Inc Earnings Call
Operator: Good day, everyone, and welcome to the Intrusion Second Quarter 2025 Financial Results Conference Call. At this time, all participants are on a listen-only mode, and we will open the floor for your questions and comments after the presentation. It is now my pleasure to turn the floor over to your host, Josh Carroll, and best of relations, sir, the floor is yours.
Good day, everyone and welcome to the intrusion. Second quarter, 2025 Financial results conference call.
At this time, all participants run a listen-only mode and we will open the floor for your questions and comments after the presentation.
It is now my pleasure to turn the floor over to your host. Josh Carroll and best of relations. Sir, the floor is yours.
Josh Carroll: Thank you and welcome. Joining me today are Tony Scott, President and Chief Executive Officer, and Kimberly Pinson, Chief Financial Officer. This call is being webcast and will be archived on the Investor Relations section of our website. Before I turn the call over to Tony, I'd like to remind everyone that statements made during this conference call relating to the company's expected future performance, future business prospects, future events, or plans may include forward-looking statements as defined under Private Security's Litigation Reform Act of 1995. Please refer to our SEC filings for more information on the specific risk factors that could cause our actual results to differ materially from the projections described in today's conference call.
Thank you and welcome. Join me today on Tony Scott, president and chief executive officer in Kimberly Pinson, Chief Financial Officer. This call is being webcast and will be archived on the investor relation section of our website.
Before I turn the call over to Tony, I'd like to remind everyone that statements made during this conference. Call relate to the company's expected future performance. Future business prospects future events or plans may include 4 looking statements as defined under private Securities. Litigation Reform, Act of 1995
Josh Carroll: Any forward-looking statements that we make on this call are based upon information that we believe as of today, and we undertake no obligation to update these statements as a result of new information or future events. In addition to US GAAP reporting, we report certain financial measures that do not conform to generally accepted accounting principles. During the call, we may use non-GAAP measures if we believe it is useful to investors or if we believe it will help investors better understand our performance or business trends. With that, let me now turn the call over to Tony for a few opening remarks. Tony?
please refer to our SEC filings for more information on the specific risk factors that could cause our Ash results to differ materially from the projections described in today's conference call
Any 4 looking statements that we make on this, call are based upon information that we believe as of today, and we undertake no obligation to update these statements as a result of new information or future events.
In addition to us, gaap reporting, we report certain Financial measures that do not conform to generally accepted accounting principles.
During the call, we may use non-GAAP measures if we believe they are useful to investors or if we believe they will help investors better understand our performance or business trends. With that, let me now turn the call over to Tony for a few opening remarks. Tony.
Tony Scott: Thank you, Josh, and good afternoon, and thank you all for joining us today. The second quarter of 2025 marked another positive step forward for Intrusion as we continue to make progress toward our goal of achieving sustainable growth and profitability. A few key highlights in the second quarter were yet another quarter of consistent revenue growth, with Q2 marking the fifth quarter in a row of delivering sequential top-line growth, near zero customer churn, which we view as a testament to the value of our offerings. The operational deployment of our shield critical infrastructure monitoring and protection capability, which expands the breadth and use of our core technology. We completed development work for our release of Intrusion Shield technology into the AWS marketplace.
Thank you, Josh and good afternoon and thank you all for joining us today.
The second quarter of 2025 marked, another positive step forward for intrusion as we continue to make progress toward our goal of achieving sustainable growth and profitability.
a few key highlights in the second quarter were
yet another quarter of consistent Revenue growth.
Quarter in a row of delivering sequential topline growth.
Near zero customer turn which we view as a testament to the value of our offerings.
Tony Scott: We've seen encouraging results from our Q2 efforts on social media and other platforms of awareness and engagement, and enthusiastic reception for our technology with our solution partner, Port Nexus. With respect to my flare alert, the next-generation solution for improving response to safety incidents in schools and other vulnerable public institutions. Now, as we discussed during our first quarter call, critical infrastructure was one of the key areas in which we are making strategic investments to strengthen our portfolio of product capabilities and ensure that our solutions are evolving and addressing the fast-moving cybersecurity landscape. Our progress in growing this portion of our portfolio was recently highlighted by the $3.0 million extension and expansion of our contract with the Department of Defense, and that's already generating incremental revenue for us. We continue to see critical infrastructure protection of operational technology environments as a highly promising market opportunity for Intrusion.
The operational deployment of our Shield critical infrastructure monitoring and protection capability which expands the breadth and use of our core technology. Um, we completed development work for our release of intrusion Shield technology into the AWS Marketplace.
We've seen encouraging results from our Q2 efforts on social media and other platforms of awareness and engagement.
An enthusiastic reception for our technology with our solution partner, Port Nexus, with respect to my Flare Alert, the Next Generation solution for improving response.
Is safety incidents in schools and other vulnerable public institutions.
