#SideChannel Announces Third Quarter Financial Results for FY 2025
WORCESTER, MA - On August 13, 2025, SideChannel, Inc. (OTCQB:SDCH), a prominent provider of cybersecurity services to emerging and mid-market companies, reported its financial results for the third quarter of the fiscal year ending September 30, 2025. The company revealed a revenue of $1.8 million, marking a 3.8% decrease compared to the same period in FY 2024.
In the third quarter, SideChannel reported a gross margin of 47.0%, slightly lower than the 48.9% recorded a year earlier. Operating expenses rose by $47,000, or 4.5%, indicating increased investment in the company’s services. The net loss for this quarter amounted to $261,000, a notable increase from the net loss of $146,000 reported in the third quarter of FY 2024.
As of June 30, 2025, the company had cash and cash equivalents totaling $1.2 million, a decrease of $46,000 from the previous year. The trailing twelve-month revenue stood at $7.5 million, with a revenue retention rate of 61.4% for the same period.
For the nine months ending June 30, 2025, SideChannel’s revenue totaled $5.6 million, reflecting a slight increase of 1.3% compared to the previous fiscal year. The gross margin remained stable at 47.5%, while operating expenses decreased by $103,000, or 3.1%, leading to a net loss of $510,000.
Brian Haugli, President and CEO of SideChannel, expressed optimism regarding the company's direction. With the Enclave Zero Trust software platform gaining traction, including onboarding two Department of Defense clients, SideChannel is focused on expanding its market presence. Additionally, the recent launch of an Insider Threat program is expected to bolster the company’s offerings, addressing internal security risks.
Haugli emphasized the company’s commitment to enhancing its cybersecurity services portfolio and adapting to meet the growing demands of critical markets. A conference call is scheduled for later today at 4:30 PM ET to further discuss these results and future initiatives.
In the third quarter of Fiscal Year 2025, SideChannel reported revenue of $1.8 million, reflecting a slight decrease of 3.8% compared to the same period in FY 2024. This modest decline may warrant further analysis, particularly in the context of ongoing initiatives that could enhance future revenue streams.
Operating expenses in the third quarter increased by $47 thousand, or 4.5% compared to FY 2024. This increase in spending may reflect ongoing investments in growth and service development, a potential positive indicator of the company's strategic positioning.
For the third quarter of FY 2025, SideChannel reported a net loss of $261 thousand, up from a net loss of $146 thousand in the same quarter last year. While increasing losses can be concerning, they may also suggest heightened investment in growth areas, particularly in technology advancements such as the Zero Trust software platform.
As of June 30, 2025, SideChannel's trailing twelve-month revenue was reported at $7.5 million. This figure could provide a foundation for assessing performance trends and growth strategy effectiveness moving forward.
Brian Haugli, CEO of SideChannel, highlighted that the Enclave Zero Trust software platform has secured contracts with two Department of Defense clients, indicating strong market traction. This development illustrates the potential for growth in high-value sectors and could enhance revenue streams in the future.
The revenue retention rate for SideChannel as of June 30, 2025, was recorded at 61.4%. While this figure indicates room for improvement in client retention strategies, it also reflects a stable foundation for building future client relationships.
SideChannel's management is focused on expanding its cybersecurity services portfolio, particularly with the addition of its Insider Threat program. This strategic move is aimed at enhancing their offerings and capturing more market share, possibly positioning the company for long-term growth.
With a focus on innovation in their cybersecurity solutions and the adoption of new technologies like the Enclave platform, SideChannel appears to be strategically positioned to meet increasing demand in the cybersecurity market. This could bode well for future growth, especially as cyber threats evolve.