CSPI 2026年度第3四半期決算説明会：粗利益率改善に伴い受注残高が65%増加

CSPIの2026年会計年度第3四半期の売上高は、ハードウェアの納期が200日以上に長期化し、AZT Protectの大企業向け営業サイクルが長引いたことで減少しました。粗利益率は改善したものの、経費の増加や一時的な年金関連費用により、四半期純損失が拡大しました。

要点

• 第3四半期の売上高は前年同期比6.5%減の1,440万ドルとなり、内訳は製品売上高が990万ドル、サービス売上高が450万ドルでした。
• 粗利益率は製品粗利益率が15.7%から20.7%へ拡大したことに支えられ、前年同期の28.8%から30.1%に上昇しました。
• 純損失は前年同期の26万4,000ドル（1株当たり0.03ドル）から、84万6,000ドル（1株当たり0.09ドル）に拡大しました。
• テクノロジー・ソリューション事業の受注残高は前年同期比で65%増加しました。これは、従来30〜60日程度であったハードウェアの納期が、多くの場合で200日以上に延びたためです。
• AZT Protectは、初回の年次更新を迎えた全顧客サイトで100%の更新率を達成しました。経営陣によると、18〜24ヶ月におよぶ営業サイクルの終盤を迎えている数十万ドル規模の大口案件が複数あるとのことです。
• CSPIは当四半期末時点で2,470万ドルの現金および現金同等物を保有して終え、約1万3,000株の自社株買いを実施するとともに、1株当たり0.03ドルの四半期配当を発表しました。

主要財務データ

2026年会計年度の最初の9ヶ月間の売上高は4,240万ドルで、前年同期の4,430万ドルから減少しました。粗利益は前年同期の1,320万ドルから1,350万ドルに増加し、粗利益率は29.9%から31.9%に拡大しました。

同9ヶ月間の純損失は49万1,000ドル（1株当たり0.05ドル）となり、2025年会計年度の純利益10万ドル（希薄化後1株当たり0.01ドル）から悪化しました。なお、同期間中にCSPIは140万ドルの営業外収益を計上し、65万4,000ドルの税金上の便益を記録しました。

事業および業績ハイライト

テクノロジー・ソリューション事業は引き続きCSPIの主要な売上源でした。受注の伸びは堅調でしたが、ハードウェアのリードタイム延長により、受注文のすべてを売上高に換算することはできませんでした。経営陣はこの混乱の原因として、AIインフラ構築に関連するメモリ、ハードディスクドライブ、プロセッサなどのコンポーネントに対する力強い需要を挙げています。

クラウドおよびマネージド・サービス事業は成長を続けました。CSPIは全国的に有名なプロスポーツチームと、7桁ドル規模の6年間のマネージド・サービス契約を締結しました。また、食品流通の顧客とも3年間の契約を獲得し、年間で数十万ドル半ばの継続的収益（ARR）が見込まれています。

AZT Protectは新規顧客を獲得し、既存の顧客企業内での導入規模を拡大しました。経営陣によると、現在までAZT Protectの顧客でセキュリティブリーチが発生した事例はなく、初回の年次更新を迎えたすべての顧客サイトが契約を更新したとのことです。

同社は複数のOEM製品へのAZT Protectの統合を完了しました。あるOEMソフトウェアパートナーとの連携では今秋のローンチを目指しており、経営陣は10月1日までに統合と製品SKUの提供が可能になると示唆しています。南アフリカでは、大手通信顧客が導入ソリューションにAZT Protectを組み込んだ3回目の発注手続きを進めていました。

また、CSPIは退職した営業担当者4名のうち3名を、長期のエンタープライズ営業サイクルに慣れた人材へと刷新しました。営業組織はOEMおよびリセラーチャネルを支援しつつ、フォーチュン500企業への直接的な案件獲得を引き続き目指しています。

経営陣の見通し

経営陣は、数十万ドル規模の大型AZT Protect商談が複数、18〜24ヶ月に及ぶ営業サイクルの終盤に近づいていると述べ、その一部が契約に至るとの楽観的な見方を示しました。顧客による検証、調達、予算化、社内承認プロセスが存在するため、より大規模な商談には12〜24ヶ月かかる場合があります。

