Intrusion Inc.

Welcome to Intrusion, Inc.' 's third quarter 2024 earnings conference call and webcast. At this time, all participant lines are in a listen-only mode. For those of you participating in the conference call, there will be an opportunity for your questions at the end of today's prepared comments. Please note, this conference is being recorded. An audio replay of the conference call will be available on the company's website within a few hours after this call. I would now like to turn the call over to Josh Carroll with Investor Relations.

Thank you and welcome. Joining me today are Tony Scott, Chief Executive Officer, and Kimberly Pinson, Chief Financial Officer. This call is being webcast and will be archived on the Investor Relations section of our website. Before I turn the call over to Tony, I'd like to remind everyone that the statements made during this conference call relating to the company's expected future performance, future business prospects, Future events or plans may include floor-looking statements as defined under the Private Securities Litigation Reform Act of 1995. Please refer to our SEC filings for more information on the specific risk factors that could cause our actual results to differ materially from the projections described in today's conference call. Any forward-looking statements that we make on this call are based upon information that we believe as of today and we undertake no obligation to update these statements as a result of new information or future events. In addition to U.S. GAAP reporting, we report certain financial measures that do not conform to generally accepted accounting principles. During the call, we may use non-GAAP measures if we believe it is useful to investors or if we believe it will help investors better understand our performance or business trends. With that, let me now turn the call over to Tony for a few opening remarks.

Well, thank you, Josh, and good afternoon, and thank you all for joining us today. Our third quarter results reflect another quarter of improved performance as we delivered our second consecutive quarter of sequential revenue improvement, which marks an important milestone in our continuing journey towards sustainable growth and profitability. As I noted in our strategic update call last month, we signed an additional seven new Shield logos during the third quarter, bringing our total new logo count year-to-date to 18. I'm also pleased to report that we've continued to experience near zero churn with our Shield customers, and as I previously noted, we were able to expand two contracts with existing logos as a result of the positive experiences that these customers have had using our technology. So we continue to remain excited about the strong momentum that we have been experiencing for our suite of Shield technology solutions. And as we deploy our solutions to these new customers over the coming quarters, we anticipate that we will experience further improvements to our financial results that will help us achieve our growth and profitability goals. As I noted on our call in October, we're also continuing to see strong demand for our products in both the Philippines and the broader Asia Pacific region. As a result of the increased presence of our technology in the region and the positive reputation of our solutions with these customers, our pipeline is growing with additional high-quality opportunities that we expect to close in both the fourth quarter and in the first half of 2025. On the domestic front, we are engaged in several exciting POCs with large enterprise customers, which we also expect will turn into bookings in the fourth quarter and beyond. As you've been hearing me say for some time, the cybersecurity challenges most organizations face will only continue to grow. And we have a unique and valuable solution that can address many of the most pressing challenges that these institutions face. Now, with respect to our product development efforts, we've continued to focus on adding new capabilities to increase the efficacy and the value of our products. We've been improving the speed and the frequency of our updates which ensure that our customers will benefit from timely, relevant, and up-to-date cybersecurity protections. The AI features we've introduced into the Shield Command Hub will continue to expand with the goals of providing near real-time expert analysis, substantially reduced workload for security operations staff, and additional ease of use and automation tools for our customers. On the leadership front, our longest serving board member, Jim Giro, has announced his retirement from our board of directors, effective November 20, 2024. Jim has been a board member of Intrusion for 21 years and is stepping away as a part of a long-planned transition to retirement to focus on other activities. And over the years, Jim's been a great resource for the board as he's utilized his extensive executive leadership experience to provide intrusion with counsel that assisted the company in addressing a wide range of challenges that we faced over the last few years in particular. It's been a pleasure to work with Jim on the board. I would like to personally thank Jim for his extraordinary commitment to intrusion during his tenure, and we wish him the best as he begins his well-deserved retirement. A replacement for Jim has not yet been identified, but the board has already begun a search to identify and evaluate qualified candidates. We'll provide additional information when it's appropriate to do so. Now briefly onto our financials. As you'll hear from Kim later in greater detail, our SHIELD revenue during the third quarter increased by 49% sequentially. The most significant portion of the increase in SHIELD revenue during the third quarter was driven by the addition of a U.S. Department of Defense contract, which is a combination of SHIELD and our more traditional consulting services. we expect to see additions to and expansions of this contract in the coming quarters. As in previous quarters, we've managed to control our costs, which remain relatively flat, and we continue to maintain a healthy gross margin above 77 percent, which I believe is essential for our long-term goals. At the same time, we continue to invest in R&D at a relatively constant level. with our prior quarters, which allows us to quickly design, develop, and implement new capabilities to keep our products fresh, relevant, and effective in a constantly changing cybersecurity environment. Now, before I turn the call over to Kim, I'd like to address our current share price. As many of you are aware, we've received a written notice from the NASDAQ stock market indicating that intrusion is not in compliance with the $1 minimum bid price requirement for continued listing. The notice has no immediate effect on our listing on NASDAQ, and we have 180 calendar days to regain compliance. Like many of our loyal investors, we're extremely disappointed with how our share price has performed over the past few months. But we recognize that the best cure for this situation is delivering on our revenue goals and we believe that the fourth quarter and the first quarter will continue to deliver the results that we've committed ourselves to. While there's still a lot of work ahead of us, we are on the right path forward, given the steps that we've taken to strengthen our balance sheet and grow our customer base, which, as you can see, has already begun to yield improved financial results. As we look ahead, I believe that the recent customer wins coupled with our strong pipeline of high-quality opportunities, have positioned us to improve our financial performance and ultimately drive our stock price higher in a sustainable fashion. And with that, I'd now like to turn the call over to Kim for a more detailed review of our third quarter financials. Kim?