Allot Announces Fourth Quarter 2025 Financial Results

69% YoY SECaaS ARR growth in 2025, with strong revenue growth and record profitability

Guiding for revenue growth acceleration to $113-$117 million in 2026

HOD HASHARON, Israel, Feb. 25, 2026 /PRNewswire/ -- Allot Ltd. (NASDAQ: ALLT) (TASE: ALLT), a leading global provider of innovative Security-as-a-Service (SECaaS) and network intelligence solutions for communications service providers and enterprises, today announced its unaudited financial results for the fourth quarter and full year of 2025.

Financial Highlights for the Fourth Quarter of 2025

Financial Highlights for 2025

Management Comment

Eyal Harari, CEO of Allot, commented, "We are very pleased with our turnaround and continued strong improvements throughout 2025. For the year, we drove double-digit revenue growth, our highest profit in over a decade, and strong operating cash flow. Our growth was primarily driven by continued excellent performance from our cybersecurity solutions."

Mr. Harari continued, "We are advancing strongly with our cybersecurity-first strategy and developing products that bring together cybersecurity and network intelligence into a single, integrated solution. As the global AI transformation continues to accelerate, AI-driven threats and new attack surface are increasing the demand for our always-on, zero-effort security embedded in the network. Allot's advantages are resonating with customers, clearly differentiating us in the market and driving meaningful growth."

Concluded Mr. Harari, "Given the continued growth in our cybersecurity business, strong visibility, and a solid backlog, our momentum is set to continue. In 2026, we expect SECaaS to deliver robust double-digit ARR growth and guiding for revenues to grow to between $113 and $117 million, with continued profitability improvements."

Fourth Quarter 2025 Financial Results Summary

Total revenues for the fourth quarter of 2025 were $28.4 million, a 14% increase year-over-year compared with $24.9 million in the fourth quarter of 2024.

Gross profit on a GAAP basis for the fourth quarter of 2025 was $20.3 million (gross margin of 71.5%), a 19% increase compared with $17.1 million (gross margin of 68.5%) in the fourth quarter of 2024.

Gross profit on a non-GAAP basis for the fourth quarter of 2025 was $20.4 million (gross margin of 71.9%), an 18% increase compared with $17.4 million (gross margin of 69.7%) in the fourth quarter of 2024.

Operating income on a GAAP basis for the fourth quarter of 2025 was $2.6 million (operating margin of 9.1%), compared with $0.3 million (operating margin of 1.3%) in the fourth quarter of 2024.

Operating income on a non-GAAP basis for the fourth quarter of 2025 was $3.6 million (operating margin of 12.7%), compared with an operating income of $1.8 million (operating margin of 7.2%) in the fourth quarter of 2024.

Net income on a GAAP basis for the fourth quarter of 2025 was $2.9 million, or $0.06 per diluted share, compared with $0.2 million, or $0.01 per diluted share, in the fourth quarter of 2024.

Net income on a non-GAAP basis for the fourth quarter of 2025 was $4.1 million, or income of $0.08 per diluted share, compared to the non-GAAP net income of $2.0 million, or income of $0.05 per diluted share, in the fourth quarter of 2024.

Operating cash flow generated in the quarter was $8.1 million.

Full Year 2025 Financial Results Summary

Total revenues for 2025 were $102.0 million, an 11% increase compared to $92.2 million in 2024.

Gross profit on a GAAP basis for 2025 was $72.6 million (gross margin of 71.1%), a 14% increase compared with $63.7 million (gross margin of 69.1%) in 2024.

Gross profit on a non-GAAP basis for 2025 was $73.4 million (gross margin of 72.0%), a 13% year-over-year growth compared with $65.1 million (gross margin of 70.6%) in 2024.

Operating income on a GAAP basis for 2025 was $3.6 million (operating margin of 3.5%), compared with a loss of $6.0 million in 2024.

Operating income on a non-GAAP basis for 2025 was $8.9 million (operating margin of 8.8%), compared with an operating income of $0.6 million (operating margin of 0.7%) in 2024.

Net income on a GAAP basis for 2025 was $3.7 million, or $0.08 per diluted share, compared with a net loss of $5.9 million, or $0.15 per basic share, in 2024.