同社は、マネージド・サービス、クラウド・サービス、およびAZT Protectが、自社でコントロール可能な継続的収益の主な成長推進力であり続けると見込んでいます。経営陣は、顧客の維持と継続的なクラウド採用が、サービス事業の成長と粗利益率の拡大を支え得ると考えています。

経営陣によると、時期の不確実性は残るものの、ハードウェアの供給制約は少なくともあと1年は持続する可能性があります。CSPIは、ベンダーによる製品出荷に合わせて受注残高を積み上げ、順次注文を処理していく計画です。

リスクおよび注視事項

• ハードウェアの納期が200日を超えていることで、売上計上および粗利益の創出が遅れています。
• AZT Protectの売上は、大企業における長期間の検証、調達、関係者の承認プロセスに依存しており、これらは主にCSPIの管理外にあります。
• OEMパートナーは大企業であり、統合やローンチのタイムラインが長期化します。経営陣によると、関連するスケジュールの約95%は同社の管理外とのことです。
• AZT Protectの初期導入から追加顧客サイトへの展開拡大には、予想以上に時間がかかっています。
• 四半期営業実績には、変動報酬の増加や、英国での年金債務売却に関連する数十万ドルの数理計算・法務費用が含まれていました。
• CSPIがカスタマイズされたAZT Protectの導入や組み込み型OEM開発を支援したため、研究開発費が増加しました。

アナリスト質疑応答のハイライト

経営陣は、CSPIがさまざまな段階で米国のOEM 3社と追加協議を行っていると述べました。目指しているモデルは、パートナー製品にAZT Protectを組み込み、それらの製品が出荷される際にライセンスを有効化し、月次または四半期ごとに使用状況を照合・精算するというものです。

OEMソフトウェアの統合に関して、経営陣は潜在的な売上規模をまだ数値化できないと述べました。完全な統合とSKUの提供が開始された後、営業チームおよび更新担当チームが再始動する見込みです。

CSPIは、AZT Protectの商談パイプラインが大幅に拡大しており、6〜7ヶ月間にわたって進められている約15件の重要な案件が含まれていると述べました。ある大手顧客の選定プロセスにおいて、同社は15件の候補から最終2社に絞り込まれた選定段階に進んでいます。

経営陣は、AZT Protectの営業サイクルが契約更新の時期、レガシーOSのサポート、ラボテスト、およびITチームとOT（制御技術）チームの間の権限分担に影響されると説明しました。顧客の予算を把握している場合、CSPIは早期からITの意思決定者に働きかけています。

同社は自社株買いを継続する意向を確認しました。第3四半期中に約1万3,000株が買い戻されました。また、取締役会は2026年8月28日時点の株主に対し、2026年9月15日に支払われる1株当たり0.03ドルの配当を承認しました。

決算説明会トランスクリプト全文

決算説明会の完全なトランスクリプト

経営陣による説明

Operator

Good day, everyone. Welcome to CSP's Third Quarter Fiscal Year 2026 Conference Call. It is now my pleasure to turn the floor over to your host, Michael Polyviou. The floor is yours.

Michael Polyviou

Thank you, Kelly. Good morning, everyone, and thank you for joining us to review CSPI's financial results for the fiscal 2026 third quarter, which ended on June 30, 26, as well as recent operating developments. Today with me on the call is Victor Dellovo, CSPI's Chief Executive Officer; and Gary Levine, CSPI's Chief Financial Officer.

After Victor and Gary conclude their opening remarks, we'll then open the call for questions. Q&A advance, thank you for your cooperation with this process. Statements made by CSPI's management on today's call regarding the company's business that are not historical facts may be forward-looking statements as those identified in federal securities laws. The words may, will, expect, believe, anticipate, project, plan, intend, estimate and continue as well as similar expressions are intended to identify forward-looking statements.

