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What changed in Genasys Inc.'s 10-K — 2024 vs 2025

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Paragraph-level year-over-year comparison of Genasys Inc.'s 2024 and 2025 10-K annual filings, covering the Business, Risk Factors, Legal Proceedings, Cybersecurity, MD&A and Market Risk sections. Every new, removed and edited paragraph is highlighted side-by-side so you can see exactly what management changed in the 2025 report.

+334 added−343 removedSource: 10-K (2025-12-15) vs 10-K (2024-12-13)

Top changes in Genasys Inc.'s 2025 10-K

334 paragraphs added · 343 removed · 249 edited across 8 sections

Item 1. Business

Business — how the company describes what it does

97 edited+15 added−35 removed53 unchanged
Biggest changeWe intend to continue making strategic acquisitions, particularly in the SaaS industry. • Team Expansion : Along with new businesses, we intend to continue to invest in new engineering, sales, marketing, production, and quality assurance talent to support Genasys’ expected growth. • Market Expansion : By acquiring Evertel, Zonehaven, and Amika Mobile, and adding new sales and marketing personnel with connections to previously untapped markets and locations, we expect our critical communications suite to experience significant sales growth. • Geographical Expansion : In fiscal year 2024, Genasys continued to expand into new regions, including a substantial project to monitor and protect more than 30 dams across the Commonwealth of Puerto Rico, coverage across the states of Oregon and New Hampshire, and expansion with local governments across the central and eastern United States. • Facilities : Genasys’ research and development offices, located in North America and Europe, feature state-of-the art equipment and facilities that help fuel innovation.
Biggest changeWe may consider strategic acquisitions in the future, particularly in the SaaS industry, as opportunities arise and if they are consistent with our business objectives and our capital positions. • Team Expansion : Along with new businesses, we intend to continue to invest in new engineering, sales, marketing, production, and quality assurance talent to support Genasys’ expected growth. • Market Expansion : By acquiring Evertel, Zonehaven, and Amika Mobile, and adding new sales and marketing personnel with connections to previously untapped markets and locations, we expect our critical communications suite to experience strong sales growth. • Geographical Expansion : In fiscal year 2025, Genasys continued to expand into new regions, including a substantial project to monitor 37 dams across the Commonwealth of Puerto Rico and provide early warning communications to residents living downstream during hurricanes, flooding, and earthquakes; coverage across Los Angeles County, California, and expansion with local governments and agencies across the United States. • R&D Facilities : Genasys’ research and development offices, located in North America and Europe, feature state-of-the art equipment and facilities that help fuel innovation.
In fiscal 2021, we completed acquisitions of Zonehaven, a software-based evacuation and repopulation management platform, and the assets of Amika Mobile, a physical security information management company. These 2 acquisitions, along with the January 2018 addition of Genasys Spain, expanded Genasys’ strong suite of software solutions.
In Fiscal 2021, we completed acquisitions of Zonehaven, a software-based evacuation and repopulation management platform, and the assets of Amika Mobile, a physical security information management company. These acquisitions, along with the January 2018 addition of Genasys Spain, expanded Genasys’ 2 strong suite of software solutions.
Stadiums and Events Genasys Protect keeps attendees, fans, participants, and staff safe through audible broadcasts, quick decision-making, team coordination, and cohesive emergency communications that can reach everyone at an event. With ALERT, event managers use voice calls, SMS messages, images, video, email, stadium Wi-Fi, IPAWS, and Wireless Emergency Alerts (“WEA”), to contact anyone in or near a stadium.
Stadiums and Events Genasys Protect keeps attendees, fans, participants, and staff safe through audible broadcasts, quick decision-making, team coordination, and cohesive emergency communications that can reach everyone at an event. With Genasys Protect, event managers use voice calls, SMS messages, images, video, email, stadium Wi-Fi, IPAWS, and Wireless Emergency Alerts (“WEA”), to contact anyone in or near a stadium.
ACOUSTICS are networked, remotely operated devices optimized with advanced driver and waveguide technology so that voice broadcasts are clearly heard and understood above loud background noise and over long distances. Acoustics’ reliability enables a constant stream of information, providing redundancy when key infrastructure fails during critical events.
Acoustics provides networked, remotely operated devices optimized with advanced driver and waveguide technology so that voice broadcasts are clearly heard and understood above loud background noise and over long distances. Acoustics’ reliability enables a constant stream of information, providing redundancy when key infrastructure fails during critical events.
Our reliable, fast, and intuitive solution for sending warnings and information via location-based SMS, CBC, mobile push, text, email, social media, TV, radio, digital displays, sirens and speaker arrays, and our platform’s compatibility with major emergency warning protocols, including IPAWS, WEA, and others, provide additional competitive advantages.
Our reliable, fast, and intuitive solution for sending warnings and information via location-based SMS, CBC, mobile 10 push, text, email, social media, TV, radio, digital displays, sirens and speaker arrays, and our platform’s compatibility with major emergency warning protocols, including IPAWS, WEA, and others, provide additional competitive advantages.
Genasys LRAD products broadcast audible alert tones and exceptionally intelligible voice messages in a focused 30° beam over long distances to specific targets. LRADs were quickly embraced by the U.S. Navy and then other domestic military branches, federal agencies, and police departments, and then throughout the world.
LRAD products broadcast audible alert tones and exceptionally intelligible voice messages in a focused 30° beam over long distances to specific targets. LRADs were quickly embraced by the U.S. Navy and then other domestic military branches, federal agencies, and police departments, and then throughout the world.
Similarly, we offer a variety of software notification suites, each with unique capabilities. This extensive catalog enables us to provide customized solutions designed to meet our clients' specific needs. • Global Presence : Genasys has physical offices in North America, Europe, and the Middle East.
Similarly, we offer a variety of software alerting and notification suites, each with unique capabilities. This extensive catalog enables us to provide customized solutions designed to meet our clients' specific needs. • Global Presence : Genasys has physical offices in North America, Europe, and the Middle East.
We have a global reputation for providing high quality, innovative voice broadcast systems and mobile alert solutions that have made Genasys and LRAD internationally recognized product brands. We actively promote our brands and products through our website, social media, podcasts, trade shows, media journals and publications, and advertising.
We have built a global reputation for providing high quality, innovative voice broadcast systems and mobile alert solutions that have made Genasys and LRAD internationally recognized product brands. We actively promote our brands and products through our website, social media, podcasts, trade shows, media journals and publications, and advertising.
Many SWAT teams now use LRAD for serving high risk warrants, and during hostage and barricaded suspect negotiations, active shooter situations, and other SWAT operations. LRAD systems are portable and adaptable in most any situation to provide clear voice broadcasts over long distances.
Many SWAT teams now use LRADs for serving high risk warrants, and during hostage and barricaded suspect negotiations, active shooter situations, and other SWAT operations. LRAD systems are portable and adaptable in most any situation to provide clear voice broadcasts over long distances.
Proven Technology: Genasys solutions have been on the front lines for more than 40 years, providing targeted communications designed to ensure the right people get the right message - right away. 2.
Proven Technology: Genasys solutions have been on the front lines for more than 40 years, providing targeted communications capabilities designed to ensure the right people get the right message - right away. 2.
This commitment to providing the highest quality products earned Genasys ISO 9001 and 27001 certifications, universal indications of excellence and consistency. All Genasys products come with a one-year warranty and our customer service team is available 24/7 for personalized technical support. • Pioneering Philosophy : Genasys created the AHD market with the invention of the LRAD in 2002.
This commitment to providing the highest quality products earned Genasys ISO 9001 and 27001 certifications, universal indications of excellence and consistency. All Genasys products come with a one-year warranty and our customer service team is available 24/7 for personalized technical support. • Pioneering Philosophy : With the introduction of LRAD in 2002, Genasys created the AHD market.
We believe our ability to unify sensors and IoT inputs with the multichannel, multiagency dissemination of geolocation-targeted alerts, notifications and instructions before, during, and after public safety and enterprise threats, critical events, and other crisis situations, gives us significant competitive advantages against these 10 established organizations.
We believe our ability to unify sensors and IoT inputs with the multichannel, multiagency dissemination of geolocation-targeted alerts, notifications and instructions before, during, and after public safety and enterprise threats, critical events, and other crisis situations, gives us competitive advantages against these established organizations.
Operated and controlled via a single dashboard that includes two-way polling, duress buttons, field check-ins and recipient locations, ALERT integrates with various data sources, including sensors, panic buttons, emergency services, active directories, human resources, visitor management, and building control systems to find and deliver safety alerts and notifications to residents, employees, staff, contractors, temporary workers, and visitors.
Operated and controlled via a single dashboard that includes two-way polling, duress buttons, field check-ins and recipient locations, Genasys Protect integrates with various data sources, including sensors, panic buttons, emergency services, active directories, human resources, visitor management, and building control systems to find and deliver safety alerts and notifications to residents, employees, staff, contractors, temporary workers, and visitors.
A common operating picture accelerates information sharing among first responders and emergency managers during the initial attack phase of a disaster and beyond. This information includes traffic monitoring, road closures, disaster paths, event simulation and modeling, and more. CONNECT helps law enforcement and other agencies to collaborate securely and is fully compliant with federal and state data retention guidelines.
A common operating picture accelerates information sharing among first responders and emergency managers during the initial attack phase of a disaster and beyond. This information includes traffic monitoring, road closures, disaster paths, event simulation and modeling, and more. Genasys Evertel helps law enforcement and other agencies to collaborate securely and is fully compliant with federal and state data retention guidelines.
Our products, systems, and solutions also have many applications within the fire rescue, maritime, asset protection, and wildlife control and preservation business segments. Genasys has developed a global market and an increasing demand for LRAD communications systems. We have a reputation for producing quality products that feature industry-leading broadcast area coverage, vocal intelligibility, and product reliability.
Our products, systems, and solutions also have many applications within the fire rescue, maritime, asset protection, and wildlife control and preservation business segments. Genasys has developed a global market for LRAD communications systems. We have a reputation for producing quality products that feature industry-leading broadcast area coverage, vocal intelligibility, and product reliability.
In fiscal year 2025 and beyond, we are focused on expanding and proliferating our unified software and connected-speaker platform. • Hardware Development: LRAD technological advancements are anticipated to drive product enhancements in fiscal year 2025.
In fiscal year 2026 and beyond, we are focused on expanding and proliferating our unified software and connected-speaker platform. • Hardware Development: LRAD technological advancements are anticipated to drive product enhancements in fiscal year 2026.
The fluctuations of foreign currency exchange rates could also impact our lead times and product costs. We have developed strong relationships with a number of our key suppliers. If these suppliers experience supply chain issues, quality problems or part shortages, our production schedules could be significantly delayed, or our costs could significantly increase.
The fluctuations of foreign currency exchange rates could also impact our product costs. We have developed strong relationships with a number of our key suppliers. If these suppliers experience supply chain issues, quality problems or part shortages, our production schedules could be significantly delayed, or our costs could significantly increase.
By using long-range communication to better manage the escalation of force, LRAD products provide a non-kinetic, non-lethal solution for resolving potentially dangerous or hostile situations. With a device capable of broadcasting audible alerts and notifications with exceptional vocal clarity over long distances, Genasys engineers enhanced the Company's Protective Communications technology to innovate a new generation of mass notification speaker systems.
By using long-range communication to initiate and manage the escalation of force, LRAD products provide a better non-kinetic solution for resolving potentially dangerous or hostile situations. With devices capable of broadcasting audible alerts and notifications with exceptional vocal clarity over long distances, Genasys engineers enhanced the Company's Protective Communications technology to innovate a new generation of mass notification speaker systems.
We have built a worldwide distribution channel consisting of partners and resellers that have significant expertise and experience selling integrated communication solutions into our various target markets.
We have also built a worldwide distribution channel consisting of partners and resellers that have expertise and experience selling integrated communication solutions into our various target markets.
Backlog Our order backlog for products that are deliverable in the next 12 months was approximately $40.3 million as of September 30, 2024 largely related to one customer, compared with $7.0 million as of September 30, 2023. The amount of backlog at any point in time is dependent upon scheduled delivery dates to our customers and product lead times.
Backlog Our order backlog for products that are deliverable in the next 12 months was approximately $60.0 million as of September 30, 2025 largely related to one customer, compared with $40.3 million as of September 30, 2024. The amount of backlog at any point in time is dependent upon scheduled delivery dates to our customers and product lead times.
For the fiscal years ended September 30, 2024 and 2023, we spent approximately $9.6 million and $8.1 million, respectively, on company-sponsored research and development.
For the fiscal years ended September 30, 2025 and 2024, we spent approximately $8.1 million and $9.6 million, respectively, on company-sponsored research and development.
ALERT Enterprise Case Study Two global auto manufacturers and Aramco, the world’s largest oil and gas company, rely on ALERT to create, manage, and deliver geo-targeted, multichannel notifications to thousands of employees in North America and the Middle East, respectively.
Genasys Protect Enterprise Case Study Two global auto manufacturers and Aramco, the world’s largest oil and gas company, rely on Genasys Protect to create, manage, and deliver geo-targeted, multichannel notifications to thousands of employees in North America and the Middle East, respectively.
Software Products The Genasys Protect Platform The Complete Protective Communications Platform The Genasys Protect platform provides a full suite of Protective Communications tools for all hazards, designed to provide targeted emergency communication, data-driven decision making, secure inter-agency collaboration, and more.
Software Products The Genasys Protect Platform The Complete Protective Communications Platform The Genasys Protect platform provides a full suite of Protective Communications tools for many hazards, designed to provide targeted emergency communication, data-driven decision making, secure inter- and intra-agency collaboration, and more.
These notifications can be delivered throughout a facility or targeted to areas affected by industrial accidents, hazmat incidents, unauthorized entries, and other worker safety threats. ALERT can send multichannel communications, and ACOUSTICS and LRAD can broadcast messages across facilities, into distant buildings, and over loud machinery noise.
These notifications can be delivered throughout a facility or targeted to areas affected by industrial accidents, hazmat incidents, unauthorized entries, and other worker safety threats. Genasys Protect can send multichannel communications, and Acoustics and LRAD can broadcast messages across 7 facilities, into distant buildings, and over loud machinery noise.
Genasys LRAD LRAD is the world’s leading AHD, with the ability to project alert tones and audible voice messages with exceptional vocal clarity in a 30° beam from close range to 5,500 meters.
LRAD by Genasys LRAD is the world’s leading AHD, with the ability to project alert tones and audible voice messages with exceptional vocal clarity in a 30° beam from close range to 5,000 meters.
Sales and Marketing We market and sell products and services through our salesforce based in Alabama, California, Colorado, Florida, Maryland, Nevada, New York, North Carolina, Oregon, Utah, Wisconsin, Spain, United Kingdom, and the U.A.E. Our corporate and administrative offices are located in San Diego, California. We sell directly to governments, militaries, large end-users, and commercial companies.
Sales and Marketing We market and sell products and services through our salesforce based in Alabama, California, Delaware, Florida, Idaho, Nevada, New York, North Carolina, Oregon, Texas, Utah, Wisconsin, Spain, United Kingdom, and the U.A.E. Our corporate and administrative offices are located in San Diego, California. We sell directly to governments, militaries, large end-users, and commercial companies.
Most legacy outdoor mass notification systems are sirens, but have limited, if any, voice broadcast capability. Genasys’ advanced mass notification systems feature the industry's highest Speech Transmission Index (“STI”), large directional and omni-directional broadcast coverage areas, and an array of options that are designed to enable the systems to continue operating when power and telecommunications infrastructure goes down.
Most legacy outdoor mass notification systems are sirens, but have limited, if any, audible voice broadcast capability. Genasys’ advanced mass notification systems feature the industry's highest Speech Transmission Index (“STI”), large directional and omni-directional broadcast coverage areas, and an array of options that are designed to enable continued operations when power and telecommunications infrastructure goes down.
The information on our website is not incorporated by reference into this report nor is it part of this report. 13
The information on our website is not incorporated by reference into this report nor is it part of this report. 12
Partnerships We partner with leading businesses to market our solutions, integrate our software for feature enhancement, and to provide additional channels to drive sales. Our partnerships include Esri, Intterra, First Due, Watch Duty, Tablet Command, Ladris AI, Waze, the NOAA, and more.
Partnerships We partner with leading businesses to market our solutions, integrate our software for feature enhancement, and to provide additional channels to drive sales. Our partnerships include Esri, Intterra, First Due, Tablet Command, Waze, the NOAA, and more.
Using ALERT command-and- control software, safety warnings can be delivered campus-wide across several channels, or to specific areas and student populations using select channels. EVAC helps break large campuses into zones to send targeted messages when emergencies arise. CONNECT enables campus security teams to communicate safely and securely and collaborate with public safety and law enforcement agencies.
Using Genasys Protect command-and-control software, safety warnings can be delivered campus-wide across several channels, or to specific areas and student populations using select channels. Genasys Protect helps break large campuses into zones to send targeted messages when emergencies arise. Genasys Evertel enables campus security teams to communicate safely and securely and collaborate with public safety and law enforcement agencies.
These SaaS solutions can disseminate critical alerts and information through text messages, emails, voice calls, push notifications, social media, speaker systems, and other delivery methods. In 2023, Genasys integrated and rebranded these solutions into what is now known as the Genasys Protect platform (“Genasys Protect”).
These SaaS solutions can be used to disseminate critical alerts and information through text messages, emails, voice calls, push notifications, social media, speaker systems, and other delivery methods. In 2023, Genasys integrated and rebranded these solutions into what is now known as the Genasys Protect platform.
ALERT communications to the public can be enhanced 3 via Genasys ACOUSTICS - connected, voice broadcast speakers - while ALERT communications among first responders and emergency personnel can be augmented and accelerated with Genasys CONNECT (formerly Evertel).
Communications to the public can be enhanced via Genasys Acoustics - connected, voice broadcast 3 speakers - while Genasys Protect communications among first responders and emergency personnel can be augmented and accelerated with Genasys Evertel ® , formerly Genasys Connect (“Genasys Evertel”).
Looking Forward: Growth Company • Acquisitions : In October 2023, we completed the acquisition of Evertel, a fully Criminal Justice Information Services (“CJIS”) compliant, cross agency collaboration software solution designed specifically for emergency managers and first responders.
Looking Forward: • Acquisitions : In October 2023, we completed the acquisition of Evertel Technologies, LLC (“Evertel”), a fully Criminal Justice Information Services (“CJIS”) compliant, cross agency collaboration software solution designed specifically for emergency managers and first responders.
These solutions include zone-based evacuation resources, integrated mass notification networks powered by Genasys command-and-control software, a mobile-ready, secure collaboration platform (via the acquisition of Evertel Technologies (“Evertel”)), and the Company’s National Emergency Warning System (“NEWS”) solution that works with mobile carriers to send emergency communications to the public with no opt-in required.
These solutions include zone-based evacuation resources, integrated mass notification networks powered by Genasys command-and-control software, a mobile-ready, secure, communication collaboration platform, and the Company’s National Emergency Warning System (“NEWS”) solution that works with mobile carriers to send emergency communications to the public with no opt-in required.
When an emergency occurs, these tools allow at-risk groups or individuals to be notified as quickly as possible without sacrificing their privacy. In addition to disseminating alerts and notifications, ALERT uses two-way communication tools, including polls and check-ins to receive feedback for enterprise clients.
When an emergency occurs, these tools allow Genasys Protect customers to notify at-risk groups or individuals as quickly as possible without sacrificing their privacy. In addition to disseminating alerts and notifications, Genasys Protect uses two-way communication tools, including polls and check-ins, to receive feedback for enterprise clients.
ALERT Public Safety Case Study ALERT coverage has expanded into cities and counties in 39 states, including the State of New Hampshire, San Diego County, and the City of Boston to help safeguard millions of residents during severe storms, tornadoes, wildfires, flood, debris flows, tsunamis, active shooter incidents, epidemics, civil unrest, and other disasters and life safety threats.
Genasys Protect Public Safety Case Study Genasys Protect coverage has expanded into cities and counties in 40 states, including the States of Oregon and New Hampshire, Los Angeles County, San Diego County, and the City of Boston to help safeguard millions of residents during severe storms, tornadoes, wildfires, flood, debris flows, tsunamis, active shooter incidents, epidemics, civil unrest, and other disasters and life safety threats.
ALERT sends targeted messages based on geographic location, permitting relevant information and instructions to be sent to the appropriate populations. Emergency managers can prepare for natural or man-made disasters by developing evacuation plans that map routes, shelters, traffic control locations, and road closures.
Our customers use Genasys Protect to send targeted messages based on geographic location, permitting relevant information and instructions to be sent to the appropriate populations. Emergency managers can prepare for natural or man-made disasters by developing evacuation plans that map routes, shelters, traffic control locations, and road closures.
Towns, Cities, Counties Genasys Protect’s scalable ALERT notification software is used by communities of all sizes to issue emergency warnings, provide important instructions, and receive community feedback quickly and directly. Genasys Protect serves communities by providing digital communications through SMS, email, social media, and other channels, and broadcasting audible messages through ACOUSTICS installations.
Towns, Cities, Counties Genasys Protect’s scalable mass notification software is used by communities of all sizes to issue emergency warnings, provide important instructions, and receive community feedback quickly and directly. Genasys Protect serves communities by providing digital communications capabilities through SMS, email, social media, and other channels. In addition, Acoustics installations can be used to broadcast audible messages.
We have a history of successfully delivering innovative products, systems, and solutions for mission critical situations, pioneering the acoustic hailing device (“AHD”) market with the introduction of our first LRAD AHD in 2002 and creating the first multi-directional, voice-based public safety mass notification systems in 2012.
We have a history of successfully delivering innovative products, systems, and solutions for mission critical situations, pioneering the Acoustic Hailing Device (“AHD”) market with the introduction of LRAD in 2002, creating the first multi-directional, voice-based public safety mass notification systems in 2012, and the first AHDs with a digital interface for remote operations in 2023.
