| Metric | Value ($ M) | Q2 FY25 |
|---|---|---|
| Revenue | 1.58 | 16.4% |
| Total Income | 1.58 | 16.4% |
| Expenditure | 2.02 | 3.1% |
| PBT | -0.44 | 780.0% |
| Net Profit | -0.44 | 780.0% |
| OPM | -28.43% | 25.20pp |
| NPM | -28.17% | 25.32pp |
| EPS | -0.10 | 900.0% |
SideChannel Reports Q2 FY2026 Revenue of $1.6 million
12 May 2026 · 12 May, 6:02 pm
Summary
SideChannel reported a revenue of $1.6 million for Q2 FY2026, a decrease of 16.8% compared to the same quarter in the previous fiscal year. The gross margin improved to 53.5%, up 380 basis points from FY 2025. However, the company experienced a net loss of $444 thousand, or $0.10 per share, significantly higher than the $54 thousand loss in FY 2025. Trailing twelve-month revenue retention improved to 66.8%. Management is focused on converting Enclave pipeline into recurring revenue while maintaining operating discipline.
Key Highlights
- 1
SideChannel's revenue was $1.6 million, which is $318 thousand or 16.8% less than the second quarter of FY 2025.
- 2
The gross margin increased to 53.5%, which is 380 basis points higher than the 49.7% gross margin for FY 2025.
- 3
Operating expenses increased by $289 thousand, or 28.8%, compared to FY 2025.
- 4
The net loss was $444 thousand, or $0.10 per share, compared to a net loss of $54 thousand, or $0.01 per share, in FY 2025.
- 5
Trailing twelve-month revenue retention improved to 66.8% as of March 31, 2026, from 63.6% as of September 30, 2025.
- 6
Cash, cash equivalents, and short-term investments decreased by $854 thousand from September 30, 2025, to an ending balance of $311 thousand at March 31, 2026.
- 7
Year-to-date revenue was $3.4 million, which is $452 thousand or 11.9% less than FY 2025.
Management Comments
Brian Haugli
Our second quarter operating expense increase reflects targeted investment in selling and marketing. These are the inputs required to scale a platform business. We remain focused on managing operating cash carefully as we scale our Enclave platform alongside our fractional vCISO and security services practice. The marketing and partnership investments we have made are translating into measurable progress on retention and margin. Trailing twelve-month revenue retention improved to 66.8% from 63.6% at fiscal year-end, and gross margin expanded 380 basis points to 53.5%. Our priority through the balance of fiscal 2026 is to convert Enclave pipeline into recurring revenue while maintaining the operating discipline that supported this quarter’s margin expansion.”
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