Earnings call transcript: Avante Logixx Q3 FY2025 shows 21% revenue growth

Avante Logixx Inc. reported a robust third quarter for fiscal year 2025, with revenue climbing 21% year-over-year to $8.4 million. The company’s stock surged by 10.38% following the announcement, reflecting investor optimism. Key drivers included significant growth in recurring revenue and innovative product offerings, positioning Avante as a leader in AI-driven security solutions. According to InvestingPro data, the company has demonstrated impressive revenue growth of 42.42% over the last twelve months, though it currently trades near its Fair Value. For deeper insights into Avante’s valuation and growth prospects, investors can access the comprehensive Pro Research Report, available exclusively on InvestingPro.

Key Takeaways

• Revenue increased by 21% year-over-year to $8.4 million.
• Stock price rose by 10.38% post-earnings.
• Recurring Monthly Revenue (RMR) grew by 25% year-over-year.
• Introduction of several new AI-powered security products.
• The company is debt-free with strong cash reserves.

Company Performance

Avante Logixx demonstrated strong performance in Q3 FY2025, driven by a 21% increase in revenue compared to the same period last year. The company’s focus on recurring revenue models and innovative security solutions has paid off, with a 25% year-over-year increase in Recurring Monthly Revenue. The strategic expansion into AI-driven products and services has positioned Avante favorably against competitors in the growing security technology market.

Financial Highlights

• Revenue: $8.4 million, up 21% year-over-year.
• Gross Profit: $3.4 million, a 17% increase from $2.9 million the previous year.
• Gross Margin: 40.9%, slightly down from 42.5% last year.
• Adjusted EBITDA: $770,000, up 74% from $442,000.

Outlook & Guidance

Avante Logixx remains optimistic about its future, targeting EBITDA margins of 15-20% and continued revenue growth driven by its core business and new services like Halo technology and AvonteVerify. The company also plans to expand its international presence and focus on recurring revenue models, which are expected to be significant growth drivers.

Executive Commentary

CEO Emmanuel Manuchos highlighted the company’s rapid response capabilities, stating, "We are the first true six-minute responder, responding from the moment an alarm is triggered." CFO Raj Kapoor emphasized the company’s diverse industry approach, noting, "We’re basically industry agnostic. We’re looking at providing solutions to a variety of different industries."

Risks and Challenges

• Market Saturation: The security technology market is competitive, with many players vying for market share.
• Economic Uncertainty: Macroeconomic pressures could impact spending on security solutions.
• Technological Advances: Rapid changes in technology require continuous innovation to stay ahead.

Q&A

During the earnings call, analysts focused on the company’s recurring revenue driven by Halo technology and its plans for geographic expansion. Questions also addressed the deployment flexibility of the Wall E security unit, with management indicating a flexible approach to buy or lease options.

Full transcript - Avante Logixx Inc (XX) Q3 2025:

Babita Darsanga, Moderator, Avante: you, everyone, for joining us today, and welcome to Avante’s Third Quarter Investor Webinar. My name is Babita Darsanga, and I will be the moderator for today’s call. Joining me on the call today are Emmanuel Manuchos, Founder and CEO of Avante and Raj Kapoor, the Company’s CFO. This call is being recorded. There will be a question and answer session at the end of the call.

I trust that everyone has received a copy of our financial results press release that was issued earlier today. Listeners are also encouraged to download a copy of our quarterly financial statements and management discussion and analysis from sedarplus.ca. Please note portions of today’s call other than historical performance include statements of forward looking information within the meaning of applicable securities laws. These statements are made under the safe harbor provisions of those laws. Forward looking statements that are based on management’s current views and assumptions and that this discussion is qualified in its entirety by the cautionary note regarding forward looking statements that is appended to our news release.

Please review our press release and Avante’s reports filed on SEDAR Plus for various factors that could cause actual results to differ materially from the projections. We use terms such as gross profit, gross margin, adjusted EBITDA and RMR on this conference call, which are non IFRS and non GAAP measures. For more information on how we define these terms, please refer to the definitions set out in our management discussion and analysis. And with that, let me turn the call over to Mr. Emmanuel Menuchos, Founder and CEO.

