Gatekeeper Reports $7.5M Revenue, 16% YoY Growth, in Record Breaking Fiscal Q3 2025

Executive Summary

• Gatekeeper Systems Inc. reported its financial results for the three and nine months ended May 31, 2025, highlighting record fiscal third-quarter revenue and significant growth in subscription services.
• The company announced substantial new contract wins, including over $7 million in transit contracts and over $5.4 million in school bus video and subscription contracts across multiple US states and Canada.
• Subsequent to the reporting period, the company completed a bought-deal brokered financing generating $11.5 million in gross proceeds and increased its Letter of Credit Facility with TD Bank to $7.5 million.

Key Details

• Q3 2025 Revenue: $7.5 million (specifically $7,465,670), representing a 16% increase from $6.5 million in the prior year; this marks the highest-ever fiscal third-quarter revenue for the company.
• Nine-Month Revenue: $20.7 million (specifically $20,671,389), compared to $26.1 million in the prior year. The prior year included a large $9 million transit contract; excluding this, regular business grew approximately 21%.
• Gross Profit & Margin:
  • Three months: $3.7 million gross profit with a 49% margin (vs. 42% prior year).
  • Nine months: $9.1 million gross profit with a 44% margin (vs. 48% prior year).
• Operating Results:
  • Three months: Operating loss of $0.1 million (vs. $0.4 million loss prior year).
  • Nine months: Operating loss of $1.4 million (vs. $3.4 million profit prior year).
  • Operating expenses increased due to higher selling/marketing and R&D costs for new product development.
• Total Comprehensive Loss: $0.4 million for the three months and $0.8 million for the nine months ended May 31, 2025.
• Balance Sheet: Working capital of $15.6 million and no borrowed-money debt as of May 31, 2025. Total assets were $20.0 million; Total shareholders' equity was $17.4 million.
• Contract Wins:
  • Transit: Contracts worth over $7 million, including a SEPTA video services extension, new customers in Oregon and Canada, and factory-installed paratransit video systems.
  • School Bus: Contracts worth over $5.4 million, including fleets of 300 (Florida), 200 (Missouri), 100 (Indiana), 100 (Virginia), 70 (Nebraska), 51 (California), Student Protector installations in Nevada, 360 Surround Vision in Florida, and interior video for Canadian districts.
• Subscription Growth: Video management and hosted service subscriptions grew from approximately 300 to 3,500 during the fiscal year.
• Financing Activity: Completed a bought-deal brokered financing generating gross proceeds of $11.5 million.
• Credit Facility: Increased Letter of Credit Facility with TD Bank to $7.5 million to support inventory purchases and performance bond guarantees.
• Strategic Focus: Expanded transit team with a focus on Federal Railroad Administration (FRA) mandate compliance (deadline October 12, 2027).

Notable Quotes

• "Our fiscal third quarter marks the Company's highest-ever fiscal third quarter revenue. We continue to make investments in our business, which we believe will contribute strongly to our future growth and we are already witnessing those benefits." — Doug Dyment, President and CEO
• "Our school bus segment has recently delivered some significant wins, and we are seeing some contracts now greater than $1 million per customer." — Doug Dyment, President and CEO
• "Gatekeeper already has a great deal of experience in providing FRA compliant solutions, and the FRA mandate comes at a time when transit agencies are also looking to do life cycle upgrades to their video systems, so this becomes a catalyst for them to do so." — Doug Dyment, President and CEO