HUB Security Reports Second Half 2024 Financial Results and the Filing of its Annual Report on Form 20-F for the Year Ended December 31, 2024
- Gross margin significantly improved to 25.6% from 15.4% YoY
- Operating expenses reduced by 29% to $14.7M
- Operating loss improved by 38%
- Secured 鈧�20M contract with Cassa di Risparmio della Repubblica di San Marino
- Successfully implemented solution for major European bank managing 鈧�900B in assets
- Resolved $17M in legacy liabilities
- Completed reverse stock split to maintain Nasdaq compliance
- Revenue declined to $13.8M from $17.6M in H2 2023
- Still operating at a loss of $11.1M in H2 2024
Insights
HUB Security shows strategic focus on profitability with 66% gross margin improvement despite revenue decline; remains unprofitable but with narrowing losses.
HUB Security's H2 2024 results reveal a deliberate shift toward prioritizing profitability over revenue volume. Revenues decreased
The financial restructuring is yielding tangible results in key profitability metrics. Gross margin expanded dramatically from
Balance sheet improvements include resolving approximately
Commercial traction in the banking sector is materializing with the
HUB has successfully executed a strategic pivot to higher-margin data security solutions while leveraging trusted relationships in regulated industries.
HUB Security's transformation represents a textbook portfolio rationalization strategy 鈥� divesting from commoditized, lower-margin businesses to concentrate resources on differentiated, high-value offerings. The company has identified its Secured Data Fabric platform as its primary growth engine, addressing the increasing regulatory pressures facing financial institutions and other regulated sectors.
This platform consolidation strategy is particularly well-timed given the escalating compliance burdens around data protection, traceability, and transparency. By positioning its solution as a unified system that consolidates fragmented data across multiple silos, HUB addresses persistent pain points for enterprises with complex IT infrastructures, particularly in KYC, AML, and sanctions screening processes.
The company's go-to-market leverage comes through its established Professional Services division with 270 specialists maintaining decades-long client relationships. This creates a powerful cross-selling dynamic, providing privileged access to introduce the Secured Data Fabric platform into organizations with typically high barriers to entry for new vendors.
Management's leadership appointments 鈥� including John Rogers as President of Americas, Renah Persofsky as Board Chair, and Shlomo Bibas as board member 鈥� indicate preparation for geographic expansion, particularly in North America. This strategic talent acquisition aligns with the transition from a services-focused business to a platform-led, recurring revenue model.
The expansion beyond banking into healthcare, payment processing, transportation, and travel technology demonstrates the platform's versatility in addressing data security and operational efficiency challenges across various regulated environments. This broadening market approach, coupled with the improved financial discipline, positions HUB to potentially capitalize on the growing demand for secure data infrastructure solutions.
Significant Year-over-Year Margin Expansion, Streamlined Operations, and Strategic Wins Position HUB for Scalable Growth in 2025
Conference call will be held Friday, May 2 at 10:00 am ET
TEL AVIV, Israel, May 01, 2025 (GLOBE NEWSWIRE) -- HUB Cyber Security Ltd. (NASDAQ: HUBC) (鈥淗UB鈥� or the 鈥淐ompany鈥�), a global leader in confidential computing and advanced data fabric technology, today announced results for the full year and second half period ended December 31, 2024 and the filing of its Annual Report on Form 20-F for the Year Ended December 31, 2024.
Financial results for H2 2024:
- Revenues were
$13.8 million , compared to$17.6 million in H2 2023. The year-over-year change reflects the Company鈥檚 deliberate strategic pivot to optimize its business mix. HUB has proactively exited lower-margin segments, including certain areas within its IT Services and Cyber Consultancy divisions, in order to concentrate on its core, higher-value offerings. This realignment underscores HUB鈥檚 commitment to enhancing profitability and building a more resilient foundation for sustainable long-term growth. - Gross margin improved significantly to
25.6% in H2 2024, up from15.4% in H2 2023. This improvement highlights the positive impact of HUB鈥檚 strategic realignment toward higher-margin business segments. Despite a leaner revenue base, the Company鈥檚 sharpened focus has enhanced overall profitability and established a stronger foundation for sustained financial performance going forward. - Operating expenses for H2 2024 totaled
$14.7 million , a significant29% reduction compared to$20.9 million in H2 2023. This sharp reduction underscores management鈥檚 disciplined approach to cost control and operational efficiency as HUB continues its transition toward a more focused, higher-margin business model. - Operating loss in H2 2024 was
$11.1 million , a significant improvement of38% compared to the prior year. This meaningful progress reflects the benefits of streamlined operations and a more efficient organizational structure, reinforcing the positive impact of the Company鈥檚 strategic realignment.