Emmanuel Manuchos, Founder and CEO, Avante: Thank you, Pevitur, and welcome, everyone. We truly appreciate everyone joining us today. On today’s call, our CFO, Raj Kapoor, will review the Q3 results and I will provide a general update and business overview of where the company is today and our positive outlook. Before we get into the financial results, I will provide a high level overview of AVANTE. Ivante is a leading provider of security operatives and technology enabled security solutions to residential and commercial clients.

Ivante’s mission is to deliver an elevated level of security globally with a white glove mentality to high network families and corporations alike through advanced solutions and methods of detecting conditions that require immediate response. The company has developed a diversified security platform that leverages advanced technology solutions to provide a superior level of security services. Avanque is headquartered in Toronto, Ontario and have approximately 187 employees in the company. Today, the security landscape for high net worth individuals has become more complex than ever. With rising geographical tensions, increasing incidence of targeted crime and growing concerns over personnel safety, the need for sophisticated security solutions has never been greater.

High profile individuals are no longer just seeking traditional protection. They require comprehensive, proactive measures that integrate advanced technology with expert oversight. At Avonte, we understand these evolving risks and are committed to providing elite security services that offer not only protection, but also peace of mind. On today’s call, I want to highlight the following topics. First is our record financial results since Raj and I took over, which Raj will discuss in a more detailed method shortly.

The third quarter of fiscal twenty twenty five was another period of strong growth for Avonte with quarterly revenues increasing by 21% year over year and improving profitability reflected in a 74% increase in adjusted EBITDA. Our core business remains robust driving a 25% increase in recurring monthly revenues. Our latest results reflect the transformation Avante has undergone since we streamlined operations and refocused on our core strengths. This also marks our first quarter with no reorganizational expenses. I can proudly announce that the company is bank debt free and that Avanti is now growing revenues and generating positive cash flows.

We have 12,000,000 available of undrawn credit facilities. We are in a very strong financial position for 2025. Second is the innovation at Avante that is driving our growth. With a growing portfolio of innovative security solutions, we are setting a new standard in the industry. Our proprietary Halo technology continues to expand, now installed in nearly 200 locations with version three, which includes HaloTrack and testing.

Meanwhile, it’s launched since its launch in January 2023, Avonte Black’s elite security service now contributes to over 10% of our total revenue, further solidifying our leadership in the high end protection. Moreover, demand for homeworks remains strong and we are on track to monetize ARGUS this year. These innovations along with our expanding pipeline create a strong foundation for sustainable growth. Third is the introduction of new products and services with AvonteVerify and Wall E. We are excited to introduce AvonteVerify and Wall E, two groundbreaking security solutions that are already gaining strong traction in the market.

Avonte Verified is revolutionizing school safety with its human in the loop AI threat detection. Meanwhile, Wall E is shaping the future of autonomous surveillance, delivering unmatched flexibility and precision in security monitoring. And lastly, we’ll continue to have a positive outlook for the remainder of the fiscal year and into next year. I would now like to turn it over to our CFO, Raj Kapoor, who will discuss the first theme of today, our financial results of 4Q3 twenty twenty five.

Raj Kapoor, CFO, Avante: Raj? Sorry, I was on mute. Thank you, Manny, and welcome, everyone. Our fiscal third quarter twenty twenty five results are as follows. The third quarter was another exceptional quarter for Avante as we increased revenue by 21% compared to the same quarter last year.

