Total Revenues

+363% YoY (Q1 2025: $4,952,185 vs Q1 2024: $1,070,680)

The dramatic increase in total revenues is driven by a surge in services and consulting income, especially from related parties (increased by 510%, from $800,825 to roughly $4.89 million), which far outpaced the negative impact of declining technology systems revenue due to ongoing delays in Railcar Inspection Portal (RIP) deployments. This revenue mix change reflects a strategic pivot and a higher contribution from high-margin service offerings, building off the limited base in Q1 2024. " " "

Gross Margin

+1,285% YoY (Q1 2025: $1,313,659 vs Q1 2024: $94,632)

Gross margin improved substantially thanks to a favorable revenue mix, driven primarily by the Asset Management Agreement (AMA) revenues recognized at a 100% margin and a 60% reduction in technology systems costs. The combination of nearly cost-free high-margin revenue and decreased production costs transformed the gross margin from a very low base in Q1 2024 to a robust figure in Q1 2025. " " "

Operating Loss

35% improvement (Q1 2025: $(1,789,628) vs Q1 2024: $(2,761,046))

Operating losses narrowed significantly as the surge in higher-margin service revenues more than offset increased operating expenses. Although total operating expenses saw an 8.7% increase (from $2,855,678 to $3,103,287), the strong top-line growth improved operational efficiency compared to Q1 2024. " " "

Net Loss

24% reduction (Q1 2025: $(2,079,663) vs Q1 2024: $(2,752,309))

Net loss declined due to the revenue uptick from the AMA and related services substantially reducing the loss magnitude, despite moderate increases in cost of revenues and operating expenses. The improved revenue performance, which helped cushion otherwise high operating expenses noted in previous periods, is the primary catalyst for the 24% drop in net loss. " " " "

Total Operating Expenses

+8.7% YoY (Q1 2025: $3,103,287 vs Q1 2024: $2,855,678)

Total operating expenses increased modestly as the company expanded its scale to support new business initiatives, notably with higher General and Administration costs. This incremental increase reflects strategic investments and expanded operating activities that, while increasing costs, also set the stage for the significant revenue and margin improvements seen in Q1 2025. " " " "

Net Cash Used in Operating Activities

Deteriorated (Q1 2025: $(4,673,425) vs Q1 2024: $(2,032,719))

Net cash used in operating activities worsened despite top-line improvements, likely due to increased cash outflows driven by higher working capital requirements and escalated operating outlays. The Q1 2025 figures indicate that while revenue recognition and margins were exceptional, the timing and scale of cash expenses (such as higher servicing and administrative costs) led to more negative operating cash flows compared to Q1 2024. " "

Revenue Guidance

FY 2025

$28 million to $30 million "

$28 million to $30 million "

no change

Adjusted EBITDA Guidance

FY 2025

Projected to achieve positive adjusted EBITDA for the full year "

Expect to breakeven and then generate positive adjusted EBITDA in Q3 and Q4 "

no change

Net Loss Guidance

FY 2025

Anticipated losses in the first half of FY 2025 "

Expects to lose money in the first half of FY 2025 "

no change

Edge Data Center Deployment

FY 2025

Plan to acquire an additional 9 edge data centers by year-end "

Plans to place 15 edge data centers by the end of FY 2025 " "

raised

Power Business Gross Margin

FY 2025

no prior guidance

Expected to remain around 32% throughout FY 2025 "

no prior guidance

Debt Retirement Guidance

FY 2025

no prior guidance

Expects to retire a further $1.2 million of debt by the end of FY 2025 "

no prior guidance

Backlog and Pipeline Guidance

FY 2025

no prior guidance

Backlog represents over $45 million in revenue with $17.4 million to be recognized and an additional $7–$8 million in near-term awards "

no prior guidance

Edge Data Center Expansion & Execution

In Q4 2024 the company emphasized a plan to deploy 15 Edge Data Centers by year‐end, with ongoing quarterly installations. " " In Q3 2024, discussions highlighted strong demand, additional acquisitions, and accelerated deployment schedules. " " In Q2 2024, Duos detailed installing 4 EDCs in Texas with revenue expected to begin shortly. " "

In Q1 2025, Duos provided significant updates: 8 additional committed EDCs to be installed within 6 months, a goal to hit 15 EDCs in 2025, and strong customer and hyperscaler interest further bolstering the expansion effort. " "

Accelerating/Positive momentum: The EDC rollout is scaling faster with increased commitments and strategic execution improvements.