Forward-looking statements should not be meant as a guarantee of future performance or results. The company cautions you that these statements reflect the current expectations about the company's future performance or events and are subject to several uncertainties, risks and other influences, many of which are beyond the company's control that may influence the accuracy of the statements and the projections upon which the segment and the statements are based. Factors that may affect the company's results include, but are not limited to, the risks and uncertainties discussed in the Risk Factors section of the annual report on Form 10-K and the quarterly report on Form 10-Q filed with the Securities and Exchange Commission.

Forward-looking statements are based on information available at the time those statements are made and management's good faith belief as of the time with respect to future events. All forward-looking statements are qualified in their entirety by this cautionary statement, and CSPi undertakes no obligation to publicly revise or update any forward-looking statements, whether as a result of new information, future events or otherwise after the date thereof. With that, I'll turn the call over to Victor Dellovo, Chief Executive Officer. Victor, please go ahead.

Victor Dellovo

Thank you, Michael, and good morning, everyone. The Technology Solutions business performed near our expectations during the fiscal third quarter, reflecting solid growth in our cloud and managed service business. However, our third quarter financial performance was impacted by what we believe are 2 relatively short-term factors.

First, while our Technology Solutions business continued to generate solid order growth during the quarter, our ability to convert those orders into revenue has been impacted by longer hardware vendor delivery times. In many cases, vendor deliveries that historically took 30 to 60 days are now extending well beyond 200 days. As a result, our Technology Solutions backlog is now 65% higher than it was a year ago. The second factor impacting our top line performance is the continued ramp of our AZT Protect business and the longer sales cycles associated with larger enterprise opportunities. We made meaningful progress during the quarter.

However, I believe we can and will do better. As we pursue larger accounts, we continue to add new land and expand customers while expanding relationships with existing customers as our customer base grows. We continue adapting to each customer's unique deployment time lines and procurement process for rolling out additional protected sites after the initial installation.

We recognize that every customer has different priorities and often multiple competing projects that can delay expansion. Our ability to execute within this environment continues to improve. We believe several initiatives will position us to expand both the number and size of AZD Protect opportunities over the next 6 months. First, we are nearing the end of the 18- to 24-month sales cycle for several large 6-figure opportunities and remain optimistic about converting a number of those into contracts. Second, we continue to see growing opportunities for AZD Protect to become part of an OEM customer solution.

During the quarter, we completed the integration of our AZT Protect into several OEM products and are beginning to see a growing pipeline from this market segment. While OEM sales cycles are lengthy, they create attractive long-term recurring revenue opportunities once integrated. A good example is our relationship with the Coronis software, where the integration has been completed, and we understand and we understand marketing materials and SKUs are on track for a fall launch. Another example is the work in South Africa, where our OEM partner, a large telecommunication customer is now working on a third purchase order with an AZT Protect embedded in the deployed solution.

With the integration challenges and unpredictable time lines largely behind us, we are making meaningful progress in the South African telecommunication market. We are applying the lessons learned from this deployment to other OEM relationships currently under development and expect continued progress in this segment over the coming quarters. A third initiative implemented during the quarter was the continued evolution of our direct sales organization focused on Fortune 500 customers.

Our experience with distributors, OEMs and large direct customers has reinforced that our sales organization must effectively serve all 3 channels while addressing the unique requirements of each customer. We believe the changes made during the quarter better position our sales team to shorten the sales cycle, broaden the sales funnel and improve execution as we enter into the new fiscal year in October. We remain committed to the land and expand strategy. Our approach is to secure the initial deployment at one customer site, validate the AZT Protect performs as expected within the customer's existing cybersecurity infrastructure and then deployment across additional sites.

This expansion phase has taken longer than anticipated, largely because of the evolving stakeholders' alignment and internal review process. But we believe our enhanced sales organization will help accelerate expansion by engaging higher decision-makers within customers' organization. Changes within the customer organization often require us to rebuild momentum.

