Cycurion Reports First Quarter 2026 Results
Rhea-AI Summary
Cycurion (NASDAQ: CYCU) reported first quarter 2026 revenue of $3.3 million, reflecting the wind-down of legacy contracts. Gross margin rose 900 basis points to 21.1%, while net loss improved 51.5% to $2.6 million and EBITDA loss improved 60.2% to $1.9 million.
The company signed binding agreements to acquire Halo Privacy and HavenX, expected to add about $7 million in annualized contracted revenue at roughly 55% gross margin. Contracted backlog totals $112 million, with an estimated $21–$22 million converting to revenue over one year including the planned acquisitions.
Cycurion also targets over $2.2 million in annualized savings from cost reduction initiatives.
AI-generated analysis. Not financial advice.
Positive
- Gross margin expanded 900 basis points to 21.1% from 12.1%
- Net loss improved 51.5% to $2.6 million from $5.3 million
- EBITDA loss improved 60.2% to $1.9 million from $4.9 million
- Selling, general and administrative expenses reduced by $1.3 million to $2.7 million
- Binding Halo Privacy and HavenX deals add about $7 million annualized contracted revenue at ~55% gross margin
- Contracted backlog of $112 million with $21–$22 million expected revenue over one year including new acquisitions
- Cost reduction program expected to generate over $2.2 million in annualized savings
Negative
- Quarterly revenue at $3.3 million during planned wind-down of certain legacy contracts
- Company remains unprofitable with a $2.6 million net loss in Q1 2026
- EBITDA remains negative at a $1.9 million loss despite improvements
News Market Reaction – CYCU
On the day this news was published, CYCU gained 0.84%, reflecting a mild positive market reaction. Argus tracked a peak move of +2.1% during that session. Our momentum scanner triggered 4 alerts that day, indicating moderate trading interest and price volatility. This price movement added approximately $44K to the company's valuation, bringing the market cap to $5.29M at that time.
Data tracked by StockTitan Argus on the day of publication.
Key Figures
Market Reality Check
Peers on Argus
Sector scanner shows names like GLE, WYY, JZ and CLPS with mixed moves (median -3.3%) around this time, indicating broader volatility in related IT/cyber names rather than an isolated CYCU move.
Previous Earnings Reports
| Date | Event | Sentiment | Move | Catalyst |
|---|---|---|---|---|
| Apr 01 | Full-year 2025 results | Positive | +4.0% | 2025 results, backlog strength and cost savings framing 2026 transformation. |
| Nov 14 | Q3 2025 earnings | Positive | +51.2% | Q3 2025 revenue, strong backlog and higher projected Q1 2026 run-rate. |
| Nov 14 | Peer earnings (IQST) | Positive | +51.2% | IQSTEL’s record Q3 2025 revenue growth and strengthened balance sheet. |
| Aug 15 | Q2 2025 update | Negative | -3.4% | Q2 2025 loss with one-time costs despite large contract wins. |
| Aug 14 | Q2 2025 results | Negative | -26.7% | Q2 2025 revenue decline, sizable net loss and macro headwinds. |
Earnings and financial updates for Cycurion have often triggered sizable moves in both directions, with several past earnings-related headlines producing double-digit percentage swings.
Recent news highlights Cycurion’s shift toward higher-margin, AI-driven contracts and aggressive cost controls. Prior updates in 2025–2026 emphasized backlog growth (up to $112M), acquisition activity, and restructuring to achieve profitability. Today’s Q1 2026 results continue that narrative with gross margin expansion, lower operating expenses, and clearer revenue visibility, building on the 2025 full-year results and earlier guidance about 2026 profitable growth initiatives.
Historical Comparison
Past earnings and results headlines for Cycurion showed an average move of 15.26%, with reactions tied closely to cost control progress and backlog trends.
Earnings updates trace a path from challenged 2025 quarters toward 2026 cost reductions, backlog expansion and improving gross margins as the AI-focused strategy scales.
Market Pulse Summary
This announcement underscores Cycurion’s transformation toward higher-margin, AI-driven contracts. Q1 2026 revenue of $3.3 million came with gross margin expanding to 21.1% and net loss improving to $2.6 million. Binding agreements for Halo Privacy and HavenX add about $7 million in contracted revenue, raising one-year revenue visibility to $21–22 million. Investors may monitor backlog conversion, integration of acquisitions, and delivery of over $2.2 million in annualized cost savings.
