Q2 2026 SuperCom Ltd Earnings Call

August 13, 2026

Speaker #1: Ladies and gentlemen, good morning and welcome to Supercom's second quarter 2026 financial results and corporate update conference call. At this time, all participants are in a listen-only mode.

Operator: Ladies and gentlemen, good morning and welcome to Supercom's Q2 2026 financial results and corporate update conference call. At this time, all participants are in a listen-only mode. Should you need assistance, please signal a conference specialist by pressing the star key followed by zero. After today's presentation, there will be an opportunity to ask questions. To ask a question, you may press star then one on your telephone keypad. To withdraw your question, please press star then two. Participants of this call are advised that the audio of this conference call is being broadcast live over the Internet. Joining me from Supercom's leadership team is Ordan Trabelsi, Supercom's President and Chief Executive Officer. I would like to remind you that during this call, Supercom management may be making forward-looking statements, including statements that address Supercom's expectations for future performance or operational results.

Speaker #1: Should you need assistance, please signal a conference specialist by pressing the star key followed by zero. After today's presentation, there will be an opportunity to ask questions. To ask a question, you may press star, then one, on your telephone keypad.

Speaker #1: To withdraw your question, please press star then two. Participants of this call are advised that the audio of this conference call is being broadcast live over the internet.

Speaker #1: Joining me from Supercom's leadership team is Ordan Trabelsi, Supercom's president and chief executive officer. I'd like to remind you that during this call, Supercom management may be making forward-looking statements, including statements that address Supercom's expectations for future performance or operational results.

Speaker #1: Forward-looking statements involve risks, uncertainties, and other factors that may cause Supercom's actual results to differ materially from those statements. For more information about these risks, uncertainties, and factors, please refer to the Risks, Factors, Described in Supercom's most recently filed periodic reports on Form 20F and Form 6K, and Supercom's press release that accompanies this call, particularly the cautionary statements in it.

Operator: Forward-looking statements involve risks, uncertainties, and other factors that may cause Supercom's actual results to differ materially from those statements. For more information about these risks, uncertainties, and factors, please refer to the risk factors described in Supercom's most recently filed periodic reports on Form 20-F and Form 6-K and Supercom's press release that accompanies this call, particularly the cautionary statements in it. Today's conference call includes EBITDA, a non-GAAP financial measure that Supercom believes can be useful in evaluating its performance. You should not consider this additional information in isolation or as a substitute for results prepared in accordance with GAAP. For a reconciliation of this non-GAAP financial measure to net loss, a comparable GAAP financial measure, please see the reconciliation table located in Supercom's earning press release that accompanies this call. Reconciliations for other non-GAAP financial measures and comparable GAAP financial measures are available there as well.

Speaker #1: Today's conference call includes EBITDA, a non-GAAP financial measure that SuperCom believes can be useful in evaluating its performance. You should not consider this additional information in isolation or as a substitute for results prepared in accordance with GAAP.

Speaker #1: For a reconciliation of this non-GAAP financial measure to net loss, a comparable GAAP financial measure, please see the reconciliation table located in Supercom's earning press release that accompanies this call.

Speaker #1: Reconciliations for other non-GAAP financial measures and comparable GAAP financial measures are available there as well. The content of this call contains time-sensitive information that is accurate only as of today August 13, 2026.

Operator: The content of this call contains time-sensitive information that is accurate only as of today, 13 August 2026. Except as required by law, Supercom disclaims any obligation to publicly update or revise any information to reflect events or circumstances that occur after this call. It is now my pleasure to turn the call over to Supercom's President and CEO, Ordan Trabelsi.

Speaker #1: Except as required by law, Supercom disclaims any obligation to publicly update or revise any information to reflect events or circumstances that occur after this call.

Speaker #1: It is now my pleasure to turn the call over to Supercom's president and CEO, Ordan Trabelsi.

Speaker #2: Hello everyone. We're pleased to report another record quarter for Supercom. In the second quarter of 2026, we achieved more than eight-year records for revenue, gross profit, and EBITDA.

Ordan Trabelsi: Hello, everyone. We are pleased to report another record quarter for Supercom. In Q2 2026, we achieved more than eight-year records for revenue, gross profit, and EBITDA, marking our ninth record quarter of the last 10 since the company turnaround began in 2021. These results build on the progress we have delivered over the past several quarters and demonstrate the increasing scale and build an operating leverage of our business model. As we expand the delivery of our proprietary electronic monitoring and public safety technologies to local and national governments around the world, we are seeing continued improvement across our key financial and operational metrics. This performance is being driven by greater operational efficiency, continued investment in our technology, and our strategy of simultaneously expanding both into new markets and within the markets we already serve.

Speaker #2: Marking our ninth record quarter of the last ten, since the company turnaround began in 2021. These results build on the progress we have delivered over the past several quarters and demonstrate the increasing scale and build on operating leverage of our business model.

Speaker #2: As we expand the delivery of our proprietary electronic monitoring and public safety technologies to local and national governments around the world, we are seeing continued improvement across our key financial and operational metrics.

Speaker #2: This performance is being driven by greater operational efficiency, continued investment in our technology, and our strategy of simultaneously expanding both into new markets and within the markets we already serve.

Speaker #2: Combined with our significantly strengthened balance sheet, these advancements provide us with a strong foundation to continue scaling the business. I'll now turn to our financial results for the second quarter of 2026.

Ordan Trabelsi: Combined with our significantly strengthened balance sheets, these advancements provide us with a strong foundation to continue scaling the business. I will now turn to our financial results for Q2 2026. Revenue increased 13.3% to $8.1 million, compared with $7.1 million in Q2 2025. Gross profit increased 16% to $4.9 million. Gross margin also expanded by approximately 90 basis points to 60%. Operating income was $900,000 compared to $1.1 million in the prior year period, and this was largely impacted by the Israeli foreign currency headwinds. During Q2, our Israel operations experienced foreign currency headwinds from approximately 17% year-over-year increases in the average Israeli currency to the US currency exchange rate, the shekel to the dollar. Despite these pressures, we sustained GAAP net income levels at roughly $1.1 million for the quarter, similar to the same quarter in the prior year period.

Speaker #2: Revenue increased 13.3% to $8.1 million, compared with $7.1 million in the second quarter of 2025. Gross profit increased 16% to $4.9 million, gross margin also expanded by approximately 90 basis points to 60%.

Speaker #2: Operating income was $900,000, compared to $1.1 million in the prior year period, and this was largely impacted by the Israeli foreign currency headwinds. During the second quarter, our Israel operations experienced foreign currency headwinds from approximately 17% year-over-year increases in the average Israeli currency to the US currency exchange rate.

Speaker #2: The shackle to the dollar. Despite these pressures, we sustained GAAP net income levels at roughly $1.1 million for the quarter, similar to the same quarter in the prior year period.

Speaker #2: On an op-gap non-GAAP basis, net income increased to $2.9 million, compared with $300,000 in the prior year period. EBITDA increased by 55.6% to $4 million.

Ordan Trabelsi: On a non-GAAP basis, net income increased to $2.9 million, compared with $300,000 in the prior year period. EBITDA increased by 55.6% to $4 million this quarter, compared to $2.5 million in Q2 2025, representing our highest quarterly EBITDA in more than a decade. GAAP earnings per share were approximately $0.20, and non-GAAP earnings per share were $0.52. We have also made substantial progress in strengthening our balance sheet. Over the past several years, we have reduced our net debt from close to $35 million to under $10 million. Our outstanding long-term debt now carries a blended interest rate of approximately 6%, with no cash payments due until the end of 2028. This structure provides us with greater flexibility to invest in growth.

Speaker #2: This quarter, compared to $2.5 million in the second quarter of 2025, represents our highest quarterly EBITDA in more than a decade. GAAP earnings per share were approximately $0.20, and non-GAAP earnings per share were $0.52.

Speaker #2: We've also made substantial progress in strengthening our balance sheet. Over the past several years, we've reduced our net debt from close to $35 million to under $10 million.

Speaker #2: Our outstanding long-term debt now carries a blended interest rate of approximately 6%, with no cash payments due until the end of 2028. This structure provides us with greater flexibility to invest in growth.

Speaker #2: Cash and cash equivalents totaled approximately $7.4 million as of June 30, 2026, compared to $9.8 million at the end of June 30, 202—sorry, at the end of 2025.

