SideChannel, Inc. (SDCH) Q3 2026 Earnings Call Prepared Remarks Transcript

SideChannel, Inc. ( SDCH ) Q3 2026 Earnings Call August 12, 2026 4:30 PM EDT Company Participants Brian Haugli - CEO & Director Ryan Polk - CFO & Secretary Presentation Operator Greetings. Welcome to the SideChannel Fiscal Year 2026 Q3 Financial Results Update. [Operator Instructions]. Please note, this conference is being recorded. I will now turn the conference over to your host, Brian Haugli, Chief Executive Officer. You may begin.

Brian Haugli CEO & Director Thanks for everybody for joining. I'm Brian Haugli, CEO of SideChannel. Ryan Polk, our CFO, is also with me. I'll give you the quarter, then I'm going to go straight at the liquidity question because I'd rather you hear that from me than find it in the filing. Ryan will take you through the financials then I'll cover where the business is heading, and we'll open it up.

Q3 was our first quarter of year-over-year revenue growth in 5 quarters. Revenue was $1.8 million, up $21,000 or 1.2%. That's a small number, but I want to be clear about why it matters anyway. For more than a year, this company was shrinking. This quarter, it didn't, and it stopped shrinking while we were also taking cost out. Gross margin was 54.9%, up 790 basis points from 47% a year ago. Two things drove that. Enclave carries a high gross margin, and it made up more of the mix, and we got better utilization out of our delivery team. Operating expenses were up 1.6%, $18,000 on a $1.1 million base, essentially flat against a quarter a year ago that we've since restructured. Net loss was $134,000 or $0.03 a share against $261,000 or $0.06 last year. We cut the quarterly loss roughly half. And we grew cash sequentially in the quarter, small, but the direction changed. Nine-month numbers are not as good, and I'm not going to present