INTRUSION INC Q3 FY2024 earnings call

• Strategic updates: Signed 7 new Shield logos in Q3, year-to-date total of 18; near 0 churn with Shield customers; expanded 2 contracts with existing customers. - Product development: Focus on adding capabilities, improving update speed/frequency, and expanding AI features in Shield Command Hub. - Financials: Shield revenue growth driven by a U.S. Department of Defense contract; cost control maintained with gross margin above 77%; R&D investment continued. - Board change: Jim Giro retired from the Board, search for replacement underway; NASDAQ listing issue regarding $1 minimum bid price, 180 days to regain compliance.

In the third quarter of 2024, Shield revenue increased by 49% sequentially. Shield revenue represented 30% of total revenues for the quarter. Consulting revenue totaled $1.1 million in the third quarter, a sequential decrease. Gross profit margin was above 77%, and operating expenses were $3.2 million, with net loss improving year-over-year due to lower operating expenses and reduced interest charges.

• Anticipate further revenue improvements from new customers and expanding existing contracts. - Confident in strong performance in the fourth quarter and first quarter based on current momentum and growing pipeline of high-quality opportunities.

• NASDAQ stock market notice of non-compliance with $1 minimum bid price requirement, with 180 calendar days to regain compliance.

Q: Can you remind us when that large Shield client started to exit?

A: The last revenue from that initial Shield client was in the first quarter of this past year.

Q: Any color on size of new Shield logos? Any thoughts on election integrity opportunities in the US?

A: New Shield logos are varied; some MSPs recommend to others. Got inquiries on election integrity but no solid signed business yet.

Q: Seen increased capital spending plans post-elections?

A: Too early to tell; will get read through conversations at upcoming exposition with managed service providers.