While some customers seek additional validation before approving broader deployment, in other cases, IT organizations initially believe their existing infrastructure adequately protects OT environments when expansion opportunities become larger enterprise projects. This creates an opportunity for us to educate customers on the unique security requirements of operational technology. The data we've collected from existing deployments, combined with strong customer references has enabled us to build compelling business case, demonstrating why AZT Protect is a better solution for OT environments. While these dynamics are a natural part of selling into complex and evolving markets, we believe we are becoming increasingly effective at influencing the customer's decision.

We made solid progress with AZT Protect during the third quarter by signing new customers and expanding deployments within existing accounts. In addition, we achieved 100% renewal rate on all customer sites reaching their 1-year renewal period. We have also advanced into final stages of the selection process within several major corporations, demanding continued continues to be supported by the growing number of cyberattacks disrupting operations worldwide as well as increased awareness of AI-driven threats and so-called friendly fire incidents generated by internal systems.

Traditionally, cybersecurity solutions rely heavily on continuous patching, which is often impractical in OT environments. Friendly fire incidents where IT inadvertently sends faulty updates into production environments can be just as disruptive as an external attack. AZT Protect prevents these production disruptions while eliminating the need for ongoing OT application security patching.

To date, no AZT Protect customer has experienced a breach. We have also developed an extensive catalog of AI-driven exploits emerging through 2026 that AZT Protect is designed to stop. One highly publicized example was the OpenAI ChatGPT-related attack involving Hugging Face. Based on the publicly available information, we believe AZT would have prevented the attack, and we have publicly shared those findings. We continue to believe AZT Protect has little effective competition in defending against these emerging AI attacks while eliminating the need for code level security patching in OT environments.

We remain intensely focused on expanding our sales opportunities as we enter the new fiscal year. Turning to our Technology Solutions business. It once again served as our primary revenue generator despite ongoing hardware shipment delays. Our offering continues to improve the efficiency and effectiveness of our customers' IT investment across networking, wireless, mobility, unified communication, data center infrastructure and advanced cybersecurity. Our managed cloud and managed service practice continues to grow at a healthy pace. We continue to benefit from the ongoing migration to the cloud and the increasing demand for managed operational support after those migrations are complete.

A key driver remains the growing complexity of cloud environments and the unique requirements of enterprise customers. During the quarter, we entered the professional sports market with the signing of a 6-year 7-figure managed service agreement with a nationally recognized sports team. We expect to issue a joint press release in the coming weeks. We also signed a 3-year managed service agreement with a food distribution customer expecting to generate mid-6 figures annual recurring revenue.

Looking ahead, we believe our best-in-class service organization, exceptional high customer retention and continued adoption of cloud-based service will drive further service growth and support continued gross margin expansion. During the quarter, service gross margin increased 1.3% compared to the prior year period. While we recognize there is still work to do before fully realizing the value of our award-winning product and customer service, we have made significant organizational improvements that position us well for the continued growth. With that, I'll turn the call over to Gary to discuss our financial results in more detail.

Gary Levine

Thanks, Victor. For the third quarter ended June 30, 2026, we generated $14.4 million in revenue compared to $15.4 million for the third quarter ended June 30, 2025. Product revenue was $9.9 million compared to $10.2 million for the prior fiscal year third quarter. Service revenue for the quarter was $4.5 million compared to $5.3 million in the prior year, reflecting the vendor delays issue mentioned earlier. Gross profit for the quarter was $4.3 million compared to $4.5 million for the same prior year period.

Gross margin for the third quarter grew by more than 100 basis points to 30.1% of sales compared to the year ago fiscal third quarter. Gross margin was 28.8% for the sales in the prior year's third quarter. Gross margin realized from product revenue for the quarter was 20.7% compared to 15.7% for the third quarter of fiscal 2025, while gross margin realized for service was 51.2% as compared to 53.9% for the year ago quarter. Research and development expenses increased 5% to $832,000 compared to $791,000 for the same prior year quarter as we supported customization of the AZT Protect deployments and OEM embedded developments.