Net income on a non-GAAP basis for 2025 was $10.9 million, or $0.23 income per diluted share, compared with $1.6 million, or $0.04 per diluted share in 2024.

Operating cash flow generated in 2025 was $17.8 million.

Cash and cash equivalents, bank deposits, restricted deposits and investments as of December 31, 2025, totaled $88 million, an increase of $29 million versus $59 million cash and cash equivalents, bank deposits, restricted deposits and investment as of December 31, 2024. As of December 31, 2025, the company has no debt.

Conference Call & Webcast:

The Allot management team will host a conference call to discuss its fourth quarter and full year 2025 earnings results today, February 25, 2026 at 9:00 am ET, 4:00 pm Israel time. To access the conference call, please dial one of the following numbers:

US: 1-888-668-9141, UK: 0-800-917-5108, Israel: +972-3-918-0644

A live webcast and, following the end of the call, an archive of the conference call, will be accessible on the Allot website at: http://investors.allot.com/index.cfm

About Allot

Allot Ltd. (NASDAQ: ALLT) (TASE: ALLT) is a leading provider of innovative converged cybersecurity solutions and network intelligence offerings for service providers and enterprises worldwide. Allot enhances value to its customers' customers through its solutions, which are deployed globally for network-native cybersecurity services, network and application analytics, traffic control and shaping, and more. Allot's multi-service platforms are deployed by over 500 mobile, fixed and cloud service providers and over 1000 enterprises. Our industry-leading network-native security-as-a-service solution is already used by many millions of subscribers globally.

For more information, visit www.allot.com

Performance Metrics

* SECaaS ARR – measures the current annual recurring SECaaS revenues, which is calculated based on estimated revenues for the month of December 2025 and multiplied by 12.

** Total cash - cash and cash equivalents, bank deposits, restricted deposits and investments.

GAAP to Non-GAAP Reconciliation:

The difference between GAAP and non-GAAP revenues is related to the acquisitions made by the Company and represents revenues adjusted for the impact of the fair value adjustment to acquired deferred revenue related to purchase accounting. Non-GAAP net income is defined as GAAP net income after including deferred revenues related to the fair value adjustment resulting from purchase accounting and excluding stock-based compensation expenses, amortization of acquisition-related intangible assets, deferred tax asset adjustment and changes in taxes-related items.

These non-GAAP measures should be considered in addition to, and not as a substitute for, comparable GAAP measures. The non-GAAP results and a full reconciliation between GAAP and non-GAAP results is provided in the accompanying Table 2. The Company provides these non-GAAP financial measures because management uses the non-GAAP measures internally to evaluate the Company's ongoing performance. Accordingly, the Company believes they are useful to investors in enhancing an understanding of the Company's operating performance.

Safe Harbor Statement

This release contains forward-looking statements, which express the current beliefs and expectations of Company management. Such statements involve a number of known and unknown risks and uncertainties that could cause our future results, performance or achievements to differ significantly from the results, performance or achievements set forth in such forward-looking statements. Important factors that could cause or contribute to such differences include risks relating to: our accounts receivables, including our ability to collect outstanding accounts and assess their collectability on a quarterly basis; our ability to meet expectations with respect to our financial guidance and outlook; our ability to compete successfully with other companies offering competing technologies; the loss of one or more significant customers; consolidation of, and strategic alliances by, our competitors; government regulation; the timing of completion of key project milestones which impact the timing of our revenue recognition; lower demand for key value-added services; our ability to keep pace with advances in technology and to add new features and value-added services; managing lengthy sales cycles; operational risks associated with large projects; our dependence on fourth party channel partners for a material portion of our revenues; and other factors discussed under the heading "Risk Factors" in the Company's annual report on Form 20-F filed with the Securities and Exchange Commission. Forward-looking statements in this release are made pursuant to the safe harbor provisions contained in the Private Securities Litigation Reform Act of 1995. These forward-looking statements are made only as of the date hereof, and the company undertakes no obligation to update or revise the forward-looking statements, whether as a result of new information, future events or otherwise.

