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ACTELIS NETWORKS INC (ASNS)·Q3 2025 Earnings Summary

Executive Summary

  • Revenue of $0.643M missed consensus of $1.50M as federal deals slipped into Q4 and a large 2024 two‑year software contract did not repeat; gross margin was 28% given low volume and fixed cost absorption . Consensus from S&P Global; values marked with an asterisk are from S&P Global estimates.*
  • Diluted EPS of $(0.17) was better than S&P Global consensus of $(1.30), though only one estimate was available; net loss was $2.0M and adjusted EBITDA loss was $1.82M . Consensus from S&P Global; values marked with an asterisk are from S&P Global estimates.*
  • Bookings nearly doubled sequentially to $1.26M and backlog entering Q4 was $0.73M (vs. < $0.1M entering Q3), setting up Q4 shipments including ~$(0.5)M FAA order scheduled for Q4 .
  • Reorganization on track targeting 15–20% baseline OpEx reduction versus 1H25, with impact expected in Q4 and early 2026; liquidity bolstered by $1.85M of private placements, $1.6M of warrant exercises, and a $30M ELOC effective Oct 1, 2025; Nasdaq equity compliance confirmed; 1‑for‑10 reverse split effective Nov 18, 2025 .

What Went Well and What Went Wrong

  • What Went Well

    • Bookings and backlog acceleration: “Customer bookings this quarter were nearly double sequentially to Q2… [and] stronger backlog of orders that are scheduled for delivery” into Q4, including an FAA order of nearly $0.5M shipping in Q4 .
    • Cyber/security momentum: High-value cyber software upgrades supported gross margin; additional wins included a ~$0.3M Southern Europe telecom software/services order and a Central Germany utility order emphasizing encryption and cyber hardening .
    • Balance sheet/liquidity actions: $1.85M raised via two private placements and $1.6M via warrant exercises; $30M ELOC effective Oct 1 supports liquidity and ongoing Nasdaq compliance .

  • What Went Wrong

    • Revenue shortfall and mix: Q3 revenue was $0.64M vs. $2.54M YoY due to the non-recurrence of a 2024 two‑year software/support renewal (next in 2027) and elongated federal deal closures; FAA order received in Q3 ships in Q4 .
    • Margin pressure from low volume: Gross margin was 28% in Q3 as fixed costs weighed on low volumes despite software mix benefit .
    • Losses widened on revenue timing: Operating loss $(1.93)M vs. $(0.32)M YoY; net loss $(2.0)M vs. $(0.51)M YoY; adjusted EBITDA loss $(1.82)M vs. $(0.23)M YoY .

Financial Results

MetricQ3 2024Q2 2025Q3 2025
Revenue ($USD Millions)$2.541 $0.941 $0.643
Gross Margin (%)68.6% (calc. from $1.743M GP/$2.541M Rev) 32% 28%
Total Operating Expenses ($USD Millions)$2.060 $2.078 $2.112
Operating Income (Loss) ($USD Millions)$(0.317) $(1.773) $(1.929)
Net Income (Loss) ($USD Millions)$(0.511) $(1.901) $(1.980)
Diluted EPS ($)$(0.09) $(0.21) $(0.17)
Adjusted EBITDA ($USD Millions)$(0.233) $(1.714) $(1.821)

Q3 2025 vs S&P Global Consensus

  • Revenue: Actual $0.643M vs Consensus $1.500M* (miss) . Values retrieved from S&P Global.*
  • EPS: Actual $(0.17) vs Consensus $(1.30)* (better), though only one estimate was available. Values retrieved from S&P Global.*

KPIs

  • Bookings: $1.26M (nearly double sequentially) .
  • Backlog entering Q4: $0.73M (vs. < $0.1M entering Q3) .
  • FAA order: nearly $0.5M received in Q3, shipping Q4 .

Segment breakdown: Not disclosed (company reports consolidated results) .

Guidance Changes

MetricPeriodPrevious GuidanceCurrent GuidanceChange
Baseline Operating ExpensesStarting Q4 2025 into early 2026Not previously quantifiedTarget 15–20% reduction vs 1H25 baseline; reorg on trackIntroduced
Shipment Timing (FAA order)Q4 2025N/A~$(0.5)M FAA order received in Q3 to ship in Q4Update (timing)
LiquidityEffective Oct 1, 2025N/A$30M ELOC entered to enhance liquidityNew
Nasdaq Listing StatusOct 28–Nov 14, 2025In processEquity compliance confirmed; bid-price plan via reverse splitUpdate
Capital Actions2H 2025N/A$1.85M private placements; $1.6M warrant exerciseNew

No quantitative revenue, margin, or EPS guidance was issued for Q4/FY; management emphasized backlog, federal pipeline timing, and cost actions .

Earnings Call Themes & Trends

Note: No Q3 2025 earnings call transcript was available in the document set at the time of analysis; themes are drawn from primary press materials.