Now as we discussed during our first quarter call, critical infrastructure was 1 of the key areas in which we are making strategic Investments to strengthen our portfolio of product capabilities and ensure that our Solutions are evolving and addressing the fast-moving cyber security landscape.
Our progress in growing this portion of our portfolio was recently highlighted by the $3.0 million extension and expansion of our contract with the Department of Defense, and that's already generating incremental revenue for us.
Tony Scott: As Homeland Secretary Kristi Noem recently highlighted in her May 14th, 2025 testimony before the House Homeland Security Committee, critical infrastructure sectors like water, energy, transportation, and communications utilities continue to be and have been prime targets for nation-state cyber actors. Through our ongoing government sales activities, we'll be spending additional effort to communicate and ultimately sell and deploy Intrusion's unique capabilities in this most important area of focus. Now, for an update on a few of our other strategic initiatives that we have underway, all of which are aimed at helping position Intrusion for future growth. As I mentioned, we're on track with our previously announced plans to make our shield cloud product generally available on the AWS marketplace and anticipate product launch later this month, with full and robust marketing and sales support activities that are critical to our success in this important space.
We continue to see critical infrastructure protection of operational technology. Environments as a highly promising Market opportunity for intrusion.
As Homeland Security Secretary Christie Gnome recently highlighted in her May 14, 2025, testimony before the House Homeland Security Committee, critical infrastructure sectors like water, energy, transportation, and communications utilities continue to be, and have been, prime targets for nation-state cyber actors.
Through our ongoing government sales activities will be spending additional effort to communicate and ultimately sell and deploy intrusions unique capabilities. In this. Most important area of focus.
Now for an update on a few of our other strategic initiatives that we have underway, all of which are aimed at helping position intrusion for future growth.
As I mentioned, we're on track with our previously announced plans to make our field Cloud product generally available on the AWS Marketplace.
And we anticipate a product launch later this month.
Tony Scott: We have an active beta release in the AWS marketplace today and reporting our own website to use this release as we speak. Additionally, we also plan to make shield cloud available on the Microsoft Azure marketplace later this year. And while it will take some time for meaningful customer traction to be seen in our financial results, we do believe that offering our products through these two marketplaces will help drive long-term growth and incremental revenue for our business. As for our partnerships, we are continuing to work closely with Port Nexus to sell our shield endpoint with their MyFlare and PledgePlus solutions. As we noted last quarter, our solutions will help provide enhanced security on the endpoints used by Port Nexus customers.
With full and robust, marketing and sales support activities that are critical to our success. In this important space, we have an active Beta release in the AWS Marketplace today and Reporting our own website to use this release as we speak. Additionally, we also plan to make Shield Cloud available on the Microsoft Azure Marketplace later this year. And while it will take some time for Meaningful customer traction, to be seen in our financial results. We do believe that offering our products through these 2 marketplaces will help Drive long-term growth and incremental revenue for our business.
As for our Partnerships, We are continuing to work closely with Port Nexus to sell our Shield endpoint, with their, my flare, and pledge plus Solutions.
Tony Scott: Some of the use cases for the MyFlare product include schools and courthouses where the solution provides for a panic button that in turn gives a near instantaneous video feed to law enforcement authorities. That provides greater situational awareness and helps cut down on the response time during an emergency. We're proud to be a part of a critical technology solution that we believe is well-positioned to generate strong market demand and revenue. Now, briefly onto our financials for the quarter, total revenues for the second quarter were $1.9 million, representing a 6% increase compared to the previous quarter and a 28% increase on a year-over-year basis. This was largely driven by work performed under the Department of Defense contract awarded in the second half of 2024.
As we noted last quarter, our Solutions will help provide enhanced security on the endpoints used by Port Nexus customers.
Some of the use cases for the MyFlare product include schools and courthouses, where the solution provides a panic button that, in turn, gives a near-instantaneous video feed to law enforcement authorities. This provides greater situational awareness and helps cut down on the response time during an emergency.
We're proud to be a part of a critical technology solution that we believe is well positioned to generate strong market demand and revenue.
Now, briefly on to our financials. For the second quarter, total revenues were $1.9 million, representing a 6% increase compared to the previous quarter and a 28% increase on a year-over-year basis.
Tony Scott: Our operating expenses were up slightly during the quarter, and this was largely due to the continued investment in our business, both product and sales and marketing, which we will continue to do in a disciplined manner over the next few quarters to help support our growth. Finally, we were pleased to see the passing of the spending bill on July 4th. And while our pipeline of non-government opportunities remains strong, a new federal budget will help open the door for the expansion of our products into new government contracts. We continue to remain excited about the future here at Intrusion, and the demand for our products continues to grow. And with that, I'd now like to turn the call over to Kim for a more detailed review of our second quarter financials. Kim?