Ordan Trabelsi: Cash and cash equivalents totaled approximately $7.4 million as of 30 June 2026, compared to $9.8 million at the end of 2025. During the quarter, we strategically deployed capital to support working capital needs and accelerate customer onboarding, installations, and technology integration across new contracts in the United States and Europe. In early July, we raised approximately $7.5 million in gross proceeds from a common shares only registered direct offering with a few institutional investors. This additional capital further strengthens our financial position and provides us with increased flexibility to support new deployments and continue executing against our growing pipeline. Finally, our book value of equity totaled approximately $48 million as of 30 June, an increase of 28% from approximately $37 million at 30 June 2025.

Speaker #2: During the quarter, we strategically deployed capitals to support working capital needs and accelerate customer onboarding installations and technology integration across new contracts in the United States and Europe.

Speaker #2: Subsequent to the quarter end, in early July, we raised approximately $7.5 million in gross proceeds from a common shares-only registered direct offering. With a few institutional investors, this additional capital further strengthens our financial position and provides us with increased flexibility to support new deployments and continue executing against our growing pipeline.

Speaker #2: Finally, our book value of equity totaled approximately $48 million as of June 30, an increase of 28% from approximately $37 million at June 30, 2025.

Speaker #2: Next, I would like to spend some time discussing the operating leverage in our business and the factors contributing to our profitability and margin expansion.

Ordan Trabelsi: Next, I would like to spend some time discussing the operating leverage in our business and the factors contributing to our profitability and margin expansion. The economics of our programs improve as they mature. At the outset of a new program, we incur upfront costs associated with onboarding, training, development, and deployment. As additional monitoring units are deployed, those initial costs are spread across a larger recurring revenue base. This increases the contribution from each incremental unit and creates meaningful operating leverage. As more of our customer relationships mature, we are seeing the benefits of this dynamic reflected in our gross margins. We have also taken several important steps to improve our operational efficiencies. In Europe, we have consolidated logistics, equipment handling, and shipments through a centralized hub in Romania. At the same time, we have brought more IT and customer support responsibilities in-house from our subcontractors.

Speaker #2: The economics of our programs improve as they mature. At the outset of a new program, we incur upfront costs associated with onboarding, training, development, and deployment.

Speaker #2: As additional monitoring units are deployed, those initial costs are spread across a larger recurring revenue base. This increases the contribution from each incremental unit and creates meaningful operating leverage.

Speaker #2: As more of our customer relationships mature, we are seeing the benefits of this dynamic reflected in our gross margins. We've also taken several important steps to improve our operational efficiencies.

Speaker #2: In Europe, we've consolidated logistics equipment handling and shipments through a centralized hub in Romania. At the same time, we have brought more IT and customer support responsibilities in-house from our subcontractors.

Speaker #2: This has reduced our reliance on local partners and we have established our own 24-hour support capabilities across multiple projects. These initiatives give us greater control over the customer experience while also improving the efficiency of our operations and building our customer support network.

Ordan Trabelsi: This has reduced our reliance on local partners, and we have established our own 24-hour support capabilities across multiple projects. These initiatives give us greater control over the customer experience while also improving the efficiency of our operations and building our customer support network. We also continue to incorporate AI capabilities into our operational processes. AI has already helped accelerate development, introduce new automation, and improve efficiency across deployment and customer support activities. We believe these are still in the early ages of AI adoption. As we continue to introduce new products, technologies, and automation, we see the potential to further reduce the labor, support, and administrative requirements associated with operating and scaling of our programs. The centralized deployment model we have developed in the United States provides another important operational advantage and leverages economies of scale.

Speaker #2: We also continue to incorporate AI capabilities into our operational processes. AI has already helped accelerate development, introduce new automation, and improve efficiency across deployment and customer support activities.

Speaker #2: We believe these are still in the early stages of AI adoption. As we continue to introduce new products, technologies, and automation, we see the potential to further reduce the labor, support, and administrative requirements associated with operating and scaling our programs.

Speaker #2: The centralized deployment model we have developed in the United States provides another important operational advantage and leverages economies of scale. Our cloud-based platform, integrated inventory management, and 24-hour support capabilities allow us to serve programs throughout the country with a unified infrastructure.

Ordan Trabelsi: Our cloud-based platform, integrated inventory management, and 24-hour support capabilities allow us to serve programs throughout the country with a unified infrastructure, one shared language, and a common operating environment directly reducing project costs. European national programs often require country-specific infrastructure, local language customization, and more decentralized support. While our experience enables us to manage that complexity effectively, the more standardized US model allows us to launch and support new country and state-level programs more efficiently and cost-effectively. As our US presence expands, we believe this model can support faster deployments and attractive margin potential, even more attractive than it is today. Underlying all these efforts is the strength of our technology. Many European national programs are awarded through rigorous technology-based evaluation processes. In markets including Sweden, Germany, Israel, and Norway, we have displaced incumbent providers that have supported these programs for approximately 20 to 25 years.

Speaker #2: One shared language and a common operating environment directly reducing project costs. European national programs often require country-specific infrastructure. Local language customization and more decentralized support.

Speaker #2: And while our experience enables us to manage that complexity effectively, the more standardized U.S. model allows us to launch and support new country- and state-level programs more efficiently and cost-effectively.

Speaker #2: As a US presence expands, we believe this model can support faster deployments and attractive margin potential for even more attractive than it is today.

Speaker #2: Underlying all of these efforts is the strength of our technology. Many European national programs are awarded through rigorous, technology-based evaluation processes. In markets including Sweden, Germany, Israel, and Norway, we have displaced incumbent providers that have supported these programs for approximately 20 to 25 years.

Speaker #2: Our win across all five Nordic countries often against long-standing incumbents. Provide compelling validation of the performance, reliability, and capabilities of our technology, as well as our ability to meet the demanding requirements of national electronic monitoring programs.

Ordan Trabelsi: Our win across all five Nordic countries, often against longstanding incumbents, provide compelling validation of the performance, reliability, and capabilities of our technology, as well as our ability to meet the demanding requirements of national electronic monitoring programs. I'll now turn to our growth and diversification strategy, which remains focused on expanding both into new markets and within the markets where we are currently established. Over the 4-year period until 31 December 2025, revenue from our electronic monitoring business grew at a compound annual rate of approximately 30% per year, while EBITDA grew at a compound annual rate of approximately 47%. This performance reflects the continued expansion of our recurring revenue base and the increase in operating leverage in our business.

Speaker #2: I'll now turn to our growth and diversification strategy, which remains focused on expanding both into new markets within and within the markets where we are currently established.

Speaker #2: Over the four-year period until December 31, 2025, revenue from our electronic monitoring business grew at a compound annual rate of approximately 30% per year.

Speaker #2: while EBITDA grew at a compound annual rate of approximately 47%. This performance reflects the continued expansion of our recurring revenue base and the increasing operating leverage in our business.

Speaker #2: In Europe, our results can fluctuate between periods because our revenue increase includes several large multi-year national programs, with each customer's ordering cycle potentially affecting the timing of revenue recognition.

Ordan Trabelsi: In Europe, our results can fluctuate between periods, because our revenue increase includes several large, multi-year national programs, with each customer's ordering cycle potentially affecting the timing of revenue recognition. Romania, for example, represented a significant portion of our European revenue in prior periods, but ordering activity temporarily moderated amid political uncertainty, and as our EMEA contract base has grown, Romania, as a singular contract, represents less of our revenue blend. The Romanian program remains active, though, and important to note, the temporary decline in Romania masked strong growth across the rest of our electronic monitoring business. Excluding the impact of Romania's decline, our underlying revenue would have grown approximately 40% between 2024 and 2025. Until today, we have secured more than 20 wins across Europe national electronic monitoring programs and maintain a presence of all five Nordic countries.

Speaker #2: Romania, for example, represented a significant portion of our European revenue in prior periods, but ordering activity temporarily moderated amid political uncertainty and as our EMEA countries base has grown, Rom Romania as a similar contract represents less of our revenue.

Speaker #2: Blend. The Romanian program remains active though, and important to note, the temporary decline in Romania masked strong growth across the rest of our electronic monitoring business, excluding the impact of Romania's decline or underlying re-revenue would have, grown approximately 40% between 2024 and 2025.