Genasys Protect help to enable preparedness, responsiveness, and collaboration to keep people, assets, and operations protected against the impacts of natural disasters, terrorism, violent civil unrest, and other dangerous situations, as well as power failures, facility shutdowns, and other non-emergency operational disruptions. 1.
By enabling communications with precision, speed, and clarity, Genasys Protect helps to enable preparedness, responsiveness, and collaboration to keep people, assets, and operations protected against the impacts of natural disasters, terrorism, violent civil unrest, and other dangerous situations, as well as power failures, facility shutdowns, and other non-emergency operational disruptions. 1.
This information is easily shared with the public and reduces the time it takes to execute emergency evacuations and conduct orderly repopulations. Auto-Discovery, an innovative feature of the platform, locates and connects with anyone on a wired or wireless network in a fixed area with no opt-in required. When discovered, ALERT anonymizes all recipient information and data.
Our customers can easily share this information with the public and reduce the time it takes to execute emergency evacuations and conduct orderly repopulations. Auto-Discovery, an innovative feature of the platform, locates and connects with anyone on a wired or wireless network in a fixed area with no opt-in required. When discovered, Genasys Protect anonymizes all recipient information and data.
We also perform third-party testing and certification of our products to ensure that they meet rigorous military and commercial specifications. We implement design and component changes periodically to reduce our product costs and improve product reliability and manufacturability.
We continue to implement rigorous manufacturing and quality processes to track production and field failures. We also perform third-party testing and certification of our products to ensure that they meet military and commercial specifications. We implement design and component changes periodically to reduce our product costs and improve product reliability and manufacturability.
Previously, SWAT teams used bullhorns and vehicle public address (“PA”) systems to communicate with violent suspects. Because of the poor intelligibility and limited broadcast range of these systems, SWAT team members often had to closely engage with suspects, putting themselves, suspects, and bystanders in harm’s way.
LRAD Case Study SWAT teams respond to potentially dangerous situations where communication is vital. Previously, SWAT teams used bullhorns and vehicle public address (“PA”) systems to communicate with violent suspects. Because of the poor intelligibility and limited broadcast range of these systems, SWAT team members often had to closely engage with suspects, putting themselves, suspects, and bystanders in harm’s way.
EVAC users can build, edit, and act upon geographical location data, including shelters, facilities, and traffic; • Modeling behaviors to plan for effective responses and/or evacuation scenarios covering emergencies that include wildfires, floods, active shooters, hurricanes, and more; • Actionable communication through the Genasys Protect mobile app to keep people informed before, during, and after a critical event; • A common operating picture across agencies to reduce response times as much as 90%; and • Targeted notifications and updates to community members through a public website and free mobile app. 4 EVAC Public Safety Case Study EVAC continues to proliferate across the western United States, with the vast majority of California, including Los Angeles County, now covered by EVAC.
Genasys Protect users can build, edit, and act upon geographical location data, including shelters, facilities, and traffic; • Modeling behaviors to plan for effective responses and/or evacuation scenarios covering emergencies that include wildfires, floods, active shooters, hurricanes, and more; • Actionable communication through the Genasys Protect mobile app to keep people informed before, during, and after a critical event; • A common operating picture across agencies to reduce response times as much as 90%; and • Targeted notifications and updates to community members through a public website and free mobile app.
ALERT acts as both a communications input and output, receiving information from state-of-the-art sensors and emergency services, and quickly relaying notifications, alerts, and instructions to at-risk populations and first responders.
Genasys Protect acts as both a communications input and output, receiving information from state-of-the-art sensors and emergency services, and quickly relaying notifications, alerts, and instructions to first responders, who can in turn relay it to at-risk populations.
LRAD products broadcast audible voice messages with exceptional vocal clarity from close range out to 5,500 meters.
LRAD by Genasys products broadcast audible voice messages with exceptional clarity from close range out to 5,000 meters.
EVAC can segment large industrial complexes into targeted zones for precise actions and communication. 7 Defense LRADs broadcast audible warning tones and voice messages with exceptional clarity from close range to 5,500 meters, enabling operators on the ground, in vehicles, on ships, or in helicopters, to increase the decision time and distance to differentiate between security threats and non-combatants, resolve uncertain situations, respond safely, and limit the escalation of force.
Defense LRADs broadcast audible warning tones and voice messages with exceptional clarity from close range to 5,000 meters, enabling operators on the ground, in vehicles, on ships, or in helicopters, to increase the decision time and distance to differentiate between security threats and non-combatants, resolve uncertain situations, respond safely, and limit the escalation of force.
ALERT clients can create and send critical, verified, and secure notifications and messages that are geographically specific and targeted using location-based SMS, CBC mobile push, text, email, social media, TV, radio, digital displays and acoustic devices, panic buttons, desktop alerts, TV, social media, and more. Additionally, Genasys is a certified provider of Integrated Public Alert and Warning System (“IPAWS”) notifications.
Genasys Protect clients can create and send critical, verified, and secure notifications and messages that are geographically specific and targeted using location-based SMS, CBC mobile push, text, email, social media, TV, radio, digital displays and acoustic devices, panic buttons, desktop alerts, TV, social media, and more.
Most legacy mass notification systems are sirens with limited, if any, voice broadcast capability. ACOUSTICS systems feature the industry's highest STI, large directional and omni-directional broadcast coverage areas, and an array of options, including solar power, battery backup, and satellite connectivity that enable the systems to continue to operate when power and telecommunications infrastructure goes down.
Acoustics systems feature the industry's highest STI, large directional and omni-directional broadcast coverage areas, and an array of options, including solar power, battery backup, and satellite connectivity that enable the systems to continue to operate when power and telecommunications infrastructure goes down.
Output channels include 2-way SMS, email, pop-ups, callouts, PA speakers, and land mobile radio outputs. ALERT can be used by state, local, or national agencies to deliver emergency alerts and life safety information to residents in certain areas, regionally, or countrywide. EVAC is used by state and local governments to produce data-driven zones for planning and targeted community notifications.
Output channels include 2-way SMS, email, pop-ups, callouts, PA speakers, and land mobile radio outputs. Genasys Protect can be used by state, local, or national agencies to deliver emergency alerts and life safety information to residents in certain areas, regionally, or countrywide.
With real-time intelligence sharing that exceeds regulatory privacy requirements for public agencies, CONNECT’s instant communication platform empowers first responders and public safety personnel to collaborate and share information in a single space with text, videos, images, and audio from any location. CONNECT provides a secure space where professionals can exchange information, make decisions, and collaborate with trust in data security.
With real-time intelligence sharing that exceeds regulatory privacy requirements for public agencies, Genasys Evertel’s instant communication platform empowers first responders and public safety personnel to collaborate and share information in a single space with text, videos, images, and audio from any location.
ALERT helps contact individuals, without the need for opt-in, through Wi-Fi auto discovery, ACOUSTICS, and digital signage. Satellite connected, solar powered ACOUSTICS systems broadcast live or prerecorded voice messages over loud background noise and into buildings, even if power and telecommunications fail. EVAC can segment stadiums into zoned sections, target facilities and event buildings, and help communicate safely in emergencies.
Genasys Protect also helps contact individuals, without the need for opt-in, through Wi-Fi auto discovery, Acoustics, and digital signage. Satellite connected, solar powered Acoustics systems broadcast live or prerecorded voice messages over loud background noise and into buildings, even if power and telecommunications fail.
LRAD products have since become the de facto standard of the AHD industry. Genasys continues to develop life safety communication solutions by innovating and enhancing the emergency warning and mass notification industry’s only unified Protective Communications platform - Genasys Protect.
Genasys continues to develop life safety communication solutions by innovating and enhancing the emergency warning and mass notification industry’s only unified Protective Communications platform - Genasys Protect.
We also plan to pursue both domestic and international emergency warning, enterprise and critical event management, government, law enforcement, fire rescue, homeland and international security, private and commercial security, border security, maritime security, and wildlife preservation and control business opportunities.
This includes building on Fiscal 2025 domestic defense sales by expanding and pursuing further U.S. military opportunities. We also plan to pursue both domestic and international emergency warning, enterprise and critical event management, government, law enforcement, fire rescue, homeland and international security, private and commercial security, border security, maritime security, and wildlife preservation and control business opportunities.
Background Genasys entered the Protective Communications market following the October 2000 attack on the USS Cole, which led to the development of LRAD AHD products capable of communicating to and determining the intent of potential threats from a safe distance.
Building on our proven, best in class, and reliable solutions, we offer the first and only unified, end-to-end Protective Communications platform. Background Genasys entered the Protective Communications market following the October 2000 attack on the USS Cole, which led to the development of LRAD products capable of communicating to and determining the intent of potential threats from a safe distance.
These agreements may not prevent disclosure of confidential information or provide adequate remedies for any breach. Research and Development The software and sound reproduction markets are subject to rapid changes in technology and design with frequent improvements and new product introductions, as well as customized solutions for specific customer applications.
Research and Development The software and sound reproduction markets are subject to rapid changes in technology and design with frequent improvements and new product introductions, as well as customized solutions for specific customer applications.
While the software and hardware mass notification markets are mature with many established manufacturers and suppliers, we believe that our advanced technology and unified platform provides opportunities to succeed in the large and growing public safety, emergency warning, and Protective Communications markets. 8 In fiscal 2025, we intend to continue pursuing domestic and international business opportunities with the support of business development consultants, key representatives, and resellers.
While the mass notification markets for software and hardware are mature with many established manufacturers and suppliers, we believe that our advanced technology and unified platform provide opportunities to succeed in the large and growing public safety, emergency warning, and Protective Communications markets.
Present and potential competitors have, or may have, substantially greater resources to devote to product development. We believe we compete primarily on the originality of our products, the uniqueness of our technology and designs, and our responsiveness to customers and the ability to meet their needs.
We believe we compete primarily on the originality of our products, the uniqueness of our technology and designs, and our responsiveness to customers and the ability to meet their needs.
CONNECT enables real-time, inter- and intra-agency collaboration across a secure, compliant platform. ACOUSTICS broadcasts highly audible and clear voice messaging thousands of meters away, staying on and connected even during broad power outages and network downtime.
Genasys Protect is used by state and local governments to produce data-driven zones for planning and targeted community notifications. Genasys Evertel enables real-time, inter- and intra-agency collaboration across a secure, compliant platform. Acoustics broadcasts highly audible and clear voice messaging thousands of meters away, staying on and connected even during broad power outages and network downtime.
LRADs are used by campus police and security to broadcast clear communications to students, visitors, and activists present on campus. As centers for activism and protests, campus police rely on LRAD for communication while de-escalating tense civil protests.
LRADs are used by campus police and security to broadcast clear communications to students, visitors, and activists present on campus. Campus police rely on LRAD for communication while de-escalating tense civil protests. Industrial Facilities Genasys solutions provide facility managers the data and tools to initiate critical safety notifications.
Competition Our technologies and products compete with those of other companies. Our LRAD AHDs and ACOUSTICS systems are part of the commercial and government audio industry and mass notification markets that are fragmented and include numerous manufacturers with products that vary widely in price, quality, and distribution channels.
Our LRAD and Acoustics systems are part of the commercial and government audio industry and mass notification markets that are fragmented and include numerous manufacturers with products that vary widely in price, quality, and distribution channels. Present and potential competitors have, or may have, substantially greater resources to devote to product development.
Genasys Protect delivers notifications to employees, contractors, visitors, and guests in corporate offices and at field sites. When integrated with human resources systems, Genasys Protect provides employee notifications, guest management systems for contractors and visitors, auto discovery alerts to anyone present on-site, and SMS opt-in for temporary enrollment to receive alerts and notifications.
When integrated with human resources systems, Genasys Protect provides employee notifications, guest management systems for contractors and visitors, auto discovery alerts to anyone present on-site, and SMS opt-in for temporary enrollment to receive alerts and notifications. Two-way enterprise-ready feedback built into Genasys Protect helps promote safety during an emergency.
Two-way enterprise-ready feedback built into ALERT helps ensure safety during an emergency. EVAC helps large facilities target communication by building, campus, or area. In addition to providing real-time safety alerts and notifications through multiple channels, Genasys Protect provides service outage, system maintenance, and other utility customer communications.
Genasys Protect also helps large facilities target communication by building, campus, or area. In addition to providing real-time safety alerts and notifications through multiple channels, Genasys Protect provides service outage, system maintenance, and other utility customer communications. Acoustics is being used for emergency warning, industrial safety notification, and facility public address.
EVAC is used by communities and counties to create disaster response plans, track emergency events, and execute timely emergency evacuations and orderly repopulations. EVAC empowers emergency services to effectively collaborate across jurisdictions to respond quickly and efficiently to disasters. CONNECT is a fully CJIS compliant solution that enables collaboration in a secure platform across or within agencies.
Genasys Protect is used by communities and counties to create disaster response plans, track emergency events, and execute timely emergency evacuations and orderly repopulations. Genasys Protect also empowers emergency services to effectively collaborate 6 across jurisdictions to respond quickly and efficiently to disasters.
We have an ongoing policy of filing patent applications to seek protection for novel features of our products and technologies. Prior to the filing and granting of patents, our policy is to disclose key features to patent counsel and maintain these features as trade secrets prior to product introduction.
We file patent applications to seek protection for novel features of our products and technologies. Prior to the filing and granting of patents, we disclose key features to patent counsel and maintain these features as trade secrets prior to product introduction. Patent applications may not result in issued patents covering all important claims and could be denied in their entirety.
With direct feedback, operators can survey the safety and status of at-risk individuals, learn of developments, update notifications and/or instructions in response to new information, and more.
With direct feedback, operators can survey the safety and status of at-risk individuals, learn of developments, update notifications and/or instructions in response to new information, and more. Genasys Protect also enables responding agencies to react swiftly, make collaborative decisions, and communicate event status in real time to other agencies, businesses, and the public.
Future levels of research and development expenditure will vary depending on the 11 timing of further new product development and the availability of funds to carry out additional research and development on currently owned technologies or in other areas.
Future levels of research and development expenditure will vary depending on the timing of further new product development and the availability of funds to carry out additional research and development on currently owned technologies or in other areas. 11 Human Capital As of September 30, 2025, we employed a total of 187 full-time employees, of which 109 were located in the United States and 78 were located internationally.
LRADs are used throughout the world in multiple applications and circumstances to safely hail, warn, inform, direct, prevent misunderstandings, determine intent, establish large safety zones, resolve uncertain situations, and save lives.
LRADs are used throughout the world in multiple applications and 5 circumstances to safely hail, warn, inform, direct, prevent misunderstandings, determine intent, establish large safety zones, resolve uncertain situations, and save lives. LRADs have been deployed in defense, law enforcement, fire rescue, critical infrastructure protection, maritime, border, and homeland security installations and applications where clear, intelligible voice communications are essential.
The technology also enables voice messages and alert tones to cut through background noise and be clearly heard and understood. These competitive advantages, and constant innovation, have made LRAD the de facto standard of the global AHD industry. LRAD Case Study SWAT teams respond to potentially dangerous situations where communication is vital.
LRADs use Genasys’ proprietary XL driver technology, which generates higher audio output in a smaller, lighter form factor. The technology also enables voice messages and alert tones to cut through background noise and be clearly heard and understood. These competitive advantages, and constant innovation, have made LRAD the de facto standard of the global AHD industry.
Item 1. Busin ess. Overview We are a global provider of Protective Communications™ solutions, including our Genasys Protect™ software platform and Long Range Acoustic Device ® (“LRAD ® ”) products. Our unified software platform receives information from a wide variety of sensors and Internet-of-Things (“IoT”) inputs to collect real-time information on developing and active emergency situations.
Item 1. Busin ess. Overview We are a global provider of Protective Communications™ (“Protective Communications”) solutions, including our Genasys Protect™ software platform (“Genasys Protect”) and Long Range Acoustic Device ® (“LRAD ® ”) hardware products.
We plan to grow our revenues through increased direct sales to governments and agencies that desire to integrate our communication technologies into their homeland security and public safety systems. This includes building on fiscal 2024 domestic defense sales by pursuing further U.S. military opportunities.
In Fiscal 2026, we intend to continue pursuing domestic and international business opportunities with the support of business development consultants, key representatives, and resellers. We plan to grow our revenues through increased direct sales to governments 8 and agencies that desire to integrate our communication technologies into their homeland security and public safety systems.
Genasys CONNECT Genasys CONNECT (“CONNECT”) - formerly Evertel - is a leading cross-agency, CJIS compliant, collaboration platform that streamlines and secures team and one-on-one communications for first responders and public safety agencies.
By adding a powerful and intuitive orchestration and management layer on top of existing physical and digital infrastructure, Genasys Protect extends the clarity, reach and range of Protective Communications. 4 The Genasys Evertel Platform Genasys Evertel is a leading cross-agency, CJIS compliant, collaboration platform that streamlines and secures team and one-on-one communications for first responders and public safety agencies.
We provide and maintain a work environment designed to attract, develop, and retain top talent through offering our employees an engaging work experience that contributes to their career development. We recognize that our success is based on the collective talents and dedication of those we employ, and we are highly invested in their success.
We have not experienced any work stoppages and are not a party to a collective bargaining agreement. We are dedicated to preserving operational excellence and remaining an employer of choice. We provide and maintain a work environment designed to attract, develop, and retain top talent through offering our employees an engaging work experience that contributes to their career development.
LRAD systems are being used for commercial security applications at large data centers, manufacturing plants, and other enterprise facilities. 6 Gas, Oil, Utilities Genasys Protect integrates with a variety of industrial technologies, including gas leak sensors, 'man down' alarms, access control systems, and badge scanners for workforce safety and accountability.
Gas, Oil, Utilities Genasys Protect integrates with a variety of industrial technologies, including gas leak sensors, 'man down' alarms, access control systems, and badge scanners for workforce safety and accountability. Genasys Protect can be used to deliver notifications to employees, contractors, visitors, and guests in corporate offices and at field sites.
Several accessories and options (cameras, searchlights, mounts, and more) are also available to enhance LRAD capabilities. All LRAD products are defined by their unparalleled audio output and clarity. LRADs use Genasys’ proprietary XL driver technology, which generates higher audio output in a smaller, lighter form factor.
LRAD product models are available in varying audio outputs, communication coverage areas, sizes, functionalities, and mounting options. Several accessories and options (cameras, searchlights, mounts, and more) are also available to enhance LRAD capabilities. All LRAD products are defined by their unparalleled audio output and clarity.
Manufacturing and Suppliers Manufacturing As an ISO 9001:2015 manufacturer, we believe maintaining quality manufacturing capacity is essential to the performance of our products and the growth of our business. Our technologies are different from mass-produced designs, and our manufacturing and assembly involves unique processes and materials. We contract with third-party suppliers to produce various components and sub-assemblies.
Our technologies are different from mass-produced designs, and our manufacturing and assembly involves unique processes and materials. We contract with third-party suppliers to produce various components and sub-assemblies. In our facility, we complete the final assembly, test, and ship our products. We have refined our internal processes to improve how we design, test, and qualify products.
Available Information Our shares of common stock trade on the NASDAQ Capital Market under the symbol “GNSS”. Our address is 16262 West Bernardo Drive, San Diego, California, 92127, our telephone number is 858-676-1112, and our website is located at www.genasys.com.
We changed our jurisdiction of organization from Utah to Delaware in 1992. Our address is 16262 West Bernardo Drive, San Diego, California, 92127, our telephone number is 858-676-1112, and our website is located at www.genasys.com.
Network Effect: Implementation in neighboring municipalities and across public- and private-sector organizations within the same municipality extends coverage and enables greater precision when notifying people of threats. Genasys ALERT Genasys ALERT (“ALERT”) is an interactive, cloud-based SaaS solution that is designed to enable SLED and enterprise customers to send critical information to at-risk individuals or groups when an emergency occurs.
Network Effect: Implementation in neighboring municipalities and across public- and private-sector organizations within the same municipality extends coverage and enables greater precision when notifying people of threats.
ALERT integrates with active directories, Human Resources, visitor management, and building control systems to empower enterprise customers to protect workers, traveling employees, contractors, and visitors. By adding a powerful and intuitive orchestration and management layer on top of existing physical and digital infrastructure, ALERT extends the clarity, reach and range of Protective Communications.
Genasys Protect integrates with active directories, human resources, visitor management, and building control systems to empower enterprise customers to protect workers, traveling employees, contractors, and visitors.
Our revenues to date have relied on a few major customers. The loss of any customer could have a materially adverse effect on our financial condition, results of operations, and cash flow. We have made progress diversifying our revenues and expect to continue to do so in future periods.
For the fiscal year ended September 30, 2024, one customer accounted for 18% of revenues, with no other single customer accounting for more than 10% of revenues. Our revenues to date have relied on a few major customers. The loss of any customer could have a materially adverse effect on our financial condition, results of operations, and cash flow.