Key Terms
basis points financial
gross margin financial
EBITDA financial
contracted backlog financial
AI-generated analysis. Not financial advice.
Delivers 900 Basis Point Gross Margin Expansion, Net Loss Cut
MCLEAN, Va., May 14, 2026 (GLOBE NEWSWIRE) -- Cycurion, Inc. (NASDAQ: CYCU) ("Cycurion" or the "Company"), a leader in AI-driven cybersecurity and national security solutions with trusted relationships across the U.S. Government, numerous leading corporations, and high-profile individuals across all industries, announced today results for the first quarter ended March 31, 2026.
"The first quarter of 2026 marks a clear inflection point in our transformation," said Kevin Kelly, Chairman and Chief Executive Officer of Cycurion. "We nearly doubled gross margins, significantly reduced operating expenses and executed binding agreements to acquire Halo Privacy and HavenX, which adds approximately
Highlights of First Quarter 2026 as Compared to Fourth Quarter 2025
- Revenue of
$3.3 million , which reflects the planned wind-down of certain legacy contracts ahead of the ramp of higher-margin replacement work. - Gross margin expanded 900 basis points to
21.1% from12.1% , nearly doubling as a result of a deliberate shift to higher-margin contracts and disciplined cost management. - Selling, general and administrative expenses decreased
$1.3 million , or31.6% , to$2.7 million . - Net loss improved
51.5% to$2.6 million from$5.3 million . - EBITDA loss improved
60.2% to$1.9 million from$4.9 million .
Strategic and Operational Momentum
- Halo Privacy and HavenX Acquisition (Binding Agreement May 2026): Adds approximately
$7 million in estimated annualized contracted revenue with a gross margin of approximately55% . Brings industry-leading secure communications technology (including the Halo Link app) and elite digital investigations/attribution capabilities (HavenX), expanding Cycurion's presence in high-growth markets. - Robust Contract Backlog: Consistent with prior disclosures, the Company's
$112 million contracted backlog is expected to realize approximately$15 million –$17 million over the next twelve months, which the addition of Halo Privacy and HavenX upon closing, this expectation increases to approximately$21 million –$22 million over a one year period. - Cost Reduction Initiatives: Organizational realignment on track to generate over
$2.2 million in annualized savings, with meaningful benefits already reflected in first quarter of 2026 selling, general and administrative expenses. - Acquisition Pipeline: Continued advancement of the revised Memorandum of Understanding to acquire Kustom Entertainment's Legacy Video Solutions segment (expected to add approximately
$5.1 million in annual revenue and approximately$8 million in contracted backlog).
About Cycurion
Based in McLean, Virginia, Cycurion (NASDAQ: CYCU) is a forward-thinking provider of IT cybersecurity solutions and AI, committed to delivering secure, reliable, and innovative services to clients worldwide. Specializing in cybersecurity, program management, and business continuity, Cycurion harnesses its AI-enhanced ARx platform and expert team to empower clients and safeguard their operations. Along with its subsidiaries, Axxum Technologies LLC, Cloudburst Security LLC, and Cycurion Innovation, Inc., Cycurion serves government, healthcare, and corporate clients committed to securing the digital future. For more information, visit www.cycurion.com.
About Halo Privacy
Halo Privacy, with more than 10 years of expertise, develops cutting-edge, privacy-first secure communication tools engineered for the highest security standards, including the revolutionary Halo Link app.
About HavenX
HavenX is a leading digital investigations and attribution firm focused on cyber-harassment, defamation tracking, OSINT, IP geolocation, breach intelligence, and high-confidence threat actor identification.
Forward-Looking Statements
This press release contains forward-looking statements as defined in the Private Securities Litigation Reform Act of 1995, including, but not limited to, statements relating to the operations and prospective growth of Cycurion's business.