Speaker #2: Until today, we have secured more than 20, wins across Europe national electronic monitoring programs. And maintain a presence of all five Nordic countries. These accomplishments give us a strong regional foundation.

Ordan Trabelsi: These accomplishments give us a strong regional foundation, but we have continued to see meaningful opportunities to expand further within our existing markets and in new ones. Several significant European opportunities are expected to come to market over the next 18 to 24 months, including the opportunity in Italy, among others. We've also discussed the opportunity in England previously, which remains a substantial opportunity for Supercom, valued at over 150 million British pounds. We competed for this England opportunity historically and came in second place when Supercom had a less developed reference base and significantly more leveraged balance sheet. Since then, we have strengthened our financial position, expanded our European presence, and established a broader record of successfully executing national electronic monitoring programs and make us a more viable candidate to secure the England program win. There can be no assurance regarding the outcome of any individual procurement.

Speaker #2: But we have continued to see meaningful opportunities to expand further within our existing markets and in new ones. Several significant European opportunities are expected to come to market over the next 18 to 24 months, including the opportunity in Italy, among others.

Speaker #2: We've also discussed the, opportunity in England previously, which remains a substantial opportunity for Supercom, valued at over $150 million British pounds. We competed for this England opportunity historically and came in second place.

Speaker #2: When Supercom had a less developed reference base and significantly more leverage balance sheet, since then we have strengthened our financial position, expanded our European presence, and established a broader record of successfully executing national electronic monitoring programs and make us a more viable candidate to secure the England program win.

Speaker #2: There could be no assurance regarding the outcome of any individual procurement. However, our success in markets that rely mostly on objective technology-based evaluation processes for example across the Nordic region gives us confidence that our technology that with our technology we're better positioned today to can be for this and other large national opportunities.

Ordan Trabelsi: However, our success in markets that rely mostly on objective, technology-based evaluation processes, for example, across the Nordic region, gives us confidence that with our technology, we're better positioned today to compete for this and other large national opportunities. The United States remains another important driver for our growth. Our strategy is not only to enter additional states, but also to expand into more counties, agencies, and programs within each state where we already have established presence. Since mid-2024, we have secured more than 45 new US electronic monitoring contracts and entered 19 new states with access to additional markets through our 18 new regional service provider partnerships. We're also seeing the scale of our contracts increase over time, from smaller initial deployments to more recent awards involving approximately 100 to 250 simultaneous units.

Speaker #2: The United States remains another important driver for our growth. Our strategy is not only to enter additional states but also to expand into more counties, agencies, and programs within each state where we already have established presence.

Speaker #2: Since mid-2024, we have secured more than 45 new US electronic monitoring contracts. And entered 19 new states with access to additional markets through our 18 regional service n 18 new regional service provider partnerships.

Speaker #2: We're also seeing the scale of our contracts increase over time. From smaller initial deployments to more recent awards involving approximately 100 to 250 simultaneous units.

Speaker #2: We are building our references and moving up in project sizes, similar to the pattern we experienced when we started our European expansion—only this time, it's faster.

Ordan Trabelsi: We are building our references and moving up in project sizes, similar to the pattern we experienced when we started our European expansion. Only this time, it is faster. Many of these wins have involved agencies and service providers transitioning from incumbent vendors and legacy systems to our PureSecurity platform. We have seen this pattern in markets including Alabama, Utah, and Virginia, where customers have selected our technology to modernize their electronic monitoring programs. These wins demonstrate the reliability, flexibility, and scalability of our platform. They also highlight the versatility of our operating model, which enables us to serve government agencies directly while also supporting regional service providers across a variety of program structures. We currently operate in 22 states, and in 12 of those, we have already expanded into multiple counties.

Speaker #2: Many of these wins have involved agencies and service providers transitioning from incumbent vendors and legacies systems to our peer security platform. We have seen this pattern in markets including Alabama, Utah, and Virginia, where customers have selected our technology to modernize their electronic monitoring programs.

Speaker #2: These wins demonstrate the reliability, flexibility, and scalability of our platform. They also highlight the versatility of our operating model, which enables us to serve government agencies directly while also supporting regional service providers across a variety of program structures.

Speaker #2: We currently operate in 22 states and in 12 of those we've already expanded into multiple counties. As you build a reputation and establish successful reference programs in each state, we believe there is significant opportunity to deepen our presence in those markets.

Ordan Trabelsi: As we build a reputation and establish successful reference programs in each state, we believe there is significant opportunity to deepen our presence in those markets. Our US platform is also supported by Leaders in Community Alternatives, our wholly-owned subsidiary in California. LCA provides re-entry and rehabilitation services that complement our core electronic monitoring technology and broaden the range of outcomes we can support for our customers. LCA recently secured a five-year re-entry services contract valued up to $2.5 million. Since we acquired LCA, Supercom has secured more than $35 million in new contracts in California alone. Together, our electronic monitoring technology and complementary service capabilities allow us to support customers across a broader range of monitoring, compliance, and rehabilitation needs. Turning now to our pipeline, we continue to see a robust and growing range of opportunities across key markets.

Speaker #2: Our US platform is also supported by leaders in community alternatives, our wholly owned subsidiary in California. LCA provides re-entry and rehabilitation services that complement our core electronic monitoring technology and broaden the range of outcomes we can support for our customers.

Speaker #2: LCA recently secured a five-year re-entry services contract valued at up to $2.5 million. And since we acquired LCA, SuperCom has secured more than $35 million in new contracts in California alone.

Speaker #2: Together, our electronic monitoring technology and complementary service capabilities allow us to support customers across a broader range of monitoring, compliance, and rehabilitation needs. Turning now to our pipeline.

Speaker #2: We continue to see a robust and growing range of opportunities across key markets. One of the most significant developments during the quarter was our expansion into Sweden.

Ordan Trabelsi: One of the most significant developments during the quarter was our expansion in Sweden. In June, we announced that we have signed and launched a new national electronic monitoring project with the Swedish Prison and Probation Service. The total estimated project value ranges from $17 million, reflecting the previously announced base case scenario, to the $75 million budget published by the customer. That published budget reflects the potential for expansion through a higher number of active offenders and the addition of capabilities such as alcohol monitoring, our PureGPS solution, our PureOne GPS solution, and the PureOfficer mobile device solution. The program is expected to expand to as many as 6,000 active offenders, representing approximately 6 times the number from the program we first launched with this customer in 2019, where we displaced the incumbent of 25 years, with more capabilities and more features this time around.

Speaker #2: In June, we announced that we have signed and launched a new national electronic monitoring project with the Swedish Prison and Probation Service. The total estimated project value ranges from $17 million, reflecting the previously announced base case scenario, to the $75 million budget published by the customer.

Speaker #2: That published budget reflects the potential for expansion through a higher number of active offenders and the addition of capabilities such as alcohol monitoring, our pure GPS, solution, our pure one GPS solution, and the pure officer mobile device solution.

Speaker #2: The program is expected to expand to as many as 6,000 active offenders, representing approximately six times the number from the program we first launched with this customer in 2019.

Speaker #2: Where we displaced the incumbent of 25 years, with more capabilities and more features this time around. Revenue recognized under the contract will ultimately depend on actual usage levels and the scope of the capabilities deployed.

Ordan Trabelsi: Revenue recognized under the contract will ultimately depend on actual usage levels and the scope of the capabilities deployed. We are also continuing to build momentum in the United States. Recent contract wins in Michigan, Georgia, Ohio, New York, and Kansas demonstrate the increased demand for our technology and the continued expansion of our national footprint. It is important to remember that there is an inherent lag between the signing of a contract and recognizing the associated revenue, especially in the US, where everything is usually charged on a recurring per unit per day model. In some cases, full deployment can take 6 months or longer, particularly when a customer must transition from an incumbent provider and replace existing monitoring units with our technology. In both Europe and the United States, deployment schedules and customer ordering patterns can affect the timing of revenue recognition from period to period.

Speaker #2: We're also continuing to build momentum in the United States. Recent contract wins in Michigan, Georgia, Ohio, New York, and Kansas demonstrate the increased demand for our technology and the continued expansion of our national footprint.

Speaker #2: It's important to remember that there's an inherent lag between the signing of a contract and recognizing the associated revenue, especially in the U.S., where everything is usually charged on a recurring per-unit, per-day basis.

