WidePoint (NYSEAMERICAN:WYY) executives said delays in the Department of Homeland Security’s (DHS) CWMS 3.0 contract award remain the company’s most important near-term issue, but emphasized that the timing is outside of WidePoint’s control and does not reflect any deterioration in its competitive position.
CWMS 3.0 timing remains uncertain, but WidePoint says its positioning is unchanged
President and CEO Jin Kang said the CWMS 3.0 award process has faced “continued delays” tied to broader federal headwinds, including government and DHS shutdowns, funding disruptions, and DHS leadership changes. He said WidePoint’s “confidence and positioning remains unchanged,” citing competitive advantages such as FedRAMP authorization, past performance, ITMS as DHS’ “command center platform and system of record,” small-business classification, facility security clearance, alignment to the statement of work, and “best value to government.”
Management also addressed the operational impact of shutdown conditions. Kang said the company successfully navigated a late-2025 government shutdown and is continuing to see DHS activity, including invoice processing and contract/task order modifications, with “no material slowing” in administrative work to date.
Fourth-quarter results show year-over-year revenue growth and continued positive EBITDA
Chief Financial Officer Robert George reported fourth-quarter revenue of $42.3 million, up $4.6 million, or 12%, from $37.7 million in the year-ago period. Full-year 2025 revenue was $150.5 million, up $8.0 million, or 6%, from $142.6 million in 2024.
Gross profit in the fourth quarter was $5.8 million, or 14% of revenue, compared with $4.8 million, or 13%, a year earlier. For the full year, gross profit was $21.0 million, or 14% of revenue, compared with $19.0 million, or 13%, in 2024. George said the higher gross margin percentage was related to increased margin in managed services. Excluding carrier services, gross profit percentage was 38% in the quarter versus 36% a year ago, and 36% for the year versus 34% in 2024.
Adjusted EBITDA was approximately $460,000 in the fourth quarter, compared with $631,000 a year earlier, while full-year adjusted EBITDA was $1.1 million compared with $2.6 million in 2024. George attributed the year-over-year decline primarily to sales pipeline opportunities “shifting to the right,” though he said most significant items were ultimately realized. WidePoint reported free cash flow of $335,000 for the quarter and $814,000 for the year, compared with $593,000 and $2.5 million, respectively, in the prior-year periods.
Net loss for the quarter was $849,000, or $0.09 per share, compared with a net loss of $356,000, or $0.04 per share, a year earlier. Full-year net loss was $2.8 million, or $0.28 per share, compared with $1.9 million, or $0.21 per share, in 2024.
CBP task work and commercial activity drive revenue line items
George said carrier services revenue rose to $26.8 million in the fourth quarter, up $2.2 million year over year, while full-year carrier services revenue increased $5.1 million to $91.9 million. He said the increase was primarily due to a new fourth-quarter task order from U.S. Customs and Border Protection (CBP) for 30,000 new lines of service. In the Q&A, management reiterated that “most of that sequential growth is CBP.”
Managed services fees were $10.5 million in the fourth quarter, up $1.1 million from the year-ago quarter, and $39.1 million for the year, up $3.3 million. George said the annual increase reflected a full year of a commercial contract implemented late in the third quarter of 2024 (for a U.S. government end customer) and the CBP task order work.
Billable services fees were $1.1 million for the quarter and $5.4 million for the year, which George characterized as consistent with 2024. Reselling and other services were $3.9 million in the quarter, up $1.2 million year over year, while the full-year figure declined $728,000 to $14.2 million. George said the annual decrease was driven by a partial termination of a software resale contract, and noted the company received a vendor credit corresponding to a refund issued to a government customer.
On expenses, sales and marketing spending rose to $747,000 in the quarter and $2.7 million for the year, and George said WidePoint expects further dollar increases as it invests, though as a percentage of revenue it expects sales and marketing to decline. General and administrative expenses increased to $5.2 million in the quarter and $19.7 million for the year, which George said primarily reflected higher employee compensation and health insurance costs.
Depreciation expense jumped to $648,000 in the quarter due to a “catch-up adjustment” from an asset review, which shifted certain items from construction-in-process to placed-in-service earlier; George said the quarter “is not indicative” of the 2026 run rate and should not be annualized.
Pipeline: carrier SaaS implementation, DaaS facility opening, and MobileAnchor pilots
Kang highlighted a $40 million to $45 million SaaS contract awarded in November to deploy WidePoint’s ITMS platform for a major mobile telecom carrier. Chief Revenue Officer Jason Holloway said the company has completed a portion of minimum viable product functionality testing and is awaiting additional datasets from the carrier for further testing. Management said it remains on track to begin recognizing “margin accretive” SaaS revenue in the second half of 2026, with a goal to be “fully scaled by the end of 2026.”
Holloway also said WidePoint officially opened its Device as a Service (DaaS) facility in Columbus, Ohio in the fourth quarter and has begun supporting mobile equipment configuration, accessory sales, depot maintenance for IT-as-a-service customers, and device recycling. The company said it is awaiting final approvals from a prospective client to begin performance. In Q&A, management said it is working to convert some existing IT-as-a-service customers to a DaaS model to “smooth out the revenue streams” and improve predictability and profitability, enabled by the new logistics and depot-maintenance capabilities.
Holloway said WidePoint is in discussions with CDW about supporting the LA28 Olympic and Paralympic Games as a subcontractor, adding that WidePoint recently supported CDW at the Winter Olympics in Italy.
On the company’s identity and access offerings, Holloway said MobileAnchor is expanding at HUD OIG in its second year and is in a pilot with the Department of Justice involving 1,000 credentials with a goal of scaling to 130,000 by 2027. He also said MobileAnchor is close to another pilot with Treasury with potential for 120,000 derived credentials, is progressing with the FAA with a goal of reaching 90,000 credentials, and is in early discussions with the Department of Energy.
Balance sheet and capital flexibility: cash, credit capacity, and planned ATM prospectus
George said WidePoint ended 2025 with $9.8 million in unrestricted cash and has a revolving credit facility with $4 million in potential borrowing capacity, though management said it does not anticipate needing to rely on it. He also said WidePoint plans to file a prospectus to establish an at-the-market (ATM) offering program as a measure to enhance financial flexibility and provide optionality.
Management emphasized it has “no current plans” to utilize an ATM at prevailing market valuations and said any use would be evaluated carefully and tied to “clearly defined value-accretive opportunities.” In Q&A, Kang said the company maintains a strong cash position to withstand potential slowdowns in invoice processing during government shutdowns and to preserve flexibility for possible acquisitions, while remaining “judicious” with capital.
Looking ahead, Kang said WidePoint’s “near-term focus” remains CWMS 3.0, which he described as having a $3 billion ceiling over 10 years, while longer-term priorities include improving margins through SaaS and DaaS pipeline execution and continued progress on the carrier SaaS implementation.
About WidePoint (NYSEAMERICAN:WYY)
WidePoint Corporation (NYSE American: WYY) is a provider of secure mobility management and identity management solutions. Headquartered in Reston, Virginia, the company delivers a range of managed services designed to help organizations control and secure their telecommunications and IT environments. Since its inception in the late 1990s, WidePoint has focused on helping businesses and government agencies optimize their mobile device portfolios and ensure regulatory compliance.
WidePoint’s core offerings include mobile device management, telecom expense management, and unified endpoint security.