Avante achieved record quarterly revenue since Manny and I joined the company of $8,400,000 during Q3 twenty twenty five compared to revenue of $6,900,000 generated during Q3 twenty twenty four. The increase was due to the acquisition of NSSG, Avante Black Growth and organic growth of our domestic business. Avante achieved gross profit of $3,400,000 in Q3 twenty twenty five compared to $2,900,000 during Q3 twenty twenty four, representing an increase of 17%. Avante’s gross margin percentage in Q3 twenty twenty five was 40.9 compared to 42.5% in Q3 twenty twenty four, indicating a consistent level of growth profitability. During Q3 twenty twenty five, Avante achieved adjusted EBITDA gain from continuing operations of $770,000 in line compared to an adjusted EBITDA gain of $442,000 in Q3 twenty twenty four.

I would also like to quickly highlight the current growth trajectory of Volante. On this slide, you can see a graphical display of our five year annual revenue and year to date for fiscal twenty twenty five. After a period of stagnant growth in fiscal twenty twenty to 2022, you can see that over the past two years, we have gotten back on the path of growing the company. Three quarters into fiscal twenty twenty five, we are already approaching our total 2024 revenue with year to date revenue up 38% in comparison to the same period in fiscal twenty twenty four. This has been achieved through the onboarding of new customers with our focused sales efforts, improving customer support, introduction of new services and accretive acquisitions such as NSSG.

Additionally, Q3 twenty twenty five marks our first quarter without reorganization expenses since Manny and I joined the organization, and we anticipate no further reorganization expenses in the future. We have a very predictable business model. As a significant portion of our revenues is reoccurring in nature, we continue to have strong visibility and predictability for future performance with over 43% of our revenue in fiscal Q3 coming from contracted reoccurring revenue. Our core business has a diversified security platform leveraging advancing technology solutions remained solid with reoccurring monthly revenue increasing by 25%. The Avante Security segment delivered reoccurring monthly revenues or RMR of $3,600,000 during the third quarter of fiscal twenty twenty five, up from $2,900,000 during the company’s third quarter in the prior year.

The increase in recurring revenue was driven by net growth in monitoring customers and the introduction of new recurring revenue services to the existing client base. As you can see from the graph, in the past five quarters, there have been an increase in overall nonrecurring revenue, which was primarily due to the acquisition of NSSG and the growth in Avonte Black. Our client contracts are one year in length and we continue to maintain 98% client retention and renewal demonstrating the value proposition and trust in our solutions. We continue to have a clean and healthy balance sheet. I’m pleased to report that we continue to have strong balance sheet and are able to fund the company’s organic growth initiatives.

We continue to have a positive outlook for the next fiscal year. As of 12/31/2024, Avante is bank debt free and had $5,000,000 in cash and short term investments. The company has access to a senior secured revolver of $2,000,000 and to a $10,000,000 unsecured term loan facility for a total of $12,000,000 all of which remains completely undrawn as of today. We feel confident to continue funding growth with cash flows from operations. Overall, the company is in very strong position going forward.

I will now turn the call back over to Manny.

Emmanuel Manuchos, Founder and CEO, Avante: Thanks, Raj. I will now discuss our second theme for today, how our innovation is driving growth at Avante. Our company was founded on the principle of combining cutting edge technology with the best in class security operatives. This unique combination has enabled us to revolutionize the security industry in several ways. We became the first security company to use cameras via dial up Internet to monitor status of large construction projects, including Walmart (NYSE:WMT) stores and other major retailer developments back in February.

We are the first true six minute responder responding from the moment an alarm is triggered, not after being contacted by the monitoring station. We have integrated real time analytics to detect trespassers, further enhancing the effectiveness of our security solutions. This culture of innovation and vision has been the cornerstone of Vovante’s growth and success. By delivering exceptional trust and services to our clients, we’ve built a strong enduring relationship that has propelled us forward. Our legacy of leadership and commitment to innovation continues to drive us as we build upon the strong foundation and shape the next chapters for Agonte.

Innovation remains at the heart of our technology. We are committed to scaling our proprietary technology for mass use and emphasizing subscription based models to enhance recurring revenue. Our pipeline of technology enabled security solutions continues to grow and I will now discuss some of them in-depth. AVANTE Black launched in January of twenty twenty three, AVANTE Black now represents 10% of our total revenues. On January twenty one of this year, we announced a 100% year to date revenue increase for AVANTE Black, driven by strong customer growth, expanded services offerings and a successful integration with NSSG.