Product and sales and marketing, which we will continue to do in a disciplined manner, over the next few quarters to help support our growth.
Finally, we were pleased to see the passing of the spending bill on July 4th. And while our pipeline of non-government opportunities remain strong, a new federal budget will help open the door for the expansion of our products into new government contracts. We continue to remain excited about the future, here at intrusion, and the demand for our products continues to grow.
And with that I'd now like to turn the call over to Kim for a more detailed review of our second quarter financials him.
Kimberly Pinson: Thanks, Tony, and good afternoon, everyone. In the second quarter of 2025, revenues were $1.9 million, an increase of 6% sequentially and 28% when compared to the prior year period. The increase in revenue was driven by multiple new contracts and shield logos in recent quarters, most notably including a contract with the United States Department of Defense utilizing both shield technology and consulting services. Consulting revenues in the second quarter totaled $1.4 million, which is flat when compared to the prior quarter, and an increase of $0.2 million on a year-over-year basis. Shield revenues in the second quarter were $0.5 million, an increase of $0.1 million sequentially, and that $0.2 million when compared to the prior year period. The increase in shield revenue primarily reflects the work performed under the previously noted Department of Defense contract award.
Thanks, Tony and good afternoon, everyone.
In the second quarter of 2025 revenues, were 1.9 million and increase of 6% sequentially and 28%. When compared to the prior year period,
the increase in Revenue was driven by multiple new contracts and shield logos in recent quarters most notably including a contract with the United States Department of Defense utilizing both Shield, technology and Consulting Services Consulting revenues in the second quarter totaled, 1.4 million, which is flat when compared to the prior quarter and an increase of 0.2 million on a year-over-year basis.
Kimberly Pinson: As Tony noted, we are continuing to see strong demand for our services with both governmental and commercial customers and anticipate deeper penetration in both sectors, which will result in further changes to our customer mix. Gross profit margin was 76% for the second quarter of 2025, which was flat on a year-over-year basis. As a reminder, gross profit margin will vary depending on our product mix. Operating expenses in the second quarter of 2025 totaled $3.5 million, an increase of $0.1 million on a sequential basis, and $0.4 million on a year-over-year basis. The increase sequentially was largely driven by an increase in R&D spending, largely related to design work for expanding our critical infrastructure monitoring product offering. We may elect to further increase our investment in both product development and sales and marketing to accelerate the growth of our customer base, which will result in higher operating expenses.
Shield revenues in the second quarter were 0.5 million and increase of 0.1 million sequentially and that 2 million when compared to the prior year period, the increase in Shield Revenue, primarily reflects the work performed under the previously noted Department of Defense contract award as Tony noted, We are continuing to see strong demand for our services with both governmental and Commercial customers and anticipate deeper penetration in both sectors, which will result in further changes to our customer mix
Gross profit margin was 76% for the second quarter of 2025 which was flat on a year-over-year basis.
As a reminder, gross profit margin will vary depending on our product mix.
Operating expenses in the second quarter of 2025, total 3.5 million and increase of 0.1 million on a sequential basis and 0.4 million on a year-over-year basis.
The increase sequentially was largely driven by an increase in R&D spending largely related to design work for expanding our critical infrastructure. Monitoring product offering
Kimberly Pinson: The increase over the prior year period of $0.4 million is primarily due to a higher share-based compensation from equity grants made in the first quarter, timing of merit increases, and minor changes to staffing. With that said, we will continue to remain vigilant with our spending to ensure we maintain a strong liquidity position. Net loss for the second quarter of 2025 was $2 million or 10 cents per share, compared to a net loss of $2.1 million for the second quarter of 2024. Turning to the balance sheet from a liquidity perspective, on June 30th, 2025, we had cash and cash equivalents of $4.7 million and short-term investments in US Treasuries of $3.7 million. We continue to have sufficient capital to fund our operations through the remainder of calendar 2025 and into early 2026.
We may elect to further increase our investment in both product development and sales and marketing to accelerate the growth of our customer base which will result in higher operating expenses.
The increase over the prior year period of 04 million is primarily due to a higher share-based compensation from Equity, grants made in the first quarter, timing of marry increases in minor changes to stopping. With that said, we will continue to remain Vigilant with our spending to ensure. We maintain a strong liquidity position.
Net loss for the second quarter of 2025 was 2 million or 10 cents per share compared to a net loss of 2.1 million for the second quarter of 2024.
Kimberly Pinson: With that, I'd like to turn the call back over to Tony for a few closing comments. Tony?
Turning to the balance sheet, from a liquidity perspective, on June 30th 2025. We had cash and cash equivalents of 4.7 million and short-term investments in US, treasuries of 3.7 million. We continue to have sufficient Capital to fund our operations, through the remainder of calendar, 2025 and into early 2026 with that. I'd like to turn the call back over to Tony for a few closing comments. Tony.