Logo: https://mma.prnewswire.com/media/703889/Allot_Logo.jpg

Investor Relations Contact:

EK Global Investor Relations

Ehud Helft

+1 212 378 8040

[email protected]

Public Relations Contact:

Seth Greenberg, Allot Ltd.

+972 54 922 2294

[email protected]

TABLE - 1

ALLOT LTD.

AND ITS SUBSIDIARIES

CONSOLIDATED STATEMENTS OF OPERATIONS

(U.S. dollars in thousands, except share and per share data)

Three Months Ended

Year Ended

December 31,

2025

2024

2025

2024

(Unaudited)

(Audited)

Revenues

$ 28,387

$ 24,906

$ 101,993

$ 92,195

Cost of revenues

8,079

7,853

29,441

$ 28,505

Gross profit

20,308

17,053

72,552

$ 63,690

Operating expenses:

Research and development costs, net

5,755

5,715

24,496

26,112

Sales and marketing

8,072

7,508

30,819

30,908

General and administrative

3,911

3,518

13,633

12,684

Total operating expenses

17,738

16,741

68,948

69,704

Operating income (loss)

2,570

312

3,604

(6,014)

Loss from extinguishment

(1,410)

Other income

100

Gain on sales of securities

193

Financial income, net

742

368

2,451

1,910

Income (loss) before income tax benefit

3,312

680

4,938

(4,104)

Income tax expenses

410

439

1,233

1,765

Net income (loss)

$ 2,902

$ 241

$ 3,705

$ (5,869)

Basic net income (loss) per share

$ 0.06

$ 0.01

$ 0.08

$ (0.15)

Diluted net income (loss) per share

$ 0.06

$ 0.01

$ 0.08

$ (0.15)

Weighted average number of shares used in

computing basic net income (loss) per share

48,528,584

39,379,254

44,070,008

38,928,475

Weighted average number of shares used in

computing diluted net income (loss) per share

49,853,533

41,772,402

46,184,989

38,928,475

TABLE - 2

ALLOT LTD.

AND ITS SUBSIDIARIES

RECONCILIATION OF GAAP TO NON-GAAP CONSOLIDATED STATEMENTS OF OPERATIONS

(U.S. dollars in thousands, except per share data)

Three Months Ended

Year Ended

December 31,

2025

2024

2025

2024

(Unaudited)

GAAP cost of revenues

$ 8,079

$ 7,853

$ 29,441

$ 28,505

Share-based compensation (1)

(99)

(148)

(564)

(779)

Amortization of intangible assets (2)

(152)

(305)

(608)

Non-GAAP cost of revenues

$ 7,980

$ 7,553

$ 28,572

$ 27,118

GAAP gross profit

$ 20,308

$ 17,053

$ 72,552

$ 63,690

Gross profit adjustments

300

869

1,387

Non-GAAP gross profit

$ 20,407

$ 17,353

$ 73,421

$ 65,077

GAAP operating expenses

$ 17,738

$ 16,741

$ 68,948

$ 69,704

Share-based compensation (1)

(929)

(1,176)

(4,453)

(5,261)

Non-GAAP operating expenses

$ 16,809

$ 15,565

$ 64,495

$ 64,443

GAAP Loss from extinguishment

$ -

$ (1,410)

$ -

Loss from extinguishment

1,410

Non-GAAP Loss from extinguishment

$ -

GAAP financial income

$ 742

$ 368

$ 2,451

$ 1,910

Exchange rate differences*

(40)

159

119

502

Non-GAAP Financial income

$ 702

$ 527

$ 2,570

$ 2,412

GAAP taxes on income

$ 410

$ 439

$ 1,233

$ 1,765

Changes in tax related items

(225)

(130)

(375)

(352)

Non-GAAP taxes on income

$ 185

$ 309

$ 858

$ 1,413

GAAP Net income (Loss)

$ 2,902

$ 241

$ 3,705

$ (5,869)

Share-based compensation (1)

1,028

1,324

5,018

6,040

Amortization of intangible assets (2)

152

305

608

Loss from extinguishment

1,410

Exchange rate differences*

(40)

159

119

502

Changes in tax related items

225

130

375

352

Non-GAAP Net income

$ 4,115

$ 2,006

$ 10,931

$ 1,633

GAAP Net income (loss) per share (diluted)

