Genasys Inc.

Good day, ladies and gentlemen, and welcome to the Genesis Inc. Fiscal First Quarter 2025 Conference Call. All lines have been placed on a listen-only mode, and the floor will be open for questions and comments following the presentation. At this time, it is my pleasure to turn the floor over to your host, Brian Alger, SVP, Investor Relations and Corporate Development. Welcome, Brian. The floor is yours.

Good afternoon. Welcome to Genesis' fiscal 2025 first quarter results conference call. I am Brian Alger, SVP Investor Relations and Corporate Development for Genesis. With me on the call today are Richard Danforth, our CEO, and Dennis Klon, the company's CFO. During today's call, management will make forward-looking statements regarding the company's plans, expectations, outlook, and future financial performance that involve certain risks and uncertainties. The company's results may differ materially from the projections described in these forward-looking statements. Factors that might cause such differences and other potential risks and uncertainties can be found in the risk factors section of the company's Form 10-K for the fiscal year ended September 30, 2024. Other than statements of historical facts, forward-looking statements made on this call are based on the information and management's expectations as of today, February 11, 2025. We explicitly disclaim any intent or obligation to update those forward-looking statements except as otherwise specifically stated. We will also discuss non-GAAP financial measures and operational metrics, including adjusted EBITDA, bookings, backlog, and adjusted net loss, which we believe provide helpful information to investors with respect to evaluating the company's performance. For a reconciliation of adjusted EBITDA to GAAP financial metrics, please see the table on the press release issued by the company at the close of market today. We consider bookings and backlog leading indicators of future revenues and use these metrics to support production planning. Bookings is an internal operational metric that measures the total dollar value of a customer's purchase orders executed in a given period, regardless of the timing of related revenue recognition. Backlog is a measure of purchase orders received that are scheduled to ship in the next 12 months. Finally, a replay of this call will be available in approximately four hours through the investor relations page on the company's website. Now, at this time, it's my pleasure to turn the call over to Genesis' Chief Executive Officer, Richard Danforth. Richard?

Thank you, Brian, and welcome, everyone. We are pleased to report that fiscal 2025 is off to a good start, substantially better than the prior year's quarter. Before we get into the results of the quarter, I want to spend some time discussing Genesis' involvement and role during January's historic fires in Southern California. These fires made national and international news. I am sure that all of you are aware that in the second week of January, Los Angeles County experienced a dangerous but not uncommon weather event, creating very high winds combined with extremely low humidity. Days before anything occurred, notices were issued by various weather services, and as a result, we and our customers were ready. What did happen, however, was far greater than anything previously experienced. Seven different fires ignited across the county requiring requiring an unprecedented amount of coordination and communicate the communication across a plethora of agencies. The sheer scale of the response was unprecedented. Emergency teams across the western United States descended upon Los Angeles as part of a comprehensive mutual aid engagement to fight the fires and keep people safe. What stood out wasn't just the scale of the fires, but the technological advancement that enabled first responders from across Southern California and beyond to work together. Unfortunately, fast moving and devastating wildfires are not uncommon. We can all recall the images from the Paradise Tubs and Lahaina fires. all driven by very high winds devastating communities near urban interface areas. The lesson learned from those prior tragedies led to Genesis developing in L.A. County to purchase our Genesis Protect solution. Though the images of the devastation to the homes and properties of the communities across Los Angeles County are eerily similar to Paradise, Glen Ellyn, and Lahaina, What is demonstrably different is the toll on human life. Utilizing Genesis Protect, LA County and its partners successfully safely evacuated hundreds of thousands of citizens. Without question, countless lives were saved through the timely use of the Genesis Protect platform. As we all know, the fire events of Los Angeles lasted for several days, and over the course of that time, emergency managers and first responders were in continuous communication with the community. Over 400 zone status changes were communicated over just two weeks. Throughout the countywide event, Genesis personnel were on site, sitting side by side with county, state, and federal emergency management. Lessons learned from this extreme experience are being implemented in the Genesys Protect development and customer success protocols. From a platform standpoint, Genesys Protect proved to be incredibly resilient, scaling up capacity orders of magnitude during peak traffic. At one point, Genesys servers were processing over 183,000 requests per second. And Genesis' website drew more than 2 million active users in the month of January, and the number of Genesis app users jumped 5x during that month. Not only did Genesis enable emergency managers to get the word out, but Genesis also continuously informed the hundreds of thousands of impacted residents, families, and loved ones around the country. with the official and most accurate information on the fires in the impacted zones. It is impossible to overstate how proud we are of the team and the performance of Genesis Protect in such a critical and high-profile event. Recently, at the California Fire Chiefs Operational Technology Summit, where fire operations chiefs from across the state join emerging technology partners servicing fire and EMS industries with the goal of improving operations and firefighter safety. Genesis presented a minute-by-minute account of the response and communication by San Diego County for the Bernardo fire two weeks ago. We were able to show the logs from our software that confirmed an incredibly fast response. Residents received evacuations warnings and orders in less than eight minutes after first responders arrived on scene. In rapidly changing emergencies where time of response equates to lives at risk, the speed and accuracy of the notifications that the Genesis Protect platform provides enables first responders to accomplish their primary mission of protecting the community and saving lives. While Genesis was supporting customers in Southern California in January, we were also making meaningful headway with the project in Puerto Rico. When we last spoke, we had received the first deposit of approximately $8 million. And recently, we have received the second deposit of $2 million. And we have received written approval of the design on the third group of dams. Procurement of hardware is well underway. and our engineers are working with local teams to coordinate the installation of various components on the first two groups. Importantly, we recently completed the first major milestone, the provisioning of a 50-kilowatt generator. As a result, our first revenues for Puerto Rico will be recorded in our second fiscal quarter. The December quarter results largely reflect the year-on-year improvement on hardware backlog and software ARR. Importantly, both gross margins and operating expenses improved sequentially. In the quarter, we realized an increase in gross profit of $400,000 and a decrease in operating expenses of $770,000. Looking forward over the balance of this fiscal year, we expect to see continued improvement in both our hardware and software business. While the Puerto Rico project is certainly going to drive the greatest impact, international law enforcement demand for our traditional LRAD products continues to rebound towards pre-COVID levels. Additionally, the value proposition of acoustics for critical infrastructure protection and public safety is becoming increasingly more apparent and is significantly expanding our pipeline for opportunities. Finally, our work with the U.S. DOD across the branches continues to be robust. Recently, we received a follow-on order for two mobile communication trailers for the United States Army, and we are regularly supporting the United States Navy with spares and equipment. We continue to see progress with the AHD CROWS program. As most of you are aware, funding was put in place for this in FY24, and is yet to be put under contract. I am certain the program will get underway and expect the timing of the award to become more clear in the coming months. In summary, fiscal 2025 is steadily ramping up and we are eager to realize the acceleration in our business over the next several months. Beyond 2025, the outlook continues to improve with a broadening pipeline and increased visibility and predictability coming from our software offerings. Now I'll turn the call over to Dennis to go through the financial and an outlook in greater detail. Dennis?