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Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

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Biggest changeThese factors include: 22 • our ability to develop and supply sound reproduction components to customers, distributors or original equipment manufacturers (“OEMs”) or to license our technologies; • market acceptance of and changes in demand for our products or products of our customers; • gains or losses of significant customers, distributors or strategic relationships; • unpredictable volume and timing of customer orders; • delays in funding approval by U.S. and foreign government and military customers; • the availability, pricing, and timeliness of delivery of components for our products and OEM products; • fluctuations in the availability of manufacturing capacity or manufacturing yields and related manufacturing costs; • the timing of new technological advances, product announcements or introductions by us, by OEMs or licensees, and by our competitors; • production delays by customers, distributors, OEMs, or by us or our suppliers; • increased competition in this market; • the conditions of other industries, such as military and commercial industries, into which our technologies may be sold; • general electronics industry conditions, including changes in demand and associated effects on inventory and inventory practices; • general economic conditions that could affect the timing of customer orders and capital spending and result in order cancellations or rescheduling; and • general political conditions in this country and in various other parts of the world that could affect spending for the products that we offer.
Biggest changeThese factors include: 22 • delays in funding approval by U.S. and foreign government and military customers; • unpredictable volume and timing of customer orders; • gains or losses of significant customers, distributors or strategic relationships; • market acceptance of and changes in demand for our products or products of our customers; • the availability, pricing, and timeliness of delivery of components for our products and original equipment manufacturers (“OEMs”) products; • our ability to develop and supply sound reproduction components to customers, distributors or OEMs or to license our technologies; • fluctuations in the availability of manufacturing capacity or manufacturing yields and related manufacturing costs; • production delays by customers, distributors, OEMs, or by us or our suppliers; • the timing of new technological advances, product announcements or introductions by us, by OEMs or licensees, and by our competitors; • general economic conditions that could affect the timing of customer orders and capital spending and result in order cancellations or rescheduling; • the conditions of other industries, such as military and commercial industries, into which our technologies may be sold; • general electronics industry conditions, including changes in demand and associated effects on inventory and inventory practices; • increased competition in this market; and • general political conditions in this country and in various other parts of the world that could affect spending for the products that we offer.
Cyberattack actors include criminal hackers, hacktivists, state-sponsored intrusions, and may involve industrial espionage, employee malfeasance and human or technological error. Computer hackers and others routinely attempt to breach the security of technology products, services and systems, and to fraudulently induce employees, customers and other third parties to disclose information or unwittingly provide access to systems or data.
Cyberattack actors include criminal hackers, hacktivists, and state-sponsored intrusions, and may involve industrial espionage, employee malfeasance and human or technological error. Computer hackers and others routinely attempt to breach the security of technology products, services and systems, and to fraudulently induce employees, customers and other third parties to disclose information or unwittingly provide access to systems or data.
Our products, services and systems may be used in critical company, customer, government or other third-party operations, or involve the storage, processing and transmission of sensitive data, including valuable intellectual property, classified information, other proprietary or confidential data, regulated data and personal information of employees, customers and others.
Our products, services and systems may be used in critical government, company, customer or other third-party operations, or involve the storage, processing and transmission of sensitive data, including valuable intellectual property, classified information, other proprietary or confidential data, regulated data and personal information of employees, customers and others.
Successful breaches, employee malfeasance or human or technological error could result in, for example, unauthorized access to, disclosure, modification, misuse, loss or destruction of company, customer, government or other third party data or systems; theft of sensitive, regulated, classified or confidential data including personal information and intellectual property; the loss of access to critical data or systems through distributed denial-of-service attacks, denial-of-service attacks, ransomware attacks, supply chain attacks, destructive attacks or other means; and business delays, service or system disruptions or denials of service.
Successful breaches, employee malfeasance or human or technological error could result in, for example, unauthorized access to, disclosure, modification, misuse, loss or destruction of government company, customer or other third party data or systems; theft of sensitive, regulated, classified or confidential data including personal information and intellectual property; the loss of access to critical data or systems through distributed denial-of-service attacks, denial-of-service attacks, ransomware attacks, supply chain attacks, destructive attacks or other means; and business delays, service or system disruptions or denials of service.
These restrictions could affect, and in many respects limit or prohibit, among other items, our ability to: • incur additional indebtedness; • create liens; • enter into certain fundamental transactions; • sell assets; • change the nature of our business; • prepay any other indebtedness; • amend certain of our contracts or governing documents; • complete a change of control; • modify our accounting methods; • make investments; • enter into transactions with affiliates; • issue or sell capital stock of certain of our subsidiaries; • enter into consignment or bailee arrangements of our inventory; 23 • declare or pay dividends or other distributions to stockholders; • repurchase our common stock or other securities; and • adopt certain benefits plans.
These restrictions could affect, and in many respects limit or prohibit, among other items, our ability to: • incur additional indebtedness; • create liens; • enter into certain fundamental transactions; • sell assets; • change the nature of our business; • prepay any other indebtedness; • amend certain of our contracts or governing documents; • complete a change of control; 23 • modify our accounting methods; • make investments; • enter into transactions with affiliates; • issue or sell capital stock of certain of our subsidiaries; • enter into consignment or bailee arrangements of our inventory; • declare or pay dividends or other distributions to stockholders; • repurchase our common stock or other securities; and • adopt certain benefits plans.
These risks include: • changes in tariff regulations; • political instability, war, terrorism, and other political risks; • foreign currency exchange rate fluctuations; • establishing and maintaining relationships with local distributors and dealers; 20 • lengthy shipping times and accounts receivable payment cycles; • import and export control and licensing requirements, particularly in connection with sales and licensing to foreign governments and other customers; • compliance with a variety of U.S. laws, including the Foreign Corrupt Practices Act, by us or key subcontractors; • compliance with a variety of foreign laws and regulations, including unexpected changes in taxation and regulatory requirements; • greater difficulty in safeguarding our technology, proprietary data, and intellectual property in international jurisdictions than in the U.S.; and • difficulty in staffing and managing geographically diverse operations.
These risks include: • changes in tariff regulations; • political instability, war, terrorism, and other political risks; • foreign currency exchange rate fluctuations; • establishing and maintaining relationships with local distributors and dealers; • lengthy shipping times and accounts receivable payment cycles; • import and export control and licensing requirements, particularly in connection with sales and licensing to foreign governments and other customers; • compliance with a variety of U.S. laws, including the Foreign Corrupt Practices Act, by us or key subcontractors; • compliance with a variety of foreign laws and regulations, including unexpected changes in taxation and regulatory requirements; • greater difficulty in safeguarding our technology, proprietary data, and intellectual property in international jurisdictions than in the U.S.; and • difficulty in staffing and managing geographically diverse operations.
Although we maintain insurance in respect of these types of events, available insurance proceeds may not be adequate to compensate us for damages sustained due to these events. 19 We could incur additional charges for excess and obsolete inventory. While we strive to effectively manage our inventory, rapidly changing technology and uneven customer demand may result in short product cycles.
Although we maintain insurance in respect of these types of events, available insurance proceeds may not be adequate to compensate us for damages sustained due to these events. We could incur additional charges for excess and obsolete inventory. While we strive to effectively manage our inventory, rapidly changing technology and uneven customer demand may result in short product cycles.
For example, we expect to continue to be impacted by the following supply chain issues, due to economic, political and other factors largely beyond our control: increased input material costs and component shortages; supply chain disruptions and delays 21 and cost inflation, all of which could continue or escalate in the future.
For example, we expect to continue to be impacted by the following supply chain issues, due to economic, political and other factors largely beyond our control: increased input material costs and component shortages; supply chain disruptions and delays and cost inflation, all of which could continue or escalate in the future.
Accordingly, because of the inherent limitations in a cost effective control system, misstatements due to error or fraud may occur and not be detected. 24 Failure to maintain an effective system of internal control over financial reporting could harm stockholders and business confidence in our financial reporting, our ability to obtain financing, and other aspects of our business .
Accordingly, because of the inherent limitations in a cost effective control system, misstatements due to error or fraud may occur and not be detected. Failure to maintain an effective system of internal control over financial reporting could harm stockholders and business confidence in our financial reporting, our ability to obtain financing, and other aspects of our business .
We may not be able to successfully integrate acquisitions in the future, and we may not be able to realize anticipated cost savings, revenue enhancements, or other synergies from such acquisitions. Since early 2018, we have completed several acquisitions, including Genasys Spain, Amika Mobile, Zonehaven and most recently Evertel.
We may not be able to successfully integrate acquisitions in the future, and we may not be able to realize anticipated cost savings, revenue enhancements, or other synergies from such acquisitions. Since early 2018, we have completed several acquisitions, including Genasys Spain, Amika Mobile assets, Zonehaven and most recently Evertel.
An extended interruption in the supply of our products could result in a substantial loss of sales. Furthermore, any actual or perceived degradation of product quality as a result of our reliance on third party manufacturers may have an adverse effect on sales or result in increased warranty costs, product returns, and buybacks.
An extended interruption in the supply of our products could result in a substantial loss of sales. Furthermore, any actual or perceived degradation of product quality as a result of our reliance on third party 21 manufacturers may have an adverse effect on sales or result in increased warranty costs, product returns, and buybacks.
The potential dilution from these shares could negatively affect the terms on which we could obtain equity financing. Our stock price is volatile and may continue to be volatile in the future. The market price of our common stock has fluctuated significantly to date.
The potential dilution from these shares could negatively affect the terms on which we could obtain equity financing. 24 Our stock price is volatile and may continue to be volatile in the future. The market price of our common stock has fluctuated significantly to date.
If we issue preferred stock, it could affect the rights or reduce the value of our common stock. In particular, specific rights granted to future holders of preferred stock could be used to 25 restrict our ability to merge with or sell our assets to a third party.
If we issue preferred stock, it could affect the rights or reduce the value of our common stock. In particular, specific rights granted to future holders of preferred stock could be used to restrict our ability to merge with or sell our assets to a third party.
Cyberattacks are expected to accelerate on a global basis in both frequency and magnitude as threat actors are becoming increasingly sophisticated in using techniques and tools (including AI) that circumvent controls, evade detection and even remove forensic evidence. Further, the use of AI by us, our customers, suppliers, and third-party service providers, among others, may also 15 introduce unique vulnerabilities.
Cyberattacks are expected to accelerate on a global basis in both frequency and magnitude as threat actors are becoming increasingly sophisticated in using techniques and tools (including AI) that circumvent controls, evade detection and even remove forensic evidence. Further, the use of AI by us, our customers, suppliers, and third-party service providers, among others, may also 14 introduce unique vulnerabilities.
While our products have been engineered to reduce the risk of damage to human hearing or human health, we could be exposed to claims of hearing damage if the product is not properly operated.
While our hardware products have been engineered to reduce the risk of damage to human hearing or human health, we could be exposed to claims of hearing damage if the product is not properly operated.
Borrowings under our Term Loan are secured by liens on substantially all of our assets, including the capital stock of certain of our subsidiaries, and the assets of our subsidiaries that are loan party guarantors.
Borrowings under our Term Loans are secured by liens on substantially all of our assets, including the capital stock of certain of our subsidiaries, and the assets of our subsidiaries that are loan party guarantors.
Our failure to manage our acquisition and integration strategy successfully could have a material adverse effect on our business, results of operations, and financial condition.
Our 17 failure to manage our acquisition and integration strategy successfully could have a material adverse effect on our business, results of operations, and financial condition.
As of September 30, 2024, the exercise prices for the options ranged from $1.70 to $6.87 per share. We also have outstanding warrants to purchase 3,068,182 shares of our common stock at an exercise price of $2.53, which warrants will expire May 14, 2029.
As of September 30, 2025, the exercise prices for the options ranged from $1.70 to $6.87 per share. We also have outstanding warrants to purchase 3,068,182 shares of our common stock at an exercise price of $2.53, which warrants will expire May 14, 2029.
Our Term Loan may not be sufficient for our future working capital, investments and cash requirements, in which case we would need to seek additional debt or equity financing or scale back our operations. In addition, we may need to seek additional financing to achieve and maintain compliance with specified financial criteria under our Term Loan.
Our Term Loans may not be sufficient for our future working capital, investments and cash requirements, in which case we would need to seek additional debt or equity financing or scale back our operations. In addition, we may need to seek additional financing to achieve and maintain compliance with specified financial criteria under our Term Loans.
The agreements governing our Term Loan impose financial and operating restrictions on us and any failure to meet our payment or other obligations under our Term Loan could have a material adverse effect on us, including permitting the lenders under our Term Loan to foreclose on, and acquire control of, substantially all of our assets.
The agreements governing our Term Loans impose financial and operating restrictions on us and any failure to meet our payment or other obligations under our Term Loans could have a material adverse effect on us, including permitting the lenders under our Term Loans to foreclose on, and acquire control of, substantially all of our assets.
If we are unable to repay outstanding borrowings when due or comply with other obligations and covenants under our Term Loan, the lenders under our Term Loan will have the right to proceed against these pledged capital stock and take control of substantially all of our assets.
If we are unable to repay outstanding borrowings when due or comply with other obligations and covenants under our Term Loans, the lenders under our Term Loans will have the right to proceed against these pledged capital stock and take control of substantially all of our assets.
This assessment must include disclosure of any material weaknesses in our internal control over financial reporting identified by management. While our management has concluded that our internal control over financial reporting was effective as of September 30, 2024, it is possible that material weaknesses will be identified in the future.
This assessment must include disclosure of any material weaknesses in our internal control over financial reporting identified by management. While our management has concluded that our internal control over financial reporting was effective as of September 30, 2025, it is possible that material weaknesses will be identified in the future.
The volatile global economic environment has created market uncertainty. A slowdown in the financial markets or other economic conditions, including but not limited to global supply chain issues, inflation, fuel and energy costs, freight costs, lack of available credit, interest rates, and tax rates, may adversely affect the Company’s growth and profitability.
The volatile global economic environment has created market uncertainty. A slowdown in the financial markets or other economic conditions, including but not limited to global supply chain issues, inflation, fuel and energy costs, freight costs, lack of available credit, sovereign debt crises, interest rates, and tax rates, may adversely affect the Company’s growth and profitability.
We expect to continue to be dependent on a limited number of customers. In fiscal year 2024, one customer accounted for 18% of revenues and no other customers accounted for more than 10% of revenues.
We expect to continue to be dependent on a limited number of customers. In fiscal year 2025, one customer accounted for 32% of revenues and no other customers accounted for more than 10% of revenues. In fiscal year 2024, one customer accounted for 18% of revenues, and no other customers accounted for more than 10% of revenues.
We may not be able to access additional capital resources due to a variety of reasons, including the restrictive covenants in our Term Loan and the lack of available capital due to global economic conditions.
We may not be able to access additional capital resources due to a variety of reasons, including the restrictive covenants in our Term Loans and the lack of available capital due to global economic conditions.
Principal factors that could affect the availability of our internally generated funds include: • failure of sales to government, military, and commercial markets to meet planned projections; • government spending levels impacting sales of our products; • political uncertainty; • foreign currency fluctuations; • working capital requirements to support business growth; • our ability to control spending; • our ability to integrate future acquisitions; • management of new business opportunities; • introduction of new competing technologies; • product mix and effect on margins; and • acceptance of our existing and future products in existing and new markets.
Principal factors that could affect the availability of our internally generated funds include: • failure of sales to, or delays in payment from, customers in the government, military, and commercial markets to meet planned projections; • government spending levels impacting sales of our products; • political or economic uncertainty; • foreign currency fluctuations; • working capital requirements to support business growth; • our ability to control spending; • our ability to integrate future acquisitions; • management of new business opportunities; • introduction of new competing technologies; • product mix and effect on margins; and • acceptance of our existing and future products in existing and new markets.
In fiscal years 2024 and 2023, revenues outside of the U.S. accounted for approximately 30% and 22% of net revenues, respectively. The risks inherent in international trade may reduce our international sales and harm our business and the businesses of our customers and our suppliers.
In fiscal years 2025 and 2024, revenues outside of the U.S. accounted for approximately 17% and 30% of net revenues, respectively. The risks inherent in international trade may reduce our international sales and harm our business and the businesses of our customers and our suppliers.
Our Term Loan also requires us to achieve and maintain compliance with a minimum liquidity covenant. A breach of any of these restrictive covenants or the inability to comply with the financial metrics could result in a default under our Term Loan. Further, our Term Loan is jointly and severally guaranteed by us and certain of our subsidiaries.
Our Term Loans also require us to achieve and maintain compliance with a minimum liquidity covenant. A breach of any of these restrictive covenants or the inability to comply with the financial metrics could result in a default under our Term Loans. Further, our Term Loans are jointly and severally guaranteed by us and certain of our subsidiaries.
Our product liability insurance coverage may be insufficient to pay all such claims. Product liability insurance may also become too costly for us or may become unavailable to us in the future. We may not have sufficient resources to satisfy any product liability claims not covered by insurance, which would materially and adversely affect our operating results and financial condition.
Product liability insurance may also become too costly for us or may become unavailable to us in the future. We may not have sufficient resources to satisfy any product liability claims not covered by insurance, which would materially and adversely affect our operating results and financial condition.
If any of these events were to occur, our business, results of operations and financial condition could be materially adversely affected. 16 We have current government contracts, and our future growth is dependent, in large part, on continued sales to U.S. and international governments and businesses that sell to governments.
If any of these events were to occur, our business, results of operations and financial condition could be materially adversely affected. 15 We have current government contracts, and our future growth is dependent, in large part, on continued sales to U.S. and international governments and businesses that sell to governments, which in turn are dependent on adequate government funding.
We have previously experienced, and may in the future experience, reductions in sales of older generation products as customers delay or defer purchases in anticipation of new product introductions. We have established reserves for slow moving or obsolete inventory of $0.8 million as of September 30, 2024.