Sales and general administrative expenses for the fiscal third quarter increased 3% to $5 million from $4.9 million a year ago fiscal third quarter. The company grew other income during the quarter by 58.7% due to the increase in physical transactions with customers. During the third quarter, we recorded several expenses, including an increase in variable compensation to the TS division and costs related to the buyout sale of the U.K. pension, which increased our operating loss for the quarter to $1.5 million from $1.2 million in the prior fiscal third quarter.

With the other income earned on our net -- our net loss was $846,000 or $0.09 per share of common for the third fiscal quarter compared to a net loss of $264,000 or $0.03 per share of common in the prior year's third quarter. Our strong balance sheet continues to provide us with resources to finance customer purchases. And as of June 30, 2026, we extended terms on over 20 transactions. We finished the quarter with cash and cash equivalents of $24.7 million, and the balance sheet continues to provide us with the necessary resources to execute our growth strategies for the managed service business and the AZT Protect product offering as well as paying a dividend of $0.03 per share, and we repurchased approximately 13,000 shares of common stock during the quarter.

Turning to our results for the 9 months of fiscal 2026. Revenue was $42.4 million compared to $44.3 million in the same period the prior year. Gross profit for fiscal 9 months ended June 30, 2026, was $13.5 million or 31.9% of sales compared to $13.2 million and 29.9% of sales. The company generated $1.4 million on other income and realized a tax benefit of $654,000 during the first 9 months of fiscal 2026.

During the same period of fiscal 2025, the company generated $1.1 million in other income and realized a tax benefit of $1.5 million. The company's net loss for the 9 months of fiscal 2026 was $491,000 or $0.05 per common share as compared to a net income of $100,000 or $0.01 per diluted common share for the comparable period during fiscal 2025. Lastly, the Board of Directors approved a dividend of $0.03 per share of common to be paid on September 15, 2026, to shareholders of record on August 28, 2026. We will now take your questions.

Operator

Your first question is coming from Joseph Nerges with Segin Investments.

質疑応答

Joseph Nerges

Let me dive in on the OEM direction you're going. I'm assuming that Chronos would be the one OEM you're talking about currently, right?

Unknown Speaker

And then...

Victor Dellovo

Yes, there's other ones that we're in the process of working with also.

Joseph Nerges

Okay. And is there an OEM -- were you referring to an OEM in the Internet of Things, IoT, we're dealing with an OEM in that respect in that area?

Unknown Speaker

Or plan.

Victor Dellovo

Well, it's all in that area. There's a couple of OEMs we're dealing with where they make boxes, and we're trying to get integrated on their platform. There's other OEMs in South Africa that they make other equipment, which I can't mention right at this second, but they make certain equipment, which, again, we're trying to get embedded on their product. So as soon as the product goes out the door, we're there. And then we just turn up the license and do a true-up every month or every quarter.

Joseph Nerges

Any additional OEMs in the U.S.?

Victor Dellovo

Yes. There's 3 other OEMs in the U.S. right now we're talking with at different stages.

Joseph Nerges

Okay. And I have one other question on that is we announced the Cronos deal, it goes back to I looked at -- the history September last year. And you mentioned it in the call about the length of it's taking to embed these things. Do we envision that same length on these other deals? I mean, I could see a year seems like a long time, almost a year. And are we hoping that we could shorten that process?

Victor Dellovo

It's not us, Joe. It's never us. It's always them, to be honest with you. They are larger organizations that truly move at a slower pace just due to the fact, I guess, the pure size sign-off and various things. It's never us. We're always there quickly. We're always waiting, let's put it that way. And there's nothing else, I think that we could possibly do to speed these large, large multibillion-dollar companies to move faster. And because of our size, it's hard to move these guys. I can promise you, we do stay on top of it constantly every week, maybe multiple times a week to try to move things along as fast as possible. It's with the Cronus.

Joseph Nerges

Some of it out of our control.

Victor Dellovo

95% of it is out of our control. Anything we can control, we have a plan, we have a time line, and we try to meet it.