$ 0.06

$ 0.01

$ 0.08

$ (0.15)

Share-based compensation

0.02

0.03

0.11

0.16

Amortization of intangible assets

0.01

0.02

Loss from extinguishment

0.03

Exchange rate differences*

0.01

Non-GAAP Net income per share (diluted)

$ 0.08

$ 0.05

$ 0.23

$ 0.04

Weighted average number of shares used in

48,528,584

39,379,254

44,070,008

38,928,475

computing GAAP diluted net income per share

Weighted average number of shares used in

50,913,796

42,560,457

47,181,673

42,289,637

computing non-GAAP diluted net income per share

* Financial income or expenses related to exchange rate differences in connection

with revaluation of assets and liabilities in non-dollar denominated currencies.

TABLE - 2 cont.

ALLOT LTD.

AND ITS SUBSIDIARIES

RECONCILIATION OF GAAP TO NON-GAAP CONSOLIDATED STATEMENTS OF OPERATIONS

(U.S. dollars in thousands, except per share data)

Three Months Ended

Year Ended

December 31,

2025

2024

2025

2024

(Unaudited)

(1) Share-based compensation:

Cost of revenues

$ 99

$ 148

$ 564

$ 779

Research and development costs, net

190

301

1,213

1,988

Sales and marketing

334

310

1,571

1,855

General and administrative

405

565

1,670

1,418

$ 1,028

$ 1,324

$ 5,018

$ 6,040

(2) Amortization of intangible assets

Cost of revenues

$ -

$ 152

$ 305

$ 608

Sales and marketing

$ -

$ 152

$ 305

$ 608

TABLE - 3

ALLOT LTD.

AND ITS SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS

(U.S. dollars in thousands)

December 31,

2025

2024

(Unaudited)

(Audited)

ASSETS

CURRENT ASSETS:

Cash and cash equivalents

$ 17,107

$ 16,142

Restricted deposit

3,573

904

Short-term bank deposits

15,100

15,250

Available-for-sale marketable securities

48,663

26,470

Trade receivables, net (net of allowance for credit losses of

$9,611 and $25,306 on December 31, 2025 and December

31, 2024 , respectively)

17,451

16,482

Other receivables and prepaid expenses

9,906

6,317

Inventories

13,180

8,611

Total current assets

124,980

90,176

NON-CURRENT ASSETS:

Severance pay fund

$ 295

$ 464

Restricted deposit

3,327

279

Operating lease right-of-use assets

5,518

6,741

Other assets

732

2,151

Property and equipment, net

6,014

7,692

Intangible assets, net

305

Goodwill

31,833

Total non-current assets

47,719

49,465

Total assets

$ 172,699

$ 139,641

LIABILITIES AND SHAREHOLDERS' EQUITY

CURRENT LIABILITIES:

Trade payables

$ 938

$ 946

Employees and payroll accruals

9,254

8,208

Deferred revenues

24,700

17,054

Short-term operating lease liabilities

348

562

Other payables and accrued expenses

11,919

9,200

Total current liabilities

47,159

35,970

LONG-TERM LIABILITIES:

Deferred revenues

5,912

7,136

Long-term operating lease liabilities

5,392

5,807

Accrued severance pay

886

946

Convertible debt

39,973

Total long-term liabilities

12,190

53,862

SHAREHOLDERS' EQUITY

113,350

49,809

Total liabilities and shareholders' equity

$ 172,699

$ 139,641

TABLE - 4

ALLOT LTD.