We have previously experienced, and may in the future experience, reductions in sales of older generation products as customers delay or defer purchases in anticipation of new product introductions. We have established reserves for slow moving or obsolete inventory of $1.3 million as of September 30, 2025.
Our operations are subject to environmental regulation in areas in which we conduct business. Our product design and procurement operations must comply with new and future requirements relating to the materials composition of our products, including restrictions on lead, cadmium, and other substances.
Current environmental laws, or laws enacted in the future, may harm our business. Our operations are subject to environmental regulation in areas in which we conduct business. Our product design and procurement operations must comply with new and future requirements relating to the materials composition of our products, including restrictions on lead, cadmium, and other substances.
We cannot guarantee that we will be able to increase our customer base. 17 Further, even if we do obtain new customers, we cannot guarantee that those customers will purchase from us in sufficient quantities or at product prices that will enable us to recover our costs in acquiring those customers and fulfilling those orders.
Further, even if we do obtain new customers, we cannot guarantee that those customers will purchase from us in sufficient quantities or at product prices that will enable us to recover our costs in acquiring those customers and fulfilling those orders.
Our Term Loan imposes, and the terms of any future debt may impose, operating and other restrictions on us.
Our Term Loans impose, and the terms of any future debt may impose, operating and other restrictions on us.
We are competing against a number of large competitors in the mass notification market, and we need to establish our product offerings as competitive to win awards against these competitors, increase our customer base, and gain market share.
We are competing against a number of large competitors in the mass notification market, and we need to establish our product offerings as competitive to win awards against these competitors, increase our customer base, and gain market share. We cannot guarantee that we will be able to increase our customer base.
A competitor may independently develop or patent technologies that are substantially equivalent to, or superior to, our technology. If this happens, our competitive position could be significantly harmed. We may face personal injury and other liability claims that harm our reputation and adversely affect our operating results and financial condition .
A competitor may 19 independently develop or patent technologies that are substantially equivalent to, or superior to, our technology. If this happens, our competitive position could be significantly harmed. We may face wrongful death, personal injury and other product liability claims that may result in significant costs, harm our reputation and adversely affect our operating results and financial condition .
These claims or perceptions, which we believe are unsubstantiated, could reduce our product sales. 18 A significant portion of our revenue is derived from our core product category. We are dependent on our core directional product category to generate our revenues.
Such claims or perceptions, which we believe are unsubstantiated, could reduce our product sales and harm our reputation. A significant portion of our revenue is derived from our core product category. We are dependent on our core directional product category to generate our revenues.
Because not all of our supply arrangements provide for guaranteed supply and some key parts may be available only from a single supplier or a limited group of suppliers, we are subject to supply and pricing risk.
Because not all of our supply arrangements provide for guaranteed supply and some key parts may be available only from a single supplier or a limited group of suppliers, we are subject to supply and pricing risk. For example, we rely on one supplier for compression drivers for our LRAD products.
Such geopolitical instability and uncertainty could have a negative impact on our ability to sell, ship products, collect payments, and support customers in certain regions based on trade restrictions, embargoes and export control law restrictions, supply disruptions, and logistics restrictions, including closures of air space, and could increase the costs, risks, and adverse impacts from supply chain and logistics challenges.
Such geopolitical instability and uncertainty could have a negative impact on our ability to sell, ship products, collect payments, and support customers in certain regions based on trade restrictions, embargoes and export control law restrictions, and could result in supply disruptions and logistics restrictions, including closures of air space.
A person injured in connection with the use of our products may bring legal action against us to recover damages on the basis of theories, including personal injury, negligent design, dangerous product or inadequate warning. We may also be subject to lawsuits involving allegations of misuse of our products.
A person injured in connection with the use of our products may bring legal action against us to recover damages on the basis of various legal theories including personal injury, negligent design, dangerous product or inadequate warning.
Risks Related to Our Capital Stock Sales of common stock issuable on the exercise of outstanding options and warrants, may depress the price of our common stock. As of September 30, 2024, we had outstanding options granted to our employees, consultants, advisors, and directors to purchase 3,695,740 shares of our common stock and we had 288,059 restricted stock units outstanding.
Risks Related to Our Capital Stock Sales of common stock issuable on the exercise of outstanding options and warrants, may depress the price of our common stock. As of September 30, 2025, we had outstanding options granted to our employees, consultants, advisors, and directors to purchase 3,999,116 shares of our common stock and we had 277,342 restricted stock units outstanding.
Should we require additional funds, general market conditions or the then-current market price of our common stock may not support capital raising transactions and any such financing may require advance approval of our stockholders under the rules of the NASDAQ Stock Market. Our ability to obtain financing may be further constrained by prevailing economic conditions.
Should we require additional funds, general market conditions or the then-current market price of our common stock may not support equity or debt capital raising transactions and any such financing may require advance approval of our stockholders under the rules of the NASDAQ Capital Market.
If our expectations regarding future sales are inaccurate, we may be unable to reduce costs in a timely manner to adjust for sales shortfalls. We may need additional capital for growth. We may need additional capital to support our growth. While we expect to generate these funds from operations, we may not be able to do so.
If our expectations regarding future sales are inaccurate, we may be unable to reduce costs in a timely manner to adjust for sales shortfalls. We may need additional capital for growth. We may need additional capital to support our growth.
Current conflicts around the world, including Ukraine and Israel, and related sanctions could damage or disrupt international commerce and the global economy. It is not possible to predict the broader or longer-term consequences of these conflicts or the impact of sanctions, embargoes, regional instability, geopolitical shifts and adverse effects on macroeconomic conditions, security conditions, currency exchange rates, and financial markets.
It is not possible to predict the broader or longer-term consequences of these conflicts or the impact of sanctions, embargoes, regional instability, geopolitical shifts and adverse effects on macroeconomic conditions, security conditions, currency exchange rates, and financial markets.
Failure to comply with U.S. and foreign governmental laws and regulations applicable to international business, such as the Foreign Corrupt Practices Act or U.S. export control regulations, could have an adverse impact on our business with the U.S. and foreign governments. Current environmental laws, or laws enacted in the future, may harm our business.
Failure to comply with U.S. and foreign governmental laws and regulations applicable to international business, such as the Foreign Corrupt Practices Act or U.S. export control regulations, could have an adverse impact on our business with the U.S. and foreign governments. 20 Worldwide armed conflicts and the related implications may negatively impact our operations.
Potential customers for our products, including government, military, and emergency response agencies, may be influenced by claims or perceptions that long-range hailing devices are unsafe or may be used in an abusive manner.
Potential customers for our products, including government, military, and emergency response agencies, may be influenced by claims or perceptions that long-range hailing devices are unsafe or may be used in an abusive manner. These claims have been voiced and exploited by third parties in the past, including on network television and social media.
The loss or reduction of sales of this product category could have a material adverse effect on our business, results of operations, financial condition, and liquidity. We may not successfully penetrate the mass notification market. The mass notification market is substantial and projected to grow globally over the next five years.
The loss or reduction of sales of this product category could have a material adverse effect on our business, results of operations, financial condition, and liquidity. We may not successfully expand our position in the mass notification market, and our margins may be affected.
We expect our proprietary acoustic products, software products, and integrated solutions will be the source of substantially all our revenues for at least the near future. Revenues from these products and solutions are expected to vary significantly due to a number of factors, many of which are beyond our control.
Our quarterly and annual revenues are likely to fluctuate significantly due to many factors, most of which are beyond our control and could result in our failure to achieve our revenue expectations. We expect our proprietary acoustic products, software products, and integrated solutions will be the source of substantially all our revenues for at least the near future.
While our warranty experience with our product line has been favorable, as we build more complexity into the product, and as we expand our supplier base, issues could arise that could affect future warranty costs, which could adversely affect our financial position, results of operations and business prospects.
While our warranty experience with our product line has been favorable, as we build more complexity into the product, and as we expand our supplier base, issues could arise that could affect future warranty costs, which could adversely affect our financial position, results of operations and business prospects. 18 System disruptions and security threats to our computer networks, including breach of our or our customers’ confidential information, could have a material adverse effect on our business and our reputation .
Sales of our products to U.S. government agencies and organizations are subject to the overall U.S. government budget and congressional appropriation decisions and processes which are driven by numerous factors, including geo-political events and macroeconomic conditions, and are beyond our control. Even awards granted may not result in orders due to spending constraints.
Sales of our products to U.S. government agencies and organizations, including, for example, our recently received LRAD order for CROWS, are subject to the overall U.S. government budget and congressional appropriation decisions and processes which are driven by numerous factors, including domestic political conditions, geopolitical events and macroeconomic conditions, and are beyond our control.
Our products are substantially different from proven, mass produced sound transducer designs and are often employed in harsh environments. We may incur substantial and unpredictable warranty costs from post-production product or component failures. We generally warrant our products to be free from defects in materials and workmanship for a period up to one year from the date of purchase.
However, we may be unable to do so as a result of competition or otherwise. We may incur significant and unpredictable warranty costs. Our products are substantially different from proven, mass produced sound transducer designs and are often employed in harsh environments. We may incur substantial and unpredictable warranty costs from post-production product or component failures.
Increases in our cost of purchasing these items could negatively impact our financial results if we are not able to pass these increased costs on to our customers. Worldwide armed conflicts and the related implications may negatively impact our operations.
Increases in our cost of purchasing these items could negatively impact our financial results if we are not able to pass these increased costs on to our customers. International trade policies, including tariffs, sanctions and trade barriers, may adversely affect our business, financial condition, results of operations and prospects.
We do not maintain “key person” life insurance on any of our executive officers. The loss of one or several key employees could seriously harm our business. We cannot ensure that employees will not leave and subsequently compete against us. We are also dependent on our ability to retain and motivate high quality personnel, especially sales and skilled engineering personnel.
We cannot ensure that employees will not leave and subsequently compete against us. We are also dependent on our ability to retain and motivate high quality personnel, especially sales and skilled engineering personnel.
Similar issues apply to sales to international governments. We have no assurance that military interest in communication devices to minimize unnecessary use of force will continue or will provide future growth opportunities for our business. Disruption and fluctuations in financial and currency markets could have a negative effect on our business.
Even awards granted may not result in orders due to spending constraints or Congressional delays in passing the federal budget. Similar issues apply to sales to international governments. Furthermore, we have no assurance that military interest in communication devices to minimize unnecessary use of force will continue or will provide future growth opportunities for our business.
Our margins could be impacted as we expand into the emergency response and mass notification market. Our sales strategy for fiscal year 2025 and beyond is to increase our share of the growing emergency response and mass notification market with our Protective Communications solutions. A number of large companies currently have a substantial share of the market.
The emergency response and mass notification market is substantial and projected to grow globally over the near future. Our sales strategy for fiscal year 2026 and beyond is to increase our share of the growing emergency response and mass notification market with our Protective Communications solutions.
We also sell extended repair and maintenance contracts with terms ranging from one to several years, which provide repair and maintenance services after expiration of the original limited warranty. As of September 30, 2024, we had a warranty reserve of $76 thousand.
We generally warrant our products to be free from defects in materials and workmanship for a period up to one year from the date of purchase. We also sell extended repair and maintenance contracts with terms ranging from one to several years, which provide repair and maintenance services after expiration of the original limited warranty.
Any one or more of the factors listed below or other factors could cause us to fail to achieve our revenue expectations.
Revenues from these products and solutions are expected to vary significantly due to a number of factors, many of which are beyond our control. Any one or more of the factors listed below or other factors could cause us to fail to achieve our revenue expectations.
Changes in laws or regulations or the manner of their interpretation or enforcement could adversely impact our financial performance and restrict our ability to operate our business or execute our strategies.
Global economic and political uncertainties and foreign currency rate fluctuations could adversely influence demand for our products leading to reduced levels of investments, reductions in government spending and budgets and changes in spending priorities and behavior. 25 Changes in laws or regulations or the manner of their interpretation or enforcement could adversely impact our financial performance and restrict our ability to operate our business or execute our strategies.
Our Term Loan provides for interest to be calculated based on the prime rate, the federal funds rate and/or the secured overnight financing rate.
Our Term Loans provide for interest to be calculated based on the prime rate, the federal funds rate and/or the secured overnight financing rate. While the Federal Reserve lowered interest rates slightly during 2025, future increases in benchmark rates would raise the interest rates applicable to our Term Loans.
Our success is dependent on the performance of our executive team, and the cooperation, performance, and retention of our executive officers and key employees. Our business and operations are substantially dependent on the performance of our current executive team including our Chief Executive Officer and our Chief Financial Officer.
Our business and operations are substantially dependent on the performance of our current executive team including our Chief Executive Officer and our Chief Financial Officer. We do not maintain “key person” life insurance on any of our executive officers. The loss of one or several key employees could seriously harm our business.
A significant product defect or product recall could materially and adversely affect our brand image, causing a decline in our sales, and could reduce or deplete our financial resources. Costs associated with our multi-year maintenance contract with a foreign military customer could be higher than expected. We are obligated under a five-year repair and maintenance agreement with a foreign military.
A significant product defect or product recall could materially and adversely affect our brand image, causing a decline in our sales, and could reduce or deplete our financial resources.
Significant litigation could also result in negative publicity and a diversion of management’s attention and resources. Our international operations could be harmed by factors including political instability, natural disasters, fluctuations in currency exchange rates, and changes in regulations that govern international transactions. We sell our products worldwide.
The outcome of any proceeding is inherently uncertain, and we may not be able to estimate reasonably the likelihood or range of potential loss. Our international operations could be harmed by factors including political instability, natural disasters, fluctuations in currency exchange rates, and changes in regulations that govern international transactions. We sell our products worldwide.
In fiscal year 2024, direct and indirect sales to the U.S. government accounted for approximately 29% of our total net sales, compared with 59% of our total net sales in fiscal year 2023. Changes in defense spending could have an adverse effect on our current and future revenues.
In this context, we note a recent decline in federal funding in the United States. In fiscal year 2025, direct and indirect sales to the U.S. government accounted for approximately 56% of our total net sales, compared with 29% of our total net sales in fiscal year 2024.
Risks Related to Our Financial Statements and Operating Results We do not have the ability to accurately predict future operating results. Our quarterly and annual revenues are likely to fluctuate significantly due to many factors, most of which are beyond our control and could result in our failure to achieve our revenue expectations.
Any of these factors could materially adversely affect our business, results of operations, and financial condition. Risks Related to Our Financial Statements and Operating Results We do not have the ability to accurately predict future operating results.
These terms may include voting rights, preferences as to dividends and liquidation, conversion and redemption rights, and sinking fund provisions. Item 1B. Unres olved Staff Comments. None.
These terms may include voting rights, preferences as to dividends and liquidation, conversion and redemption rights, and sinking fund provisions. General Risk Factors Our success is dependent on the performance of our executive team, and the cooperation, performance, and retention of our executive officers and key employees.
Removed
Global economic and political uncertainties and foreign currency rate fluctuations could adversely influence demand for our products leading to reduced levels of investments, reductions in government spending and budgets and changes in spending priorities and behavior. 14 Risks related to global economic instability, including global supply chain issues, inflation, labor costs, and fuel and energy costs, may affect the Company’s business.
Added
While we expect to generate these funds from operations, we may not be able to do so, or may be able to do so only on terms unfavorable to us.
Removed
While there are several large companies already established in this market, we believe our unique SaaS systems and solutions, the clear, intelligible voice capability of our Genasys speaker products, and our unified software/hardware platform provide us with competitive advantages.
Added
As a result of the size of our public float, we are limited in our ability to raise significant equity capital in a public offering. Our ability to obtain financing may be further constrained by prevailing economic conditions.
Removed
Based on the increase in global public safety and enterprise threats, we continue to invest in marketing, selling, and software development resources to become successful in this growing market. However, we are competing against established competitors that have greater resources and have successfully penetrated the market.
Added
If we raise additional funds through debt financing, the terms of such financing may not be favorable to us, and may also restrict our strategic or operational flexibility. 13 Risks related to global economic instability, including global supply chain issues, inflation, labor costs, and fuel and energy costs, may affect the Company’s business.
Removed
While we believe we have a strong product platform that can successfully compete against these larger players, given the highly competitive environment, we expect to confront pricing pressures, which may negatively impact our overall margins. We may incur significant and unpredictable warranty costs.
Added
Changes in defense and other government spending could have an adverse effect on our current and future revenues.
Removed
System disruptions and security threats to our computer networks, including breach of our or our customers’ confidential information, could have a material adverse effect on our business and our reputation .
Added
The funding of U.S. government programs is subject to an annual congressional budget authorization and appropriations process.
Removed
We have contracted with a third-party service provider to administer the required services under the terms of the maintenance agreement. The revenue from the maintenance agreement with our customer is fixed and paid annually upon completion of each year through May 2024.
Added
In years when the U.S. government does not complete its appropriations before the beginning of the new fiscal year on October 1, government operations are typically funded pursuant to a "continuing resolution," which allows federal government agencies to operate at spending levels approved in the previous appropriations cycle, but does not authorize new spending initiatives.
Removed
It is possible that the cost to repair and maintain the products and the cost to contract with our third-party service provider could exceed the revenue generated by the maintenance agreement.
Added
When the U.S. government operates under a continuing resolution, delays can occur in the procurement of the products, services and solutions that we provide and may result in new initiatives being canceled.
Removed
While the Federal Reserve decreased interest rates in 2024 any future increases in interest rates on which our Term Loan interest rates are based would increase interest rates on our debt, which could materially adversely impact our interest expense, operating results and cash flows.