Management Commentary
Noah Hershcoviz, CEO of HUB, had the following commentary on the Company鈥檚 financial results:
We said we鈥檇 rebuild HUB on stronger ground - and this report shows we鈥檙e doing exactly that. In 2024, we executed a focused strategic transformation, shifting away from non-core, lower-margin services to concentrate on our core strength: delivering secure, enterprise-grade data infrastructure for regulated industries. By doubling down on our Secured Data Fabric platform and modern data governance capabilities, we鈥檝e reinforced our financial foundation, improved operational efficiency, and positioned HUB as a trusted partner for institutions navigating complex compliance and data management environments. These results confirm that our strategy is taking hold -and we remain committed to scaling profitably, expanding our client base, and creating lasting value for our shareholders
Our strategic expansion into the highly regulated banking sector is beginning to bear fruit. In March, we were selected by Cassa di Risparmio della Repubblica di San Marino S.p.A. to execute a comprehensive
Momentum is also building across our base of other European clients driven by regulatory pressure, IT complexity, and rising compliance costs. A leading bank managing over
In recent months, we have enhanced our financial flexibility by resolving approximately
We鈥檝e learned from the Company鈥檚 experience, and we鈥檙e clear-eyed about what it takes to rebuild shareholder equity and long-term trust. We鈥檝e put the past behind us, and through it all, we鈥檝e continued to make the business world a safer, smarter place. Global institutions continue to rely on us, and we take that responsibility seriously. By aligning every part of the business around our Secured Data Fabric platform, we鈥檝e created a focused, high-performance engine for scalable growth. This is no longer just a turnaround story, rather a reaffirmation of our ability to execute, deliver, and create lasting value for our clients, shareholders, and partners.
Secured Data Fabric: Innovation and Market Penetration
The Secured Data Fabric platform is the Company's primary growth engine. This cutting-edge technology consolidates data from multiple silos into a unified, secure system that enables clients to navigate vast data pools, ensure compliance, and protect sensitive information with advanced encryption.
HUB鈥檚 solution stands apart from traditional data lake systems by securely retrieving data in real time. It offers a transformative approach that reduces costs and mitigates security vulnerabilities. This unique value proposition has driven strong demand, reflected in a significant increase in our backlog and a surge in RFPs from existing and new clients.
Leading financial institutions have already embraced HUBs platform, and the Company is seeing growing interest across various sectors, including healthcare, payment companies, transportation, travel tech, and other regulated industries. This broadening demand highlights the versatility of our solution in addressing critical challenges in data security and operational efficiency across diverse verticals.
With an expanding pipeline of opportunities and a proven ability to deliver tailored solutions at scale, HUB believes it is well-positioned for continued growth and to further establish itself as a trusted partner across industries.
Premier Professional Services: Stability, Trust, and Cross-Sell Opportunity
Our Premier Professional Services and Cyber Consultancy group remains a cornerstone of HUB鈥檚 operations. This is a trusted advisor business -staffed by over 270 skilled professionals -that delivers ICT, software, and cyber defense solutions to some of the world鈥檚 most sensitive environments. What makes this business powerful is its trust capital. Many of our client relationships go back decades-some as far as the early 1990s. These relationships are not just recurring-they are strategic. They give us privileged access, long-term visibility, and a platform to introduce our Secured Data Fabric into large, complex organizations. We believe this business not only underpins our cash flow but gives HUB a major competitive advantage in winning new software deployments within high-barrier sectors.
Building for the Future: Talent and Leadership
HUB has strengthened its leadership team with key appointments as part of our broader transformation efforts. In recent months, the Company has announced the appointment of John Rogers as President of the Americas Region, Renah Persofsky as Chairperson of the Board of Directors, and Shlomo Bibas as the newest member of our Board. These leaders bring the experience and execution focus required to support our expansion into new markets. Looking ahead, we intend to further scale our leadership bench by adding world-class talent to support our North American growth strategy in the coming months.
Filing of Annual Report on Form 20-F for the Year Ended December 31, 2024
A copy of the Company鈥檚 annual report on Form 20-F for the year ended December 31, 2024 has been filed with the U.S. Securities and Exchange Commission at https://www.sec.gov/ and posted on the Company鈥檚 investor relations website at https://investors.hubsecurity.com/. The Company will deliver a hard copy of its annual report, including its complete audited consolidated financial statements, free of charge, to its shareholders upon request at [email protected].
Conference Call Details
Date and Time: Friday, May 2, 2025, at 10:00 am ET
Live Webcast Information: Interested parties can access the conference call via a live webcast, which is available in the Investor Relations section of the Company's website at or .
