SideChannel (SDCH) Q1 2025 earnings summary

Executive summary

• Revenue for the quarter ended December 31, 2024, increased 9.9% year-over-year to $1.9 million, driven by growth in vCISO engagements and higher adoption of cybersecurity services and software.

• Net loss for the quarter was $195 thousand, an improvement from a net loss of $246 thousand in the prior year period.

• Gross margin declined to 45.8% from 48.7% in the prior year quarter due to increased third-party software and services revenue.

• Cash, cash equivalents, and short-term investments totaled $1.4 million at quarter end, with a $75 thousand increase during the quarter.

• Strategic focus on proprietary software (Enclave), vCISO services, and expanding program adoption at current and new clients, supported by international sales expansion and new hires.

Financial highlights

• Revenue grew 9.9% year-over-year to $1.9 million for the quarter.

• Gross profit was $874 thousand, with a gross margin of 45.8%.

• Operating expenses decreased 2.2% year-over-year to $1.08 million.

• Cash and cash equivalents plus short-term investments totaled $1.4 million at quarter end.

• Cash provided by operating activities was $75 thousand for the quarter.

Outlook and guidance

• No formal financial guidance provided.

• Management expects existing cash, cash equivalents, and anticipated cash flows from operations to be sufficient for at least the next 12 months.

• Planned investments in sales and marketing to drive future revenue growth, using cash generated from operations.

• Continued focus on expanding Enclave and vCISO services, with resource planning aligned to these priorities.