Avante Black represents the pinnacle of exclusive risk mitigation, offering an unprecedented level of client experience that redefines how risk mitigation and crisis management are handled. This elite offering has been built by assembling a team of experts, including veterans from the elite Israeli forces who combine their expertise in covert operations and tailored security solutions. Our investigation services are unparalleled, providing clients with the most comprehensive and accurate intelligence in the industry. This extends to a 20 fourseven personal security protection supported by a physical response team capable of acting within minutes when a threat arises. We also go beyond conventional security by offering safe houses for our clients and their families who require heightened protection.

In addition, we proactively monitor reputational risk on social media, addressing and rectifying issues before they escalate. Avanti Black’s capability include in-depth background investigations to uncover potential threats and provide clients with a clear and understanding risk technical surveillance countermeasures, ensuring client communications and operations remain secure custom campaigns designed to protect clients and their corporations from targeted risk, ethical hacking to test and straighten and strengthen network security. Halo. Halo is Avantis AI driven tracking and two way voice communication service. With the use of Halo video analytics, we can dispatch before an intruder can break into the home.

It is based on self learning technology that uses pattern based algorithms to recognize movement and characteristics. Halo sets itself apart with proprietary AI driven analytics that detect full body silhouettes and even individual limbs, offering unmatched accuracy. Features such as instant detection, two way voice capabilities and seamless integration with existing cameras systems, HALO makes HALO a market leader in the next generation of security solutions. In fact, HALO is approved by the Department of Defense for use in U. S.

Nuclear facilities, providing high level security with AI video analytics. Since launching in the summer of twenty twenty four, HALO has achieved significant market penetration, now installed in approximately 200 neighbourhoods across the Greater Toronto Area. We are continuing to enhance Halo capabilities. Looking ahead, we incorporate HaloTrack, a game changing feature, allowing us to activate up to 200 nearby Halo devices when an intruder is detected to track them across neighborhoods or cities, providing real time location updates and facilitating communication with the authorities. Gail represents a transformative step forward in neighborhood security, offering peace of mind to our clients while solidifying Avonte’s leadership in AI driven security technology.

We believe this innovation will drive growth, strengthen our market position and deliver long term value to our stakeholders. Other innovative services. Our ARGUS is a groundbreaking safety companion app designed to provide unmatched protection and peace of mind to our clients. With Argus, we ensure our clients feel safe and secure no matter where they are in the world. The app allows users to instantly request assistance from Ivanti’s team of skilled security professionals with just a tap on either a physical Argus button or the app within their mobile device.

Whether you’re in a perilous situation or simply feeling uneasy, Arvest insurers help us on the way. We have been testing and service the key clients and expect to monetize it within this year. Avante Homeworks is excuse me. Homeworks is Avante’s home management service providing trusted, vetted and security background check trade persons for luxury homes to perform home repairs and maintenance services. It also provides services such as boarding up windows and repairs after a break in.

The Reserve, which is formerly Toybox, is an exclusive top tier auto storage service tailored for automotive enthusiasts, collectors and owners of high value vehicles. We’ve had a ton of interest in the reserve given the high volume of the car thefts in the Greater Toronto Area. Next (LON:NXT), I’ll dive into our third theme for today, our new services introduced in Q3. On November 11, we announced the launch of Monteverify, our human in the loop, remote video services. Developed in partnership with Skyla Technologies, this service integrates Skyla’s AI capabilities and physical threat detection with Ivanti’s expert human oversight and redefine the standards for security solutions.

Avante Verify brings together the strengths of AI and human judgment. Advanced AI algorithms continually monitor video feeds and identify potential risk in real time, while our human operators step in to validate and interpret instances, ensuring rapid and accurate responses. As the only visual AI company with multiple industry benchmarks and proprietary technology, Skyler brings unparalleled expertise. The use of this product has begun with K-twelve schools currently monitoring three schools in New Mexico, Asteria School Board for gun detection. However, we plan to expand the product into commercial security and defense.