Joseph Nerges

Just one other thing, and this goes to another point, the Hugging Face attack, the press release on Monday. I don't think some people realize we do have a -- how can I say it, we have a partnership that we have not announced that I know of with a very large partner that deals quite heavily with the federal government. This partner also from my research has an embedded cybersecurity lab in their thing. I'm just wondering, I'm sure the federal government is really high up on these hacks, I'll call it, cyber attacks by software no less. And I'm just wondering, have we talked to this partner as far as getting a test with the government somehow?

Victor Dellovo

Again, I know who you're talking about, which I can't mention, but we do talk to them. We have standard calls every 2 weeks. And again, because of their size, we have to move at their pace. But -- and what they tell us is minimum of what goes on between them and the government directly. I have no idea, Joe, to be honest with you.

Joseph Nerges

I know. But finally, we have something that might appeal, let's put it that way, if nothing else, to somebody at the government level. That's all I'm saying if you can finally get to their the bureaucracy, the logical.

Victor Dellovo

I think that's why we just put that out just to let everyone know compared to some of the other products that are out there that are not stopping these various viruses or attacks coming from different -- the way our technology is made, we're made to stop these things, right? So I think that was more of an educational press release just for either people looking at a product or the confidence of different customers already using the product. So...

Joseph Nerges

I'm going to extend one more question. Just a lot of attacks in the last couple of weeks with the utilities, the water utilities, wastewater utilities. Have we had -- I mean, we've got 2 partners, UFT. And I see recently, we signed another partner was at CITCO in that. Have we gotten any feedback from those guys in the last couple of weeks? I mean, what's happening in that area as far as updating some of the customers looking to do some updates opportunity-wise?

Victor Dellovo

Yes. We have a standing call with UFT. CITCO is a newer company that we signed up. So that relationship is still working. But we have a good long-term relationship with UFT because not only are they a cloud customer of ours, that's how the relationship started probably back 4 or 5 years ago because of TESCO, one of the companies they own that concentrates on the water and waste and water plants, that's how they became a reseller for the product. Again, because of their size, they have a process and the process is, a, get through legal; two, which takes forever. Second stage was get it into their lab, which took a while also. And then they wanted 3 customers of theirs to use the product for a period of time. So before they pushed it out or presented it to all their customers that they had confidence that AZT would work in like different products, whether Siemens, Emerson, you name it, Honeywell and different environments. So when they put their name on it because their goal is to sell it as a product and service directly from their sales team that they had confidence that it would represent them correctly. And so that has taken probably we're in about 9 months now. We will be announcing some new things that I won't tell you right now, but you'll see them in the next 2 or 3 weeks, some things that we'll be doing together.

Operator

Your next question is coming from Will Lauber with Visionary Wealth Advisors.

William Lauber

Yes. Victor, if you can kind of expand a little bit on -- I'm not quite sure I understand the sales force new strategy. I noticed, I guess, from LinkedIn that a number of the salespeople that were last year are no longer with you guys. And if you can kind of explain kind of just developments in the sales force and what the new strategy is in a little bit more detail.

Victor Dellovo

Yes, it's not a new strategy. We just -- it's -- because of the sales cycle due to individual financial everyone has their own financial capacity of how long they can wait for a sale to close. We needed to kind of get into some salespeople that were used to a longer sales cycle that came from the marketplace, and that's kind of what we just ended up replacing 3 out of the 4 salespeople already that left the organization. Yes. And one of them is already up and running, one started this week, one starts next week. Yes. And we're still focused on the OEM. It's a specific business. We're working through all the resellers as we normally have, but we're also putting a heavy emphasis of us as an Aria talking to the customers directly to try to move this along as fast as possible. It's not always easy for the resellers to give us the contact info. But as time goes on, the trust builds. So they know that we're going to treat that customer with white glove service.

William Lauber

Okay. So would it be safe to say that, I guess, the sales force is going to be more compensated on commission rather than salary? Or how is that?

Victor Dellovo

I'd rather not -- if we want to have a sidebar on that, we can talk about that in this audience.

William Lauber

Okay. And then if I could just get a little bit -- when you had mentioned the 18- to 24-month sales cycle, is that because the customers are in current contracts with other cybersecurity contracts and they -- that's when it expires? Or is it something that with the big companies, it just takes that long for them to kind of test it and go through everything? Or what's kind of the driver of that long sales cycle?

