Genasys Inc. Reports Record Revenue and Positive Outlook

Genasys Inc. ((GNSS)) has held its Q4 earnings call. Read on for the main highlights of the call.

The recent earnings call for Genasys Inc. presented a generally positive outlook, underscored by record revenue growth, robust gross margins, and a substantial backlog. Despite these achievements, the company continues to face challenges such as ongoing net losses and a reduction in cash reserves. Nonetheless, Genasys remains optimistic about its future profitability and growth prospects in both its Hardware and Software segments.

Record Revenue Growth

Genasys Inc. reported a remarkable achievement in Q4 2025, with a record revenue of $17 million. This represents a 153% increase year-over-year and a 73% growth sequentially, marking the largest revenue quarter in the company’s history. This significant growth is a testament to the company’s strategic initiatives and market demand.

Strong Gross Margin

The company maintained a strong gross profit margin of 50.3% in Q4 2025, which it expects to sustain moving forward. This robust margin is attributed to a favorable mix in its Hardware segment, highlighting the company’s effective cost management strategies.

Significant Backlog

As of September 30, 2025, Genasys reported a backlog exceeding $60 million, indicating strong future demand and growth potential. This backlog serves as a solid foundation for the company’s future revenue streams and market expansion.

Puerto Rico Project Progress

The $75 million Puerto Rico project has contributed $13.2 million in revenue for fiscal 2025. The project is progressing according to plan, with completion expected in 2027 and major work slated for 2026, underscoring Genasys’s capability to manage large-scale projects.

CROWS Initiative Success

Genasys secured a $9 million order under the CROWS program, marking its first production contract for Acoustic Hailing Devices (AHDs). This initiative is expected to generate multiyear revenues, reinforcing the company’s position in the defense sector.

Positive Operating Income

For the first time in seven quarters, Genasys reported positive operating income and adjusted EBITDA in Q4 2025. This milestone reflects the company’s efforts in improving operational efficiency and financial performance.

Software and Hardware Growth

The company experienced growth in both its Software and Hardware segments, with Software revenue increasing by 21% in 2025 and Hardware revenues growing over 91%. Excluding the Puerto Rico project, Hardware revenues grew over 12%, showcasing balanced growth across its product lines.

Net Loss Despite Improvements

Despite these improvements, Genasys reported a GAAP net loss of $1.4 million in Q4 2025 and $18.1 million for the full year. This highlights the ongoing financial challenges the company faces as it strives towards profitability.

Cash and Equivalents Decrease

The company’s cash, cash equivalents, and marketable securities decreased to $8 million as of September 30, 2025, down from $13.1 million the previous year. This decline in cash reserves is a concern that the company needs to address.

Software Revenue Plateau

Software revenue in Q4 2025 was approximately $2.2 million, remaining flat compared to the previous quarter. This plateau in software revenue growth indicates a potential area for strategic focus and improvement.

Forward-Looking Guidance

In the earnings call, Genasys’s leadership highlighted their forward-looking guidance, emphasizing the company’s achievement of positive operating income and adjusted EBITDA for the first time in seven quarters. With a remarkable 153% year-over-year revenue growth in Q4 and a 50% gross margin, the company is poised for further growth. The full-year revenue for fiscal 2025 was $40.8 million, up 70% from 2024, driven by significant contributions from the Puerto Rico project and the U.S. Navy. Genasys anticipates continued growth in both Hardware and Software segments, expecting to maintain a 50% gross margin into 2026.

In summary, Genasys Inc.’s latest earnings call reflects a positive sentiment with record revenue growth and strong gross margins, despite ongoing challenges such as net losses and decreased cash reserves. The company’s strategic initiatives, including the Puerto Rico project and CROWS program, position it for continued success. Investors and stakeholders can remain optimistic about Genasys’s future prospects as it continues to focus on profitability and growth across its segments.