Speaker #2: Model. In some cases, full deployment can take six months or longer. Particularly when a customer must transition from an incumbent provider and replace an existing monitoring units with our technology.

Speaker #2: In both Europe and the United States, deployment schedules and customer ordering patterns can affect the timing of revenue recognition from period to period. Despite this timing dynamic, the recurring revenue base associated with our U.S. electronic monitoring technology continues to grow.

Ordan Trabelsi: Despite this timing dynamic, the recurring revenue base associated with our US electronic monitoring technology continues to grow. Our US EM technology annualized recurring revenues has been accelerating, reflecting growth of approximately 290% from July 2025 to July 2026. This progression provides an encouraging indication of how our recent contract wins are beginning to translate into recurring revenue. We continue to see substantial room for expansion. There are many markets, both United States and Europe, that we have not entered yet. As we increase our scale, strengthen our financial position, and build a broader record of successful deployments, we believe we will be qualified to pursue an expanding range of opportunities.

Speaker #2: Our US EM technology annualized recurring revenues have been accelerating, reflecting growth of approximately 290% from July 2025 to July 2026. This progression provides an encouraging indication of how our recent contract wins are beginning to translate into recurring revenue.

Speaker #2: We continue to see substantial room for expansion. There are many markets both United States and Europe that we have not entered yet. And as we increase our scale, strengthen our financial position, and build a broader record of successful deployments, we believe it will be qualified to pursue an expanding rage expanding range of opportunities.

Speaker #2: In summary, I'm extremely pleased with the progress we delivered during the second quarter and with the consistent growth and profitability we have sustained over the past several quarters.

Ordan Trabelsi: In summary, I am extremely pleased with the progress we delivered during Q2 and with the consistent growth and profitability we have sustained over the past several quarters, as well as securing highly valuable new contracts such as the national projects announced in Sweden and Norway. We achieved record revenue, gross profit, and EBITDA, while continuing to invest in new deployments, advancing our technology and expanding our presence across the United States and Europe. We are also seeing increasing operating leverage as our programs mature and our recurring revenue base grows. We believe Supercom is stronger today than at any point in its history. We have an exceptional global team, a significantly improved balance sheet, proven and differentiated technology, and a growing range of opportunities to expand both into new markets and within the markets we already serve, and the record revenue and EBITDA numbers to this point.

Speaker #2: As well as securing highly valuable new contracts such as the national projects announced in Sweden and Norway. We achieved record revenue gross profit and EBITDA while continuing to invest in new deployments.

Speaker #2: Advancing our technology and expanding our presence across the United States and Europe. We're also seeing increasing operating leverage as our programs mature and our recurring revenue base grows.

Speaker #2: We believe SuperCom is stronger today than at any point in its history. We have an exceptional global team, a significantly improved balance sheet, proven and differentiated technology, and a growing range of opportunities to expand both into new markets and within the markets we already serve, as well as the record revenue and EBITDA numbers to this point.

Speaker #2: As we look ahead, we remain focused on executing our pipeline, supporting our customers, and building on our position as a global leader in the electronic monitoring and public safety technology market.

Ordan Trabelsi: As we look ahead, we remain focused on executing our pipeline, supporting our customers, and building on our position as a global leader in electronic monitoring and public safety technology market. This concludes our prepared remarks, and I will turn the call back to the operator for questions.

Speaker #2: This concludes our prepared remarks. I will now turn the call back to the operator for questions.

Speaker #1: Thank you. Ladies and gentlemen, if you wish to ask a question on today's call, you will need to press star then the number one on your telephone.

Operator: Thank you. Ladies and gentlemen, if you wish to ask a question on today's call, you will need to press star, then the number 1 on your telephone. If you are using a speakerphone, please pick up your handset before entering your request and speaking on the call. If your question has been answered and you wish to withdraw your request, you may do so by pressing star then 2. One moment, please, for the first question. Our first question today is coming from Matthew Galinko with Maxim Group. Matthew, your line is live. Please go ahead.

Speaker #1: If you're using a speakerphone, please pick up your handset before entering your request and speaking on the call. If your question has been answered and you wish to withdraw your your request, you may do so by pressing star then two.

Speaker #1: One moment please for the first question today is coming from Matthew Galinko, with Maxim Group. Matthew, your line is live. Please go ahead.

Speaker #2: Hey, congratulations on another strong quarter. Can you maybe touch on...

Matthew Galinko: Hey. Congratulations on another strong quarter.

Ordan Trabelsi: Thank you.

Matthew Galinko: Can you maybe touch on-

Speaker #1: Sure.

Ordan Trabelsi: Sure.

Speaker #2: with you know, we can obviously see the momentum, I think, in the, in the US market in terms of, you know, expanding your territory.

Matthew Galinko: We can obviously see the momentum, I think, in the US market in terms of expanding your territory, and appreciate the metrics you provided on growth rates. At what point, I guess, do you expect that to I guess maybe firstly, do you expect that to accelerate as you, to your point, move into higher scale deployments in the US market? So like as you move into higher offender counts or monitoring counts, do you anticipate that that number could actually accelerate from the current rate of growth?

Speaker #2: And appreciate the the metrics you provided on on growth rates. At what point, I guess, do you expect that to I mean, I guess maybe firstly, do you expect that to accelerate as you to your point, move into higher scale deployments in the US market?

Speaker #2: So, like, as you move into higher offender count or monitoring counts, do you do you anticipate that that number could actually accelerate from the current rate of growth?

Speaker #3: The number's been accelerating this year, I think, in the last quarter we announced, up to 180%. Now we're at 290. year over year ARR.

Ordan Trabelsi: The number's been accelerating this year. I think in the last quarter, we announced up to 180%. Now we're at 290% year-over-year ARR. At some point, naturally, as the numbers get larger and larger, the acceleration will stop and the growth will continue, though. In the US market, we started with smaller county projects. I'm sorry. There we go. Calling out of Tel Aviv. There were smaller county projects that have been growing in size, and now we're at level of roughly 100 to 250. Of course, there's much larger projects in the US and some of our projects in Europe, as we discussed, Sweden was 1,000 units and expected to reach 6,000. This time around, Romania was 15,000 units. We've deployed much larger projects in Europe.

Speaker #3: At some point, naturally, as the numbers get larger and larger, the acceleration will stop and the growth will continue, though. In the US market, we started with, you know, smaller county projects.

Speaker #3: And sorry, there's there we go. Calling out of Tel Aviv. there was smaller, county projects that had been growing in size and now we're at level of roughly 100 to 250.

Speaker #3: Of course, there's a much larger project in the US and some of our projects in Europe as we discussed Sweden was 1,000 units and expected to reach 6,000 this time around.

Speaker #3: Romania was 15,000 units. So, we've deployed much larger projects in Europe, but originally in Europe it was also 50 units or 100 units, and we rescaled project after project, and that's what we're doing in the US.

Ordan Trabelsi: But originally in Europe, it was also 50 units or 100 units, and we scaled project or project, and that's what we're doing in the US. We're just doing it much faster this time around. In the last two years, we expanded into 19 new states, and it took us much longer to reach that kind of presence in Europe.

Speaker #3: We're just doing it much faster this time around. In the last two years, we expanded into 19 new states, and it took us much longer to reach that kind of presence in Europe.

Speaker #2: Got it. cool. Very good. I I think you you touched on Romania headwinds, but i i is it reasonable to can you maybe characterize where that opportunity is today as far as maybe expansion of scope or, is there potential to bring orders back from Romania or how how does that look today?

Matthew Galinko: Got it. Well, very good. I think you touched on Romania headwinds, but can you maybe characterize where that opportunity is today as far as maybe expansion of scope, or is there potential to bring orders back from Romania, or how does that look today?

Speaker #3: So Romania is still an active customer of ours. but like many of customers of ours when we start the program, if if the relationship is good and the deployment is successful as it was, they can order at a at the planned rate or faster.

Ordan Trabelsi: Romania is still an active customer of ours. Like many of customers of ours, when we start the program, if the relationship is good and deployment is successful as it was, they can order at the planned rate or faster than planned, and that's what we saw there. It was initial fast ramp. At some point, there were elections, and those elections happened twice, and some things slowed down a little bit, and you saw a decline of revenues in Romania in 2025, which masked an underlying growth of 40% for revenues that year from the rest of the business, if you avoid that decline. But Romania is still active, and there's expansion opportunities, just like any of our contracts, and we started with them in 2022.