Tony Scott: Thanks, Kim. While we're excited about the progress we've made in growing our business, we recognize that there's still a lot of work to be done in order to achieve our goal of generating sustainable growth and profitability. We do believe that we are on the right path forward and that the strategic investments we've made, combined with the improved conversations we've been having with both current and potential customers, both in government and in the private sector, give us confidence that we'll be able to drive consistent improvement in our financial results. This concludes our prepared remarks, and I'll now turn the call over to the operator for Q&A.
Thanks Kim.
Well, we're excited about the progress. We've made in growing our business. We recognize that, there's still a lot of work to be done in order to achieve our goal of generating, sustainable, growth and profitability.
We do believe that we are on the right path forward, and that the Strategic Investments we've made combined with the improved conversations. We've been having with both current and potential customers both in government and in the private sector. Give us confidence that we'll be able to drive consistent improvement in our financial results. This concludes our prepared remarks, and I'll now turn the call over to the operator for Q&A.
Operator: Certainly. Everyone at this time will be 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 that while posing your question, please pick up your headset if you're listening on speakerphone to provide optimum sound quality. Once again, if you have any questions or comments, please press star one on your phone. Please hold while we poll for questions. Your first question is coming from Scott Buck from HC Wainwright. Your line is live.
Certainly everyone at the 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.
Once again, if you have any questions or comments, please press star 1 on your phone.
Please hold while we pull for questions.
Your first question is coming from Scott Buck from HC. Wayne Wright, your line is live.
Various Analysts/Participants: Hi, good afternoon, guys. Thanks for taking my questions. Tony, I just want to be clear, the $3 million contract with the DOD, is that an expansion of services or just an extension of services you were already providing?
Hi. Good afternoon, guys. Thanks for taking my questions.
Tony, I just want to be clear the 3 million, uh, dollar contract with the dod, is that an expansion of services or just an extension of
uh, Services, you were already providing
Tony Scott: Yeah, great question. It's both, really. It's a kind of a renewal or an existing contract, but it's a dollar value increase on top of what we had been running. So it's kind of both. It's an increase in scope, but a continuation contract. So, and we do expect more of that as this year and next year roll out.
Yeah, great question. It's it's both really. It's uh it's a um uh
kind of a renewal or an of our, an existing contract but it's a dollar value increase on top of what we had been running. So it's it's kind of both, it's a increase in scope but uh a continuation uh contract. So uh and we do expect more of that is uh as this year and next year uh roll out.
Various Analysts/Participants: Okay. I guess that's my follow-up, right? Is you know what is the broader opportunity within the DOD and how does the signing of the big beautiful bill serve as a catalyst or a tailwind in your efforts there?
Okay, I guess that's my my follow-up right? Is you know what? What is the broader opportunity within the dod. And and how does
Uh, the signing of the, the big, beautiful bill. Um,
You know, serve as a, a catalyst or a or a Tailwind uh in your efforts there.
Tony Scott: Well, I'm pretty excited about it. I mean, the DOD work we're doing covers some of the places that DOD is responsible for. But as I mentioned in my remarks, Kristi Noem specifically called out domestic opportunities for water and utilities and communications and so on. And the exact same solutions that we've created for DOD, which are being deployed largely outside the continental US, those solutions are as applicable internally inside the continental US. So we're going to pursue that with vigor, and I think the opportunity domestically is, you know, perhaps even larger than the international opportunities. So we're excited about it. We don't have anything landed yet, but it's clearly a focus of this administration. So we're going to be there, and we're going to play hard to win.
Well, I'm pretty excited about it. I mean, the dod work, we're doing uh covers, some of the places that DOD is responsible for, but as I mentioned in my remarks, Christy gnome specifically called out domestic opportunities for water, and utilities and Communications and so on, and the exact same solutions that we've created for DOD, which are being deployed. Largely outside the continental US, those Solutions are are, uh, as applicable, uh, internally inside the continental US. So we're going to pursue that uh, with Vigor and and um, I think the opportunity domestically is, you know, perhaps even larger than than the uh International uh uh opportunities. So we're we're excited about it, we don't have anything landed yet but um, it's
Clearly a focus of this Administration so we're going to be there and we're going to play hard to win.
Various Analysts/Participants: Great. That's helpful. And then I'm curious, in terms of the marketplaces, what can you guys do in terms of sales and marketing to get eyeballs on Intrusion Shield within these marketplaces?
Great, that's helpful. And then
uh, I'm curious in terms of the marketplaces, what can you guys do in terms of
Sales and marketing to to get eyeballs on intrusion Shield within within these marketplaces.
