SideChannel, Inc. reported a slight decline in total revenue for the fiscal year ending September 30, 2025, with figures reaching $7.35 million, down from $7.40 million in the previous year. The company's revenue from vCISO (virtual Chief Information Security Officer) services decreased by 14.9% to $4.08 million, attributed to client churn outpacing new client acquisitions. Conversely, revenue from cybersecurity software and services, which includes the proprietary product Enclave, increased by 25.6% to $3.27 million, reflecting a strategic shift as clients transitioned to lower-revenue generating software services.
The company's operating expenses decreased slightly to $4.42 million from $4.47 million, with general and administrative costs falling by 8.3% to $2.89 million. This reduction was primarily due to lower professional services and stock-based compensation costs. However, selling and marketing expenses rose by 25.3% to $966,000, driven by increased personnel and advertising costs. SideChannel reported a net loss of $892,000 for the year, a marginal improvement from the $904,000 loss in the prior year.
In terms of operational metrics, SideChannel's employee count stood at 23 full-time employees as of September 30, 2025, with an additional 15 independent contractors. The company continues to focus on expanding its client base and enhancing its service offerings, particularly in the realm of cybersecurity solutions tailored for mid-market and emerging companies. The firm is also actively promoting the adoption of its Enclave software to existing vCISO clients, aiming to deepen relationships and provide integrated security solutions.
Looking ahead, SideChannel anticipates that its existing cash reserves, totaling approximately $1.2 million, will be sufficient to fund operations through at least December 2026. The company is committed to improving its financial performance and aims to achieve positive cash flow from operations. However, it acknowledges the potential need for additional capital to support future growth initiatives, including the development of new products and services. The management has outlined a plan to address identified material weaknesses in internal controls, which they believe will enhance the company's financial reporting and operational efficiency moving forward.
About SideChannel, Inc.
SideChannel, Inc. provides cybersecurity advisory services and software solutions, focusing on mid-market and emerging companies. Its core offerings include virtual CISO services, proprietary Enclave platform for zero trust network segmentation, and a range of cybersecurity products and services. The company targets organizations seeking cost-effective, tech-enabled risk management, leveraging industry trends like remote work, AI, and data security to enhance client security postures.
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