FalconStor: Fiscal 3Q23 Financial Results

Strong revenue growth, net income, and cash generation
• 8% year-over-year increase in total GAAP revenue for Q3 and 40% increase versus previous quarter
• 18% increase in total hybrid cloud ARR run-rate for Q3 versus previous quarter
• 10% increase in MSP-driven hybrid cloud ARR run-rate for Q3 versus previous quarter

FalconStor Software, Inc. announced financial results for its third quarter of 2023, which ended on September 30, 2023.

“Enterprises around the globe are accelerating their strategic focus on hybrid cloud technology solutions as they seek competitive advantages and operating efficiencies,” said Todd Brooks, CEO. “Our hyper-focus on IBM Power customers, and partnership with IBM, are driving adoption of FalconStor’s data protection and migration technology throughout the IBM global ecosystem. As a result, we plan to increase our hybrid cloud growth investments to continue delivering year-over-year revenue growth and profitability.”

3FQ23 Financial Results
• Hybrid Cloud ARR Run-Rate: 18% increase compared to 2FQ23, and 224% increase Y/Y
• Ending Cash: $1.8 million, compared to $1.3 million in 2FQ23, and $1.7 million in 3FQ22
• Total Revenue: $3.3 million, compared to $2.4 million in 2FQ23, and $3.1 million in 3FQ22
• Total Cost of Revenue: $0.4 million, compared to $0.4 million in 2FQ23, and $0.4 million in 3FQ22
• Total Operating Expenses: $2.0 million, compared to $2.2 million in 2FQ23, and $2.3 million in 3FQ22
• GAAP Net Income (Loss): $0.8 million, compared to $(0.5) million in 2FQ23, and $0.2 million in 3FQ22

“Our disciplined focus on operating efficiency and alignment with the industry’s adoption of hybrid cloud solutions, are driving our improved results,” said Vincent Sita, CFO. “We generated a healthy level of cash in the quarter, and will continue to balance tight expense control and strategic growth investments as we move forward.”