Speaker #3: Than planned and that's what we saw there. And so as initial fast ramp, at some point there were elections and those elections happened twice.

Speaker #3: And some things slowed down a little bit and you saw a decline of our revenues in Romania in 2025, which masked an underlying growth of 40%, for revenues that year.

Speaker #3: Then the rest of the business, if you avoid that decline. But Romania is still active and there are expansion opportunities, just like any of our contracts, and we're only—you know, we started with them in 2022.

Speaker #3: Many of these contracts when we provided four examples of Israel, Sweden, Norway, are over 20, 25 years with the same incumbent provider. So once you start a relationship with them, and you're doing well as as we believe we're doing there, there's more expansions, more opportunities, and, we're excited about the path ahead.

Ordan Trabelsi: Many of these contracts, and we provided four examples of Israel, Sweden, Norway, are over 20 to 25 years with the same incumbent provider. Once you start a relationship with them, and you are doing well, as we believe we are doing there are more expansions, more opportunities, and we are excited about the path ahead.

Speaker #2: Thanks. All right, last question from me, and then I'll jump back in the queue. Your gross margin has been, you know, very strong, I think, for the last couple of quarters.

Matthew Galinko: Thanks. All right, last question from me, and I will jump back in the queue. Your gross margin has been very strong, I think, for the last couple of quarters. Is it predominantly the revenue mix and where you are in the contract cycle, or is the implementation of AI and efficiency contributing to that gross margin? I guess, how sustainable are we in the 55% to 60% range?

Speaker #2: Is can you point to any is it predominantly kind of the revenue mix and where you are in the contract cycle or are is the implementation of AI and efficiency contributing to that gross margin?

Speaker #2: And I guess, how sustainable are we kind of in the 55 to 60% range?

Speaker #3: So we we we touched on some of this also in the past. we we are taking so a lot of the in the projects in Europe, there's different deployments and different regions with local subcontractors and local languages.

Ordan Trabelsi: We touched on some of this also in the past. In the projects in Europe, there are different deployments in different regions with local subcontractors and local languages. We have been taking a lot of that in-house, and that lowers the cost that we are shipping out to subcontractors, so that improves margins. The US market, where we are having more revenues, has higher margins than Europe because it is all centralized on the cloud and in English. But also the existing projects that we have in Europe are reaching a later stage, maturing. The more the project matures, the more you are just adding additional units at a very high gross margin compared to the initial deployment, where you have a lot of installations and hardware and security and training and adaptations.

Speaker #3: We've been taking a lot of that in-house. And that lowers the cost that we're shipping out to subcontractors so that improves margins. The US market where we're having a you know, more revenues has higher margins in Europe because it's all centralized on the cloud and in English.

Speaker #3: But also, the existing projects that we have in Europe are reaching a later stage—maturing. And the more the project matures, the more you're just adding additional units at a very high gross margin, compared to the initial deployment where you have a lot of installations, hardware, security, training, and adaptations.

Speaker #3: And so when you're in later stage projects or as your projects mature, the gross margins are are naturally higher. And we still have opportunity in the business, to grow margins more, especially when revenues are higher because there's significant operating leverage in this business model.

Ordan Trabelsi: When you are in later stage projects or as your projects mature, gross margins are naturally higher, and we still have opportunity in the business to grow margins more, especially when revenues are higher, because there is significant operating leverage in this business model. AI also, that we described, and I am talking about AI not in the products, which is a separate thing. I am talking about AI just from our operations. A lot of the things are becoming more automated, more seamless, and that is improving everything in terms of inventory management, other processes that we have to do, and it is helping us deploy a lot of efficiencies, and we think that is just the beginning. We think there is much more that can be done, and we will not give a spoiler, but over time, we will have more updates along the way as those things go.

Speaker #3: AI also that that we described and I'm talking about AI not in the products which is a separate thing. I'm talking about AI just from our operations.

Speaker #3: A lot of the things are are becoming more automated, more seamless and that's improving everything in terms of the inventory management, other processes that we have to do.

Speaker #3: And it's helping us deploy a lot of efficiencies and we think that's just the beginning. We think there's much more that can be done.

Speaker #3: And we won't—we won't give a spoiler, but over time, we'll have more updates along the way as those things go.

Speaker #2: Thank you. Your next question is coming from Greg Mesnef from Kingswood. Greg, your line is live. Please go ahead.

Operator: Thank you. Your next question is coming from Greg Mesniaeff from Kingswood. Greg, your line is live. Please go ahead.

Speaker #4: Thank you. Hi Ordan. How are you?

Greg Mesniaeff: Thank you. Hi, Ordan. How are you?

Speaker #3: I'm great. How are you doing? Thanks for joining.

Ordan Trabelsi: I am great. How are you doing?

Greg Mesniaeff: Good.

Ordan Trabelsi: Thanks for joining.

Speaker #4: two two questions. first one's kind of a general on the newer contracts that you've announced recently, what's the typical duration period of the contract and how is it structured?

Greg Mesniaeff: Two questions. The first one's kind of a general. On the newer contracts that you've announced recently, what's the typical duration period of the contract, and how is it structured? Is there a percentage of the contract that's earmarked for service and support, and is that optional, or is that included in the overall contract? Also, what kind of cybersecurity guarantees are you required to provide, given the sensitive nature of some of this data, and the fact that you're dealing with law enforcement and governments?

Speaker #4: Is there a percentage of the contract that's earmarked for service and support? And is that option optional or is that included in the overall contract?

Speaker #4: And also, what kind of cybersecurity guarantees are you required to provide, given the sensitive nature of some of this data and the fact that you're dealing with law enforcement, government, and governments?

Speaker #3: I'll start with the latter. just because it's a little i it's a little interesting to remind but we we we we have ISO 27001 and other certifications.

Ordan Trabelsi: I'll start with the latter, just because it's a little interesting to remind, but we have ISO 27001 and other certifications. Also at Supercom, in our history, we have cybersecurity capabilities. We used to do penetration testing and advise various organizations on this. We have cybersecurity software as part of our operations. So we're very sensitive, and a lot of people here are from cybersecurity in their past experience and in Supercom. So while we're deploying our technology, a big focus is cybersecurity, and we're handling very sensitive data. The projects we did in the history of Supercom before electronic monitoring was in identification, which was the full sense of a country, of all the citizens, and all their taxes and their criminal rates and their passports.

Speaker #3: But also it's Supercom i in our history we have cybersecurity capabilities. We used to do penetration testing and advise various organizations on this. We have cybersecurity software.

Speaker #3: as part of our as part of our operations. So we're very sense and a lot of people here are from cybersecurity in their in their past experience.

Speaker #3: And in SuperCom, while we're deploying our technology, a big focus is cybersecurity, and we're handling very sensitive data. The projects we did in the history of SuperCom before electronic monitoring were in identification.

Speaker #3: Which was, you know, the full sense of the country—of all the citizens, you know, in all their taxes and their criminal rates and their passports. And so, we have a lot of experience in that department.

Ordan Trabelsi: So we have a lot of experience in that department, and of course, that lays over to what we're doing with electronic monitoring. So especially on-premise deployments that we see in Europe, cybersecurity is a big part of it, and I think we're able to show very strong capabilities, and it helps us to score the highest in the technology portions of the bids. They provide the penetration tests, and they do the cybersecurity audits. In Europe, the national projects, there's several levels of evaluation. In those evaluations, besides testing our products and the accuracy of the location tracking and the reliability and the consistency, they're also assessing the cybersecurity capabilities. That was the second one. The first question was around the contracts. I don't know if you were asking about Europe or the US, so I'll speak in general about the two models.

Speaker #3: And of course, that lays over to what we're doing with electronic monitoring. So, especially on-premise deployments that we see in Europe, cybersecurity is a big, big part of it, and I think we're able to show very strong capabilities. It helps us score the highest in the technology portions of the bids.

Speaker #3: Now, in terms of the— and they provide the penetration tests, and they do the cybersecurity audits. In Europe, the national projects— there's several levels of evaluation.

Speaker #3: and and in those evaluations besides testing our products and the accuracy of the location tracking and the reliability and the consistency, they're also tech assess assessing the cybersecurity capabilities.

