SuperCom Reports Record Net Income of $4.2 Million and EPS of $1.2 for First Quarter 2025

Non-GAAP Net Income $5.24 million; Non-GAAP EPS $1.5; Record Gross Margin 63.3% , /PRNewswire/ -- SuperCom (NASDAQ: SPCB), a global provider of secured solutions for the e-Government, IoT, and Cybersecurity sectors, today reported results for the first quarter, ended March 31, 2025. First Quarter Ended March 31, 2025, Financial Highlights (Compared to the First Quarter of 2024) Revenue increased to $7.05 million, from $6.85 million. Gross profit grew 18% to $4.5 million, from $3.8 million. Gross margin improved to 63.3%, a 10-year record, from 55.3%. Net income increased to $4.2 million, from $0.8 million. Non-GAAP net income increased to $5.24 million, from $1.35 million. Cash and cash equivalents increased to $17.1 million, up from $3.2 million at end of 2024. Working capital improved to $38.9 million, up from $22.5 million at end of 2024. Book Value of Equity increased to $34.8 million, up from $11.7 million at end of 2024. Recent Business Highlights: Since mid-2024, SuperCom has secured over 20 new electronic monitoring (EM) contracts across the United States, including entry into eight new states, and five new partnerships with regional service providers. These achievements reflect strong market demand for SuperCom's technology and the Company's growing ability to displace incumbents. SuperCom, together with partner company Electra Security, was awarded a five to nine-year national electronic monitoring contract by the Israel Prison Service to cover the entire EM offender population in Israel. The project is currently actively monitoring over 1,200 offenders and utilizes advanced GPS and RF technologies from SuperCom's PureSecurity™ Suite. On May 8, 2025, SuperCom announced a new contract with a seasoned Canadian electronic monitoring service provider to introduce its PureSecurity™ Suite, including PureTrack™ and PureOne™, into the provider's operations. On April 29, 2025, SuperCom was awarded a new electronic monitoring contract in Utah through a competitive Request For Bid process with multipe other vendors, further signaling to SuperCom's momentum in displacing legacy systems. This marked SuperCom's eighth new U.S. state entry since mid-2024. On April 17, 2025, SuperCom announced a new direct agency contract in Kentucky to deploy its GPS tracking technology under a daily lease model. On April 10, 2025, SuperCom entered a contract with a regional service provider in the U.S. Midwest to expand operations into Wisconsin, Minnesota, and Michigan. The agreement includes domestic violence monitoring. On March 26, 2025, SuperCom signed a new contract with a statewide rehabilitative services provider in Arizona, enabling deployment of its GPS and domestic violence EM technology. On February 20, 2025 , SuperCom announced it was awarded a new national domestic violence monitoring project in the EMEA region, marking the company's seventh national DV contract globally . The program will utilize SuperCom's advanced PureTrack and PureShield technologies to support victim protection and offender compliance. On February 6, 2025, SuperCom announced it secured additional orders from a European government for a nationwide EM project, reflecting more than 200% growth in PureTrack™ GPS units as of January 2025. On January 21, 2025, SuperCom secured a new contract with a leading multi-state EM service provider, covering regions across the West Coast, Northeast, and Southeast U.S. The agreement was awarded following an extensive competitive evaluation and includes plans for deployment of SuperCom's GPS and domestic violence monitoring technologies. On January 13, 2025, SuperCom announced a new electronic monitoring contract with a Juvenile Probation Agency in Ohio, marking its sixth new U.S. state entry since summer 2024 and displacing the incumbent vendor. On January 6, 2025, SuperCom secured a contract with a government agency in Alabama to provide GPS and domestic violence monitoring solutions, its fifth U.S. state entry since August 2024. The Company reduced its outstanding debt by 32%, from the end of 2023 to January 2025, through various premium-priced share issuances, including a $4.37 million reduction at $43.7 per share, enhancing its ability to capitalize on growth opportunities. Management Commentary: "We're pleased to report a strong start to 2025, building on our record-breaking success in 2024 with even more milestone achievements this quarter," commented Ordan Trabelsi, President and CEO of SuperCom. "We delivered revenue growth, record gross margins of 63.3%, and record net income of $4.2 million. We've also deployed over 1,200 units at record speed in the national Israeli EM project we recently won. These achievements were driven by strong project execution, continued efficiency improvements, strategic financial agreements, and the operational leverage built into our model." "Furthermore, we continued