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ASHBURN, Va. - Telos Corporation (NASDAQ:TLS), a provider of cybersecurity solutions with a current market capitalization of $176 million, has been awarded a $5.8 million contract by the U.S. Department of Defense to support the Microwave Line of Sight (MLoS) program. According to InvestingPro data, while the company maintains a strong balance sheet with more cash than debt, it faces near-term profitability challenges. The contract, starting April 2, 2025, spans a six-month base period with an option to extend for three additional months through December 31, 2025.
The MLoS program is designed to offer rapidly deployable, high-bandwidth, and low-latency communication infrastructure to warfighters in various operational settings, including joint, interagency, and coalition environments. This mobile and scalable solution provides an alternative to fiber, ensuring resilient communication channels for critical voice, video, and data connectivity on the battlefield.
Under this contract, Telos will deliver Field Service Representative (FSR) support and technical expertise, emphasizing a cost-effective strategy for deploying operational and permanent communications infrastructure. According to Telos CEO John B. Wood, the company's secure networks portfolio and technical acumen will provide real-time benefits to warfighters in the field. With a current ratio of 4.13, InvestingPro analysis shows the company maintains strong liquidity to support its operational commitments, though analysts note the company is currently burning through cash at a concerning rate.
Telos highlights the ability to repurpose up to 95% of MLoS equipment costs, positioning the solution as a significant saving over traditional fiber options. The company, with a deployment history of over 500 systems in the Middle East, offers 24/7 global field support and boasts a team with extensive experience, including a majority with prior military service and contingency operations experience.
The MLoS communications solutions provided by Telos feature high bandwidth capabilities, offering up to 300 Mbps full duplex, and support bidirectional IP connectivity. The systems are capable of point-to-point and point-to-multi-point functions, integrating LTE and Mesh technology.
This contract underscores Telos' commitment to delivering secure and agile communication solutions that align with U.S. national security objectives. The information for this article is based on a press release statement from Telos Corporation. Looking ahead, InvestingPro data reveals analysts anticipate sales growth in the current year, with 4 analysts recently revising their earnings expectations upward. For deeper insights into Telos' financial health and growth prospects, investors can access the comprehensive Pro Research Report, available exclusively to InvestingPro subscribers.
In other recent news, Telos Corporation reported fourth-quarter earnings that exceeded analyst expectations, with adjusted earnings per share at -$0.04 compared to the estimated -$0.11. However, the company faced a significant year-over-year revenue decline of 36%, despite hitting the high end of its guidance with $26.4 million in revenue. The Security Solutions segment saw a 6% increase, but this was overshadowed by a 78% drop in the Secure Networks segment. Analysts at DA Davidson revised their price target for Telos, lowering it from $3.50 to $2.50, while maintaining a Neutral rating, citing mixed guidance for the first quarter. BMO Capital Markets also adjusted their price target to $3.00 from $4.50, keeping a Market Perform rating, and noted improved positioning for the Security Solutions division in 2025. Both firms highlighted the potential risks associated with new business in the government sector due to administrative transitions. Despite these challenges, Telos is positioning itself for growth in 2025, with an expanded TSA PreCheck® program and new contract wins. The company anticipates first-quarter 2025 revenue to range between $28.2 million and $30.2 million, driven by the Security Solutions segment.
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