Alarum Technologies Ltd. Q4 FY2024 earnings call

• 2024 was a pivotal year where the company focused solely on data collection, phasing out other activities, and launched cutting-edge products in this domain. Annual revenue reached a record high, with data collection contributing 97% of total revenues. - The AI revolution is reshaping the data collection market, with data being critical for innovation and decision-making. Alarum expanded its IP network in 2024, enhanced infrastructure to handle data traffic, and saw initial sales of new products. - There was a spike in demand from AI-driven companies for large-scale data extraction solutions, and the company started initial AI model training and analysis trial projects with major corporations.

In 2024, Alarum Technologies achieved annual revenue of $31.8 million, with the data collection segment accounting for 97% of total revenue, reaching $30.9 million. In the fourth quarter of 2024, revenue was $7.4 million, with the data collection portion at $7.2 million. Non-IFRS gross margin for the full year 2024 was 77%, up from 74.3% in 2023. Adjusted EBITDA for 2024 was a record $9.4 million, up from $5.2 million in 2023.

• First quarter of 2025 revenue is anticipated to range at $7.3 million, plus/minus 3%. - First quarter of 2025 adjusted EBITDA is expected to range from $0.8 million to $1.2 million.

• Market volatility due to websites modifying structures and access restrictions, leading to revenue fluctuation across the industry. - Uncertainty in the strategic shifts of customers (websites and AI platforms) impacting short-term demand and revenue.

Q: You mentioned navigating a period of adjustment as the industry evolves and slower revenue growth. Can you describe what you're referring to?

A: The industry is experiencing a technology war between websites and AI platforms, with websites modifying structures to halt AI engines. This causes volatility in demand, as customers (websites and AI platforms) restructure their strategies. Short-term revenue may fluctuate, but long-term, the need for data supports Alarum's position.

Q: Can you tell us the evolution of the volume of the large customer using Website Unblocker?

A: The large customer is very satisfied, increased usage, with the annual run rate coming to more than $500,000.

Q: How important are alternative data types to AI-driven customer model building strategy?

A: Alternative data types like audio and video are crucial for big players in the AI space, who need huge scales of data to train models. Alarum's solutions enable collection of such data, positioning the company as a significant enabler.

Q: How much did AI-related customer engagement impact Q4 revenue?

A: AI-related customer engagement was in progress but did not materially impact Q4 revenue, though it is progressing well.