Speaker #3: That was the second one. The first question was around the contracts. I don't know if you were asking about Europe or the US, so I'll speak in general about the two models.

Speaker #3: In the US, it's actually quite mature. The market in a in a more homogeneous fashion and usually the projects are priced at per unit per day for active offender being tracked.

Ordan Trabelsi: In the US, it's actually quite mature, the market, in a more homogeneous fashion, and usually, the projects are priced at per unit per day for active offender being tracked. The revenue recognition is consistent. That's throughout our customers in the US, whether it's direct agency customer or through a service provider. In the US, we don't have subcontractors that we have to put some of the cost to. So when we receive things, they're already at a higher margin.

Speaker #3: And that's how the revenue recognition is consistent. That's throughout our customers in the US, whether it's a direct agency customer or through a service provider.

Speaker #3: But in the US we don't we don't have we don't have subcontractors that we have to that we have to put the some of the costs to.

Speaker #3: So when we receive things they're already at a higher margin. And.

Speaker #2: Mm-hmm.

Speaker #3: It's all recurring per unit per day. Also the cash payments are consistently per month. In Europe, you have some some projects that are purchased where they're acquiring the equipment.

Ordan Trabelsi: It is all recurring per unit per day. Also, the cash payments are consistently per month. In Europe, you have some projects that are purchased where they are acquiring the equipment and other ones that are still lease, but they have a large deployment. Because you are doing an on-premise deployment where you are buying servers and installing the firewalls and the infrastructure and connecting into their database, into their census, and providing the deployment work, that could take as quick as 3 weeks for initial stages, like we did in Romania, and it could take much longer, up to a year. In Europe, we get paid for that portion, of course. Then we have the deployment revenues as well as the after ongoing revenues and maintenance and deployment of additional units. That is what we are seeing in our European customers, and each one is a little bit different.

Speaker #3: And other ones that are still lease but they have a large deployment. Because you're doing it on s on-premise deployment where you're buying servers and installing the firewalls and the infrastructure, and connecting into their database, into their census, and providing the deployment work that could take as as quick as three weeks, for initial stages, like we did in in Romania and it could take much longer.

Speaker #3: up to a year. And in Europe we get paid for that portion of course. And then we have the deployment revenues as well as the after ongoing revenues of maintenance and and deployment of additional units.

Speaker #3: And that's what we're seeing in our European customers. And each one is a little bit different. It's not homogeneous to to one kind of contract model like it is in the US.

Ordan Trabelsi: It is not homogeneous to one kind of contract model like it is in the US. Everyone has the way that they like to do it, and we conform to many different customers and many different structures, and it is all fine by us.

Speaker #3: Everyone has the way that they like to do it, and we conform to many different customers and many different structures. It's all fine by us.

Speaker #4: And what is typically the renewal period of the newer contracts, particularly in the US?

Greg Mesniaeff: What is typically the renewal period of the newer contracts, particularly in the US?

Speaker #3: So would you say renewal period? What do you mean the the.

Ordan Trabelsi: When you say renewal period, what do you mean? The length of it?

Speaker #4: I mean after after say after say two or three years the contract is you know, renegotiated.

Greg Mesniaeff: After, say, 2 or 3 years, the contract is renegotiated.

Speaker #3: Okay, so typically the contracts are three to five years. The initial term could be three years, or two years with two extensions. Or it could be five years with some extensions.

Ordan Trabelsi: Typically, the contracts are 3 to 5 years, the initial term. It could be 3 years, 2 expansions, or it could be 5 years with some expansions, but then it goes up for rebid, and if the customer likes you and they believe in you, then you have a good chance of winning again, if you put out a strong bid.

Speaker #3: But then it goes up for rebid and if the customer likes you and and they believe in you then you know, you have a good chance of winning again if you put out a strong bid.

Speaker #3: Which is why. Some of the vendors that we've that we displaced were there for twenty twenty-five years in Europe. A lot of these counties that were displacing the incumbent technology provider these are legacy providers that have been there for a while.

Greg Mesniaeff: Sure.

Ordan Trabelsi: Which is why some of the vendors that we displaced were there for 20, 25 years in Europe. A lot of these counties that we're displacing the incumbent technology provider, these are legacy providers that have been there for a while. They've been there for 10 years, 15 years, and sometimes we give notes to that. But it's usually much more than the 3 to 5 years.

Greg Mesniaeff: Sure.

Speaker #3: They've been there for ten years, fifteen years. And sometimes we give notes to that, but it's usually much more than the three to five years.

Speaker #3: If you haven't done anything wrong or you're doing you're doing well it typically renews for more and more. That's what's interesting about this market.

Greg Mesniaeff: Yeah.

Ordan Trabelsi: If you haven't done anything wrong or you're doing well, it typically renews for more and more. That's what's interesting about this market. It's a little bit hard to penetrate into new contracts, into new regions, but once you're there, it's very sticky. And we feel great about what we've achieved, and we had over 20 national wins and over 45 new contracts in the US. It was hard to get those, and each of those provides us a moat and long-term relationship that we believe will go on for many years with each of these customers that we have a strong deployment with.

Speaker #3: It's a little bit hard to penetrate into new contracts in new regions, but once you're there, it's very sticky. And we feel great about what we've achieved—we had over 20 national wins and more than 45 new contracts in the U.S.

Speaker #3: It was hard to to get those and each of those providers us a moat and long-term relationship that we believe will go on for many years with each of these customers that we have a a strong deployment with.

Speaker #4: Great. Thanks. And just one one quick follow-up Orden. are you capitalizing any of the new customer onboarding costs?

Greg Mesniaeff: Great. Thanks. Just one quick follow-up, Ordan. Are you capitalizing any of the new customer onboarding costs?

Speaker #3: The new customer onboarding costs. some of the some of the some of the projects are recognized as revenue percentage completion. not not exactly capitalizing the costs but for for some components you you could look at it indirectly as that.

Ordan Trabelsi: The new customer onboarding costs. Some of the projects are recognized as revenue of percentage completion. Not exactly capitalizing the cost, but for some components, you could look at it indirectly as that. But it is sometimes a milestone progression together with cost progression for revenues for these projects, and that depends on ASC 606 and how the different projects are categorized and classified.

Speaker #3: But it is sometimes a a milestone progression together with with cost progression for revenues for these projects. And that depends on ASC six oh six and how the how the different projects are categorized and classified.

Speaker #4: Got it. Thank you.

Speaker #3: Yeah. Yes. You're welcome.

Speaker #2: Thank you. Thank you. Your next question is coming from Jack Juliano from Leaven Capital Management. Jack your line is live. Please go ahead.

Greg Mesniaeff: Got it. Thank you.

Ordan Trabelsi: Yes. You are welcome.

Operator: Thank you. Your next question is coming from Jack Giuliano from Blavin Capital Management. Jack, your line is live. Please go ahead.

Speaker #5: Hey Ordon. thanks for letting us join the call and congrats on the results.

Speaker #3: Thank you.

Speaker #5: I just two quick quick questions from us. firstly in terms of opportunities you know, outside of Europe and the Americas we noticed that you hired two directors of sales are are actively hiring two directors of sales in APAC and LATAM.

Jack Giuliano: Hey, Ordan. Thanks for letting us join the call, and congrats on the results.

Jack Juliano: Hey, Ordan. Thanks for letting us join the call, and congrats on the results.

Ordan Trabelsi: Thank you.

Jack Giuliano: Just two quick questions from us. Firstly, in terms of opportunities outside of Europe and the Americas, we noticed that you hired two directors of sales, or are actively hiring two directors of sales in APAC and LATAM. Could you potentially tell us about the opportunities you are seeing there and the timelines on those as well?

Jack Juliano: Just two quick questions from us. Firstly, in terms of opportunities outside of Europe and the Americas, we noticed that you hired two directors of sales, or are actively hiring two directors of sales in APAC and LATAM. Could you potentially tell us about the opportunities you are seeing there and the timelines on those as well?

Speaker #5: And so, could you potentially, you know, tell us about the opportunities you're seeing there, and then the timelines on those as well?

Speaker #3: Okay. Interesting that you saw those. Yeah, we have our hires on our career portion of our website. So, we believe that there are interesting markets outside of the US and Europe.