Certain statements in this press release that are not historical facts are forward-looking statements within the meaning of Section 27A of the Securities Exchange Act of 1934, as amended. Any statements contained in this press release that are not statements of historical fact may be deemed forward-looking statements. Such statements include, but are not limited to, statements regarding the proposed transaction contemplated by the binding agreement, including the likelihood, timing, structure or consummation of the transaction; the anticipated benefits of the transaction; the acceleration of the Company's inorganic growth strategy; the continued execution on the Company's backlog; and other statements that are not historical facts, including statements which may be accompanied by words such as "continue," "will," "may," "could," "should," "expect," "expected," "plans," "intend," "anticipate," "believe," "estimate," "predict," "potential," and similar expressions are intended to identify such forward-looking statements. All forward-looking statements involve significant risks and uncertainties that could cause actual results to differ materially from those expressed or implied in the forward-looking statements, many of which are generally outside the control of Cycurion and are difficult to predict. Examples of such risks and uncertainties include, but are not limited to, risks related to customer performance and satisfaction, contract modifications, delays or terminations, and the Company’s ability to fulfill contractual obligations, the outcomes of the Company's investigations, any potential legal proceedings, or the future performance of the Company's stock. Additional factors that could cause actual results to differ materially from those expressed or implied in the forward-looking statements can be found in the most recent annual report on Form 10-K, quarterly reports on Form 10-Q, and current reports on Form 8-K filed by Cycurion with the U.S. Securities and Exchange Commission. Cycurion anticipates that subsequent events and developments may cause its plans, intentions, and expectations to change. Cycurion assumes no obligation, and it specifically disclaims any intention or obligation, to update any forward-looking statements, whether as a result of new information, future events, or otherwise, except as expressly required by law. Forward-looking statements speak only as of the date they are made and should not be relied upon as representing Cycurion's plans and expectations as of any subsequent date.
Cycurion Investor Relations:
(888) 341-6680
investors@cycurion.com
Cycurion Media Relations:
(888) 341-6680
media@cycurion.com
| Quarterly Results of Operations and Non-GAAP Financial Measures (Unaudited) | |||||||||||
| Quarterly Consolidated Results of Operations | |||||||||||
| For the Three Months Ended | |||||||||||
| March 31, 2026 | December 31, 2025 | March 31, 2025 | |||||||||
| Revenue | $ | 3,268,620 | $ | 3,542,644 | $ | 3,870,050 | |||||
| Cost of revenue | 2,580,262 | 3,114,505 | 3,192,287 | ||||||||
| Gross profit | 688,358 | 428,139 | 677,763 | ||||||||
| Gross margin | 21.1 | % | 12.1 | % | 17.5 | % | |||||
| Operating expenses: | |||||||||||
| Selling, general and administrative expenses | 2,743,695 | 4,013,876 | 337,374 | ||||||||
| Stock compensation expenses | 315,833 | 804,424 | — | ||||||||
| Business combination expenses | — | 630,000 | 10,437,894 | ||||||||
| Total operating expenses | 3,059,528 | 5,448,300 | 10,775,268 | ||||||||
| Operating loss | (2,371,170 | ) | (5,020,161 | ) | (10,097,505 | ) | |||||
| Interest income | 14,236 | 25,768 | — | ||||||||
| Interest expense | (204,852 | ) | (257,174 | ) | (178,890 | ) | |||||
| Gain on debt settlement, net | — | (28,504 | ) | 141,653 | |||||||
| Other expense | — | — | (113,744 | ) | |||||||
| Other expense, net | (190,616 | ) | (259,910 | ) | (150,981 | ) | |||||
| Loss before income taxes | (2,561,786 | ) | (5,280,071 | ) | (10,248,486 | ) | |||||
