SuperCom (NASDAQ:SPCB) reported a 21% increase in third-quarter revenue as it expanded its electronic monitoring business in the U.S. and Europe, though a foreign exchange loss contributed to an operating loss and lower GAAP net income.
Revenue rose to $7.5 million from $6.2 million a year earlier, while EBITDA increased approximately 17% to $2.6 million from $2.2 million, President and CEO Ordan Trabelsi said on the company’s Nov. 12 earnings call. EBITDA margin was 34.4%, compared with 34.6% in the prior-year quarter.
Trabelsi said SuperCom has won more than 50 new U.S. electronic monitoring contracts and expanded into 21 new states since mid-2024. He also discussed SafeGenie, a cybersecurity product suite introduced in October to monitor and control autonomous artificial intelligence agents.
Revenue Growth Accompanied by Operating Loss
SuperCom posted a third-quarter operating loss of $0.3 million, compared with operating income of $0.6 million a year earlier. Trabelsi attributed the swing primarily to a $1.3 million foreign exchange loss and noted that most of SuperCom Ltd.’s operating costs are denominated in shekels. Non-GAAP operating income was $2.2 million.
GAAP net income fell to $0.1 million from $0.7 million, while non-GAAP net income was $1.9 million, in line with the prior-year period. GAAP earnings per share declined to $0.01 from $0.14, and non-GAAP earnings per share fell to $0.30 from $0.39.
Trabelsi reported quarterly gross profit of $2.7 million and gross margin of 49.8%. Those figures are not mathematically consistent with the reported $7.5 million in revenue. He said gross profit was $3.8 million and gross margin was 60.8% in the prior-year period.
For the first nine months of 2026, revenue increased approximately 14% to $23.2 million, while EBITDA rose approximately 37% to $9.9 million. Excluding $4.1 million in extraordinary financial gains reported in the first half of 2025, non-GAAP net income increased approximately 45% to $7.5 million, Trabelsi said.
Contract Wins and Expansion Plans
Trabelsi said recent U.S. wins included contracts in Texas, Utah, Illinois, Indiana and New York. All five of SuperCom’s Texas contracts replaced incumbent providers, he said. The company’s third Utah contract also displaced a provider that had served the county for more than a decade.
SuperCom operates in 22 U.S. states and has deployed in multiple counties in 11 of them, according to Trabelsi. He said some contracts can take six months or more to reach full deployment as customers replace existing units, creating a lag between signing and revenue recognition.
In Europe, SuperCom announced in June that it had signed and launched a national electronic monitoring project with Sweden’s Prison and Probation Service. Trabelsi said the project’s estimated value ranges from a $17 million base case to the customer’s published $75 million budget, with the higher figure reflecting potential expansion in monitored offenders and capabilities.
Trabelsi said several European opportunities could come up for bid over the next 24 months, including Italy. He identified England as an opportunity valued at more than 150 million British pounds, while saying SuperCom is better positioned to compete than when it previously pursued the contract.
He also said ordering activity in Romania had temporarily moderated amid political uncertainty. Excluding Romania’s impact, underlying revenue would have grown approximately 40% between 2024 and 2025, he said.
SafeGenie Rollout and Balance Sheet
SafeGenie builds on technology and customer relationships at Safend, SuperCom’s wholly owned cybersecurity subsidiary. Trabelsi said the product is designed to allow, flag or block actions attempted by AI agents in real time according to an organization’s policies.
The initial rollout will focus on Safend’s existing customers and distribution channels in the U.S., Europe and Asia. SuperCom plans to offer SafeGenie as a separate subscription and is preparing initial versions for deployment with several existing customers, Trabelsi said.
Asked by Maxim analyst Matthew Galinko about the potential for material revenue in 2027, Trabelsi did not provide a revenue forecast. He said Safend has between 500,000 and 1 million endpoints and roughly $1 million in revenue, while emphasizing that the potential customer base would not necessarily all convert to the new product.
SuperCom ended September with approximately $12.9 million in cash and cash equivalents, up from $7.4 million at the end of June. The company raised approximately $7.5 million in gross proceeds through a registered direct offering in July. Trabelsi said net debt had fallen to approximately $7 million from close to $35 million over the past few years, and that outstanding long-term debt had no cash payments due until the end of 2028.
About SuperCom (NASDAQ:SPCB)
SuperCom Ltd. (NASDAQ: SPCB) is an Israeli technology company that provides secure solutions for the e-government, public safety and justice markets. Its products are designed to help government agencies and service providers manage electronic monitoring, offender supervision, corrections and related public-sector programs. The company’s offerings include electronic monitoring and tracking systems for individuals under court or correctional supervision, including programs involving house arrest, probation, parole, sex offenders and domestic-violence cases.