Ordan Trabelsi: Okay. Interesting you saw those. We have our hires on our career portion of our website. We believe that there are interesting markets outside of US and Europe as well. At Supercom, we have over 38 years of experience serving over 40 nations around the world, different type of government, large-scale government deployments, and we think we are well-positioned to expand there as well. The technology has been tested and has been successful time and time again in different regions of Europe and different areas of the US. The same, let's say, physical and technological requirements apply to other regions of the world. It is more just getting them up to speed with the process of running electronic monitoring programs. We have done this as well. In Croatia, we launched a brand-new program. Romania, it is a brand-new program. They have not done this before.

Speaker #3: as well. And it's super calm. We have over 38 years of experience serving over 40 nations around the world. Different types of government, large-scale government deployments.

Speaker #3: And we think we're well positioned to expand there as well. The technology has been tested and has been successful time and time again in different regions of Europe and different areas of the U.S.

Speaker #3: the same let's say physical and technological requirements apply to other regions of the world. It's more just getting them up to speed with the process of running an electronic monitoring programs.

Speaker #3: And we've done this as well in Russia. We launched a brand new program in Romania. It's a brand new program they haven't done this before.

Speaker #3: So, we think we could be great partners for a lot of these countries outside of the US and Europe, and we're seeing opportunities come up.

Speaker #3: And we thought it's time to capitalize on that as well. So yeah we we have been looking for directors of sales in those two regions for LATA LATAM and Asia Pacific.

Ordan Trabelsi: We think we could be great partners for a lot of these countries outside the US and Europe. We are seeing opportunities come up, and we thought it time to capitalize on that as well. We have been looking for directors of sales in those two regions for LATAM and Asia-Pacific. Asia-Pacific specifically, there is actually a developed electronic monitoring market that we have not yet accessed. Our initial focus will be there in Australia and New Zealand. There are many different programs. They have a lot of experience doing that there. Some of the same players that we are displacing in Europe and the US are over there, and we look forward to competing against them there as well.

Speaker #3: And Asia Pacific specifically is actually a developed electronic monitoring market that we haven't yet accessed in our initial focus would be there in Australia and New Zealand.

Speaker #3: There are many different programs. They have a lot of experience doing that there. Some of the same players that we're displacing in Europe and the US are over there.

Speaker #3: And we look forward to competing against them there as well.

Speaker #5: It sounds great. you know, and secondly I know there's a lot of focus on the US but you know, when it comes to Europe there's a lot of opportunities there as well.

Speaker #5: And so maybe you can walk us through what you're seeing in terms of other opportunities outside of, you know, Italy and the UK, which you mentioned on your previous call.

Jack Giuliano: It sounds great. Secondly, I know there is a lot of focus on the US, but when it comes to Europe, there is a lot of opportunities there as well. Maybe you can walk us through what you are seeing in terms of other opportunities outside of Italy and the UK, which you mentioned on your previous call. If there is other opportunities outside of that, it would be great to hear about those as well.

Jack Juliano: It sounds great. Secondly, I know there is a lot of focus on the US, but when it comes to Europe, there is a lot of opportunities there as well. Maybe you can walk us through what you are seeing in terms of other opportunities outside of Italy and the UK, which you mentioned on your previous call. If there is other opportunities outside of that, it would be great to hear about those as well.

Speaker #5: If there's other opportunities outside of that it'd be great to hear about those as well.

Speaker #3: So. Yeah I'll sort of say there are there are many opportunities in Europe. And in the past we had over sixty-five percent win rate.

Speaker #3: in Europe recently the the last few programs that we bid on we won three out of three. So sometimes that that win rate is even as high as a hundred percent over prolonged periods of time.

Ordan Trabelsi: I will sort of say there are many opportunities in Europe, and in the past, we had over 65% win rate. In Europe recently, the last few programs that we have bid on, we won 3 out of 3, so sometimes that win rate is even as high as 100% over prolonged periods of time. There are some opportunities. We talked about Italy, we talked about England. England is not just the national opportunity, which is over GBP 150 million. There are also other small ones in different regions. It is a whole market that we are looking to enter. There are other ones in Europe. We do not always want to give the heads-up to competition, so we try to keep it limited on exactly the names we are sharing on where we plan to bid and expand to. I think we have done an amazing job.

Speaker #3: and there's some opportunities we we talked about Italy. We talked about England. England is not just the the national opportunity which is over a hundred fifty million pounds.

Speaker #3: There are also other small ones in different regions. It's a whole market that we're looking to enter, and there are others in Europe.

Speaker #3: We don't always wanna give the heads up to competition. So we try to keep it limited on exactly the names we're sharing on where where we plan to to bid and expand to.

Speaker #3: but we I think we've done an an amazing job. The team here has done an amazing job at winning contracts in Europe in new regions where we where we haven't had any past experience or relationships.

Speaker #3: And we've overcome you know, all the h hurdles to come in as a brand new provider. and displace the incumbents that they've had for for a very long period of time even over twenty years in in many of these so we we're we're still excited about the European projects and also they're much larger in size than the projects in in the US.

Ordan Trabelsi: The team here has done an amazing job at winning contracts in Europe, in new regions where we have not had any past experience or relationships. We have overcome all the hurdles to come in as a brand-new provider, and displaced the incumbents that they have had for a very long period of time, even over 20 years in many of these. We are still excited about the European projects. Also, they are much larger in size than the projects in the US, and we think a lot of our growth will continue to come from Europe.

Speaker #3: And we think a lot of our growth will continue to come from Europe. But at the same time, you see that in the US market, things are starting to ramp up quickly.

Speaker #3: And we're having great, great references and great feedback from service providers who are not just aware of one technology, because typically, typically a service provider sees all the technology in the industry.

Speaker #3: And if they choose to take our technology on and displace to others and these are savvy you know, they they know they work with the technology a lot.

Ordan Trabelsi: At the same time, you see that in the US market, things are starting to ramp up quickly. We are having great references and great feedback from service providers who are not just aware of one technology, because typically, a service provider sees all the technology in the industry, and if they choose to take our technology on and displace the others. These are savvy. They work with technology a lot. They are not necessarily government officials, which might know one technology or the other. We think it is really good feedback and a good testament to where we are going in the US. The US market is six times bigger than Europe, and it is, I think, going to be a nice part of our future growth potential.

Speaker #3: It's not that they're necessarily government officials, which might know one technology or the other. We think it's really good feedback and a good testament to where we're going in the US.

Speaker #3: So the US market is six times bigger than Europe. And it's I think gonna be a a nice part of our our future growth potential.

Speaker #3: but meanwhile as that grows Europe the Europe the European market's doing great for us. And we expect expect to have continued wins and expansion there as well.

Speaker #5: Sounds great. thanks Ordon.

Speaker #3: Thank you.

Speaker #2: Thank you. Your next question is coming from Sean Westrop from DeepSale Capital. Sean, your line is live. Please go ahead.

Ordan Trabelsi: Meanwhile, as that grows, the European market is doing great for us, and we expect to have continued wins and expansion there as well.

Speaker #4: Thank you. Thanks, Ordan, for having the call. And a good quarter here. Just wanted to touch on Sweden a little bit. Kinda wondering on contract ramp.

Jack Giuliano: Sounds great. Thanks, Ordan.

Jack Juliano: Sounds great. Thanks, Ordan.

Ordan Trabelsi: Thank you.

Operator: Thank you. Your next question is coming from Shawn Westrup from DeepWork Capital. Shawn, your line is live. Please go ahead.

Operator: Thank you. Your next question is coming from Sean Westropp from Deep Sail Capital. Shawn, your line is live. Please go ahead.

Speaker #4: I know it's like you guys have a nine-year contract there. Is it going to be very front-loaded in '26 and '27, kind of similar to what we saw in Romania?

Shawn Westrup: Thank you. Thanks, Ordan, for having me call, and a good quarter here. Just wanted to touch on Sweden a little bit. Kind of wondering on contract ramp. I know it is like, you guys have a 9-year contract there. Is it going to be very front-loaded in 2026 and 2027, kind of similar to what we saw in Romania? Or do you think it is going to be more spread out? How is that looking?

Sean Westropp: Thank you. Thanks, Ordan, for having me call, and a good quarter here. Just wanted to touch on Sweden a little bit. Kind of wondering on contract ramp. I know it is like, you guys have a 9-year contract there. Is it going to be very front-loaded in 2026 and 2027, kind of similar to what we saw in Romania? Or do you think it is going to be more spread out? How is that looking?