| Provision for income tax | — | — | — | ||||||||
| Net loss | (2,561,786 | ) | (5,280,071 | ) | (10,248,486 | ) | |||||
| Less: Net loss attributable to non-controlling interest | 433,324 | 175,017 | — | ||||||||
| Net loss attributable to Cycurion | $ | (2,128,462 | ) | $ | (5,105,054 | ) | $ | (10,248,486 | ) | ||
| Reconciliation of Net Loss to EBITDA (Non-GAAP) and Adjusted EBITDA (Non-GAAP) | |||||||||||
| For the Three Months Ended | |||||||||||
| March 31, 2026 | December 31, 2025 | March 31, 2025 | |||||||||
| Net loss attributable to Cycurion | $ | (2,128,462 | ) | $ | (5,105,054 | ) | $ | (10,248,486 | ) | ||
| Interest income | (14,236 | ) | (25,768 | ) | — | ||||||
| Interest expense | 204,852 | 257,174 | 178,890 | ||||||||
| Other expense | — | — | 113,744 | ||||||||
| Depreciation and amortization | 1,187 | 7,665 | 74,892 | ||||||||
| EBITDA (Non-GAAP) | (1,936,659 | ) | (4,865,983 | ) | (9,880,960 | ) | |||||
| Loss on debt settlement, net | — | 28,504 | (141,653 | ) | |||||||
| Transaction related expenses | — | 630,000 | 10,437,894 | ||||||||
| Finance expense | — | — | 100,000 | ||||||||
| Stock-based compensation | 315,833 | 904,424 | — | ||||||||
| Adjusted EBITDA (Non-GAAP) | $ | (1,620,826 | ) | $ | (3,303,055 | ) | $ | 515,281 | |||
| CYCURION, INC. AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS (Unaudited) | |||||||
| March 31, 2026 | December 31, 2025 | ||||||
| Assets: | |||||||
| Cash and cash equivalents | $ | 2,028,718 | $ | 5,255,235 | |||
| Accounts receivable, net | 3,336,047 | 2,687,479 | |||||
| Prepaid expenses and other current assets | 106,934 | 60,133 | |||||
| Total current assets | 5,471,699 | 8,002,847 | |||||
| Software development costs, net | 4,735,981 | 4,606,981 | |||||
| Goodwill | 21,238,450 | 20,842,508 | |||||
| Total non-current assets | 25,974,431 | 25,449,489 | |||||
| Total assets | $ | 31,446,130 | $ | 33,452,336 | |||
| Liabilities and Stockholders' Equity: | |||||||
| Liabilities: | |||||||
| Bank loan-revolving credit line | $ | 2,725,546 | $ | 2,933,396 | |||
| Loans payable - current portion | 669,693 | 669,693 | |||||
| Factoring liability | 1,566,887 | 1,511,678 | |||||
| Convertible notes | 192,897 | 192,897 | |||||
| Promissory notes | 2,500,849 | 2,499,662 | |||||
| Loans payable - related parties | 123,650 | 123,650 | |||||
| Accounts payable | 1,441,596 | 1,314,772 | |||||
| Accrued liabilities | 4,283,045 | 4,228,337 | |||||
| Accrued compensation and benefits | 1,306,906 | 919,825 | |||||
| Accrued interest payable | 1,486,041 | 1,347,787 | |||||
| Excise tax payable | 1,167,173 | 1,167,173 | |||||
| Total current liabilities | 17,464,283 | 16,908,870 | |||||
| Loans payable - non-current portion | 300,000 | 300,000 | |||||
| Total non-current liabilities | 300,000 | 300,000 | |||||
| Total liabilities | 17,764,283 | 17,208,870 | |||||
| Stockholders' Equity: | |||||||
| Preferred stock ( | |||||||
| Series A convertible preferred stock ( | — | — | |||||
| Series B convertible preferred stock ( | — | — | |||||
| Series C convertible preferred stock ( | — | — | |||||
| Series D convertible preferred stock ( | 15 | 15 | |||||
| Series E convertible preferred stock ( | — | — | |||||
| Series F convertible preferred stock ( | — | — | |||||
| Series G convertible preferred stock ( | — | — | |||||
| Common stock ( | 551 | 364 | |||||
| Additional paid in capital | 46,979,742 | 46,979,762 | |||||
| Accumulated deficit | (29,007,543 | ) | (26,879,081 | ) | |||
| Total stockholders' equity attributable to Cycurion | 17,972,765 | 20,101,060 | |||||
| Deficit attributable to noncontrolling interests | (4,290,918 | ) | (3,857,594 | ) | |||
| Total stockholders' equity | 13,681,847 | 16,243,466 | |||||
| Total liabilities and stockholders’ equity | $ | 31,446,130 | $ | 33,452,336 | |||
| CYCURION, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS (Unaudited) | |||||||
| For the Three Months Ended March 31, | |||||||
