Executive Summary

Q3 2025 marked a sharp operational inflection: net sales reached $1.94M vs $0.045M in Q2 2025 as the company’s SaaS pivot scaled, while Q3 net loss improved year over year to $0.253M from $0.625M in Q3 2024 .
YTD mix shift drove structural margin expansion: 9M 2025 gross margin was 83.0% (vs 32.4% in 9M 2024) on SaaS/Software services replacing legacy hardware; 9M operating loss narrowed 75% YoY and net loss narrowed 71% YoY .
Commercial traction strengthened: SaaS customers increased to 528 (from 245 in Q2), and prepaid SaaS fees rose to $4.24M (from $1.5M in Q2); management cited $0.48M of customized software R&D contracts underpinning dual growth engines (MCN digital services and customized software) .
Liquidity improved: cash and cash equivalents were $5.91M at Sep 30, 2025; net cash provided by operating activities was $2.48M for 9M 2025, providing runway for continued product and go-to-market investments .
No formal quantitative guidance ranges were provided in the Q3 press materials; stock reaction catalysts center on SaaS momentum (customers, prepaid) and high gross margin durability against a still-small absolute revenue base .

What Went Well and What Went Wrong

What Went Well
- Revenue inflected sequentially: Q3 net sales of $1,939,542 vs $44,993 in Q2 as SaaS/Software services commercialization ramped .
- Structural margin and loss improvement: 9M 2025 gross margin 83.0% (32.4% prior year); 9M operating loss reduced to $1.11M (from $4.38M) and net loss to $1.27M (from $4.37M), reflecting the model transition .
- Healthy early KPIs and liquidity: 528 SaaS customers (245 in Q2) and $4.24M prepaid fees (vs $1.5M in Q2) alongside $5.91M cash at quarter-end and $2.48M 9M operating cash inflow .
- Management quote: “our net sales increased by 210% year over year…customized software R&D services already securing $480 thousand in contracts…dual growth engine” — Rafael Li, CEO .
What Went Wrong
- Company remains loss-making: Q3 net loss was $252,985 (albeit improved YoY from $625,067) and overall scale remains modest .
- G&A increased 20.4% YoY in 9M 2025 to support market-entry initiatives; expense trajectory bears monitoring as revenue scales .
- Legacy hardware revenue went to zero vs prior year (cable modems & gateways and other network products down 100% YoY YTD), concentrating growth in new lines of business .

Financial Results

Quarterly results and sequential trends

Metric	Q1 2025	Q2 2025	Q3 2025
Net Sales ($)	$125	$44,993	$1,939,542
Diluted EPS ($)	-0.101*	-0.130*	-0.040*
Gross Margin (%)	N/A*	2.4%*	85.0%*
Net Income Margin (%)	N/A*	N/A*	-13.0%*

Values with asterisks (*) retrieved from S&P Global.

Year-to-date YoY comparison

Metric	9M 2024	9M 2025	YoY Change
Net Sales ($)	$639,893	$1,984,660	+210%
Gross Profit ($)	$207,259	$1,648,241	+$1,441,0k
Gross Margin (%)	32.4%	83.0%	+50.6 pp
Operating Expenses ($)	$4,590,491	$2,756,879	-39.9%
Operating Loss ($)	$(4,383,232)	$(1,108,638)	+$3,274,594
Net Loss ($)	$(4,371,934)	$(1,266,575)	+$3,105,359
Diluted Net Loss/Share ($)	$(1.47)	$(0.25)	+$1.22

Segment/line-of-business mix (YTD)

Line Item	9M 2024	9M 2025
Cable modems & gateways ($)	$638,804	$0
Other network products ($)	$1,089	$0
SaaS – MCN Digital Services ($)	$0	$1,797,314
Software Services ($)	$0	$187,346
Total Net Sales ($)	$639,893	$1,984,660

Operating cash and liquidity (point-in-time / period)

Cash & Cash Equivalents (Sep 30, 2025): $5,905,372 .
Net Cash Provided by Operating Activities (9M 2025): $2,478,829 .

KPIs

KPI	Q2 2025	Q3 2025
SaaS Customers (period-end)	245	528
Prepaid SaaS Subscription Fees (cumulative)	$1.5M	$4.24M

Guidance Changes

Metric	Period	Previous Guidance	Current Guidance	Change
Guidance (all metrics)	FY/Q4 2025	Not disclosed in prior press materials	Not disclosed in Q3 press materials	N/A

The Q3 2025 press materials and 8-K did not include formal quantitative guidance ranges for revenue, margins, opex, OI&E, tax, or segment metrics .

