Executive Summary

Q4 2022 preliminary revenue was $14.7M, the company’s highest quarterly revenue, up 150% year over year vs $5.9M in Q4 2021; management said this marked seven consecutive record-revenue quarters .
Preliminary operating loss was $9.4M, an improvement of 71% year over year vs $32.9M in Q4 2021; sequentially, operating loss worsened vs Q3’s $(8.4)M loss as the company continued investing and integrating acquisitions .
Liquidity actions: CISO issued a $5.0M 10% unsecured convertible note (conversion price $1.20) and intends to use proceeds plus existing cash to repay a defaulted $5.035M Bell Bank note (rate stepped up to 7% post-default) .
No formal numerical guidance and no earnings call transcript were found; Wall Street consensus estimates from S&P Global were unavailable due to system limits, so beat/miss vs Street cannot be assessed .

What Went Well and What Went Wrong

Record revenue and demand: “highest quarterly revenue ever” and “seven consecutive quarters of record revenues,” with management citing growing demand and validation of strategy .
Year-over-year loss improvement: Operating loss reduced to $(9.4)M from $(32.9)M in Q4 2021, reflecting scale benefits and lower nonrecurring items YOY .
De-risking near-term debt: Proceeds from the $5.0M convertible note targeted to repay the Bell Bank note in default, reducing interest expense and default risk .

Continued operating losses: Q4 operating loss $(9.4)M; sequential loss from operations worsened vs Q3 $(8.4)M, indicating ongoing margin pressure amid integration and growth investments .
Internal control weaknesses: Management disclosed material weaknesses in disclosure controls and procedures persisting into Q3 2022 (lack of risk assessment procedures; lack of documentation) .
Governance/related-party optics: The note purchaser is Hensley & Company, where a CISO director (Andrew McCain) is President/COO—heightening related-party scrutiny though terms were disclosed .

Metric	Q2 2022	Q3 2022	Q4 2022 (Prelim)
Revenue ($USD Millions)	$11.228	$11.253	$14.700
Gross Profit ($USD Millions)	$0.765	$0.924	Not disclosed
Operating Income (Loss) ($USD Millions)	$(7.293)	$(8.423)	$(9.400)
Net Loss ($USD Millions)	$(7.340)	$(8.501)	Not disclosed
EPS (Basic/Diluted, $USD)	$(0.05)	$(0.06)	Not disclosed
Gross Margin %	6.8% (0.765/11.228)	8.2% (0.924/11.253)	Not disclosed
Operating Margin %	(64.9)% (−7.293/11.228)	(74.9)% (−8.423/11.253)	(63.9)% (−9.4/14.7)
Revenue YoY ($USD Millions)	+$8.278 vs $2.950 Q2’21	+$7.508 vs $3.745 Q3’21	+$8.800 vs $5.900 Q4’21
Operating Loss YoY ($USD Millions)	−$5.239 vs $(2.053) Q2’21	−$5.264 vs $(3.158) Q3’21	−$23.5 vs $(32.9) Q4’21

Notes: Q4 figures are preliminary; margin percentages are computed from cited revenue and profit/loss figures .

Segment Revenue ($USD Millions)	Q2 2022	Q3 2022	Q4 2022
Security Managed Services	$10.376	$10.061	Not disclosed
Professional Services	$0.852	$1.192	Not disclosed
Total	$11.228	$11.253	$14.700

Metric	Period	Previous Guidance	Current Guidance	Change
Revenue	FY 2023	None	No formal guidance; directional comment: “expect… demand… to carry on through 2023”	Maintained (no numeric)
Margins/OpEx/Tax/Dividends	FY 2023	None	None provided	Maintained (no numeric)
Financing/Balance Sheet	Near-term	N/A	Intends to use $5.0M note proceeds plus cash to repay Bell Bank note in default	New disclosure

No Q4 2022 earnings call transcript was found; trends draw from Q2/Q3 filings and Q4 press release [Search: none].

Topic	Previous Mentions (Q-2 and Q-1)	Current Period (Q4 2022)	Trend
Regional trends	Q2: US + Chile; Chile revenue $1.87M; US $9.36M . Q3: US $9.00M; Chile $2.15M .	Q4: Region mix not disclosed (prelim) .	Expanding LATAM presence; disclosure limited in prelim .
Capital markets/liquidity	Q2: S-3 shelf declared effective ($300M); working capital deficit $(0.77)M . Q3: working capital deficit $(3.28)M; expects further losses through 2022 .	Issued $5.0M 10% convertible note; intends to repay Bell Bank note in default .	Active financing; addressing near-term obligations .
Internal controls	Q3: material weaknesses in disclosure controls persist (risk assessment; documentation) .	Not addressed in the prelim release .	Ongoing remediation; risk persists .
M&A integration	Q2: Creatrix acquired . Q3: CyberViking, CUATROi, NLT Secure acquired .	Prelim note: results subject to business combination measurement period adjustments .	Continued integration; measurement adjustments pending .

“We are very pleased to announce this 2022 preliminary estimated financial information, which reflects our highest quarterly revenue ever and continues our string of seven consecutive quarters of record revenues… We continue to see growing demand for our services and expect this to carry on through 2023.” — David Jemmett, CEO and Chairman .
Use of proceeds: “The Company intends to use the net proceeds of the Note Offering and its existing cash resources to repay in full the $5,000,000 4% promissory note issued and sold to Bell Bank in June 2022.” .

No Q4 2022 earnings call transcript was available in the document set; therefore Q&A themes and clarifications cannot be assessed [Search: none].

Wall Street consensus estimates for Q4 2022 (EPS, revenue, EBITDA, target price) via S&P Global were attempted but unavailable due to system limits, so a beat/miss analysis vs Street cannot be provided at this time. We will update if access becomes available.

Demand backdrop remains constructive; preliminary Q4 revenue rose to $14.7M (+150% YoY), extending record-revenue streak, a near-term narrative positive .
Sequential margins remain a watch item: operating loss worsened vs Q3 (Q4 $(9.4)M vs Q3 $(8.4)M), indicating continued integration and investment impacts despite stronger revenue .
Liquidity risk mitigation: the $5.0M convertible note and intent to retire the defaulted Bell Bank obligation reduce near-term refinancing/interest burden and default risk .
Governance/related-party scrutiny: note purchaser affiliation (director involvement) raises optics; disclosure is comprehensive but warrants monitoring of future related-party financing terms .
Internal control remediation remains outstanding per Q3 disclosure; investors should expect ongoing process investments and potential reporting variability until remediation completes .
Street comparison unavailable: with no formal guidance and unavailable consensus data, short-term trading setups hinge on debt resolution progress and subsequent audited results clarity .
M&A integration and measurement period adjustments may alter final audited Q4/FY results; monitor audit completion for any material changes to revenue or operating loss .

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