TopicPrevious Mentions (Q1 & Q2 2025)Current Period (Q3 2025)Trend
Federal/Military pipelineFocus areas, DoDIN APL/JITC/NIST credentials; awaiting sizeable federal business delayed from Q2; CRO (Americas) and Director of Federal Sales hired to accelerate growth FAA order ~$(0.5)M received (ships Q4); “seeing good traction… in Federal” with large opportunities advancing Pipeline improving; timing shifted to Q4
MDU progressTrials and initial deployments across multiple carriers/ISPs/developers; first major US telco order in Q2 Continued emphasis on Federal and MDU opportunities in CEO remarks Expanding customer activity
Cybersecurity/softwareOngoing emphasis on cyber‑hardened solutions; AI initiatives referenced in Q2 Cybersecurity upgrades across installed base; MetaAssist EMS/security orders (e.g., ~$0.3M Southern Europe) Strengthening mix toward software/services
Restructuring/OpExCost discipline in Q1; strategic restructuring plan announced in Q2 targeting 15–20% OpEx reduction Reorg on track; impact expected to appear in Q4 and early 2026 Progressing per plan
Regional activityOrders across Nordics, Hungary, Japan, UK (Q1–Q2) Orders in Central Germany utility; Oklahoma rural telco; Southern Europe telecom Broadening geographic footprint
Liquidity/NasdaqBalance sheet strengthened in Q1; raised ~$1.35M in Q2 $1.85M raises, $1.6M warrants, $30M ELOC; Nasdaq equity compliance; reverse split Nov 18 Improved liquidity and compliance

Management Commentary

  • “We are seeing good traction and opportunities develop in Federal and MDU markets, despite a soft quarter on the Federal revenue side… Customer bookings this quarter were nearly double sequentially to Q2, and we entered the fourth quarter with stronger backlog of orders that are scheduled for delivery” — Tuvia Barlev, Chairman & CEO .
  • “Our reorganization is proceeding as planned, while the financial impact will be seen in Q4 and into early 2026… we continue to expand our Federal and Military reach and pursue opportunities for both organic and selective inorganic growth” — Tuvia Barlev .
  • Q2 CFO perspective on operating leverage and cost actions: “the associated 15-20% cost reduction will create sustainable operational leverage towards breaking even” — Yoav Efron, Deputy CEO & CFO (context for the ongoing plan) .

Q&A Highlights

No Q3 2025 earnings call transcript was available in the document corpus at the time of analysis; Q&A highlights and any guidance clarifications from a call were not accessible. The company’s press release provides the primary source for commentary and metrics this quarter .

Estimates Context

S&P Global consensus vs actuals (quarterly)

  • Revenue (USD): Consensus vs Actual
    • Q1 2025: $1.20M* vs $0.721M (miss) . Values retrieved from S&P Global.*
    • Q2 2025: $1.00M* vs $0.941M (in-line) . Values retrieved from S&P Global.*
    • Q3 2025: $1.50M* vs $0.643M (miss) . Values retrieved from S&P Global.*
  • EPS (Primary, USD): Consensus vs Actual
    • Q1 2025: $(2.50)* vs $(0.22) (better) . Values retrieved from S&P Global.*
    • Q2 2025: $(1.60)* vs $(0.21) (better) . Values retrieved from S&P Global.*
    • Q3 2025: $(1.30)* vs $(0.17) (better; note only one estimate) . Values retrieved from S&P Global.*

Given the large variance between S&P Global “Primary EPS” estimates and reported EPS (GAAP) and the presence of only a single estimate, investors should be cautious about drawing strong conclusions from EPS “beats,” which may reflect share count or methodology differences rather than fundamental upside . Values retrieved from S&P Global.*

Revenue estimate shortfalls were explicitly linked to federal deal timing and the non‑recurrence of a 2024 software/support renewal; backlog and scheduled Q4 deliveries (FAA) support a potential sequential revenue recovery into Q4 .

Additional Notable Updates (Q4 Set-up and Corporate)

  • Liquidity/Capital Markets: $30M ELOC effective Oct 1, 2025; Nasdaq equity compliance confirmed Oct 28; 1‑for‑10 reverse split effective Nov 18 to support bid-price compliance .
  • New Orders: Central Germany utility (cyber‑hardened solution), Oklahoma rural telco (amplification for underserved communities), Southern Europe telecom (~$0.3M software/services) .

Key Takeaways for Investors

  • Near-term revenue visibility improved: bookings nearly doubled sequentially to $1.26M with $0.73M backlog entering Q4 and an FAA order (~$0.5M) shipping in Q4; watch Q4 execution on federal timing .
  • Q3 revenue miss was driven by timing and non‑recurring 2024 software renewal; mix included higher‑margin cybersecurity/software, but low volumes constrained gross margin to 28% .
  • Cost actions should begin to show in Q4 and accelerate into early 2026 as the 15–20% baseline OpEx reduction plan flows through; track OpEx trajectory and adjusted EBITDA inflection .
  • Liquidity runway strengthened via $30M ELOC, recent raises, and Nasdaq compliance; reverse split may broaden potential investor base but does not change fundamentals; monitor capital deployment and dilution discipline .
  • Medium-term thesis hinges on federal/military and MDU funnel conversion, cybersecurity/software growth, and reorg-driven operating leverage; evidence points to pipeline progress but execution timing remains critical .
  • For trading: Q4 catalysts include shipment conversion from backlog (FAA), any incremental federal awards, and demonstration of OpEx reduction; revenue trajectory vs prior delays will likely drive stock reaction .
  • Estimates likely need recalibration on revenue timing; EPS estimates carry limited signal given one-analyst coverage and potential methodological differences; prioritize backlog/booking-to-revenue conversion over headline EPS variance . Values retrieved from S&P Global.*

Footnotes:

  • Non-GAAP: Adjusted EBITDA excludes interest, other financial items, taxes, D&A, SBC, and certain one‑time costs; see the company’s reconciliation and non‑GAAP definitions .
  • Consensus data marked with an asterisk are from S&P Global and may reflect different EPS methodologies (e.g., share count effects). Values retrieved from S&P Global.*

Other Primary Sources Read this Quarter:

  • Q3 2025 8‑K with press release and financial tables .
  • Reverse split press release (1‑for‑10 effective Nov 18, 2025) .
  • Nasdaq compliance press release .
  • Orders: Central Germany utility , Oklahoma telco , Southern Europe telecom software/services (~$0.3M) .
  • Prior quarter results: Q2 2025 press release and tables ; Q1 2025 press release and tables .