Actelis Networks, a leader in cyber-hardened, rapid deployment networking solutions for wide-area IoT applications, reported a stellar performance in its Q3 2024 financial results, achieving a 200% year-over-year revenue increase. With revenue for the quarter reaching $2.54 million, Actelis has surpassed its total 2023 revenue in the first nine months of 2024 alone. Driven by contract renewals and new orders across strategic markets, the company has not only increased its gross margin but also dramatically improved its financial health by narrowing its EBITDA losses.
Breaking Revenue Records and Surpassing 2023 Performance
Actelis’ Q3 revenue surge marks a 200% year-over-year growth from $0.85 million in Q3 2023 to $2.54 million. With $6.7 million in total revenue over the first nine months of 2024, a 46% increase from the prior year, Actelis has already surpassed its full-year 2023 performance. A significant portion of this growth is attributed to the renewal of a two-year software and services contract with a major North American client, bringing in $1.1 million in Q3 alone.
This momentum reflects Actelis’ successful expansion into critical markets, especially in the U.S., where the company has capitalized on increasing demand for secure networking infrastructure across key sectors, including Intelligent Transportation Systems (ITS), defense, and smart cities. Additionally, recent new orders from the U.S. Department of Transportation and projects with German municipalities underscore Actelis’ widening influence in delivering hybrid-fiber technology solutions to essential infrastructure and government applications.
Gross Margins Reach New Highs
An exceptional highlight of Actelis’ Q3 results is the 69% gross margin, a leap from 27% in the same quarter last year. This improvement underscores the company’s emphasis on software and services—a shift that is transforming Actelis into a higher-margin, sustainable business. Over the nine months ending in September 2024, gross margin rose to 58%, up from 34% in the previous year, driven by the increase in software-related revenue and efficiencies in cost management.
Actelis has made strides in aligning its revenue mix with its core focus on high-margin products, such as its cyber-hardened, rapid-deployment networking solutions. The company’s “Cyber Aware Networking” initiative, which introduces an AI-powered layer to provide comprehensive threat monitoring and automated response for IoT networks, is a testament to Actelis’ commitment to meeting the complex needs of modern cyber-hardened infrastructure.
Cost Reduction Strategy Pays Off
Actelis’ rigorous cost-cutting strategy has significantly reduced operating expenses, enhancing overall profitability. Operating expenses for Q3 2024 dropped by 12% compared to Q3 2023, totaling $2.0 million. For the nine months ending September 30, operating expenses declined by 17% to $6.0 million, resulting in savings of over $1.2 million. This reduction aligns with Actelis’ commitment to driving financial discipline as the company scales.
The company also reported a narrowing of its net loss, down to $0.51 million in Q3 2024 from $0.87 million in Q3 2023. The improvement extended to the year-to-date net loss, which decreased by 41% to $2.57 million, signaling a positive turnaround driven by both increased revenue and margin expansion.
Positioned for Sustained Growth
With a robust liquidity position and strengthened shareholders’ equity at $2.8 million as of September 30, 2024, Actelis is strategically positioned to leverage its growth trajectory. In June, the company raised nearly $5 million and subsequently activated an At-The-Market (ATM) facility, providing financial flexibility to fuel future growth initiatives and strategic opportunities.
In a statement, Tuvia Barlev, Chairman and CEO of Actelis, emphasized the company’s strong financial foundation and future potential: “Our third-quarter results underscore Actelis’ strong financial performance and continued growth trajectory. With robust revenue growth, a dramatic increase in gross margins, and disciplined cost management, we are achieving the financial resilience needed to support our expanding role in critical sectors. This progress reflects the value of our cyber-hardened, rapid-deployment networking solutions and our commitment to driving sustainable long-term growth for our shareholders.”
Strategic Wins Across Multiple Sectors
Actelis’ impressive performance is also attributable to strategic wins across various sectors. Notable among these is the $1.4 million contract renewal for software and services with a major North American client, affirming the company’s foothold in critical infrastructure sectors. The company also secured new orders in ITS modernization for major U.S. cities and counties, as well as military deployments—a sector that is increasingly recognizing the importance of secure, resilient communications infrastructure. Actelis’ expansion into the European market, with deployments in Italy’s national highways and German utilities, further strengthens its position as a global player in the cyber-hardened networking space.
Looking Ahead: Building on the Cyber Aware Networking Initiative
Actelis’ recent advancements go beyond immediate financial gains. The company’s “Cyber Aware Networking” initiative, which adds a cybersecurity layer to its IoT networks, holds promise as a long-term growth engine. Partnering with an advanced cybersecurity provider, Actelis is pushing forward a next-generation approach to network security with AI-driven threat monitoring and automated response capabilities. This initiative is expected to enhance Actelis’ software-based revenue streams, positioning it to tap into the growing demand for secure IoT networks.
Looking Ahead
As Actelis wraps up a milestone Q3, the company is well-poised to continue its growth in 2024 and beyond. By capitalizing on the demand for secure, hybrid-fiber networking solutions and maintaining a disciplined approach to cost management, Actelis has laid a foundation for sustainable, profitable growth. With significant contract renewals and new market inroads, the company’s leadership team, under the guidance of CEO Tuvia Barlev, is optimistic about the road ahead.
Looking forward, Actelis is not only focused on driving organic growth but also remains open to strategic opportunities that could further accelerate its trajectory. With its robust financial footing, expanded market reach, and innovative approach to networking solutions, Actelis is redefining its role in the IoT landscape, making it a company to watch in the years to come.
Click Here to Read Actelis Networks’ Full Announcement
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