We are currently targeting 10,000 cameras by the end of twenty twenty five. By offering clients this balanced adaptive solution, we ensure that security decisions are precise, timely and effective, ultimately empowering our clients with peace of mind and superior protection. Turning our latest innovation, Wall E. This solution represents a major leap in autonomous security technology and is a prime example of how Ivanti continues to push the batteries of innovation in the industry. WALL E is an unmanned solar powered security unit that integrates our proprietary Halo technology to provide real time surveillance and threat detection.

Equipped with AI driven video analytics, it can identify unauthorized individuals, detect weapons and provide immediate alerts to security teams. This ensures rapid response and heightens its situational awareness in any environment. Designed for versatility, WALL E is ideal for a wide range of applications from securing large gatherings, corporate campuses and construction sites to protecting schools, hospitals and public spaces. Its mobility and ability to operate in remote locations made it a game changer for clients seeking effective, scalable security solutions about the need for fixed infrastructure. With the increased demand for advanced security solutions, we expect WALL E to be a significant contributor to our growth.

We are ramping up the production to deploy additional units in the coming months and are seeing strong interest from both public and private sector. We are also hiring a dedicated sales executive for the product. By combining sustainable design and cutting edge technology, Wall E reinforces Avante’s leadership and security innovation and position us for continued success in the evolving market. I will now conclude with our final theme of today, our positive outlook for the remainder of fiscal twenty twenty five. Our outlook continues to look promising with increased sales, positive EBITDA, clean balance sheet and potential for future acquisitions.

The company’s long term financial objectives serves as a guide in developing our strategy and should not be considered as guidance. The company’s long term financial objectives are build recurring revenues achieve consolidated adjusted EBITDA margins consistent with industry achieve growth in adjusted net income per share reinvest cash flow and future business growth. I believe we laid an excellent foundation for the company and we have a positive outlook for the remainder of fiscal twenty twenty five. We expect continued improvements in revenue, cash flow and EBITDA driven by organic growth, introduction of new products and services, increasing NSSG revenues. We expect international revenue to increase this calendar year as NSSG allows us to attract new clients globally and service them in the boutique manner that Avonte offers.

We are very excited about the potential growth and opportunities with our newly introduced services, WALL E and Avonte VERIFY. We are expecting overall revenues to benefit over the next year from these new services. Meanwhile, we continue to actively seek new opportunities to expand and enhance our services through acquisitions. We maintain a positive outlook for fiscal twenty twenty five with renewed optimism based on continued sales growth, improving cash flow and potential M and A activity. Finally, I’d like to thank the entire team at Avante, including the employees whose hard work continues to elevate the company to higher levels.

We want to thank our customers around the globe who trust us and rely on us to use innovative technologies to manage risk and provide elevated security solutions and services. Also, I’d like to thank you all for joining us on this call today. We look forward to providing more updates next quarter. I will now hand it over to Patatere for questions.

Babita Darsanga, Moderator, Avante: With that, we will now open the call to questions. We have a live question from Daniel Rosenberg of Paradigm Capital. Please go ahead, Mr. Rosenberg.

Daniel Rosenberg, Analyst, Paradigm Capital: Thanks for taking my questions. Hi, Mani, Hrash. My first question was just around the MRR growth. Nice to see some strong numbers in the release. I was just wondering if you could unpack the number of business lines you have.

It seems like there’s some growth opportunities, but what’s driving the MRR growth in this quarter? And if you could help us understand that balance between NSSP and the rest of the business?

Emmanuel Manuchos, Founder and CEO, Avante: Well, our recurring revenue growth is really based on Halo. Halo is really opening up. So halo is a technology that we apply in different verticals. And with the residential market and the commercial market, that monitoring is a lot more expensive than your traditional alarm system. So it’s really helped us in this last quarter.