Tony Scott: Well, we've studied very closely the things that have been successful in those marketplaces and the practices that they've followed in terms of creating awareness and promoting and creating examples of where their specific technologies are appropriate. And so we have a playbook that we're going to follow those best practices. And where we see failures, it's in companies that didn't follow some of these best practices or failed to execute on some of the things that are known to work. So we're fully committed, and you know we're going to spend some money, but we expect to have commensurate results.
Well, we've studied very closely the, um,
Things that have been successful in those marketplaces and the practices that they followed in terms of creating awareness and promoting and, um, and creating examples of where their specific Technologies are appropriate. And so we're we have a Playbook that we're going to follow uh those best practices. Um and where we see failures, it's in companies that uh didn't follow. You know, some of these best practices or or failed to execute on some of the things that are known to work. So we're fully committed and you know, we're going to spend some money. But um, we expect to have commensurate results.
Various Analysts/Participants: Perfect. And then last one, just in terms of some of your reseller partners, kind of where do you stand with them? You kind of mentioned it or touched on it during the prepared remarks, but just a little additional color there would be very helpful.
Perfect. And then last 1.
Uh, just in terms of some of your your reseller Partners um, kind of where where do you stand with with them? Uh, you kind of mentioned it or touched on it during the prepared remarks? But just a little additional color there would be would be very helpful.
Tony Scott: Well, I think I've said this in prior calls, but we're continuing to refine our reseller space. We've had some resellers that, you know, frankly didn't do much for us, and we've dropped them, and we've added some new ones. I think we're getting better at understanding which of those are likely to be more successful than, say, others. And we're doing a better job of qualifying those partners, and in turn, they do a better job of qualifying potential customers. That said, we're still focused primarily on MSPs and MSSPs, and we've been doing a number of trade shows and places where we can meet those specific kinds of customers with really good reception. So we're going to continue that this fall and hopefully see some great results from that. But we're constantly refining and learning as we go.
Well we've um I think I've said this in Prior calls, but we're continuing to refine our uh, reseller space. Um, we've we've had some resellers that you know, frankly didn't do much for us and we've dropped them and we've added some new ones. Um I think we're getting better at understanding which of those are likely to be more successful than than say others. Um and we're doing a better job of qualifying. Uh you know those those partners and in turn, they do a better job of qualifying potential customers. Uh that said we're still focused uh primarily on msps and mssps and we've been doing uh a number of trade shows and places where we can meet those specific kinds of customers with really good reception. So um we're going to continue that.
Learning as we go.
Various Analysts/Participants: Yep. No, that's great. I appreciate the added color, guys. Thank you very much for the time.
Yep. No, that's, that's great. I, I appreciate that. I had a caller, guys, thank you very much for the time.
Tony Scott: Thanks.
Thanks.
Operator: Thank you. Your next question is coming from Ed Wu from Ascendiant Capital. Your line is live.
Thank you. Your next question is coming from Ed, Woo, from ascendant Capital, your line is live.
Various Analysts/Participants: Yeah, congratulations on the progress. There seems to be a lot of emphasis on federal opportunities. What about enterprise opportunities? And have you seen any big shift in either budgets or in sales cycles?
Yeah, congratulations on the progress. Uh, there seems to be a lot of emphasis on federal, uh, opportunities. What about, uh, enterprise opportunities? And have you seen any big shifts in either budgets or in sales cycles?
Tony Scott: Well, the government opportunities are kind of obvious, I guess, because of the sort of focus and emphasis. And it's also a marketplace that, you know, frankly, we've been in business with for quite a long time in Intrusion's history. So it's appropriate for us to mine that. I think the shift that we're seeing there is we're using a lot of our shield-based technology, and we also have a healthy consulting business there. In the corporate and enterprise sector, we're a new entrant in that, and we're continuing to pursue some opportunities in that space. But we think our best entry in the market at this point is through managed service providers and managed service security providers. And so that's where we're putting a lot of interest and effort, I should say.
Well, the, you know, the government opportunities are kind of obvious, I guess because of the of the sort of focus and emphasis uh and and it's also a Marketplace that you know, frankly we've been in business with for quite a long time in intrusions history. So um, it's appropriate for us to mine that I think the shift that we're seeing there is, um, we're we're using a lot of our Shield based technology. Um, and, and, and we also have, you know, a healthy Consulting business there in the, um, corporate and Enterprise sector. We're a new entrant in that, and we're continuing to, you know, pursue some opportunities in that space. But we think our best entry in the Market at this point is through managed service providers and managed services.
Tony Scott: But we're not going to turn away enterprise business, but it's not our core focus at the moment.
Security providers. And so, that's where we're putting a lot of interest and effort, I should say. But we're not going to turn away enterprise business; it's just not our focus.
Core focus at the at the moment.
Various Analysts/Participants: Have you noticed any significant shift, either federal or enterprise, in terms of, you know, the budgeting or in terms of sales cycles of whether anybody want to delay purchasing big software contracts?