AND ITS SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS

(U.S. dollars in thousands)

Three Months Ended

Year Ended

December 31,

2025

2024

2025

2024

(Unaudited)

(Audited)

Cash flows from operating activities:

Net income (loss)

$ 2,902

$ 241

$ 3,705

$ (5,869)

Adjustments to reconcile net loss to net cash used in operating activities:

Depreciation and amortization

794

2,348

4,048

6,424

Share-based compensation

1,029

1,324

5,018

6,040

Capital loss

255

Loss from extinguishment

1,410

Other income

(100)

Gain on sales of securities

(193)

Changes in operating assets and liabilities:

Decrease (Increase) in accrued severance pay, net

(8)

(48)

109

(203)

Decrease (Increase) in other assets, other receivables

and prepaid expenses

2,063

(274)

(135)

702

Decrease in accrued interest and amortization of premium

on available-for sale marketable securities

(309)

(223)

(1,215)

(1,392)

Decrease in operating leases liability

(533)

(545)

(546)

(1,644)

Decrease in operating lease right-of-use asset

269

325

1,140

2,174

Decrease (Increase) in trade receivables

3,363

888

(969)

(1,654)

Decrease (Increase) in inventories

1,028

1,438

(4,569)

3,263

Increase in trade payables

(6,260)

(2,178)

(8)

(24)

Increase (Decrease) in employees and payroll accruals

(371)

(1,798)

1,046

(4,358)

Increase in deferred revenues

3,466

3,265

6,422

1,861

Increase (Decrease) in other payables and accrued expenses

813

(684)

2,938

(494)

Gain of foreign exchange on cash and cash equivalents

(112)

(565)

Net cash provided by operating activities

8,134

4,079

17,791

4,826

Cash flows from investing activities:

Decrease (Increase) in restricted deposit

(6,070)

(5,717)

703

Investment in short-term bank deposits

(12,800)

(15,250)

(45,350)

(24,550)

Withdrawal of short-term bank deposits

14,500

5,500

45,500

19,300

Purchase of property and equipment

(1,504)

(445)

(2,293)

(2,117)

Investment in marketable securities

(14,022)

(16,719)

(113,669)

(61,003)

Proceeds from redemption or sale of marketable securities

4,525

10,750

92,902

64,790

Proceeds from sale of patent

100

Net cash used in investing activities

(15,371)

(16,164)

(28,527)

(2,877)

Cash flows from financing activities:

Issuance of share capital

42,308

Proceeds from exercise of stock options

238

Redemption of convertible debt

(31,410)

Net cash provided by financing activities

11,136

Effect of exchange rate changes on cash and cash equivalents

112

565

Increase (Decrease) in cash and cash equivalents

(7,125)

(12,084)

965

1,950

Cash, cash equivalents at the beginning of the period

24,232

28,226

16,142

14,192

Cash, cash equivalents at the end of the period

$ 17,107

$ 16,142

$ 17,107

$ 16,142

Non-cash activities:

ROU asset and lease liability decrease, due to lease termination

(83)

Redemption of convertible debt

(10,000)

Right-of-use assets obtained in the exchange for operating lease liabilities

5,858

Other financial metrics (Unaudited)

U.S. dollars in millions, except top 10 customers as a % of revenues and number of shares

Q4-25

FY 2025

FY 2024

Revenues geographic breakdown

Americas

4.2

15 %

19.1

19 %

14.2

15 %

EMEA

18.2

64 %

63.7

62 %

54.0

59 %

Asia Pacific

6.0

21 %

19.2

19 %

24.0

26 %

28.4

100 %

102.0

100 %

92.2

100 %

Revenues breakdown by type

SECaaS (Security as a Service)

8.1

28 %

26.8

26 %

16.5

18 %

Products

8.4

30 %

31.1

30 %

30.1

33 %

Professional Services

2.9

10 %

8.2

8 %

8.3

9 %

Support & Maintenance

9.0

32 %

35.9

36 %

37.3

40 %

28.4

100 %

102.0

100 %

92.2

100 %

Top 10 customers as a % of revenues

46 %

41 %

43 %

Non-GAAP Weighted average number of basic shares

(in millions)

48.5

44.1

38.9

Non-GAAP weighted average number of fully diluted shares

(in millions)

50.9

47.2

42.3

SECaaS (Security as a Service) revenues - U.S. dollars in millions (Unaudited)

Q4-2025:

8.1

Q3-2025:

7.3

Q2-2025:

6.4

Q1-2025:

5.1

Q4-2024:

4.8

SECaaS ARR* - U.S. dollars in millions (Unaudited)

Dec. 2025:

30.8

Dec. 2024:

18.2

Dec. 2023:

12.7

Dec. 2022:

9.2

SOURCE Allot Ltd.