With respect to NSSG, they’ve been attaining contracts where they have employees embedded in corporations that are long term contracts for them and that’s how they’re generating the recurring revenue. Avonte Black doesn’t have recurring revenue, but it has recurring business that’s coming in. That also was a big growth in this last quarter.

Daniel Rosenberg, Analyst, Paradigm Capital: Okay. And then on the outlook, one of your goals for going forward was adjusted EBITDA consistent with industry. I’m just wondering what you kind of benchmark that as, as obviously you’re going to have some tech in the mix as well as services. So just wondering if you could at least provide a little bit of guardrails around what that means.

Emmanuel Manuchos, Founder and CEO, Avante: Bob, the goal here is always to go above and beyond expectations. And we’re just driving the different vertical markets that we’ve set up. Our overhead is being cut, but we’re managing the growth and we’re managing the recurring revenue and the sales. When we see the industry, it’s really about just growing as much as we can. There’s it’s just full steam ahead in here.

If you come to our office, you can feel the energy and you can feel everybody and the excitement that’s occurring. It’s a really exciting place. And it’s just full steam ahead.

Raj Kapoor, CFO, Avante: Yes. And Daniel, in terms of targets, I think we’re looking at about 15% to 20% EBITDA margins.

Daniel Rosenberg, Analyst, Paradigm Capital: Okay. Thanks. Appreciate that. And then just speaking to that growth and the growth opportunity, could you just help me prioritize which parts of the business you expect to grow fastest, understanding that some of these are just being launched or are a small base, but just what are kind of the priority, if you’re to rank them by growth opportunity, how would you do that?

Emmanuel Manuchos, Founder and CEO, Avante: Well, it’s a funny question because we it’s a good question, but also very hard to answer. There’s we kind of our phones ring all the time. We it all our focus is to grow halo and its vertical markets. That’s a high number for recurring revenue for us. And then, Avonte Black, they call us just yesterday.

I have a very important meeting today. The core business is growing again, just the phones are ringing. So we can’t say that one is growing faster than the other. Yes, we focus on halo because it is bringing us back. The Wall E brings us back more recurring revenue.

It’s bringing human in the loop. So really, if we’re going to say the phones didn’t ring, our efforts would be in Halo, Ivanti Black, our core business. But we’re getting emails and requests daily, which kind of are exciting in certain ways that we deal with in a priority level.

Daniel Rosenberg, Analyst, Paradigm Capital: Okay. I appreciate that. And then lastly, just a small follow-up. I think in one of your earlier remarks, you mentioned that, you know, when when the alarm device is triggered, you show up rather than, passing through an intermediary that then, notify somebody to check the instance. I’m just wondering, how do you view differentiation in the market?

How important is that to customers? If you could just speak to that, please.

Emmanuel Manuchos, Founder and CEO, Avante: Sure. So we developed something called a SmartBox over twenty years ago and it’s still operation today where if an alarm sounds from any of our clients’ homes, it goes directly to our vehicles, it goes through our control center. This allows us to instantly roll the wheels and take off and get to our clients’ homes. The traditional way that a dispatch happens is the alarm system goes off, it calls a monitoring station. The operator can take anywhere from four to seven minutes to act on it, which means they’re gonna they’re gonna call the dispatch company, which is a third party guard company.

The guard company is then gonna radio the car and find out who’s closest and then they’re gonna dispatch. So by using automated dispatching in a way, we respond in our average time of six minutes or less. That’s how we have been beating all our anybody trying to get into the areas that we service because we get there so quickly due to our technology. And if they use halo, which a lot of our clients have, once they step on the property and we detect them, we dispatch before they break into the house. So the alarm isn’t even going off yet and we’ve dispatched our vehicles.

Daniel Rosenberg, Analyst, Paradigm Capital: Okay. Interesting. I didn’t realize it was that degree of difference. Well, congrats on a good quarter and thanks for taking my questions.

Emmanuel Manuchos, Founder and CEO, Avante: Thank you, Daniel.

