Genasys Inc.

Good day, ladies and gentlemen, and welcome to the Genesis Incorporated Fiscal Third 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. If you should require assistance throughout the conference, please press star zero on your telephone keypad to reach a live operator. At this time, it is my pleasure to turn the floor over to your host, Brian Alger, SVP of Senior Relations and Corporate Development. Sir, the floor is yours.

Good afternoon. Welcome to Genesis's Fiscal 2025 Third 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 Cassandra Monchion, the company's interim CFO. During today's call, management will make forward-looking statements regarding the company's plans, expectations, outlook, and future financial performance that may 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 only on the information and management's expectations as of today, August 14, 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, and backlog, which we believe provide helpful information to investors with respect to evaluating the company's performance. For a reconciliation of the adjusted EBITDA to GAAP financial metrics, please see the table on the press release issued by the company at the close of the 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 customer purchase orders executed in a given period, regardless of the timing of the related revenue recognition. Backlog is a measure of purchase orders received that are scheduled to ship within 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. At this time, it's my pleasure to turn the call over to Genesis's CEO, Richard Danforth. Richard?

Thank you, Brian, and welcome, everyone. Fiscal Q3 revenues reflect the first material impact of the Puerto Rico Early Warning System project. Total revenues were $9.9 million in the quarter, inclusive of $4.3 million from Puerto Rico. Our software pipeline is at an all-time high and is rapidly growing in response to our sales efforts and increased awareness of our offerings due to the LA fires, SignalGate, and more recently, the floods in Texas. International and domestic LRAD bookings continue to rebound, resulting in a growing 12-month backlog of business that, for Genesis as a whole, amounted to more than $60 million at the end of June. As you are aware, after invoicing the customer in March of this year, we received a partial payment for the deposit on the third group of dams in Puerto Rico in May. The remaining portion has finally been transferred today. We believe the root cause of the payment delays has been identified and resolved, and future payments are now expected to be made in a timely manner, similar to the first two groups' deposits. The CROWS-AHD effort, part of the CROWS II Tech Refresh Program of record, saw our initial research and development funding in fiscal 2022 and 2023. The first production funding was included in the 2024 federal budget, and following the successful completion of the design, test, and qualification of the LRAD 450 XL RT, the U.S. Army issued an RFQ in July of 2025. The RFQ has since closed, and a purchase order of $8 to $8.5 million is being finalized. Genesis expects many more years of continued CROWS-related revenue. The temporary funding freeze of the Urban Area Security Initiatives and the Homeland Security Grant Program, as well as the cancellation of FEMA's Hazard Mitigation Program's Building, Resilience, Infrastructure, and Communities that occurred at the beginning of this calendar year, has delayed, disrupted, and in some cases, eliminated more than $2 billion in annual funding that state and local agencies rely on. This has resulted in a slowdown of our software bookings. As we detailed in our earnings release earlier today, more than $9 million of software bookings are currently awaiting funding from various federal programs that flow down to state and local jurisdictions. Recent indications are that public safety and hazard mitigation grants are being solidified, and funding is slowly starting to move. But it would be naive to think that everything will change instantaneously. Acknowledging this reality, we have recently completed a number of actions to reduce our operating expense levels while maintaining a strong sales effort for Genesis Protect. Included in those actions was a targeted headcount reduction. We expect to save $2.5 million annually as a result of the actions taken. It is important for all of us to understand that despite the recent slowdown in software bookings, traction and momentum are growing. As I already mentioned, our pipeline of software business is at an all-time high and our geographic footprint is expanding. Historically, Genesis has seen most of its success west of the Rockies. However, with new product feature sets and targeted sales effort, we have seen a massive improvement in the pipeline of business east of the Rockies. Much so that more than 25% of the software pipeline added in the past 12 months comes from the customers located east of the Rocky Mountains. In our CRM system, many details in our software pipeline are labeled pending funding. These deals range from cities within LA County looking for their own EVAC licenses to large regional emergency managers eager for precise zone-based solutions to even federal agencies interested in Genesis' unique and differentiated Genesis Protect. Though the recently reported top-line results don't reflect this activity, our deal count, diversity of customers and increasing deal size gives us increasing confidence that Genesis Protect meets the market demands. I would now like to spend a little time detailing our progress in Puerto Rico. As you know, this is a $75 million contract with PREPA that is fully funded by FEMA. The project covers 37 dams across the island of Puerto Rico that have been broken down into seven distinct groups. The first two groups, which have a total of roughly $17 million, are well underway. Within the first two groups, there are nine dams. Each dam has unique sensor and communication equipment requirements. Across the first two groups, 58 poles, 69 solar panels, kits, 51 sensors, 35 cameras and nearly 400 LRAD speakers will be installed. As of this week, construction is underway on all nine dams and essentially all of the equipment necessary to complete the installations for the first two groups is on the island. Moreover, sign-off on the first dam and the early warning system software has already been received. The significance of this acceptance cannot be overstated. The software and hardware development and integration is complete and operational on the first dam. The third group is the largest of the seven groups, including installations at 10 dams with a value of $18 million to Genesis. Upon receipt of the remainder of the deposit, we will rapidly seek permits and finalize the production of the equipment and begin construction necessary to complete this group as quickly as possible. With tropical storm Aaron tracking down towards Puerto Rico this week, we are reminded that the installation schedules are sometimes subject to forces outside our control. Thus far, the construction project has been going very well and we are tracking very close to plan. There is no guarantee that the weather will continue to cooperate, but regardless, we aim to complete the installations across all seven groups as quickly as possible. Whether it is natural disasters, geopolitical unrest or macroeconomic change, a lot of uncertainties continue to arise around the world, which in many cases creates new and evolving opportunities for Genesis solutions. Genesis delivers products all over the world that save lives. From Africa to Singapore to Florida, central Florida, Genesis software and hardware is making a difference in protecting lives throughout the world. We know that we have products that the market wants. Exiting the June quarter, Genesis has over $60 million in its 12-month backlog. This does not include the $650,000 of ARR associated with Puerto Rico, nor anything related to crows. While not a guarantee of outcome, the existing backlog and the growing pipeline of additional business provides us with confidence in the business and the strategic value of the company. In summary, fiscal 2025 has been challenging on a number of levels. However, with an extremely strong backlog, growing pipeline and differentiated product portfolio, Genesis is in position to reap the rewards of its investments over the next several years. Now, I will turn the call over to Cassandra to go through the financial outlook in greater detail. Cassandra?