INTRUSION Inc. (NASDAQ:INTZ), a company specializing in computer communications equipment, has carried out an unregistered exchange of equity securities, according to a recent SEC filing. On Monday, the company entered into a private agreement with Streeterville Capital, LLC, exchanging 68 shares of its Series A Preferred for 110,340 shares of its common stock, with a par value of $0.01 per share.
The transaction, dated November 18, 2024, was valued at $74,800, which the company states represents fair value for the exchanged common shares. This equity swap was conducted under the exemption from registration requirements provided by Section 3(a)(9) of the Securities Act of 1933, as amended.
INTRUSION Inc., headquartered in Plano, Texas, and incorporated in Delaware, has its common stock listed on the NASDAQ Capital Market. The exchange of securities does not involve any new issuance of shares but rather represents a conversion of one form of equity into another, within the existing capital structure of the company.
The company has not disclosed any further details on the rationale behind the exchange or the potential impact on its capital structure. The information provided in this article is based on the company's SEC filing.
In other recent news, Intrusion Inc. has made significant strides, as reflected in its Third Quarter 2024 Earnings Conference Call. The cybersecurity solutions provider announced its second consecutive quarter of revenue growth, reaching $1.5 million, a 3% sequential increase. This growth was primarily driven by the company's Shield product line, which experienced a 49% sequential revenue increase, thanks in part to a new $2 million contract with the U.S. Department of Defense.
Despite a slight decrease in consulting revenue and an overall net loss, Intrusion Inc. has seen an improvement in its financial health, with a reduction in net loss to $2.1 million from $3.2 million in the previous year. The company also added seven new Shield logos in the third quarter, bringing the total to 18 for the year.
Intrusion Inc. is optimistic about achieving its revenue and profitability goals in 2025, and is actively enhancing product capabilities while seeking to expand its market presence, particularly in the Asia Pacific. However, the company is currently dealing with a NASDAQ minimum bid price compliance issue. Despite this, Intrusion Inc. remains confident in its market position and growth prospects, bolstered by its new defense contract and the robust demand for cybersecurity solutions.
InvestingPro Insights
INTRUSION Inc.'s recent equity swap comes at a challenging time for the company, as revealed by InvestingPro data. The company's market capitalization stands at a modest $4.12 million, reflecting its current struggles. INTRUSION's financial performance has been concerning, with the stock price falling significantly over the past year, dropping by nearly 91%.
InvestingPro Tips highlight that INTRUSION is quickly burning through cash and its short-term obligations exceed liquid assets. This context adds importance to the recent equity swap, as it may be part of the company's efforts to manage its financial position. Despite these challenges, INTRUSION maintains impressive gross profit margins of 77.84% for the last twelve months as of Q3 2024, suggesting potential in its core business model.
However, analysts do not anticipate the company will be profitable this year, which aligns with the reported operating income margin of -163.54% for the same period. The company's revenue of $5.46 million for the last twelve months, coupled with a negative EBITDA of -$7.32 million, underscores the financial hurdles INTRUSION faces.
For investors seeking a more comprehensive analysis, InvestingPro offers 13 additional tips for INTRUSION Inc., providing a deeper understanding of the company's financial health and market position.
This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.