• Renewal of licence agreements for monitoring products from major clients
• Continued progress on key deals in pipeline
• Investing in software portfolio to ensure relevance and competitiveness
• Decline in Annualised Recurring Revenue (ARR) due to Telstra customer churn

FirstWave Cloud Technology Limited (ASX:FCT) released its Activity Report and Appendix 4C for the third quarter of FY25 ended 31 March 2025. The key highlights include the renewal of licence agreements for the company's monitoring products from major clients such as John Deere and Macquarie Telecom. The company also continued to progress key deals in its pipeline and plans to update the market as they develop. During the quarter, the company invested in its portfolio of software to ensure their relevance to customers and competitiveness in the market. The company's cash position at the quarter end was $0.55 million, down from $1.68 million at the end of the previous quarter. Annualised Recurring Revenue (ARR) was $8.03 million, down 1.5% quarter-on-quarter, driven by continued churn from Telstra end-customers due to the previously disclosed discontinuation of their GPA firewall product and CSX2 hosting platform. Revenue was $2.14 million, down 5.7% quarter-on-quarter, but excluding the $0.21 million drop in zero-margin Telstra recharges, revenue was up 3.9% at $2.11 million. Gross Profit in Q3 was $1.94 million, up 4.9% quarter-on-quarter with a margin improvement of 9 percentage points to 91%. The company's normalised cash usage at the end of Q3 was calculated at $220,000 per month.

With support from Amazon Web Services (AWS), FirstWave has entered into an agreement with US technology company Corent Tech. The agreement is fully funded by AWS for the first 12 months to support the advancement of the AWS and FirstWave partnership, which may include the ability for FirstWave cloud services to be included on AWS invoices. Given the low cash balance and the likelihood that operating cash flows for Q4 will be negative, the board is advancing as quickly as it can all options it has at its disposal - increased sales, debt restructuring, asset disposal, new capital - to de-risk the business during this period and will update the market as soon as any of these become certain. The company is also maintaining a close watch on its operations in the US and LATAM where negative sentiment flowing from the actions of the US Administration has the potential to inject uncertainty into investment decisions by its customers.