Babita Darsanga, Moderator, Avante: The next question comes from Gabriel Leung of Beacon Securities. Please go ahead, Mr. Leung.

Emmanuel Manuchos, Founder and CEO, Avante: Good morning, Gabriel. I think you’re on mute.

Gabriel Leung, Analyst, Beacon Securities: There we go. Hey, guys. Thanks for taking my questions and congrats on the progress. Just a couple of things I want to touch on. So just looking at the core bread and butter sort of monitoring business, I’m curious whether your priority for organic growth here is going to be on sort of increasing the number of subs within your core geographic markets?

Or you’ve got aspirations to expanding into sort of new geographies over and above where you’re at right now, whether domestically or in Canada or abroad in U. S?

Daniel Rosenberg, Analyst, Paradigm Capital: Yes. It’s

Emmanuel Manuchos, Founder and CEO, Avante: interesting how we’re getting asked to design more halo based services around the world. We have two halo based detection technology services in Italy. We have one in California. We have a couple in Florida. We have one in Greenwich.

So the word is getting out through our through Ennis (NYSE:EBF) SG and through our we have one in Spain or humans. When I say one, I don’t mean like one unit. I’m saying it’s a project and it could be up to 100 units, where we will be able to monitor remotely. And we the model is we use local security installation companies. We advise them what cameras to use.

We kind of like them to use what they’re used to. So they installed everything, then we ship our Halo device. They plug it in. We step them through just how to initiate it, and then we take over from there. We set up the parameters.

We ship monitoring and removing. So although we’re growing here in our area, by having two way voice, we’re able to service a larger geographical area and the word’s getting out that we’re able to do that. Especially like even the schools in The U. S, we have more schools coming on board through the sales partners that we have selling the schools down in Florida and in New York and in different parts of The states.

Gabriel Leung, Analyst, Beacon Securities: Gotcha. Thanks for that. And then just actually moving on then to Halo and the In the Loop service. Any early feedback you can provide from the deployments in New Mexico and what the schools are telling you, number one? And number two is, can you just talk about the pipeline that’s ramping that gives you confidence of your ability to hit sort of 10,000 halo deployments in calendar twenty five?

Emmanuel Manuchos, Founder and CEO, Avante: Well, it’s 10,000 cameras to be monitored. Right. So we have there’s a network of integrators that Skyla and another partner called Eagle Technologies has across The U. S. They’re actually selling in every state and where their source for monitoring.

So they are rapidly increasing the sales of the human in the loop for Avante verified. It isn’t a one off situation. It’s actually a full team of integrators across The U. S. That are pushing the product in the installation.

Gabriel Leung, Analyst, Beacon Securities: Got you. And any early feedback you can offer from the schools that you have deployed so far in New Mexico in terms of their experience with the solution?

Emmanuel Manuchos, Founder and CEO, Avante: Well, so far, we’ve identified a couple of trespassers that looked like they were carrying a weapon, but they were not. So the schools are very pleased that we weren’t just setting off false alarms. The AI is very, very good. There’s a lot of really good feedback that we’re getting about the professionalism and about how they’re calling us and we pick up the phone instantly. It’s getting to be a very good relationship.

And we can get them to use as a we can use them as reference to other schools and universities.

Gabriel Leung, Analyst, Beacon Securities: Got you. That’s helpful. Just moving over to NSG, obviously that revenue line is ramping quite nicely on a quarter over quarter basis, especially in Q3. I’m curious, where are you right now in terms of your revenue capacity for that line of business? I guess that would include Avanti Black as well.

What sort of quarterly revenue run rate could you get to with your existing personnel? And what are your plans in terms of expansion in terms of the human footprint in that division?

Emmanuel Manuchos, Founder and CEO, Avante: Raj, you want to kind of pipe in here?

Raj Kapoor, CFO, Avante: Yes, sure. So, Gabriel, we have the infrastructure in place. So, majority of these kind of projects are done with third parties, be it secured transport, international transport where we’d have somebody local contracted. So, we don’t see a lot of increased costs to maintain growth in that revenue line.

