Duos Technologies Group Inc ((DUOT)) has held its Q1 earnings call. Read on for the main highlights of the call.
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Duos Technologies Group Inc. recently held its earnings call, revealing a generally positive sentiment driven by significant growth and expansion in its Power and Edge Data Center businesses. The company reported a strong revenue increase and improved gross margin, although challenges remain in the rail industry. Despite operating at a net loss, reductions have been made, and the sentiment leans positive due to promising performance in key segments and a robust revenue pipeline.
Significant Increase in Contracted Megawatts
Duos Technologies has made substantial progress in its Power business, successfully contracting 570 megawatts with APR Energy’s gas turbine fleet, marking an increase of 180 megawatts since the last report. The company anticipates contracting an additional 160 megawatts in the coming weeks, which would bring the total to approximately 730 megawatts.
Expansion of Edge Data Centers
The company has secured customer commitments for an additional 8 Edge Data Centers and plans to deploy 15 by the end of the year. This expansion is expected to generate more than $3 million in annual recurring revenue starting in 2026, underscoring Duos Technologies’ strategic growth in this segment.
Record Revenue Growth
Duos Technologies reported a remarkable 363% increase in total revenues for Q1 2025, reaching $4.95 million compared to $1.07 million in Q1 2024. This growth was primarily driven by Duos Energy’s Asset Management Agreement with New APR, highlighting the success of their strategic partnerships.
Improved Gross Margin
The company’s gross margin for Q1 2025 saw a significant increase of 1288%, totaling $1.31 million compared to $90,000 in Q1 2024. This improvement is largely attributed to the performance of the Asset Management Agreement with New APR.
Reduction in Net Operating Loss
Duos Technologies achieved a reduction in net operating loss for Q1 2025, totaling $1.79 million, down from $2.76 million in Q1 2024. This decrease is a result of increased revenues, reflecting the company’s efforts to improve its financial health.
Strong Backlog and Pipeline
The company boasts a strong backlog and pipeline, with current contracts representing more than $45 million in revenue. Of this, $17.4 million is projected to be recognized in 2025, with additional expected near-term awards and renewals.
Challenges in Rail Industry
Despite not achieving the desired success in the rail industry, Duos Technologies continues to develop world-class technologies and plans to introduce new products. This indicates the company’s commitment to innovation and overcoming industry challenges.
Increase in Operating Expenses
Operating expenses for Q1 2025 increased by 9% to $3.1 million compared to $2.86 million for Q1 2024. This rise is largely due to non-cash stock-based compensation charges, highlighting the company’s investment in its workforce.
Continued Net Loss
The net loss for Q1 2025 totaled $2.08 million, a decrease from $2.75 million in Q1 2024, showing a 24% reduction. While the company is still operating at a loss, the reduction indicates progress towards financial stability.
Optimistic Forward-Looking Guidance
During the earnings call, Duos Technologies provided an optimistic outlook, highlighting significant progress across its business segments. The Power line of business saw a substantial increase in contracted gas turbine capacity, with expectations to rise further. The Edge Data Center business secured commitments for additional centers, aiming for multiple deployments by year-end. Financially, Duos reiterated its guidance for consolidated revenue between $28 million and $30 million for the year, with expectations to achieve positive adjusted EBITDA by year-end, despite a net loss reduction of 24% compared to Q1 2024.
In conclusion, Duos Technologies Group Inc.’s earnings call reflected a positive sentiment, driven by robust growth in its Power and Edge Data Center businesses. While challenges persist in the rail industry, the company is making strides towards financial improvement, supported by a strong revenue pipeline and optimistic guidance for the future.