Earnings Call Themes & Trends

Note: A Q3 2025 earnings call transcript was not available in our document corpus; themes below draw from the company’s Q2 and Q3 press materials. If a transcript becomes available, we will update this section accordingly.

Topic	Previous Mentions (Q-2 and Q-1)	Current Period (Q3 2025)	Trend
SaaS pivot and commercialization	Launch on Mar 28, 2025; 245 customers by Q2; $1.5M prepaid; early-stage costs depressed 1H margins .	528 customers; $4.24M prepaid; Q3 net sales $1.94M as scaling begins .	Improving (commercial traction accelerating) .
Customized Software R&D services	Vendor partnerships; platform build-out; KYC, file transfer, authentication technologies highlighted .	$480k in contracts secured; positioned as second growth engine .	Positive (early bookings) .
Margin profile	1H 2025 gross margin 1.0% given launch costs; non-representative of future trends .	9M gross margin 83.0% on SaaS-heavy mix .	Rapidly improving .
Cost discipline	1H opex down 74.6% YoY; G&A down 40.4% YoY in 1H .	9M opex down 39.9% YoY, but G&A up 20.4% YoY for market-entry .	Mixed (total down, G&A needs monitoring) .
International exposure	—	Osaka World Expo showcased products; engaged global innovators and potential partners .	Expanding presence .

Management Commentary

“We are pleased to report strong third-quarter results…our net sales increased by 210% year over year, validating our strategic pivot to SaaS…customized software R&D services already securing $480 thousand in contracts…dual growth engine strategy” — Rafael Li, CEO .
“Another highlight was our successful participation in the Osaka World Expo…we plan to remain focused on expanding our international presence and delivering our products to a worldwide community of key opinion leaders” — Rafael Li .
“To accelerate our growth, we have recently acquired advanced technologies…product authentication…high-efficiency file transfer…KYC solutions…powering our SaaS products” — Rafael Li (prior update) .

Q&A Highlights

We were unable to source a Q3 2025 earnings call transcript in our document set; therefore, Q&A highlights and any call-based guidance clarifications are not available at this time. We will update this section if/when the transcript is published in our corpus.

Estimates Context

S&P Global consensus coverage appears limited. For Q3 2025, we did not observe published consensus for revenue or EPS; S&P Global reflects the actual revenue of $1,939,542 and no consensus fields for EPS or number of estimates [GetEstimates].
Implication: With no formal consensus, buyside modeling will likely tighten around reported SaaS KPIs (customers, prepaid fees) and implied ARR traction. Values retrieved from S&P Global.

Metric	Period	Consensus	Actual	Surprise
Revenue ($)	Q3 2025	N/A (no published consensus)*	$1,939,542	N/A*
EPS ($)	Q3 2025	N/A (no published consensus)*	-0.040 (diluted EPS, S&P Global intra-quarter estimate)*	N/A*

Values with asterisks (*) retrieved from S&P Global.

Key Takeaways for Investors

The business has turned a commercialization corner: sequential net sales re-accelerated to $1.94M in Q3, supported by expanding SaaS customer count and sizable prepaid balances signaling forward demand .
Margin structure is now SaaS-like: 9M gross margin of 83% indicates the mix shift is working and should support operating leverage as scale builds .
Losses are narrowing quickly, but scale remains small; monitoring G&A and efficiency metrics is essential to sustain momentum without pressuring cash .
The dual-engine strategy (MCN digital services + customized software R&D) is gaining proof points via $480k in contracts and growing SaaS KPIs, offering multiple growth vectors .
Liquidity improved materially with $5.91M cash and positive operating cash generation YTD, providing runway for product and GTM investments .
Absence of formal guidance and lack of consensus estimates increases modeling uncertainty; focus near-term on leading indicators (customers, prepaid, retention/upsell) and sequential revenue cadence .
Event exposure (Osaka Expo) may accelerate partnerships and international pipelines, potentially aiding FY transition to a recurring-revenue model .

References:

Q3 2025 8-K and Exhibit 99.1 press release (includes financial tables and highlights) .
Q3 2025 press release (PR Newswire) with identical highlights/tables .
Q2 2025 8-K and first half press release (context for prior quarter metrics and early KPIs) .
Osaka World Expo press release (context on international exposure) .

S&P Global data disclosure:

Any values marked with an asterisk (*) were retrieved from S&P Global.

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