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Item 1C. Cybersecurity

Cybersecurity — threats and controls disclosure

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Biggest changeThird-party risk is managed through vendor assessments and SOC 2 report requests, designed to ensure that our partners adhere to strict cybersecurity standards.
Biggest changeRisks from cybersecurity threats associated with the Company’s use of third-party service 26 providers are managed through vendor assessments and SOC 2 report requests, designed to ensure that our partners adhere to strict cybersecurity standards.
Our Board also periodically engages independent third-party technology experts to test our information technology systems, including cybersecurity. Management Role The Director of IT leads the day-to-day management of cybersecurity at Genasys, supported by a team of three IT professionals with a combined 45 years of IT and cybersecurity experience.
Our Board also periodically engages independent third-party technology experts to test our information technology systems, including cybersecurity. Management Role The Director of IT leads the day-to-day management of cybersecurity at Genasys, supported by a team of two IT professionals with a combined 45 years of IT and cybersecurity experience.
Our Director of IT, who is responsible for the oversight and implementation of the cybersecurity program, also periodically makes presentations to Board members on cybersecurity topics as part of the Board ’ s continuing education on topics that impact our company. Additionally, we have an escalation process to inform the Board of high-severity cybersecurity incidents that may occur.
Our Director of IT , who is responsible for the oversight and implementation of the cybersecurity program, also periodically makes presentations to Board members on cybersecurity topics as part of the Board’s continuing education on topics that impact our company. Additionally, we have an escalation process to inform the Board of high-severity cybersecurity incidents that may occur.
Management also ensures that employees and contractors undergo quarterly cybersecurity training and phishing simulations via KnowBe4, as part of a comprehensive awareness program.
Management also ensures that employees and contractors undergo quarterly cybersecurity training and phishing simulations, as part of a comprehensive awareness program.

Item 2. Properties

Properties — owned and leased real estate

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Biggest changeItem 2. Prop erties Our executive offices, sales, research and development and production facilities are located at 16262 West Bernardo Drive, San Diego, California. The lease of 55,766 square feet commenced July 1, 2018 and expires August 31, 2028.
Biggest changeItem 2. Prop erties Our executive offices, sales, research and development and production facilities for all our Protective Communications, including Genasys Protect and LRAD, are located at 16262 West Bernardo Drive, San Diego, California. The lease of 55,766 square feet commenced July 1, 2018 and expires August 31, 2028.
The aggregate monthly 26 payments, with abatements, are $84 thousand, $86 thousand, $89 thousand, $92 thousand and $94 thousand per month for the sixth through tenth years of the lease, respectively, plus other certain costs and charges as specified in the lease agreement, including the Company’s proportionate share of the building operating expenses and real estate taxes.
The aggregate monthly payments, with abatements, are $89 thousand, $92 thousand and $94 thousand per month for the eighth through tenth years of the lease, respectively, plus other certain costs and charges as specified in the lease agreement, including the Company’s proportionate share of the building operating expenses and real estate taxes.