Um, have you noticed, any significant shift either of federal or Enterprise in terms of, you know, I, I know the budgeting or in terms, of sales cycles of whether anybody want to, you know, delay, you know, purchasing, uh, you know, big software contracts.
Tony Scott: Well, I think there's still long cycles, you know, from everything I can see. And, you know, talking to my friends and, you know, former colleagues and so on, they are under a lot of pressure to validate and justify cybersecurity spend. And they're, in many cases, looking at where am I getting value, you know, particularly in spaces where they're vulnerable. So phishing continues to be the number one entry point for all kinds of bad things to get into your environment. And supply chain is also a huge focus. We're also seeing quite a bit of interest in sort of OT technology protection as opposed to IT protection. The IT protection space has pretty well got a lot of people playing in it and a lot of saturation.
Well, I think there are still long cycles. You know, from everything I can see, and you know, talking to my friends and...
You know, former colleagues and so on. Um, they are under a lot of pressure to validate and justify cyber security, spend, and their in many cases looking at, where am I getting value? Um, you know, particularly in in space is where they're vulnerable. So fishing continues to be the number 1 entry point for all kinds of bad things to get into your environment. Um, and um, and supply chain is also a huge Focus. Um, we're also seeing quite a bit of interest in um, in sort of OT technology protection as opposed to it protection. Um, the it protection space.
Tony Scott: But the OT environment, I'm talking about manufacturing floors and other things like that, seems to be a space that's not quite as crowded and a place that we can, I think, play well. So we're going to undertake some additional efforts in that OT space.
Is pretty well. Uh, got a lot of people playing in it and a lot of saturation. But the OT environment, I'm telling about manufacturing, floors and other, uh, things like that. Seems to be a space. That's not quite as crowded and a place that we can, I think play well. So, um, we're going to undertake some additional efforts in that, um, in that OT space.
Various Analysts/Participants: Great. Well, thanks for answering my questions, and I wish you guys good luck. Thank you.
Great. Well thanks for asking my questions and I wish you guys. Good luck. Thank you.
Operator: Thank you. Your next question is coming from Howard Braus from Wellington Shields. Your line is live.
Thank you. Your next question is coming from Howard Browse from Wellington Shields. Your line is live.
Howard Braus: Thank you. Tony, five quarters in a row sequential growth. I'll take nickels, dimes, quarters, or dollars. So first, congratulations on that. Secondly, critical infrastructure. When you talk about schools, could you give us some timing and visibility of what you're talking about in terms of, say, revenue and when?
Thank you. Tony 5. Quarters in a row, sequential growth. I'll take nickels dimes quarters or dollars. So, uh, first, congratulations on that.
Um, secondly, critical infrastructure, when you talk about schools,
can you give us some timing and visibility of what you're talking about in terms of say revenue and uh,
Tony Scott: Yeah. So the schools with the Port Nexus thing, we did some trade shows with them over the summer. Schools, you know, tend to go to their trade shows over the summer and then actually purchase during the fall and winter months as they get into their budget years and school years and so on. One of the things that kind of impressed me when we were showing administrators of school districts our solutions at some of these trade shows was how quick the sales cycle was. You know, we would do a 10 or 15 or 20-minute demo, and the reaction we'd get is, "Boy, I want this," which in our traditional products, you know, as you know, sometimes is months or, you know, longer in terms of, you know, getting to a point where they're that enthusiastic about buying.
Yeah so the schools with the port Nexus thing uh we did some trade shows with um them over the summer schools. You know tend to go to their trade shows over
Over the summer and then, um, actually purchased during the fall and and winter months. Um, as the as they get into their budget years in school years and so on, um, 1 of the things that kind of impressed me, um, when we were showing, uh, administrators of school districts are solutions that some of these trade shows was
um, which in our traditional products, you know, as as you, you know, sometimes is months or, you know, longer in terms of
Tony Scott: So I'm encouraged by, you know, those kinds of receptions. On the other critical infrastructure stuff, like, you know, protecting communications and water wells and utilities and those kinds of things, you know, I think that's going to be a longer sales cycle, you know, because these are typically larger institutions. And in some cases, they have dedicated cybersecurity teams who are going to want to, you know, test and vet the solutions and so on. But as we look at the landscape, we don't see as much competition, or at least perceived competition, in those spaces. So I think we've got room to spread our wings and impress people in those marketplaces.
Uh, you know, getting to a point where they're that enthusiastic about buying so. So I'm encouraged by, you know, those kinds of receptions.
