Core Viewpoint - KWESST Micro Systems reported a significant revenue growth of 588% in Q1 Fiscal 2025 compared to Q1 Fiscal 2024, indicating a successful transition from development to revenue generation [1][4][2] Financial Performance - Revenue for Q1 Fiscal 2025 reached CAD 887,658, up from CAD 129,068 in Q1 Fiscal 2024, driven by government contracts and the pilot of the Lightning SaaS product [5][4] - Gross profit for the quarter was CAD 404,522, representing a gross margin of 45.6%, a notable improvement from a gross loss of CAD 53,805 in the same period last year [4][5] - Operating loss increased to CAD 2,916,186 in Q1 Fiscal 2025 from CAD 2,508,240 in Q1 Fiscal 2024, reflecting higher operating expenses [5][8] Revenue Drivers - The revenue increase was primarily attributed to the DSEF and Land C4ISR government contracts, the Canadian Red Cross pilot, and growth in the ARWEN business [4][6] - The digitization business line contributed an additional CAD 0.6 million, while the non-lethal business line added CAD 0.1 million from ARWEN product sales [6] Operating Expenses - Total operating expenses rose by CAD 0.9 million year-over-year, driven by increased general and administrative costs, sales and marketing expenses, and research and development expenses [8][9] - General and administrative expenses increased by CAD 0.6 million due to higher professional fees and personnel costs [9] Future Outlook - The company anticipates further revenue growth with the commercial launch of KWESST Lightning and expected demand for new ARWEN products [7] - Management is focused on ramping up activities related to the DSEF and Land C4ISR programs, with a maximum potential workshare of approximately CAD 48 million and CAD 27 million respectively [12] Major Highlights - The company reported CAD 0.8 million in unfavorable changes in the fair value of warrant liabilities and CAD 1.8 million in share offering costs during the quarter [11] - A public offering in November 2024 raised approximately CAD 4.9 million before expenses, indicating strong market interest [13] Financial Position - As of December 31, 2024, total assets were CAD 8,070,198, with cash and cash equivalents significantly increasing to CAD 2,854,256 from CAD 256,828 [10] - Total liabilities decreased to CAD 3,057,657 from CAD 4,248,861, reflecting improved financial health [10]
KWESST Micro Systems Announces Q1 2025 Financial Results