Item 3. Legal Proceedings

Legal Proceedings — active lawsuits and investigations

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Biggest changeItem 3. Legal P roceedings We may at times be involved in litigation in the ordinary course of business. We will also, from time to time, when appropriate in management’s estimation, record adequate reserves in our financial statements for pending litigation. Item 4. Mine Safety Disclosure Not applicable. 27 PART II
Biggest changeItem 3. Legal P roceedings We may at times be involved in litigation in the ordinary course of business. We will also, from time to time, when appropriate in management’s estimation, record adequate reserves in our financial statements for pending litigation.
Added
On November 19, 2025, Gerry Darden, individually and as representative of the estate of Stacey Darden, filed a lawsuit in Los Angeles Superior Court against the Company, Southern California Edison Company, and Edison International related to the wildfire that occurred in early January, 2025 in the Eaton Canyon/Altadena area of Los Angeles County.
Added
In the complaint, the plaintiff alleges products liability and negligence claims against the Company based on Los Angeles County’s use of the Company’s products and seeks unspecified damages.
Added
As of the date of this Annual Report on Form 10-K, the Company has not been served the complaint and cannot assess with any meaningful probability the likelihood of an adverse outcome or the possible loss or range of loss, if any, related to this lawsuit. The Company will vigorously defend itself in the lawsuit. Item 4.
Added
Mine Safety Disclosure Not applicable. 27 PART II

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

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Biggest changeItem 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities. Market Information Our common stock is traded and quoted on the NASDAQ Capital Market under the symbol “GNSS.” Holders We had 44,928,967 shares issued and outstanding held by 910 holders of record of our common stock as of December 4, 2024.
Biggest changeItem 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities. Market Information Our common stock is traded and quoted on the NASDAQ Capital Market under the symbol “GNSS.” Holders We had 45,193,561 shares of our common stock issued and outstanding held by 911 holders of record as of December 5, 2025.
Dividends There were no dividends declared or paid during the years ended September 30, 2024 and 2023. The declaration of future cash dividends, if any, will be at the discretion of the Board of Directors and will depend on the Company’s earnings, if any, capital requirements and financial position, general economic conditions and other pertinent conditions.
Dividends There were no dividends declared or paid during the years ended September 30, 2025 and 2024. The declaration of future cash dividends, if any, will be at the discretion of the Board of Directors and will depend on the Company’s earnings, if any, capital requirements and financial position, general economic conditions and other pertinent conditions.
It is our present intention not to pay any cash dividends in the near future. Equity Compensation Plan Information The information required by this item is incorporated by reference to the information set forth in Item 12 of this Annual Report on Form 10-K. Recent Sales of Unregistered Securities None.
It is our present intention not to pay any cash dividends in the near future. Our Term Loans restrict our ability to pay dividends. Equity Compensation Plan Information The information required by this item is incorporated by reference to the information set forth in Item 12 of this Annual Report on Form 10-K. Recent Sales of Unregistered Securities None.
Removed
Issuer Purchases of Equity Securities In December 2022, the Board of Directors extended the Company’s share buyback program through December 31, 2024. Under the program, the Company was authorized to repurchase up to $5 million of its outstanding common shares. There were no shares repurchased during the year ended September 30, 2024 and 2023.
Removed
As of September 30, 2024, all repurchased shares were retired, and $3.0 million was available for share repurchase under this program. Item 6. Res erved 28

Item 6. [Reserved]

Selected Financial Data — reserved (removed by SEC in 2021)

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Biggest changeOther Information 42 ITEM 9C. Disclosure Regarding Foreign Jurisdictions that Prevent Inspections 42 PART III ITEM 10. Directors, Executive Officers and Corporate Governance 43 ITEM 11. Executive Compensation 43 ITEM 12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters 43 ITEM 13. Certain Relationships and Related Transactions, and Director Independence 43 ITEM 14.
Biggest changeOther Information 41 ITEM 9C. Disclosure Regarding Foreign Jurisdictions that Prevent Inspections 41 PART III ITEM 10. Directors, Executive Officers and Corporate Governance 42 ITEM 11. Executive Compensation 42 ITEM 12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters 42 ITEM 13. Certain Relationships and Related Transactions, and Director Independence 42 ITEM 14.
ITEM 6. Reserved 28 ITEM 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations 29 ITEM 7A. Quantitative and Qualitative Disclosures About Market Risk 41 ITEM 8. Financial Statements and Supplementary Data 41 ITEM 9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosure 41 ITEM 9A. Controls and Procedures 42 ITEM 9B.
ITEM 6. Reserved 28 ITEM 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations 29 ITEM 7A. Quantitative and Qualitative Disclosures About Market Risk 40 ITEM 8. Financial Statements and Supplementary Data 40 ITEM 9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosure 41 ITEM 9A. Controls and Procedures 41 ITEM 9B.
Principal Accountant Fees and Services 43 PART IV ITEM 15. Exhibits and Financial Statement Schedules 44 Consolidated Financial Statements F- i Signatures PART I Forward Looking Statements This Annual Report on Form 10-K contains forward-looking statements relating to future events or the future performance of our company.
Principal Accountant Fees and Services 42 PART IV ITEM 15. Exhibits and Financial Statement Schedules 43 Index to Consolidated Financial Statements F- i Signatures F- 37 PART I Forward Looking Statements This Annual Report on Form 10-K contains forward-looking statements relating to future events or the future performance of our company.