to execute on our strategic expansion plan, securing new contracts in key U.S. states like Utah, Kentucky, and Arizona, and launching regional partnerships in the Midwest U.S. and Canada. Internationally, we were awarded our seventh national domestic violence project in the EMEA region and saw GPS device volumes grow significantly in some of our European national programs. These wins demonstrate both the competitiveness of our PureSecurity™ technology and the trust we've built with government customers worldwide." "Our financial foundation also strengthened considerably. We reduced our long-term debt by 32% , completed premium-priced debt-to-equity conversions, and raised over $16 million in new capital. As a result of this, our stream of new projects and optimized operations, we ended the quarter with $17.1 million in cash and nearly $39 million in working capital, positioning us well for continued expansion," Trabelsi added. "Looking ahead, we remain focused on disciplined execution and expanding our global footprint. With a stronger balance sheet, a growing number of recurring revenue customers, and robust global demand, we believe that SuperCom is well-positioned to continue driving impact in public safety while creating long-term value for its stakeholders," Trabelsi concluded. Conference Call The Company will hold a conference call today (May 14, 2025) at 10:00 a.m. Eastern Time (7:00 a.m. Pacific time) Time / 5:00 p.m. IL time) to discuss these results, followed by a question and answer session. Conference Call Dial-In Information: Date: Wednesday, May 14, 2025 Time: 10:00 a.m. Eastern time (7:00 a.m. Pacific time)U.S. toll-free: 877-545-0523Israel toll-free: 1-809-423-853International: 973-528-0016Access Code: SuperCom Link: https://www.webcaster4.com/Webcast/Page/2259/52441 Please call the conference telephone number 5-10 minutes prior to the start time. An operator will register your name and organization. About SuperCom Since 1988, SuperCom has been a global provider of traditional and digital identity solutions, providing advanced safety, identification and security solutions to governments and organizations, both private and public, throughout the world. Through its proprietary e-government platforms and innovative solutions for traditional and biometrics enrollment, personalization, issuance and border control services, SuperCom has inspired governments and national agencies to design and issue secure Multi-ID documents and robust digital identity solutions to its citizens and visitors. SuperCom offers a unique all-in-one field-proven RFID & mobile technology and product suite, accompanied by advanced complementary services for various industries including healthcare and homecare, security and safety, community public safety, law enforcement, electronic monitoring, and domestic violence prevention. For more information, visit www.supercom.com. Cautionary Note Regarding Forward-Looking Statements This press release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Statements preceded or followed by or that otherwise include the words "believes", "expects", "anticipates", "intends", "projects", "estimates", "plans", and similar expressions or future or conditional verbs such as "will", "should", "would", "may" and "could" are generally forward-looking in nature and not historical or current facts. These forward-looking statements are subject to risks and uncertainties that could cause our actual results to differ materially from the statements made. Examples of these statements include, but are not limited to, statements regarding business and economic trends, the levels of consumer, business and economic confidence generally, the adverse effects of these risks on our business or the market price of our ordinary shares, and other risks and uncertainties described in the forward looking statements and in the section captioned "Risk Factors" in our Annual Report on Form 20-F for the year ended December 31, 2024, filed with the U.S. Securities and Exchange Commission (the "SEC") on April 28, 2025 our reports on Form 6-K filed from time to time with the SEC and our other filings with the SEC. Except as required by law, we not undertake any obligation to update or revise these forward-looking statements, whether as a result of new information, future events or otherwise, after the date of this press release. Results presented in this press release are based on management's estimated unaudited analysis of financial results for the presented periods. SuperCom's independent registered accounting firm has not audited the financial data discussed in this press release. During the course of SuperCom's quarter- and fiscal year-end closing procedures and review process, SuperCom may identify items that would require it to make adjustments, which may be material, to the information presented in this press release. As a result, the estimate financial results constitute forward-looking