Intrusion (INTZ) Q2 2024 earnings summary

Executive summary

• Q2 2024 revenue was $1.5 million, up 29% sequentially but nearly flat year-over-year, driven by new government contracts and customer wins for Shield and consulting services.

• Net loss narrowed to $2.1 million for Q2 2024, an 18% improvement sequentially and 30–34% year-over-year.

• Operating expenses decreased to $3.1 million, down $0.2 million sequentially and $0.9 million year-over-year, reflecting cost reductions in staffing, marketing, and litigation.

• Gross margin was 76% in Q2 2024, down from 78% in Q2 2023, due to a higher mix of lower-margin consulting revenue.

• Expanded government sector presence with first large-scale adoption of Shield technology and five new customer wins, with about half in the Philippines.

Financial highlights

• Q2 2024 revenue: $1.5 million, up 29% sequentially and down 1% year-over-year; six-month total: $2.6 million, down 7% year-over-year.

• Consulting revenue was $1.2 million, up $0.5 million sequentially and $0.1 million year-over-year, aided by new government contracts.

• Shield revenue was $0.3 million, down $0.1 million sequentially and year-over-year due to the loss of a large early customer, partially offset by new wins.

• Gross profit for Q2 2024 was $1.1 million (76% margin); six months: $2.0 million (77.8% margin).

• Cash and equivalents at quarter-end were $1.5 million, with a working capital deficit of $0.5 million.

Outlook and guidance

• Management expects Shield revenue growth in the second half of 2024, driven by new government and Philippines contracts and expansion of current deployments.

• Expects to be at a multiple of the current annualized revenue run rate by year-end as new contracts ramp.

• Focus remains on cost control and potential acceleration of product development as revenues grow.

• Plans to report Shield recurring revenue on an annualized basis in future quarters.

• Management expects improved financial performance in future periods, citing new government contracts, recent customer wins, and a strong sales pipeline.