Hyperscaler Engagements

Q4 2024 discussions featured active talks with 5–6 major hyperscalers including AWS, while Q3 2024 mentioned early-stage discussions aimed at accelerating EDC deployment. Q2 2024 had preliminary engagement mentions at industry events. " " "

In Q1 2025, the focus remains on hyperscaler engagement with active discussions with 3–4 hyperscalers showing interest in behind‐the‐meter solutions for both power and EDC projects. " "

Consistent strategic focus: Engagement continues steadily though the absolute number cited varies, reflecting sustained market interest.

Power Business Operational Resilience & Margin Sustainability

Q4 2024 highlighted strong operational resilience thanks to US‐based assets under the asset management agreement, with expectations for healthy margins. Q3 2024 underscored a 2‐year, $42 million AMA managing 850 MW of assets, and Q2 2024 pointed to margins in the 50–60% range on power projects. " " " "

In Q1 2025, while Duos reported a gross margin for the power business around 32%, operational resilience is maintained through US asset ownership and strong AMA contributions. " "

Slight margin decline but stable resilience: Margins appear lower compared to earlier projections, yet the US asset base continues to protect the business.

Tariff Exposure & Raw Material Cost Risks

Q4 2024 noted that domestic sourcing (e.g., steel and aluminum for railcar portals) minimizes immediate tariff impacts, with no concrete impact on power assets. Q3 and Q2 2024 did not address these risks in detail. "

In Q1 2025, Duos reiterated that tariffs currently have no impact on either its power or EDC business due to US ownership and agreements with partners like Accu‐Tech, though watchfulness remains. "

Neutral; ongoing risk awareness: There is a consistent understanding that while tariffs pose potential future risks, current exposures are well shielded.

Rail Business Subscription Growth & Regulatory/Execution Challenges

Q2 2024 showcased a new 5‐year subscription partnership with a Class 1 railroad, a $10.7 million revenue backlog, and discussions with around 20 prospects; Q3 2024 highlighted pilot programs (e.g., with Amtrak and Canadian National) and subscription revenue forecasts, but also mentioned delays in projects; Q4 2024 stressed a shift toward a subscription model amid regulatory hurdles and patent disputes. " " " " " "

In Q1 2025, the rail business received less emphasis. Although some delays (e.g., in railcar inspection portal installations and additional amortization expenses) were noted, the focus shifted toward new product rollouts to address slow market adoption. " "

Deprioritized with persistent challenges: The rail segment is receiving less focus relative to EDCs and power, while execution hurdles remain.

Increasing Expense Pressure (stock‐based compensation & depreciation)

Q2 and Q3 2024 earnings calls did not address this topic, and Q4 2024 only noted that non‐cash stock compensation was excluded from adjusted EBITDA without further detail. "

In Q1 2025, there is a clear disclosure of significant expense pressures from stock‐based compensation—with quarterly charges forecast around $500K–$600K—and anticipates higher depreciation as new EDCs come online. " "

Newly emphasized: Expense pressures are now being discussed in detail, highlighting an increased focus on managing stock-based charges and depreciation.

Execution & Deployment Risks for Key Projects

Q2 2024 highlighted delays in the Amtrak installation and noted operational timing risks for EDC and power deployments. " " Q3 2024 elaborated on delays in Amtrak and EDC rollouts and noted power asset management challenges, while Q4 2024 provided detailed examples of rail portal delays, power deployment speed, and EDC installation hurdles. " " " "

In Q1 2025, explicit discussion of execution risks is less detailed; however, the ambitious rapid rollout of 8 committed EDCs and accelerated APR Energy deployments inherently suggest ongoing risks. " "

Consistent but less explicit: Execution risks remain inherent given rapid rollout plans, though they are less overtly highlighted in Q1 despite ambitious timelines.

Competitive Pressure in the Energy Division

Q3 2024 mentioned that the energy division faces stiff competition from large OEMs (General Electric, Siemens, Caterpillar, Cummins) and noted equipment availability challenges. Q2 and Q4 2024 did not address competition explicitly. "

Q1 2025 does not specifically mention competitive pressure in the energy division.

Reduced focus in current period: While Q3 provided clarity on strong competition, Q1 sees a de-emphasis on competitor pressure, suggesting a possible shift in focus.