information and are subject to risks and uncertainties, including possible adjustments to such results. Use of Non-GAAP Financial Information In addition to disclosing financial results calculated in accordance with the generally accepted accounting principles in the United States ("GAAP"), this release also contains non-GAAP financial measures, which SuperCom believes are the principal indicators of the operating and financial performance of its business. Management believes the non-GAAP financial measures provided are useful to investors' understanding and assessment of SuperCom's ongoing core operations and prospects for the future, as the charges eliminated are not part of the day-to-day business or reflective of the core operational activities of the company. Management uses these non-GAAP financial measures as a basis for strategic decisions, forecasting future results and evaluating the Company's current performance. The presentation of these non-GAAP financial measures is not intended to be considered in isolation from, or as a substitute for, or superior to, operating loss and or net income (loss) or any other performance measures derived in accordance with GAAP or as an alternative to net cash provided by operating activities or any other measures of our cash flows or liquidity. Non-GAAP EPS is defined as earnings before amortization and other non-cash or one-time expenses divided by weighted average outstanding shares. EBITDA is defined as earnings before interest, taxes, depreciation, amortization, and other non-cash or one-time expenses. SuperCom Investor Relations:[email protected] -Tables Follow- SUPERCOM LTD. CONSOLIDATED BALANCE SHEETS (U.S. dollars in thousands) As ofMarch 31, As of December 31, 2025 2024 Unaudited Audited CURRENT ASSETS Cash and cash equivalents 17,133 3,150 Restricted bank deposits 388 388 Trade receivable, net 15,566 12,767 Patents 5,283 5,283 Other accounts receivable and prepaid expenses 2,181 2,153 Inventories, net 2,845 2,521 Total current assets 43,396 26,262 LONG-TERM ASSETS Deferred tax long term 919 919 Property and equipment, net 4,024 3,261 Other intangible assts, net 5,614 5,638 Other non-current assets 2,695 2,818 Goodwill 7,026 7,026 Total long-term assets 20,278 19,662 Total Assets 63,674 45,924 CURRENT LIABILITIES Trade payables 965 878 Employees and payroll accruals 1,252 1,165 Accrued expenses and other liabilities 754 470 Short-term Operating lease liabilities 434 445 Short-term credit 423 423 Deferred revenues ST 650 366 Total current liabilities 4,478 3,747 LONG-TERM LIABILITIES Long-term loan 24,212 29,748 Deferred revenues 49 444 Deferred tax liability LT 170 170 Long-term Operating lease liabilities - 118 Total long-term liabilities 24,431 30,480 SHAREHOLDERS' EQUITY: Ordinary shares 59,655 29,238 Additional paid-in capital 77,172 88,746 Accumulated deficit (102,062) (106,287) Total shareholders' equity 34,765 11,697 Total liabilities and equity 63,674 45,924 SUPERCOM LTD. CONSOLIDATED STATEMENTS OF OPERATIONS (U.S. dollars in thousands, except for EPS) Three months ended March 31, 2025 March 31, 2024 Unaudited Unaudited REVENUES 7,048 6,852 COST OF REVENUES (2,588) (3,065) GROSS PROFIT 4,460 3,787 OPERATING EXPENSES: Research and development 933 901 Selling and marketing 678 524 General and administrative 1,594 1,389 Other expense (income), net 40 255 Total operating expenses 3,245 3,069 OPERATING PROFIT 1,215 718 FINANCIAL EXPENSES, NET 3,010 (362) PROFIT BEFORE INCOME TAX 4,225 356 INCOME TAX EXPENSE (BENEFIT) - (418) NET INCOME FOR THE PERIOD 4,225 774 Earnings Per Share 1.20 0.8 SUPERCOM LTD. Reconciliation Table of GAAP to Non-GAAP Figures and EBITDA to Net Income (U.S. dollars in thousands) Three months ended March 31, 2025 March 31, 2024 Unaudited Unaudited GAAP gross profit 4,460 3,787 Amortization of intangible assets 88 88 Non-GAAP gross profit 4,548 3,875 GAAP Operating Profit 1,215 718 Amortization of intangible assets 588 513 Foreign Currency Loss 200 200 Stock Based Compensation 182 - Other one-time expenses 40 280 Non-GAAP operating profit 2,225 1,711 GAAP net Profit 4,225 774 Amortization of intangible assets 588 513 Stock Based Compensation 182 - Income tax expenses (benefit) - (418) Foreign Currency Loss 200 200 Other one-time expenses 40 280 Non-GAAP net Profit 5,235 1,349 Non-GAAP EPS 1.5 1.4 Net Profit for the period 4,225 774 Financial expenses (income), net (3,010) 362 Income tax expenses (benefit) - (418) Depreciation and Amortization 889 767 Stock Based Compensation 182 - Foreign Currency Loss 200 200 Other one-time expenses 40 280 EBITDA * 2,526 1,965 * EBITDA is a non-GAAP financial measure generally defined as earnings before interest,tax,depreciation and amortization and other non-cash or one-time expenses . 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SuperCom Reports Record Net Income of $4.2 Million and EPS of $1.2 for First Quarter 2025

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