On the other critical infrastructure stuff like, you know, protecting Communications and water, wells, and utilities, and those kinds of things. Um, uh, you know, I think that's going to be a longer sales cycle. Um, you know, because these are typically larger institutions and, and in some cases, they have dedicated cyber security teams who are going to want to, you know, test and vet the solutions and and so on. But as we look at the landscape we don't see um as much competition or at least perceived competition in those spaces. So I I think we've got room to spread our wings and and impress people in those uh marketplaces
Howard Braus: Can you give us a sense of, given the opportunities very near term, of when you think you might break even?
uh, can you give us a sense of
Given the opportunities. Very near-term of when you think you might break even
Tony Scott: Well, we could have a couple of big contracts, and that would get us there quickly. And if it's a bazillion small ones, it's probably not as quick. But I'm not going to give a date projection, but it's absolutely our goal. And Kim and I think about this every single day, about when and how we can get there. So our BDIs are on the target, and we're aiming for that as soon as we can reasonably get there. We're not going to go buy business only to have it go away, but we want sustainable, profitable, long-term business, and that's what we're going for.
Well, um, we could have a couple of big contracts and that would get us there quickly, and if it's a bazillion small ones, it's probably not as quick, but I'm not, uh, I'm not going to give a a date projection, but it's absolutely our goal and Tim and I think about this every single day about when and how we can get there. So our our BDI are on the Target and we're we're we're aiming for that as as soon as we can reasonably get there. We're not going to go buy business. Uh only to have it go away, but we want sustainable profitable um long term uh business and that's what we're going for.
Howard Braus: Thank you. That's all I have.
Thank you. That's all I have.
Operator: Thank you. And once again, everyone, if you have any questions or comments, please press star, then one on your phone. Your next question is coming from Mildred Maffingale. Your line is live.
Thank you. And once again, everyone, if you have any questions or comments, please press star, then 1 on your phone. Your next question is coming from Mildred Mafinga.
Coming.
Various Analysts/Participants: Tony. Tony?
Tony Scott: Hello? Yeah, can you hear me? We can hear you, yes.
Tell me, hello.
Yes, can you hear me? All right, we can hear you. Yes.
Various Analysts/Participants: I'm Ms. Maffingale, financial advisor. I did notice that you took over as CEO in 2021 and a substantial improvement in the net loss in the company. So I applaud you on that. One of the things I wanted to ask you is, when do you anticipate having sustainable improvement in your cash flow?
I'm Miss mass and Gail's financial advisor. Uh, I did notice that you um,
took over and CEO and 2021 and a substantial Improvement.
In the the net loss.
Uh, in the company. So I I plugged you on that.
Uh, one of the things I wanted to ask you is, um,
When do you anticipate having sustainable?
Improvement in your cash flow.
Tony Scott: Well, again, it's kind of related to Howard's question. We have a number in mind, which is not that far away, that we think would get us to, you know, cash flow break even or positive EBITDA. And as I said earlier, I think a couple of good contracts, you know, get us there, or, you know, a bunch of smaller ones, obviously. But I think given all of the initiatives that we've launched this year between this infrastructure and OT product, the marketplace with AWS, later on with Azure, and our endpoint product, and other developments that we have underway, there's multiple avenues for us to get there. So I'm more encouraged than ever that it's achievable, and I'm looking at nearer term rather than long term, so, however you want to define those things. But it's certainly our goal.
Um, well, again, it's kind of related to Howard's question. Um, we're um.
We have a a number in mind, which is not that far away that we think, uh, would get us to, um, you know, cash flow Break Even or positive ibida. Um, and as I said earlier, I think a couple of good contracts.
You know, get us there, um, or you know, a bunch of smaller ones, obviously. Um, but I think given all of the initiatives that we've launched this year between this infrastructure, um, and OT product, um, the marketplace with AWS later on, with Azure, um, and our endpoint product, and, uh, and other developments that we have underway, there are multiple avenues for us to get there. So I'm more encouraged than ever that it's achievable.
Tony Scott: And as a major investor in the company, it's important to me that we get there. So I'll be as excited as anyone when we do.
And, uh, I'm looking at nearer term rather than than long term so, um, however you want to define those things, but, uh, it's certain our goal.
And as a major investor in the company, it's important to me that we get there. So, I'll be as excited as anyone when we do.
Various Analysts/Participants: Who are some of your major competitors?
We are some of your major competitors.
Tony Scott: Well, it's a great question. There's what I'd call perceived competitors and then real competitors. And one of the things that we've struggled with is if you look at the offerings of a lot of cybersecurity companies, at a high level, it sounds like they do some of the same things that we do. But when you get down to the details and understand what they actually do, there aren't really any competitors. So as an example, people often think that we do the same thing as, for example, Cisco Umbrella, which is a product name that Cisco has. But when we do a side-by-side comparison, we find that there's very little overlap, and we're very unique in our space. And same thing with offerings from Palo Alto Networks or CrowdStrike or many of the other people in the cybersecurity space.
Well, it's a great question. We um, there's
Call perceived competitors.
And then real competitors. One of the things that we've struggled with is if you look at the offerings of a lot of cybersecurity companies.