| March 31, 2026 | March 31, 2025 | ||||||
| Revenue | $ | 3,268,620 | $ | 3,870,050 | |||
| Cost of revenue | 2,580,262 | 3,192,287 | |||||
| Gross profit | 688,358 | 677,763 | |||||
| Operating expenses: | |||||||
| Selling, general and administrative expenses | 2,743,695 | 337,374 | |||||
| Stock compensation expenses | 315,833 | — | |||||
| Business combination expenses | — | 10,437,894 | |||||
| Total operating expenses | 3,059,528 | 10,775,268 | |||||
| Operating loss | (2,371,170 | ) | (10,097,505 | ) | |||
| Other income/(expenses): | |||||||
| Interest income | 14,236 | — | |||||
| Interest expense | (204,852 | ) | (178,890 | ) | |||
| Gain on debt settlement, net | — | 141,653 | |||||
| Other expense, net | — | (113,744 | ) | ||||
| Other expenses, net | (190,616 | ) | (150,981 | ) | |||
| Loss before income taxes | (2,561,786 | ) | (10,248,486 | ) | |||
| Provision for income tax | — | — | |||||
| Net loss | (2,561,786 | ) | (10,248,486 | ) | |||
| Less: Net loss attributable to non-controlling interest | 433,324 | — | |||||
| Net loss attributable to Cycurion | $ | (2,128,462 | ) | $ | (10,248,486 | ) | |
| Comprehensive loss | $ | (2,128,462 | ) | $ | (10,248,486 | ) | |
| Loss per share: | |||||||
| Basic | $ | (0.47 | ) | $ | (15.57 | ) | |
| Diluted | $ | (0.47 | ) | $ | (7.40 | ) | |
| Weighted average shares outstanding: | |||||||
| Basic | 4,561,976 | 658,218 | |||||
| Diluted | 4,561,976 | 1,383,507 | |||||
| CYCURION, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited) | |||||||
| For the Three Months Ended March 31, | |||||||
| 2026 | 2025 | ||||||
| Cash flows from operating activities: | |||||||
| Net loss | $ | (2,561,786 | ) | $ | (10,248,486 | ) | |
| Adjustments to reconcile net loss to net cash used in operating activities: | |||||||
| Stock-based compensation | 315,833 | — | |||||
| Stock-based compensation - business combination related | — | 9,250,000 | |||||
| Amortization of debt discount | 1,187 | 64,850 | |||||
| Depreciation of property and equipment | — | 1,709 | |||||
| Amortization of software development costs | — | 8,333 | |||||
| Gain on debt settlement, net | — | (141,653 | ) | ||||
| Finance expense | — | 100,000 | |||||
| Changes in assets and liabilities: | |||||||
| Accounts receivable, net and other receivables | (648,568 | ) | (1,300,686 | ) | |||
| Prepaid expenses and other current assets | (46,801 | ) | (11,415 | ) | |||
| Accounts payable and accrued liabilities | (184,201 | ) | (286,114 | ) | |||
| Accrued compensation and benefits | 96,248 | 37,673 | |||||
| Accrued interest payable | 138,254 | (219,320 | ) | ||||
| Net cash used in operating activities | (2,889,834 | ) | (2,745,109 | ) | |||
| Cash flows from investing activities: | |||||||
| Cash acquired on business combination | — | 34,983 | |||||
| Capitalized software development costs | (129,000 | ) | (70,000 | ) | |||
| Cash withdrawn from Trust Account in connection with redemption | — | 1,001,216 | |||||
| Release of Trust Account to Company's bank account | — | 833,324 | |||||
| Net cash (used in)/provided by investing activities | (129,000 | ) | 1,799,523 | ||||
| Cash flows from financing activities: | |||||||
| Proceeds from exercise of warrants | 167 | 3,309,921 | |||||
| Redemption of common stock subject to redemption | — | (1,001,216 | ) | ||||
| Repayments of revolving line of credit | (207,850 | ) | (9,300 | ) | |||
| Repayment of bank borrowings | — | (5,114 | ) | ||||
| Proceeds from convertible notes payable | — | 386,500 | |||||
| Proceeds from notes payable | — | 513,200 | |||||
| Repayments of notes payable | — | (20,000 | ) | ||||
| Net cash (used in)/provided by financing activities | (207,683 | ) | 3,173,991 | ||||
| Net (decrease)/increase in cash and cash equivalents | (3,226,517 | ) | 2,228,405 | ||||
| Cash and cash equivalents, beginning of period | 5,255,235 | 40,790 | |||||
| Cash and cash equivalents, end of period | $ | 2,028,718 | $ | 2,269,195 | |||
