CSPi Boosts Gross Margin to 39.3% with 14.6% Services Growth, Declares $0.03 Dividend
CSPi reported fiscal Q1 services revenue rose 14.6%, boosting overall gross margin to 39.3%, up over 10 percentage points year-over-year. Revenue dipped to $12.0 million due to last year’s one-time $4.5 million orders, while net income held at $91,000 and a $0.03 quarterly dividend was declared.
1. Fiscal First Quarter Results
CSPi generated $12.0 million in revenue for the quarter ended December 31, 2025, down from $15.7 million a year ago due to last year’s one-time $4.5 million orders. The company reported net income of $91,000, or $0.01 per diluted share, and declared a quarterly dividend of $0.03 per share.
2. Services Revenue and Gross Margin Expansion
Services revenue climbed 14.6% driven by strong customer retention and new engagements, lifting overall gross margin to 39.3%, a more than 10 percentage point increase compared to the prior year period as higher-margin services accounted for a larger revenue mix.
3. AZT PROTECT Deployment Gains Traction
Initial Proof of Concept single-site engagements for the AZT PROTECT cybersecurity solution led to new customer signings and multi-site expansions, and the sales pipeline for the offering continues to grow through distribution partners targeting critical infrastructure sectors.
4. Financial Position and Outlook
The company ended the quarter with $24.9 million in cash and equivalents, providing ample resources to invest in managed services and AZT PROTECT growth, and management expressed optimism for continued expansion over the remainder of fiscal 2026.