Item 7. Management's Discussion & Analysis

Management's Discussion & Analysis (MD&A) — revenue / margin commentary

74 edited+27 added−49 removed48 unchanged
Biggest changeYears Ended September 30, 2024 September 30, 2023 % of % of Total Total Fav(Unfav) Amount Revenue Amount Revenue Amount % Revenues: Product revenue $ 14,384 59.9 % $ 40,128 86.0 % $ (25,744 ) (64.2 %) Contract and other 9,624 40.1 % 6,535 14.0 % 3,089 47.3 % Total revenues 24,008 100.0 % 46,663 100.0 % (22,655 ) (48.6 %) Cost of revenues 13,819 57.6 % 24,901 53.4 % 11,082 44.5 % Gross Profit 10,189 42.4 % 21,762 46.6 % (11,573 ) (53.2 %) Operating expenses Selling, general and administrative 27,261 113.5 % 24,621 52.8 % (2,640 ) (10.7 %) Research and development 9,644 40.2 % 8,127 17.4 % (1,517 ) (18.7 %) Total operating expenses 36,905 153.7 % 32,748 70.2 % (4,157 ) (12.7 %) Loss from operations (26,716 ) (111.3 %) (10,986 ) (23.5 %) (15,730 ) 143.2 % Other expense, net (5,419 ) (22.6 %) (10 ) (0.0 %) (5,409 ) 54,090.0 % Loss before income taxes (32,135 ) (133.9 %) (10,996 ) (23.6 %) (21,139 ) 192.2 % Income tax (benefit) expense (405 ) (1.7 %) 7,400 15.9 % 7,805 105.5 % Net loss $ (31,730 ) (132.2 %) $ (18,396 ) (39.4 %) $ (13,334 ) 72.5 % Net revenue Hardware $ 16,668 69.4 % $ 42,864 91.9 % (26,196 ) (61.1 %) Software 7,340 30.6 % 3,799 8.1 % 3,541 93.2 % Total net revenue $ 24,008 100.0 % $ 46,663 100.0 % $ (22,655 ) (48.6 %) US v International Revenue US Revenue $ 16,888 70.3 % $ 36,286 77.8 % (19,398 ) (53.5 %) International Revenue 7,120 29.7 % 10,377 22.2 % (3,257 ) (31.4 %) Total $ 24,008 100.0 % $ 46,663 100.0 % $ (22,655 ) (48.6 %) Revenues Revenues decreased $22,655 in the fiscal year ended September 30, 2024, compared with fiscal year 2023.
Biggest changeYears Ended September 30, 2025 September 30, 2024 % of % of Total Total Fav (Unfav) Amount Revenue Amount Revenue Amount % Revenues: Product revenue $ 28,455 69.8 % $ 14,384 59.9 % $ 14,071 97.8 % Contract and other 12,302 30.2 % 9,624 40.1 % 2,678 27.8 % Total revenues 40,757 100.0 % 24,008 100.0 % 16,749 69.8 % Cost of revenues 23,801 58.4 % 13,819 57.6 % (9,982 ) (72.2 )% Gross Profit 16,956 41.6 % 10,189 42.4 % 6,767 66.4 % Operating expenses Selling, general and administrative 25,660 63.0 % 27,261 113.5 % 1,601 5.9 % Research and development 8,106 19.9 % 9,644 40.2 % 1,538 15.9 % Total operating expenses 33,766 82.8 % 36,905 153.7 % 3,139 8.5 % Loss from operations (16,810 ) (41.2 %) (26,716 ) (111.3 %) 9,906 37.1 % Other expense, net (1,183 ) (2.9 %) (5,419 ) (22.6 %) 4,236 78.2 % Loss before income taxes (17,993 ) (44.1 %) (32,135 ) (133.9 %) 14,142 44.0 % Income tax (benefit) expense 119 0.3 % (405 ) (1.7 %) (524 ) (129.4 %) Net loss $ (18,112 ) (44.4 %) $ (31,730 ) (132.2 %) $ 13,618 42.9 % Net revenue Hardware $ 31,839 78.1 % $ 16,668 69.4 % 15,171 91.0 % Software 8,918 21.9 % 7,340 30.6 % 1,578 21.5 % Total net revenue $ 40,757 100.0 % $ 24,008 100.0 % $ 16,749 69.8 % US v International Revenue US Revenue $ 33,922 83.2 % $ 16,888 70.3 % 17,034 100.9 % International Revenue 6,835 16.8 % 7,120 29.7 % (285 ) (4.0 %) Total $ 40,757 100.0 % $ 24,008 100.0 % $ 16,749 69.8 % Revenues Revenues increased $16,749 for fiscal year 2025, compared with fiscal year 2024 including a $15,171 increase in hardware revenue and a $1,578 increase in software revenue compared with the prior fiscal year.
We account for share-based compensation in accordance with the provisions of Financial Accounting Standards Board (“FASB”) ASC 718, “ Compensation—Stock Compensation ” (“ASC 718”) which requires the measurement and recognition of compensation expense for all share-based payment awards made to employees, consultants, and directors based on estimated fair values.
Share-Based Compensation We account for share-based compensation in accordance with the provisions of Financial Accounting Standards Board (“FASB”) ASC 718, “ Compensation—Stock Compensation ” (“ASC 718”) which requires the measurement and recognition of compensation expense for all share-based payment awards made to employees, consultants, and directors based on estimated fair values.
Our products are sold to customers in many different markets and geographic locations. We estimate our allowance for doubtful accounts for expected credit losses on a case-by-case basis due to a limited number of customers.
Allowance for Doubtful Accounts for Expected Credit Losses Our products are sold to customers in many different markets and geographic locations. We estimate our allowance for doubtful accounts for expected credit losses on a case-by-case basis due to a limited number of customers.
Our products, systems, and solutions also have many applications within the fire rescue, maritime, asset protection, and wildlife control and preservation business segments. Genasys has developed a global market and an increased demand for LRADs and advanced mass notification speakers. We have a reputation for producing quality products that feature industry-leading broadcast area coverage, vocal intelligibility, and product reliability.
Our products, systems, and solutions also have many applications within the fire rescue, maritime, asset protection, and wildlife control and preservation business segments. Genasys has developed a global market and an increased demand for LRADs and advanced mass notification speakers. We have a reputation for producing quality products that feature industry-leading broadcast area coverage, vocal intelligibility, and product 29 reliability.
Intangible assets consist of technology, customer relationships, and trade name portfolio acquired in the acquisitions of Genasys Spain, Zonehaven, Evertel, and the Amika Mobile asset purchase, and patents and trademarks that are amortized over their estimated useful lives. We must make judgments and estimates regarding the future utility and carrying value of intangible assets.
Valuation of Intangible Assets Intangible assets consist of technology, customer relationships, and trade name portfolio acquired in the acquisitions of Genasys Spain, Zonehaven, Evertel, and the Amika Mobile asset purchase, and patents and trademarks that are amortized over their estimated useful lives. We must make judgments and estimates regarding the future utility and carrying value of intangible assets.
We evaluate quarterly the realizability of the deferred tax assets and assess the need for a valuation allowance. We record valuation allowances to reduce our deferred tax assets to an amount that we believe is more likely than not to be realized. Realization is dependent on generating sufficient taxable income prior to expiration of the loss carryforwards.
Deferred Tax Asset We evaluate quarterly the realizability of the deferred tax assets and assess the need for a valuation allowance. We record valuation allowances to reduce our deferred tax assets to an amount that we believe is more likely than not to be realized. Realization is dependent on generating sufficient taxable income prior to expiration of the loss carryforwards.
Revenue Recognition Accounting Standards Codification (“ASC”) 606, Revenue from Contracts with Customers (“ASC 606”), outlines a single comprehensive model for entities to use in accounting for revenue arising from contracts with customers and supersedes most revenue recognition guidance, including industry-specific guidance. This new revenue recognition model provides a five-step analysis in determining when and how revenue is recognized: 1.
Revenue Recognition Accounting Standards Codification (“ASC”) 606, Revenue from Contracts with Customers (“ASC 606”), outlines a single comprehensive model for entities to use in accounting for revenue arising from contracts with customers and supersedes most revenue recognition guidance, including industry-specific guidance. This revenue recognition model provides a five-step analysis in determining when and how revenue is recognized: 1.
We record the adjustment to the allowance for doubtful accounts for expected credit losses in SG&A expenses in the consolidated statement of operations. 34 Valuation of Inventory. Our inventory is comprised of raw materials, assemblies, and finished products. We must periodically make judgments and estimates regarding the future utility and carrying value of our inventory.
We record the adjustment to the allowance for doubtful accounts for expected credit losses in SG&A expenses in the consolidated statement of operations. Valuation of Inventory Our inventory is comprised of raw materials, assemblies, and finished products. We must periodically make judgments and estimates regarding the future utility and carrying value of our inventory.
We account for business combinations using the acquisition method of accounting, which requires that assets acquired and liabilities assumed be recorded at their respective fair values as of the acquisition date. The excess of the purchase price over those fair values is recorded as goodwill.
Business Combination We account for business combinations using the acquisition method of accounting, which requires that assets acquired and liabilities assumed be recorded at their respective fair values as of the acquisition date. The excess of the purchase price over those fair values is recorded as goodwill.
We establish a warranty reserve based on anticipated warranty claims at the time product revenue is recognized. This reserve requires us to make estimates regarding the amount and costs of warranty repairs we expect to make over a period of time.
Accrued Warranty We establish a warranty reserve based on anticipated warranty claims at the time product revenue is recognized. This reserve requires us to make estimates regarding the amount and costs of warranty repairs we expect to make over a period of time.
We derive our revenue from the sale of products and services to customers, contracts, license fees, other services, and freight. We sell our products and services through its direct sales force and through authorized resellers and system integrators.
We derive our revenue from the sale of products and services to customers, contracts, license fees, other services, and freight. We sell our products and services through our direct sales force and through authorized resellers and system integrators.
Goodwill is recorded as the difference, if any, between the aggregate consideration paid for an acquisition and the fair value of the acquired net tangible and intangible assets acquired.
Valuation of Goodwill Goodwill is recorded as the difference, if any, between the aggregate consideration paid for an acquisition and the fair value of the acquired net tangible and intangible assets acquired.
The carrying values of such assets are periodically reviewed and impairments, if any, are recognized when the expected future benefit to be derived from an individual intangible asset is less than its carrying value. This generally occurs when certain assets are no longer consistent with our business strategy and whose expected future value has decreased. Valuation of Goodwill.
The carrying values of such assets are periodically reviewed and impairments, if any, are recognized when the expected future benefit to be derived from an individual intangible asset is less than its carrying value. This generally occurs when certain assets are no longer consistent with our business strategy and whose expected future value has decreased.
We are required to make quarterly interest payments on the Term Loan, and may elect to pay quarterly interest on the Term Loan based on the three-month Secured Overnight Financing Rate (“SOFR”) plus five percent (5%) in cash or we may elect to pay interest based on the three-month SOFR plus six percent (6%) with 50% paid in cash and the remainder paid by issuing shares of our common stock.
We are required to make quarterly interest payments on the Close Date Term Loan, and may elect to pay quarterly interest on the Close Date Term Loan based on the three-month Secured Overnight Financing Rate (“SOFR”) plus five percent (5%) in cash or we may elect to pay interest based on the three-month SOFR plus six percent (6%) with 50% paid in cash and the remainder paid by issuing shares of our common stock.
On October 4, 2023, we completed an underwritten public offering of 5,750,000 shares of its common stock at a public offering price of $2.00 per share. We received gross proceeds of approximately $11,500 from the offering, before underwriting discounts and commissions and offering expenses of $1,051.
On October 4, 2023, we completed an underwritten public offering of 5,750,000 shares of our common stock at a public offering price of $2.00 per share. We received gross proceeds of approximately $11,500 from the offering, before underwriting discounts and commissions and offering expenses of $1,051.
These statements involve risks and uncertainties that could cause actual results to differ materially from those suggested in the forward-looking statements. Overview We are a global provider of Protective Communications solutions including our Genasys Protect software platform and Genasys LRAD products.
These statements involve risks and uncertainties that could cause actual results to differ materially from those suggested in the forward-looking statements. Overview We are a global provider of Protective Communications solutions including our Genasys Protect software platform and LRAD by Genasys hardware products.
Although we do not believe that inflation has had a material impact on our financial results through September 30, 2024, sustained or increased inflation in the future may have a negative effect on our ability to achieve certain expectations in gross margin and operating expenses.
Although we do not believe that inflation has had a material impact on our financial results through September 30, 2025, sustained or increased inflation in the future may have a negative effect on our ability to achieve certain expectations in gross margin and operating expenses.
In addition, we sell maintenance services on a stand-alone basis and is therefore capable of determining their fair 33 value. On this basis, the amount of the embedded maintenance is separated from the fee for the perpetual license and is recognized on a straight-line basis over the period to which the maintenance relates.
In addition, we sell maintenance services on a stand-alone basis and are therefore capable of determining their fair value. On this basis, the amount of the embedded maintenance is separated from the fee for the perpetual license and is recognized on a straight-line basis over the period to which the maintenance relates.
For reporting units where we perform the quantitative goodwill impairment test, an impairment loss is recorded to the extent that the reporting unit’s carrying amount exceeds the reporting unit’s fair value. An impairment loss cannot exceed the total amount of goodwill allocated to the reporting unit. Accrued Warranty.
For reporting units where we perform the quantitative goodwill impairment test, an impairment loss is recorded to the extent that the reporting unit’s carrying amount exceeds the reporting unit’s fair value. An impairment loss cannot exceed the total amount of goodwill allocated to the reporting unit.
In fiscal 2025, we intend to continue pursuing domestic and international business opportunities with the support of business development consultants, key representatives, and resellers. We plan to grow our revenues through increased direct sales to governments and agencies that desire to integrate our communication technologies into their homeland security and public safety systems.
In fiscal year 2026, we intend to continue pursuing domestic and international business opportunities with the support of business development consultants, key representatives, and resellers. We plan to grow our revenues through increased direct sales to governments and agencies that desire to integrate our communication technologies into their homeland security and public safety systems.
We incurred non-cash share-based compensation expenses allocated to selling, general and administrative expenses of $1,378 and $1,428 for fiscal years 2024 and 2023, respectively. We may expend additional resources on the marketing and selling of our products in future periods as we identify ways to optimize potential business opportunities. Commission expense will fluctuate based on the nature of our sales.
We incurred non-cash share-based compensation expenses allocated to selling, general and administrative expenses of $1,418 and $1,378 for fiscal years 2025 and 2024, respectively. We may expend additional resources on the marketing and selling of our products in future periods as we identify ways to optimize potential business opportunities. Commission expense will fluctuate based on the nature of our sales.
This includes building on fiscal 2024 domestic defense sales by pursuing further U.S. military opportunities. We also plan to pursue domestic and international emergency warning, enterprise and critical event management, government, law enforcement, fire rescue, homeland and international security, private and commercial security, border security, maritime security, and wildlife preservation and control business opportunities.
This includes building on fiscal year 2025 domestic defense sales by expanding and pursuing further U.S. military opportunities. We also plan to pursue domestic and international emergency warning, enterprise and critical event management, government, law enforcement, fire rescue, homeland and international security, private and commercial security, border security, maritime security, and wildlife preservation and control business opportunities.
Refer to Note 19, Segment Information and Note 20, Major Customers, Suppliers and Related Information in the consolidated financial statements included in this report for additional details of revenues by reporting segment and disaggregation of revenue. Share-Based Compensation .
Refer to Note 19, Segment Information and Note 20, Major Customers, Suppliers and Related Information in the consolidated financial statements included in this report for additional details of revenues by reporting segment and disaggregation of revenue.
Factors affecting warranty reserve levels include the number of units sold, anticipated cost of warranty repairs, and anticipated rates of warranty claims. Warranty expense is recorded in cost of revenues. We evaluate the adequacy of this reserve each reporting period. Deferred Tax Asset.
Factors affecting warranty reserve levels include the number of units sold, anticipated cost of warranty repairs, and anticipated rates of warranty claims. Warranty expense is recorded in cost of revenues. We evaluate the adequacy of this reserve each reporting period.
Adjusted EBITDA is a measure used by management to understand and evaluate our core operating performance and trends and to generate future operating plans, make strategic decisions regarding allocation of capital, and invest in initiatives that are focused on cultivating new markets for our solutions.
EBITDA and Adjusted EBITDA are measures used by management to understand and evaluate our core operating performance and trends and to generate future operating plans, make strategic decisions regarding allocation of capital, and invest in initiatives that are focused on cultivating new markets for our solutions.
The agreement also has a change in control clause whereby the chief executive officer would be entitled to receive specific severance and equity vesting benefits if specified termination events occur. 40 There were no other employment agreements with executive officers or other employees providing future benefits or severance arrangements.
The agreement also has a change in control clause whereby the Chief Executive Officer would be entitled to receive specific severance and equity vesting benefits if specified termination events occur. There were no other employment agreements with executive officers or other employees providing future benefits or severance arrangements. The disclosure provided in Note 15.
The carrying value of our inventory is periodically reviewed and impairments, if any, are recognized when the expected future benefit from our inventory is less than its carrying value. Valuation of Intangible Assets.
The carrying value of our inventory is periodically reviewed and impairments, if any, are recognized when the expected future benefit from our inventory is less than its carrying value.
During the years ended September 30, 2024 and September 30, 2023, the Company recorded $508 and $194, respectively, in bonus expense, and related payroll tax expense in connection with the bonus plans. Unpaid bonus related expense is included in “Accrued liabilities” on the consolidated balance sheet.
During the years ended September 30, 2025 and September 30, 2024, the Company recorded $319 and $508, respectively, in bonus expense, and related payroll tax expense in connection with the bonus plans. Unpaid bonus related expense is included in “Accrued liabilities” on the consolidated balance sheet.
As of September 30, 2024, we not believe that it is more likely than not that its deferred tax assets will be realized; accordingly, a full valuation allowance has been established and no deferred tax asset is shown in the accompanying balance sheet.
As of September 30, 2025, we do not believe that it is more likely than not that our deferred tax assets will be realized; accordingly, a full valuation allowance has been established and no deferred tax asset is shown in the accompanying balance sheet.
The Company operates in two business segments: Hardware and Software and its principal markets are North and South America, Europe, Middle East and Asia. As reviewed by the Company’s chief operating decision maker, Chief Executive Officer, the Company evaluates the performance of each segment based on sales and operating income.
Hardware and Software and its principal markets are North and South America, Europe, Middle East and Asia. As reviewed by the Company’s chief operating decision maker, the Chief Executive Officer, the Company evaluates the performance of each segment based on sales and operating income.
In some cases, we delivers software development services bundled with the sale of the software.
In some cases, we deliver software development services bundled with the sale of software.
Loan Agreement On May 13, 2024, we entered into a term loan and security agreement, pursuant to which we received gross proceeds of $15,000, before generating professional expenses of $1,121 related to the Term Loan. The principal of the Term Loan is $15,000 and is payable upon maturity on May 13, 2026.
Loan Agreements On May 13, 2024, we entered into the Loan Agreement, pursuant to which we received gross proceeds of $15,000, before generating professional expenses of $1,121 related to the Close Date Term Loan. The principal of the Close Date Term Loan is 38 $15,000 and is payable upon maturity on May 13, 2026.
We determine the amount of share-based compensation expense based on awards that we ultimately expect to vest, reduced for estimated forfeitures. ASC 718 requires forfeitures to be estimated at the time of grant and revised, if necessary, in subsequent periods if actual forfeitures differ from those estimates. Allowance for doubtful accounts for expected credit losses .
We determine the amount of share-based compensation expense based on awards that we ultimately 32 expect to vest, reduced for estimated forfeitures. ASC 718 requires forfeitures to be estimated at the time of grant and revised, if necessary, in subsequent periods if actual forfeitures differ from those estimates.
Recent Accounting Pronouncements New pronouncements issued for future implementation are discussed in Note 3, Recent Accounting Pronouncements, to our consolidated financial statements. 35 Segment and Related Information We are engaged in the design, development, and commercialization of critical communications hardware and software solutions designed to alert, inform, and protect people.
Recent Accounting Pronouncements New pronouncements issued for future implementation are discussed in Note 3, Recent Accounting Pronouncements, to our consolidated financial statements. 34 Segment and Related Information We are engaged in the design, development, and commercialization of critical communications hardware and software solutions designed to alert, inform, and protect people. The Company operates in two business segments.
We had $249 in long-term marketable securities as of September 30, 2024, compared with no long-term marketable securities as of September 30, 2023. We also had restricted cash of $345 as of September 30, 2024 and $854 as of September 30, 2023.
We had no long-term marketable securities as of September 30, 2025, compared with $249 in long-term marketable securities as of September 30, 2024. We also had restricted cash of $585 as of September 30, 2025 and $345 as of September 30, 2024.
As of September 30, 2024, we were in compliance with all financial and reporting covenants of the Term Loan and we paid all interest in cash through September 30, 2024.
As of September 30, 2025, we were in compliance with all financial and reporting covenants of the Term Loans and we paid all interest in cash through September 30, 2025.
Nevertheless, use of adjusted EBITDA has limitations as an analytical tool, and you should not consider it in isolation or as a substitute for analysis of our financial results as reported under U.S. GAAP.
Adjusted EBITDA has limitations as an analytical tool, and should not be considered in isolation or as a substitute for analysis of our financial results as reported under U.S. GAAP.
GAAP”), have a significant impact on the results we report in our financial statements. We base our estimates on historical experience and on various other assumptions that we believe to be reasonable under the circumstances. These estimates affect the carrying values of assets and liabilities. Actual results may differ from these estimates under different assumptions or conditions.
We base our estimates on historical experience and on various other assumptions that we believe to be reasonable under the circumstances. These estimates affect the carrying values of assets and liabilities. Actual results may differ from these estimates under different assumptions or conditions.
Warrant liabilities are also recorded at fair value at issuance and remeasured each reporting period, with changes recognized in other income (expense) using a Monte Carlo simulation model. Business Combination.