Uh, at a high level, it sounds like they do some of the same things that we do.
But when you get down to the details and understand,
What they actually do there, there aren't really any competitors. So, as an example, people often think that we do the same thing as...
Tony Scott: And up until now, we've not spent a lot of money, you know, marketing and what have you to try to explain to people what those differences are. But that changes this year with the introduction of our new products and our different vehicles to market that we've already talked about. So we're going to spend some money this year talking to people about our differentiation and why we think we're necessary and better than some of the things that they might perceive as competitive products. Long-winded answer, but it's something we've been very focused on.
For example, Cisco umbrella, which is a product named that Cisco has. But when we do a side-by-side comparison, we find that there's very little overlap and and we're very unique in our space and same thing with offerings from Paulo Alto networks or crowdstrike or um, many of the other people in the cyber security space.
And up until now we've not spent a lot of money, you know, marketing and and what have you to try to explain to people what those differences are.
But that changes this year with the introduction of our new products and our different vehicles to market that we've already talked about. So we're going to spend some money this year.
Talking to people about our differentiation and, and why we think we're necessary and, and better than some of the things that they, uh, might perceive as competitive products long-winded answer. But, um, it's it's, it's something we've been very focused on
Various Analysts/Participants: Well, I think it's very important, you know, for you to get some of the big money backing you, you know, approaching different private investors or mutual fund companies that can give you an influx of capital to help you with that marketing.
Well, I think it's very important, you know, for you to get some of the big money backing.
you um, you know, approaching
uh, different, uh, private investors or
uh, digital fund companies that, that can give you an influx of
Capital.
To help you with that marketing.
Tony Scott: For sure. And I would say last year we needed that badly. Right now, we're sitting in a pretty good cash position. And I meant to mention it on the call, but Kim alluded to it. We don't see a need to raise capital anytime in the near future, at least until, you know, next year at the earliest. And with any luck, we won't need to do it at all, so.
For sure. And I would say, last year we needed that badly. Um, right now we're sitting in a pretty good cash position and I, I meant to mention it on the call, but uh, give them alluded to it. We don't see a need to raise Capital anytime in the near future, at least until, um, you know, next year, uh, at the earliest and uh, with any luck, we won't need to do it at all. So
Various Analysts/Participants: Okay. Well, thank you for taking my questions and wish you a lot of success there in Plano.
Okay, well thank you for taking my questions and um wish you a lot of success there in Plano.
Tony Scott: Thank you.
Thank you.
Various Analysts/Participants: Yes, sir.
Yes, sure.
Operator: Thank you. That concludes our Q&A session. I'll now hand the conference back to Tony Scott, President and CEO, for closing remarks. Please go ahead.
Thank you, that concludes our Q&A session. I'll now hand the conference back to Tony Scott, president and CEO for closing remarks, please go ahead.
Tony Scott: Well, thanks, everyone. I'm really looking forward to an exciting Q3 and Q4 this year. Our teams are highly motivated and energized to go do the work that we need to do to continue our success. We're prepared to continue our product innovation journey, and we've got a bunch of exciting things in the hopper that I think will excite our customers. We're trying out some of our new messaging at a trade show this week, and it seems to be working pretty, pretty well. So I'm looking forward to more of that. Kim and I are going to be doing a number of investor and non-deal roadshows this fall. And so we're looking forward to those conversations. And hopefully, it convinces a bunch of people to buy Intrusion stock and help our stock price continue to grow. And I'm looking forward to sharing our Q3 results.
Well, thanks everyone. Um, I'm really looking forward to an exciting Q3 and Q4 this year. Um, our teams are highly motivated and energized to do the work that we need to do to continue our success. Um, we're prepared to continue our product innovation journey, and we've got a bunch of exciting things in the hopper that I think will excite our customers.
Um, we're, uh, trying out our, some of, our new messaging at a trade show this week, and it seems to be working pretty pretty well. So, um, I'm looking forward to more of that.
Uh, Kim and I are going to be doing a number of, uh, investor and non-DIehl Road shows this fall. And so we're looking forward to those conversations and hopefully it convinces a bunch of people to buy Intrusion stock and, uh, help our stock price.
Continue to grow.
Tony Scott: But in the meantime, I'm wishing everyone a healthy and prosperous end of summer and fall. And we'll look forward to talking with you when we share our Q3 results. Thanks, everybody.
And I'm looking forward to sharing our Q3 results. Um, but in the meantime, I'm wishing everyone a healthy and prosperous end of summer and fall, and we'll look forward to talking with you, uh, when we share our Q3 results. Thanks, everybody.
Operator: Thank you, everyone. This concludes today's event. You may disconnect at this time and have a wonderful day. Thank you for your participation.
Thank you. Everyone that concludes today's event. You may disconnect at this time and have a wonderful day.
Thank you for your participation.