Earnings call transcript: SideChannel posts first revenue growth in five quarters in Q3 2026

SideChannel reported returning to year-over-year revenue growth in Q3 2026, marking the first increase in over five quarters for the cybersecurity services company. The company disclosed a revenue of $1.8 million, accompanied by a net loss of $134,000, translating to $0.03 per share. Shares of SideChannel surged 13.94%, closing at $1.88 in premarket trading, up from a previous close of $1.65.

The operational turnaround was evident, as revenue increased from $1.8 million in the same quarter last year by $21,000. Management attributed this growth to cost control measures, with operating expenses rising by just 1.6% compared to the prior year. A notable shift in the business mix occurred, with cybersecurity software and services now comprising 51.6% of revenue, up from 48.4% for vCISO services.

This change indicates a strategic pivot towards higher-margin software and services. Despite maintaining low liquidity, with $326,000 in cash and about $15,000 in net working capital, SideChannel emphasized that the positive trend in revenue growth, margin expansion, and reduced losses offered a promising outlook. The company remains small and financially constrained, with a going concern warning unresolved.

Management highlighted the need to convert pipeline into new logos, maintain lower operating expenses, or explore equity or debt financing to sustain operations in the future.