Fair value is determined using a discounted cash flow method and Monte Carlo simulation. Warrant liabilities are also recorded at fair value at issuance and remeasured each reporting period, with changes recognized in other income (expense) using a Monte Carlo simulation model.
We will continue to evaluate the ability to realize its net deferred tax assets on an ongoing basis to identify whether any significant changes in circumstances or assumptions have occurred that could materially affect the ability to realize deferred tax assets and will adjust the valuation accordingly. Fair Value of the Term Loan and Warrant Liabilities.
We will continue to evaluate the ability to realize our net deferred tax assets on an ongoing basis to identify whether any significant changes in circumstances or assumptions have occurred that could materially affect the ability to realize deferred tax assets and will adjust the valuation accordingly. 33 Fair Value of the Term Loan and Warrant Liabilities We measure the fair value of the term loan and warrant liabilities at each reporting date in accordance with ASC 820, “ Fair Value Measurement ”.
Principal factors that could affect the availability of our internally generated funds include: • ability to meet sales projections; • government spending levels; • introduction of competing technologies; • product mix and effect on margins; • ability to reduce and manage inventory levels; and • product acceptance in new markets.
Principal factors that could affect the availability of our internally generated funds include: • ability to meet sales projections; • government spending levels; • ability to implement current contract programs timely; • timely collection of customer contract receivables; • introduction of competing technologies; • product mix and effect on margins, including the impact of tariffs on margin; • ability to reduce and manage current inventory levels and manage our supply chain; and • product acceptance in new markets.
We believe that adjusted EBITDA provides useful information to investors and others in understanding and evaluating our operating results in the same manner as our management and board of directors.
In particular, the exclusion of certain expenses in calculating adjusted EBITDA facilitates comparisons of our operating performance on a period-to-period basis. We believe that adjusted EBITDA provides useful information to investors and others in understanding and evaluating our operating results in the same manner as our management and board of directors.
Liquidity and Capital Resources Cash and cash equivalents as of September 30, 2024 were $4,945, compared with $8,665 as of September 30, 2023. In addition, we had $7,945 in short-term marketable securities as of September 30, 2024, compared with $1,481 as of September 30, 2023.
Cash and cash equivalents as of September 30, 2025 were $7,969, compared with $4,945 as of September 30, 2024. In addition, we had $70 in short-term marketable securities as of September 30, 2025, compared with $7,945 as of September 30, 2024.
A large number of LRAD and ACOUSTICS components and sub-assemblies manufactured by outside suppliers within our supply chain are produced within 50 miles of our facility. We do not source component parts from suppliers in China. It is likely that some of our suppliers source parts in China.
We also engage in ongoing value engineering to reduce the cost and simplify the manufacturing of our products. A large number of LRAD and Acoustics components and sub-assemblies manufactured by outside suppliers within our supply chain are produced within 50 miles of our facility. We do not source component parts from suppliers in China.
Other Metrics We monitor a number of financial and operating metrics to evaluate our business, measure our performance, identify trends affecting our business, formulate business plans and make strategic decisions, including the following key metrics.
Other Metrics We monitor a number of financial and operating metrics to evaluate our business, measure our performance, identify trends affecting our business, formulate business plans and make strategic decisions, including the following key metrics. Our other business metrics may be calculated in a manner different than similar other business metrics used by other companies (in thousands): 36 Non-U.S.
Net cash increase from changes in our operating assets and liabilities, consisted primarily of a $2,819 decrease in accounts receivable due to decreased hardware sales, a $2,235 increase in accounts payable related to procurement for increased 2025 sales projection, and a $442 increase in accrued and other liabilities, which included customer deposits, accrued payroll, deferred revenue, and operating lease liabilities, partially offset by a $1,272 increase in prepaid expenses and other, which includes deposits paid on inventory purchases, prepaid rent and prepaid insurance, and a $816 increase in inventory.
Net cash increase from changes in our operating assets and liabilities, consisted primarily of a $18,062 increase in customer deposits mostly related to the Puerto Rico Early Warning System Project, a $4,114 increase in accounts payable related to procurement for increased 2026 sales projection, and a $35 increase in accrued and other liabilities, which included customer deposits, accrued payroll, deferred revenue, and operating lease liabilities, partially offset by a $5,967 increase in contract assets mostly related to the Puerto Rico Early Warning System Project, a $5,937 increase in prepaid expenses and other current assets, which includes deposits paid on inventory purchases, prepaid rent and prepaid insurance, a $4,303 increase in accounts receivable due to increased hardware sales, and a $1,943 increase in inventory.
Net Loss The net loss of $31,730 for fiscal 2024 was an increase of $13,334 compared with the net loss of $18,396 in fiscal year 2023.
Net Loss The net loss of $18,112 for fiscal year 2025 was a decrease of $13,618 compared with the net loss of $31,730 in fiscal year 2024.
Additional capital, if needed, may not be available on satisfactory terms, if at all. 39 Cash Flows Our cash flows from operating, investing and financing activities, as reflected in the consolidated statements of cash flows, are summarized in the table below (in thousands): Years ended September 30, 2024 2023 Cash provided by (used in): Operating activities $ (19,454 ) $ (9,593 ) Investing activities (8,666 ) 5,538 Financing activities 23,873 (114 ) Operating Activities During the year ended September 30, 2024, net cash used in operating activities was $19,454, primarily resulting from net loss of $31,730, offset by a net cash increase from changes in our operating assets and liabilities of $3,408 and non-cash expenses of $8,868.
Cash Flows Our cash flows from operating, investing and financing activities, as reflected in the consolidated statements of cash flows, are summarized in the table below (in thousands): Years ended September 30, 2025 2024 Cash provided by (used in): Operating activities $ (8,762 ) $ (19,454 ) Investing activities 7,902 (8,666 ) Financing activities 4,031 23,873 39 Operating Activities During the year ended September 30, 2025, net cash used in operating activities was $8,762, primarily resulting from net loss of $18,112, offset by a net cash increase from changes in our operating assets and liabilities of $4,061 and non-cash expenses of $5,289.
In the year ended September 30, 2024, we did not receive proceeds from the exercise of stock options. Commitments We are committed for our San Diego headquarter facility lease through August 30, 2028, as more fully described in Note 13, Leases, in our consolidated financial statements.
Commitments We are committed for our San Diego headquarters facility lease through August 30, 2028, as more fully described in Note 13, Leases, in our consolidated financial statements.
LRAD products provide audible voice messages with exceptional vocal clarity from close range out to 5,500 meters. We have a history of successfully delivering innovative systems and solutions in mission critical situations, pioneering the AHD market with the introduction of our first LRAD AHD in 2002 and creating the first multidirectional voice-based public safety mass notification systems in 2012.
We have a history of successfully delivering innovative systems and solutions in mission critical situations, pioneering the AHD market with the introduction of LRAD in 2002, creating the first multidirectional voice-based public safety mass notification systems in 2012, and the first AHDs with a digital interface for remote operation in 2023.
Our accounting policies are more fully described in our consolidated financial statements and related notes located in “Item 8. Financial Statements and Supplementary Data.” The impact and any associated risks related to these policies on our business operations are discussed in “Item 1A. Risk Factors” and throughout “Item 7.
Financial Statements and Supplementary Data.” The impact and any associated risks related to these policies on our business operations are discussed in “Item 1A. Risk Factors” and throughout “Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations” when such policies affect our reported and expected financial results.
Management’s Discussion and Analysis of Financial Condition and Results of Operations” when such policies affect our reported and expected financial results. The methods, estimates, and judgments we use in applying our accounting policies, in conformity with generally accepted accounting principles in the United States of America (“U.S.
The methods, estimates, and judgments we use in applying our accounting policies, in conformity with generally accepted accounting principles in the United States of America (“U.S. GAAP”), have a significant impact on the results we report in our financial statements.
Financing Activities During the year ended September 30, 2024, net cash provided by financing activities was $23,873, primarily due to $13,698 in net proceeds from the Term Loan in May 2024, and $10,449 in net proceeds from an offering of the Company’s common stock in October 2023, offset by $219 payment made for contingent consideration, $43 settlement in statutory tax withholding requirement upon cashless exercise of stock options, and $12 to settlement in statutory tax withholding requirements upon vesting of restricted stock units.
Financing Activities During the year ended September 30, 2025, net cash provided by financing activities was $4,031, primarily due to loan proceeds of $4,000 from the First Amendment Term Loan in May 2025, and $49 cash proceeds received from the exercise of stock options, offset by $18 for settlement of statutory tax withholding requirements upon vesting of restricted stock units.
Investing Activities During the year ended September 30, 2024, net cash used in investing activities was $8,666, primarily due to $16,206 purchases short and long-term marketable securities, $908 of cash used in the Evertel acquisition, $764 of cash used for asset purchase holdback liability, and $191 cash used for capital expenditure, which includes the purchase of product tooling, computer equipment, and leasehold improvements for our operating facilities.
Investing Activities During the year ended September 30, 2025, net cash provided by investing activities was $7,902, primarily due to $9,557 proceeds received from maturities of available for sale marketable securities, partially offset by purchasing $1,400 of short-term marketable securities, and $255 in cash used for capital expenditure, which includes the purchase of product tooling, computer equipment, and leasehold improvements for our operating facilities.
Refer to Note 19, Segment Information, in our consolidated financial statements for further discussion. Comparison of Results of Operations for Fiscal Years Ended September 30, 2024 and 2023 The following table provides for the periods indicated certain items of our consolidated statements of operations expressed in thousands of dollars and as a percentage of net sales.
Refer to Note 19, Segment Information, in our consolidated financial statements for further discussion. Comparison of Results of Operations for Fiscal Years Ended September 30, 2025 and 2024 All dollar amounts presented in this section are in thousands.
We regularly review and adjust the sales price of our finished goods to offset these inflationary factors.
We have been affected by price increases from our suppliers and logistics and other inflationary factors such as increased salary, labor, and overhead costs. We regularly review and adjust the sales price of our finished goods to offset these inflationary factors.
Business Outlook Our products, systems, and solutions continue to gain worldwide awareness and recognition through increased marketing efforts, product demonstrations, and word of mouth as a result of positive responses and increased acceptance. We believe we have a solid global brand, technology, and product foundation, which we continue to expand to serve new markets and customers for greater business growth.
We believe we have a solid global brand, technology, and product foundation, which we continue to expand to serve new markets and customers for greater business growth.
In addition to the matters above, we are authorized for the performance of services and provision of goods pursuant to Delaware General Corporation Law. Our research and development strategy involves incorporating further innovations and capabilities into our Genasys Protect platform to meet the needs of our target markets. Our Genasys Protect software solutions are more complex offerings.
Our research and development strategy involves incorporating further innovations and capabilities into our Genasys Protect platform to meet the needs of our target markets. Our Genasys Protect software solutions are more complex offerings. We are pursuing certain certifications, which are often required when bidding on government and mass notification opportunities.
The financial information and discussion below should be read in conjunction with the consolidated financial statements and notes contained in this Annual Report.
The following table provides for the periods indicated certain items of our consolidated statements of operations expressed in thousands of dollars and as a percentage of net sales. The financial information and discussion below should be read in conjunction with the consolidated financial statements and notes contained in this Annual Report.
With such product updates and changes we have limited warranty cost experience and estimated future warranty costs can impact our gross margins. We do not believe that historical gross profit margins should be relied upon as an indicator of future gross profit margins. Selling, General and Administrative Expenses Selling, general and administrative expenses increased by $2,640, or 10.7%.
We do not believe that historical gross profit margins should be relied upon as an indicator of future gross profit margins. Selling, General and Administrative Expenses Selling, general and administrative expenses decreased by $1,601, or 5.9%.
The increase in software revenue in this fiscal year is due to growth in SaaS revenue, partially offset by lower professional services revenue on software contracts. As of September 30, 2024, we had aggregate deferred revenue and prepayments from customers in advance of product shipment of $5,618.
The increase in software revenue in fiscal year 2025 is primarily due to growth in recurring SaaS revenue. As of September 30, 2025, we had aggregate deferred revenue and prepayments from customers in advance of product shipment of $25,412. The receipt of orders will often be uneven due to the timing of customers’ approval or budget cycles.
Changes in fair value, including accrued interest, are recognized in other income (expense) on the condensed consolidated statements of operations, with related costs expensed as incurred. Fair value is determined using a discounted cash flow method and Monte Carlo simulation.
We elected the Fair Value Option (FVO) for its term loan, recording it at fair value upon issuance and remeasuring it at each reporting date. Changes in fair value, including accrued interest, are recognized in other income (expense) on the condensed consolidated statements of operations, with related costs expensed as incurred.
We are also configuring alternative solutions to achieve lower price points to meet the needs of certain customers or applications. We also engage in ongoing value engineering to reduce the cost and simplify the manufacturing of our products.
We intend to invest engineering resources to enhance our Genasys Protect software solutions to compete for larger emergency warning and critical communications business opportunities. We are also configuring alternative solutions to achieve lower price points to meet the needs of certain customers or applications.
Negative impacts on our supply chain could have a material adverse effect on our business. We communicate with our suppliers regarding measures to alleviate ongoing worldwide supply chain issues. 32 We have been affected by price increases from our suppliers and logistics and other inflationary factors such as increased salary, labor, and overhead costs.
It is likely that some of our suppliers source parts in China. Negative impacts on our supply chain could have a material adverse effect on our business. We communicate with our suppliers regarding measures to alleviate ongoing worldwide supply chain issues.
GAAP measure, for each of the periods indicated (in thousands): Years ended September 30, 2024 2023 Net loss (31,730 ) (18,396 ) Other expense, net 5,419 10 Income tax expense (benefit) (405 ) 7,400 Depreciation and amortization 2,929 2,558 Share-based compensation 1,652 1,642 Adjusted EBITDA $ (22,135 ) $ (6,786 ) Segment Results Segment results include net sales and operating income by segment.
GAAP measure, for each of the periods indicated (in thousands): Years ended September 30, 2025 2024 Net loss $ (18,112 ) $ (31,730 ) Interest income 285 237 Interest expense 1,575 603 Income tax expense (benefit) 119 (405 ) Depreciation and amortization 2,779 2,929 EBITDA (13,924 ) (28,840 ) Non-GAAP adjustments Share-based compensation 1,663 1,652 Change in fair value of Term Loans and warrants 730 (3,950 ) Other non-recurring expense* 623 1,103 Adjusted EBITDA $ (12,368 ) $ (22,135 ) * Other non-recurring expense consists of loss on term loan issuance, one-time legal fees and consulting fees, which we do not consider indicative of ongoing operations. 37 Segment Results Segment results include net sales and operating income by segment.
We may voluntarily redeem the Term Loan within one year of the issuance at 101% of the principal amount and after one year at par value. The Term Loan includes financial covenants and contains other customary affirmative and negative covenants and events of default. All obligations under the Term Loan are secured by substantially all of our assets.
The terms of the existing $15,000 Close Date Term Loan remain unchanged. The Term Loans include financial covenants and contain other customary affirmative and negative covenants and events of default. All obligations under the Term Loans are secured by substantially all of our assets.
Software Hardware Years ended Years ended September 30, Fav (Unfav) September 30, Fav (Unfav) 2024 2023 $ % 2024 2023 $ % Revenue $ 7,340 $ 3,799 $ 3,541 93.2 % $ 16,668 $ 42,864 $ (26,196 ) (61.1 %) Operating (loss) income (14,898 ) (14,226 ) (672 ) 4.7 % (11,818 ) 3,240 (15,058 ) (464.8 %) Reconciliation of U.S.
Software Hardware Years ended Years ended September 30, Fav (Unfav) September 30, Fav (Unfav) 2025 2024 $ % 2025 2024 $ % Revenue $ 8,918 $ 7,340 $ 1,578 21.5 % $ 31,839 $ 16,668 $ 15,171 91.0 % Operating (loss) income (11,883 ) (14,898 ) 3,015 20.2 % (4,927 ) (11,818 ) 6,891 58.3 % Net income (loss) (11,765 ) (14,433 ) 2,668 18.5 % (6,347 ) (17,297 ) 10,950 63.3 % Reconciliation of U.S.
LRAD LRAD is the world’s leading AHD, with the ability to project alert tones and audible voice messages with exceptional vocal clarity in a 30° beam from close range to 5,500 meters.
LRAD products provide audible voice messages with exceptional vocal clarity from close range out to 5,000 meters.
If we are unable to offset the negative impacts of inflation with increased prices, our future results could be materially affected. Critical Accounting Policies and Estimates We have identified the policies below as critical to our business operations and to understanding our results of operations.
Critical Accounting Policies and Estimates We have identified the policies below as critical to our business operations and to understanding our results of operations. Our accounting policies are more fully described in our consolidated financial statements and related notes located in “Item 8.
The decrease in gross profit was due to lower hardware revenue and related reduced overhead absorption partially offset by higher margin software in fiscal 2024. Gross margin as a percentage of sales was 42.4% in fiscal year 2024, compared with 46.6% in the prior year. Our products have varying gross margins and product mix may affect gross profits.
Gross Profit Gross profit for fiscal year 2025 increased $6,767, compared with fiscal year 2024. The increase in gross profit was primarily due to higher revenues driven by the hardware segment. Gross margin as a percentage of sales was 41.6% in fiscal year 2025, compared with 42.4% in fiscal year 2024.
In addition, our margins vary based on the sales channels through which our products are sold in a given period. We continue to implement product updates and changes, including raw material and component changes that may impact product costs.
Software margins were slightly higher at 58.8% compared to 54.5% in fiscal year 2024. Our products have varying gross margins and product mix may affect gross profits. In addition, our margins vary based on the sales channels through which our products are sold in a given period.
Research and Development Expenses R&D expenses increased by $1,517, or 18.7%, due to an increase in engineers compared with the prior year period, including the addition of Evertel software development activities. We incurred non-cash share-based compensation expenses allocated to research and development expenses of $207 and $103 for the fiscal years 2024 and 2023, respectively.
We incurred non-cash share-based compensation expenses allocated to research and development expenses of $170 and $207 for the fiscal years 2025 and 2024, respectively. Other Expense, net Other expense, net, decreased by $4,236.
We do not consider these items to be indicative of our core 37 operating performance. The items that are non-cash include depreciation and amortization expense and share-based compensation.
We define adjusted EBITDA as EBITDA further adjusted for share-based compensation, fair value measurements of our Term Loans and warrants, and other items that we do not consider indicative of our core operating performance.
GAAP to Non-GAAP Depreciation and amortization 2,535 2,160 375 17.4 % 394 398 (4 ) (1.0 %) Share-based compensation 487 333 154 46.2 % 1,165 1,309 (144 ) (11.0 %) Adjusted EBITDA $ (11,876 ) $ (11,733 ) $ (143 ) 1.2 % $ (10,259 ) $ 4,947 $ (15,206 ) (307.4 %) Software Segment Software segment revenue increased $3,541, or 93.2%, compared to the prior fiscal year.
GAAP to Non-GAAP Other (income) expense, net (116 ) (3 ) 113 3,766.7 % 1,299 5,422 4,123 76.0 % Income tax expense (benefit) (2 ) (463 ) (461 ) (99.6 %) 121 58 (63 ) (108.6 %) Depreciation and amortization 2,421 2,535 114 4.5 % 358 394 36 9.1 % Share-based compensation 319 487 168 34.5 % 1,344 1,165 (179 ) (15.4 %) Adjusted EBITDA $ (9,143 ) $ (11,877 ) $ 2,734 23.0 % $ (3,225 ) $ (10,258 ) $ 7,033 (68.6 %) Software Segment Software segment revenue increased $1,578, or 21.5%, compared to the prior fiscal year.
Removed
Our unified Protective Communications platform includes: Software Products The Genasys Protect Platform The Complete Protective Communications Platform The Genasys Protect platform provides a full suite of Protective Communications tools for all hazards, providing targeted emergency communication, data-driven decision making, secure inter-agency collaboration, and more.
Added
Recent Developments Business developments during fiscal year 2025: • Received $9 million in LRAD system orders for Common Remotely Operated Weapon Stations (CROWS) • Initiated deliveries and installation of hardware for the Puerto Rico Early Warning System Project • Awarded a four-year contract by the Maui Emergency Management Agency to provide Genasys Protect and AI-powered traffic management solutions by Ladris to the island of Maui • Received a four-year contract from Los Angeles County to provide Genasys Protect alerting and evacuation management software services • Expanded the Board of Directors to include new independent director R.
Removed
Genasys Protect enables preparedness, responsiveness, and collaboration to keep people, assets, and operations protected against the impacts of natural disasters, terrorism, violent civil unrest, and other dangerous situations, as well as power failures, facility shutdowns, and other non-emergency operational disruptions. 1.
Added
Rimmy Malhotra • Appointed Cassandra Hernandez-Monteon as Interim Chief Financial Officer • Entered into a partnership with FloodMapp to combine dynamic emergency management and flood preparedness • Entered into the First Amendment to Term Loan and Security Agreement to obtain $4 million First Amendment Term Loan Business Outlook Our products, systems, and solutions continue to gain worldwide awareness and recognition through increased marketing efforts, product demonstrations, and word of mouth as a result of positive responses and increased acceptance.
Removed
Proven Technology: Genasys solutions have been on the front lines for more than 40 years, providing targeted communications designed to ensure the right people get the right message - right away. 2.
Added
If we are unable to offset the negative impacts of inflation with increased prices, our future results could be materially affected. In addition, the United States has recently experienced a decline in federal funding. Changes in defense and other government spending could have an adverse effect on our current and future revenues.

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