Speaker #4: Or do you think it's gonna be more spread out? Like how how is that looking?

Speaker #3: So we can't—we can't at this point express exactly how it's going to be in a specific program. But we have shared that many times when the programs launch, there's an initial plan, and the customer likes what we're doing.

Speaker #3: And they end up ordering and deploying them much faster. And we have experience to do so. We deploy many many contracts probably more than any other vendor in Europe but we're deploying many contracts at a very high very fast pace with new technology deployments and new cycles.

Ordan Trabelsi: We cannot, at this point, express exactly how it is going to be in a specific program. But we have shared that many times when the programs launch, there is the initial plan, and the customer likes what we are doing, and they end up ordering and deploying it much faster. We have the experience to do so. We deploy many contracts, probably more than any other vendor in Europe. We are deploying many contracts at a very high, very fast pace with new technology deployments and new cycles. We are very well-versed to support their, let us say, growing needs of speed and acceleration. We are ready to deploy as fast as needed. As in many contracts in the past, we have seen the deployments be much faster than originally anticipated. Here, when you talk about Sweden, note it is not just. They already have a program there.

Speaker #3: And so we're very, very well-versed to support their, let's say, growing needs for speed and acceleration. So we're ready to deploy as fast as needed.

Speaker #3: And as in many contracts in the past, we've seen that the deployments have been much faster than originally anticipated. And here, when you talk about Sweden, note it's not just so—they already have a program there.

Speaker #3: They're deploying a new one.

Speaker #4: Right.

Speaker #3: But they're also looking to add on things like alcohol and other capabilities and things that we've— we're also very ready to deploy. We're doing in many of our countries, we have multiple programs, three, four, five different programs.

Speaker #3: So that's that's very easy for us to add those modules. And then the amount the counts that they look they're looking to grow significantly we have the capacity to support that as well.

Ordan Trabelsi: They are deploying a new one.

Shawn Westrup: Right.

Sean Westropp: Right.

Ordan Trabelsi: But they are also looking to add on things like alcohol and other capabilities and things that we are also very ready to deploy. We are doing, in many of our countries, we have multiple programs, three, four, five different programs. So that is very easy for us to add those modules. Then the amount, the counts that they are looking to grow significantly, we have the capacities to support that as well. So we cannot say exactly how fast it will be, but we know we can support it. Yeah.

Speaker #3: So we can say exactly how fast it will be. But but we know we can support it. Yeah.

Speaker #4: And the fact that you guys already have a deployment there is is that le is that mean it's a little faster and a little cheaper for you guys to to deploy this additional larger contract there?

Speaker #3: that's a good question. you know, by by the standard competitive process you know, they can't give advantage to to one vendor over other even even if they're the incumbent.

Shawn Westrup: The fact that you guys already have a deployment there, does that mean it is a little faster and a little cheaper for you guys to deploy this additional larger contract there?

Sean Westropp: The fact that you guys already have a deployment there, does that mean it is a little faster and a little cheaper for you guys to deploy this additional larger contract there?

Speaker #3: But naturally, as you can expect, when you have experience in the country and you build a good reputation and you understand how things work, you can plan better and do things in a much faster and more effective fashion.

Ordan Trabelsi: That is a good question. By the standard competitive process, they cannot give advantage to one vendor over other, even if they are the incumbent. But naturally, as you can expect, when you have experience in the country and you build a good reputation and you understand how things work, you can plan better and do things at a much faster and more effective fashion.

Speaker #4: Great. That makes sense. Great. just wanted to touch then on the US growth. So in the in the press release you you you noted the one hundred and seventy-one percent recurring revenue growth.

Speaker #4: can you just talk about what's driving that? Is that mainly contracts you won kinda from last year ramping? Or is that some of these larger contracts that you won more recently like the Arizona State coming into play?

Shawn Westrup: Great. That makes sense. Great. Just wanted to touch then on the US growth. In the press release, you noted the 171% recurring revenue growth. Can you just talk about what is driving that? Is that mainly contracts you won from last year ramping, or is that some of these larger contracts that you won more recently, like that Arizona State, coming into play, or is it just kind of a mix of everything?

Sean Westropp: Great. That makes sense. Great. Just wanted to touch then on the US growth. In the press release, you noted the 171% recurring revenue growth. Can you just talk about what is driving that? Is that mainly contracts you won from last year ramping, or is that some of these larger contracts that you won more recently, like that Arizona State, coming into play, or is it just kind of a mix of everything?

Speaker #4: Or is it just kind of a mix of everything?

Speaker #3: It's a little bit of a mix. I'd say that the initial projects, when we started mid-2024, were much smaller in size. And they're growing, you know. As we continue to move forward, our salespeople focus on larger and larger contracts.

Speaker #3: And we're able to win them. And then we take the references from those and go to larger ones. And also, the contracts that we have—we're growing the amount of units.

Ordan Trabelsi: It is a little bit of a mix. I would say that the initial projects when we started mid-2024 were much smaller in size, and they are growing. As we continue to move forward, our sales people focus on larger and larger contracts, and we are able to win them, and then we take the references from those and go to larger ones. Also the contracts that we have, we are growing the amount of units. Sometimes it could be, let us say, a service provider that has 1,000 units, and they will start us off with 100 or 150 units because they like the technology, but then they will see it is working really well, and they could give more units and more units. Sometimes it is just a contract that the whole size county contract was 100 units, and that is bigger than what we had in the past.

Speaker #3: And sometimes it could be a let's say a service provider that has a thousand units and they'll start us off with a hundred or a hundred fifty units 'cause they they like the technology.

Speaker #3: But then they'll see it's working really well, and they could give more units, and more units. And sometimes it's just a contract, that the whole-size county contract was a hundred units.

Speaker #3: And that's bigger than what we had in the past. So we're actively—we still have a lot to deploy with the contracts we currently have announced.

Speaker #3: They're not at full capacity at all.

Speaker #4: Right.

Speaker #3: Those are scaling up, and we expect them to scale up more than the numbers that we disclosed. And we expect more contracts, of course.

Speaker #3: But the numbers we have now are just the billings based on what has already been deployed. And that's part of the, you know, active unit per unit per day recurring revenue charges.

Ordan Trabelsi: We still have a lot to deploy with the contracts we currently have announced. They are not at full capacity at all. Those are scaling up. We expect them to scale up more than the numbers that we disclosed, and we expect more contracts, of course. But the numbers we have now is just the billings based on what has already been deployed, and that is part of the active unit per unit per day recurring revenue charges.

Speaker #4: Great. All right. Great. Thanks thanks a lot. That's all I had.

Speaker #3: Thank you very much. Yeah.

Speaker #2: Thank you. Should anyone have any further questions at this time, you may press star one on your telephone keypad. Once again, if there are any further questions at this time, please press star one on your keypad to join the queue.

Shawn Westrup: Great. All right. Great. Thanks a lot. That is all I had.

Sean Westropp: Great. All right. Great. Thanks a lot. That is all I had.

Ordan Trabelsi: Thank you very much.

Speaker #2: Please hold a moment while we re-pull for questions. And there are no further questions in queue at this time. And this does conclude our question and answer session.

Operator: Thank you. Should anyone have any further questions at this time, you may press star one on your telephone keypad. Once again, if there are any further questions at this time, please press star one on your keypad to join the queue. Please hold a moment while we re-poll for questions. There are no further questions in queue at this time, and this does conclude our question and answer session. At this time, I will pass the call back to Ordan for closing remarks.

Speaker #2: At this time, I will pass the call back to Ordan for closing remarks.

Speaker #3: Thank you, operator. And I want to thank all of you for participating in today's conference call and for your continued interest in SuperCom. We look forward to sharing our progress on our next conference call, filings, and press releases.

Ordan Trabelsi: Thank you, operator, and I want to thank all of you for participating in today's conference call and for your continued interest in Supercom. We look forward to sharing our progress on our next conference call, filings, and press releases. Thank you very much and have a great day.

Speaker #3: Thank you very much. And have a great day.

Speaker #2: Thank you. This does conclude today's conference call. You may disconnect at this time. And have a wonderful day. Thank you once again for your participation.

Operator: Thank you. This does conclude today's conference call. You may disconnect at this time and have a wonderful day. Thank you once again for your participation.