Gabriel Leung, Analyst, Beacon Securities: Got you. And maybe one last question around Wall E. Obviously, we’re seeing an increased interest in sort of mobile security type services. So what are your thoughts about the ramp up of that division? I know you talked about being in the process of building out sort of 10 units.

Are those units already spoken for? And how do you see the growth of that sort of playing out over the next twelve to eighteen months just given the conversations you’re having?

Emmanuel Manuchos, Founder and CEO, Avante: Yes. So we yes, the 10 units are spoken for already, but there’s some people want to buy the units and we want to have more of a lease model, a complete you rent it for the month and we monitor it using our technology. So we’re in a little bit of a trying to figure out for people who want to buy three of them, for example, how we’re going to manage that. But I see the ramp up being a little slow now. And then just once we have our sales team in place, I consider ramping up considerably in the next, I guess, starting in about four months from now.

Gabriel Leung, Analyst, Beacon Securities: Are there any specific verticals you’re targeting or where you think you’re going to get the most juice from with Vale?

Emmanuel Manuchos, Founder and CEO, Avante: Well, they’re coming from everywhere, from event planners, from countries and governments that they’re just people are calling are interested in the ability to analyze people that are not supposed to be at an event, for example, to detect guns if there’s any kind of guns in various events, neighborhoods. So, it’s very interesting of the people that are calling us.

Raj Kapoor, CFO, Avante: Gabriel, with Wally, we’re basically industry agnostic. We’re looking at providing solutions to a variety of different industries.

Gabriel Leung, Analyst, Beacon Securities: Got you. Thanks for that. Thanks for the feedback and congrats on all the progress.

Babita Darsanga, Moderator, Avante: We have a few questions from the Q and A from listeners. The first question is, this quarter marked the first without reorganization expenses since the leadership transition. What back end efficiencies have you guys implemented and what impact do you expect them to have on future financial performance?

Raj Kapoor, CFO, Avante: So, we maintain we’re always striving to be more efficient. The biggest thing that is going to impact us moving forward is the implementation of our ERP system. We are looking to have that implemented to go live next week. We expect to see further efficiencies from there. The prior reorg costs were based on prior issues related to when LOGIX was part of the company.

And we don’t expect to see any more rework costs moving forward. Obviously, I mean, we can be surprised, but we’re not expecting anything.

Babita Darsanga, Moderator, Avante: The next question is, can you explain how WALL E is different from other security solutions on the market?

Emmanuel Manuchos, Founder and CEO, Avante: I think the biggest differentiator is our Halo technology. It’s true AI. It isn’t cameras that have some kind of motion built in. It isn’t pixels that change. It is, you know, it’s real advanced technology.

That’s the most that’s the biggest differentiator in my view. The service that we have in our control center, again, if anybody’s welcome to come and visit and see our control center, the professional staff, the whole NASA look that we have with big screens and the image and the professionalism and the training. But the way I see it is our Halo technology is the best AI video analytics out there in the market. It’s a proofreader Department of Defense for nuclear facility monitoring.

Babita Darsanga, Moderator, Avante: That’s great. And one more question here. What are your biggest priorities for the rest of fiscal twenty twenty five?

Emmanuel Manuchos, Founder and CEO, Avante: Well, if you actually get to know me, everything is a priority. So it’s a hard question to answer. Again, I’ll repeat that we are very energetic here and we are very focused on growth and to become more efficient with our costs. That’s the priority if I

Babita Darsanga, Moderator, Avante: have to put it at a high level. Great. And I think that’s the remaining time we have for questions. We’ll now pass the call back to Manny for closing remarks.

Emmanuel Manuchos, Founder and CEO, Avante: In closing, I want to thank everyone once again for joining our call today. Thank you too to the analysts for their questions. We look forward to our next update at the end of our fiscal twenty twenty five. Thank you very much.

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