In This Article:
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Total Revenue: $15.7 million, up from $15.4 million in the prior year's first quarter.
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Service Revenue: $4.7 million, compared to $4 million in the previous year and the fiscal fourth quarter.
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Gross Profit: $4.6 million, representing 29.1% of sales, up from $4.1 million or 26.6% of sales in the prior year.
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Net Income: $472,000 or $0.05 per diluted common share, compared to a net loss of $73,000 or $0.01 per diluted common share in the prior year.
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Cash and Cash Equivalents: $30.7 million as of December 30, 2024.
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Engineering and Development Expenses: $786,000, up from $700,000 in the prior year.
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SG&A Expenses: $4.1 million, compared to $3.7 million in the prior year.
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Dividend: Authorized $0.03 per share quarterly cash dividend.
Release Date: February 10, 2025
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
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CSP Inc (NASDAQ:CSPI) reported a 17% increase in service revenue for the first quarter of fiscal 2025.
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The company expanded its gross margins by 200 basis points, reflecting improved profitability.
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CSP Inc (NASDAQ:CSPI) ended the quarter with over $30 million in cash and cash equivalents, indicating strong liquidity.
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The company secured a second major cruise line order and continued success in the ocean freight liner market, boosting monthly recurring revenue.
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CSP Inc (NASDAQ:CSPI) signed several new customers for its AZT Protect product, expanding its presence in the operational technology cybersecurity market.
Negative Points
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Despite the positive developments, AZT Protect revenues are not yet material in the estimated $50 billion OT market.
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The company faces long sales cycles, particularly with large OT customers, which can delay revenue realization.
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CSP Inc (NASDAQ:CSPI) has not yet fully leveraged its partnership with Rockwell Automation, as sales through this channel are still in the early stages.
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The company has been slow to gain name recognition in the market, which could hinder faster adoption of its products.
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There is ongoing concern among investors about the dilution of shares due to management stock compensation, with calls for more aggressive share buybacks.
Q & A Highlights
Q: Can you provide an update on the AZT Protect product and any upcoming upgrades? A: Victor Dellovo, President and CEO, confirmed that there is a slight upgrade in progress for AZT Protect, which will be announced soon. The product continues to evolve to meet security needs.
Q: How many patents does CSPI currently hold, and are there any pending? A: Victor Dellovo stated that CSPI has three issued patents, with two more expected by year-end and two additional submissions anticipated to be completed by 2026.