Replay: A webcast replay will be available in the Investor Relations section of the Company's website at or .
About HUB Cyber Security Ltd.
HUB Cyber Security Ltd (鈥淗UB鈥� or the 鈥淐ompany鈥�) was established in 2017 by veterans of the elite intelligence units of the Israeli Defense Forces. The Company specializes in unique cyber security solutions protecting sensitive commercial and government information. The Company debuted an advanced encrypted computing solution to prevent hostile intrusions at the hardware level while introducing a novel set of data theft prevention solutions. HUB operates in over 30 countries and provides innovative cybersecurity computing appliances and a wide range of cybersecurity services worldwide. Hub's Secured Data Fabric is a revolutionary product developed in partnership with its subsidiary, BlackSwan Technologies, that is emerging as a leader in highly secure data management and unification.
Forward-Looking Statements
This press release contains forward-looking statements for purposes of the safe harbor provisions under the United States Private Securities Litigation Reform Act of 1995. Forward-looking statements are typically identified by words such as 鈥減lan,鈥� 鈥渂elieve,鈥� 鈥渆xpect,鈥� 鈥渁nticipate,鈥� 鈥渋ntend,鈥� 鈥渙utlook,鈥� 鈥渆stimate,鈥� 鈥渇uture,鈥� 鈥渇orecast,鈥� 鈥減roject,鈥� 鈥渃ontinue,鈥� 鈥渃ould,鈥� 鈥渕ay,鈥� 鈥渕ight,鈥� 鈥減ossible,鈥� 鈥減otential,鈥� 鈥減redict,鈥� 鈥渟eem,鈥� 鈥渟hould,鈥� 鈥渨ill,鈥� 鈥渨ould鈥� and other similar words and expressions, but the absence of these words does not mean that a statement is not forward-looking.
The forward-looking statements are based on the current expectations of the management of HUB, as applicable, and are inherently subject to uncertainties and changes in circumstances and their potential effects and speak only as of the date of such statement. There can be no assurance that future developments will be those that have been anticipated. These forward-looking statements involve a number of risks, uncertainties, or other assumptions that may cause actual results or performance to be materially different from those expressed or implied by these forward-looking statements. These risks and uncertainties include, but are not limited to, those discussed and identified in public filings made with the SEC by HUB and the following: (i) significant uncertainty regarding the adequacy of HUB鈥檚 liquidity and capital resources and its ability to repay its obligations as they become due; (ii) the war between Israel and Hamas commenced in October 2023, which may harm Israel鈥檚 economy and HUB鈥檚 business; (iii) expectations regarding HUB鈥檚 strategies and future financial performance, including its future business plans or objectives, prospective performance and opportunities and competitors, revenues, products and services, pricing, operating expenses, market trends, liquidity, cash flows and uses of cash, capital expenditures, and HUB鈥檚 ability to invest in growth initiatives and pursue acquisition opportunities; (iv) the outcome of any legal or regulatory proceedings against HUB in connection with our previously announced internal investigation or otherwise; (v) the ability to cure and meet stock exchange continued listing standards and remain listed on the Nasdaq; (vi) competition, the ability of HUB to grow and manage growth profitably, maintain relationships with customers and suppliers and retain its management and key employees; (vii) limited liquidity and trading of HUB鈥檚 securities; (viii) geopolitical risk, including military action and related sanctions, and changes in applicable laws or regulations; (ix) the possibility that HUB may be adversely affected by other economic, business, and/or competitive factors; (i) other risks and uncertainties set forth in the sections entitled 鈥淩isk Factors鈥� and 鈥淐autionary Statement Regarding Forward-Looking Statements鈥� in HUB鈥檚 Annual Report on Form 20-F filed on May 1, 2025.
Should one or more of these risks or uncertainties materialize or should any of the assumptions made by the management of HUB prove incorrect, actual results may vary in material respects from those expressed or implied in these forward-looking statements.
All subsequent written and oral forward-looking statements concerning the business combination or other matters addressed in this press release and attributable to HUB or any person acting on its behalf are expressly qualified in their entirety by the cautionary statements contained or referred to in the press release. Except to the extent required by applicable law or regulation, HUB undertakes no obligation to update these forward-looking statements to reflect events or circumstances after the date of this press release to reflect the occurrence of unanticipated events.
Investor Relations
Lytham Partners
Ben Shamsian
646-829-9701
[email protected]
FAQ
What were HUB Security's (HUBC) key financial results for H2 2024?
Why did HUBC's revenue decline in H2 2024?
What major contracts did HUB Security win in 2024?
How did HUB Security address its Nasdaq compliance issues?
What is HUB Security's main growth engine?
