AltiGen Communications (OTCMKTS:ATGN) reported fiscal fourth-quarter and full-year 2025 results, highlighting a sixth consecutive profitable quarter and full-year profitability as management detailed progress on its multi-year business transformation.
Fiscal 2025 results show full-year profitability
For the fiscal fourth quarter ended Sept. 30, 2025, AltiGen reported revenue of $3.5 million and GAAP net income of $254,000, or $0.01 per share. CFO Gary Stone noted the prior quarter included GAAP net income of $2.1 million, or $0.08 per share, and pointed to a key comparability factor from the year-ago period: in the fourth quarter of fiscal 2024 the company recorded a $1.8 million deferred tax benefit, compared with $300,000 in the fourth quarter of fiscal 2025.
Gross margin for the year was 63%, compared with 62% in fiscal 2024. GAAP operating expenses were $8.1 million, a 7% decrease from $8.7 million in the prior year. GAAP net income for fiscal 2025 was $738,000, or $0.03 per diluted share, versus $1.56 million, or $0.06 per diluted share, in fiscal 2024, which included the deferred tax benefit. On an “apples-to-apples” basis excluding the tax impact, Stone said net income for fiscal 2025 was $1.03 million compared with a loss of $279,000 last year, a favorable swing of roughly $1.3 million.
Shift away from legacy platforms and into new cloud offerings
CEO Jerry Fleming said fiscal 2025 marked progress in addressing revenue pressure tied to what he described as the declining competitive position of certain legacy PBX and contact center offerings. Management said the company conducted an evaluation of alternatives and introduced new, white-label UCaaS and CCaaS solutions during fiscal 2025.
Fleming provided early adoption metrics for the company’s newer offerings:
- CoreEngage Teams Contact Center: Six customers representing 240 agents were deployed during fiscal 2025, with billing starting at various points through the year. AltiGen also contracted with an additional five customers representing 230 agents that are expected to begin contributing revenue after deployment. Fleming said the 11 customers represent 470 agents and are expected to generate about $75,000 per month in recurring revenue once fully billed.
- MaxCloud UC: Approximately 60 customers representing 1,600 users were migrated from the legacy MaxCS cloud platform during fiscal 2025. The company has since contracted an additional 50 customers representing about 1,400 users, expected to begin billing after deployments are completed. Fleming added that AltiGen has another 100 customers representing about 2,500 users on the legacy MaxCloud platform that it plans to migrate to MaxCloud UC over the next six months.
Fleming emphasized that migrations within existing cloud recurring plans do not immediately raise revenue, but he said the company expects benefits including extended customer lifetime value, reduced churn, and lower long-term support costs. Looking ahead, he said AltiGen also plans to target “several hundred” remaining MaxCS on-premises customers, representing about 4,000 users, to convert them to MaxCloud UC—moves he said should create new monthly incremental revenue because those on-premises customers are currently “lower revenue” customers.
Operating model changes, cost reductions, and go-to-market relaunch
Chief Digital and Transformation Officer Joe Hamblin said the company has spent the last 18 months rebuilding its operating model, technology stack, and go-to-market foundation. Operational changes included modernizing internal systems, outsourcing non-core functions such as accounts payable and receivable, consolidating vendors, and increasing automation across finance, provisioning, and service delivery.
Hamblin said these efforts eliminated approximately $1.5 million in annualized operating expense. He also said the buy-versus-build approach helped the company rapidly modernize its UCaaS and CCaaS portfolio and redeploy capital away from maintaining legacy software toward AI and analytics innovation.
Looking to fiscal 2026, Hamblin said AltiGen plans to align around four primary revenue streams: MaxCloud UC, its Microsoft Teams practice, IVR, and its consulting services practice. He also outlined a relaunch of the AltiGen brand, including a new digital marketing firm, an SEO refresh, pay-per-click campaigns, new CoreEngage content, and a vertical outreach program initially focused on approximately 1,700 regional banks and credit unions with more than $500 million in assets.
Fiserv initiatives and AI roadmap: timing remains uncertain
Fleming said AltiGen continues to advance multiple initiatives with strategic partner Fiserv, including a next-generation AI-powered cloud IVR solution, an AI-enabled customer experience analytics platform, and the CoreEngage CCaaS platform. He noted these offerings are brought to market under the Fiserv brand, meaning AltiGen does not control launch timelines. Fleming described the approval process at Fiserv as taking time but said the company continues to progress toward product launches.
Hamblin added that a conversational AI front-end for IVR is in customer preview, and that CoreInsights—described as a next-generation customer engagement analytics platform combining IVR transaction data with customer demographics data—has completed development. He said the customer preview program for CoreInsights is expected to begin in the first quarter of 2026.
Hamblin also said AltiGen initiated a SOC 2 Type 2 certification program with the expectation of completing it in January 2026, which he characterized as an important milestone to pursue larger opportunities in regulated industries and enterprise markets. He also said the company signed a partnership with a “leading Agentic AI platform provider,” describing a dual revenue opportunity of recurring platform revenue and professional services.
Legal update, liquidity, and outlook themes from Q&A
Stone said a U.S. District Court in Utah ruled in AltiGen’s favor in a lawsuit with Intermountain Technology. Following the ruling, the company reduced its accrued liability by half to $372,000, and he said further reductions could occur as the company gains clarity on damages and legal fees it may be entitled to recover.
On liquidity, Stone said AltiGen ended fiscal 2025 with $2.75 million in cash and cash equivalents, up from $2.6 million a year earlier and down from $3.5 million in the prior quarter, which he attributed to an earlier-than-expected prepayment by a large customer. Working capital was $2.9 million compared with $2.1 million in the prior year, representing a 38% increase and what he called a multi-year high. Adjusted EBITDA, excluding legal, severance, and other one-time costs, was $1.6 million compared with $500,000 in the prior year.
During the Q&A, management said it was difficult to forecast the exact timing of material revenue acceleration due to customers being in various stages of deployment and because deployment timelines are not fully within the company’s control. Fleming said the company expects better visibility once deployments are complete and billing is underway. In response to a question about whether the fiscal fourth quarter represented a “low watermark” for revenue, Fleming said the company believes its platform updates have “stopped the downside” and that management generally expects an upward trend, while acknowledging the possibility of quarterly variability.
Fleming also reiterated a longer-term internal goal, referring to a “2028 vision” of 20% top-line growth with 20% “to the bottom line,” and said the company aims to be in that position by 2028, while noting he could not guarantee achieving it earlier.
About AltiGen Communications (OTCMKTS:ATGN)
AltiGen Communications, Inc is a provider of voice-over-IP (VoIP) telephony and unified communications solutions designed primarily for small and medium-sized businesses. The company offers a range of IP-based PBX systems, contact center applications and unified messaging products that enable organizations to streamline inbound and outbound voice traffic, automate call routing and integrate voice mail, e-mail and conferencing functions into a single platform.
Founded in the mid-1990s and headquartered in California, AltiGen develops both hardware appliances and software modules that support analog, digital and SIP-based telephony endpoints.