Victor Dellovo

It's a combination of both, I would say. It's not -- it could be one or the other one is coming up for renewal or sometimes the Windows 10 is -- that's a big push where some of the -- our competitor products are not supporting any longer. So that would drive them to look. And then it's -- a lot of it's political, to be honest with you. You got the OT guys who love it, want to move fast and then you got IT folks who have to go because it's their budget, they bring it into the lab, they take their time. They got to go through. It just -- there's no rhyme of reason. We do know now for sure that if it comes from IT, we have to engage with them immediately because they -- if they have the purse strings, they are making the ultimate decision. Even if the OT guys love it, if they don't control the budget, they're not making -- they can influence the sale, but they won't make the ultimate decision on that. So some lessons learned over the last year or so on how these larger organizations and the political piece of it kind of rolls out. So yes, I just kind of gave an 18 to 24. We have closed some other business that took a lot shorter. Wastewater, we closed some businesses that took 6 weeks, right? So -- but the large $700,000 million deals, it's -- I would say it could take 12 months to 24, somewhere in that range. If I can do anything to show on that, you can believe that I'm trying.

William Lauber

Okay. And with the Cronos, I know that they had held at least 2 joint webinars with you all. And I guess that was even before that the product was integrated into their system. Have you gotten any indication as to what kind of interest that they're seeing from their customers?

Victor Dellovo

Yes. We kind of had to put everything kind of on hold, to be honest with you, just because there was no way for the sales team to sell it, right? They were getting products integrated into their system takes quite a bit of time. It's just a process they have because it touches multiple systems, and it's a process. So not only do we have to do -- they did significant testing with it, they also had to get it integrated. So they'll be able to sell it not just in the U.S. but all over the world. So what that's going to look like, we're going to have to reengage with the sales team, the renewal team, we're going to have to kick start it up again, but the VPs of sales said, until this is fully integrated and all the SKUs are available, you need to kind of slow your role, and that's kind of where we're at right now. So promises of October -- by October 1, everything should be integrated, and then we'll go full steam ahead trying to educate the sales team, get the renewal team on board and push it out.

Operator

Your next question is coming from Mike Price.

Mike Price

I'm just -- can you give us an idea of what the completed product integration with the Cronos software means when it's totally rolled out in terms of revenue? What are we going to see from that?

Victor Dellovo

I have no idea yet.

Mike Price

Okay. And can you tell us how much of the -- I haven't seen the 10-Q. How much of the receivables are being financed, both short and long term?

Gary Levine

The probably -- well, I've broken out on -- it's probably about 30% or 40% longer term.

Mike Price

And the dollar amount? I mean last quarter, it was 7.7% and 8.6% over a year.

Gary Levine

Yes. And let's see. Right now, it's 8.3.

Mike Price

On the longer -- over a year?

Gary Levine

Yes.

Mike Price

So effectively, the receivables that are financed are going to become cash. Is that correct? So you have cash and receivables that are being financed equivalent to about $40 million.

Gary Levine

Ash if you add those together, yes. Exactly.

Mike Price

Okay. I mean just trying to get an idea of the company where you have cash and receivables that are being financed at $40 million, and we're looking at less than an $80 million market cap. Can you give us -- can you tell us how many shares were repurchased last quarter? 13,000.

Joseph Nerges

Yes.

Mike Price

Okay. Is the intent still to buy shares, especially at this price?

Gary Levine

Absolutely.

Mike Price

Okay. And my final question is, we appreciate the press releases about OpenAI's attack on hugging face could have been prevented. And going back 1.5 years, what happened with CrowdStrike and the fact that the old Microsoft operating systems, anybody using it can be protected. And these are great talking points, and you said it's hard to move the needle on billion-dollar or multibillion-dollar companies. The market has to be aware of AZT and what it can do. And having 100% retention is really saying something for the product. Is there not somebody out there that CSPI can partner with that can move the needle on these multibillion-dollar companies faster than what we've seen? That's what...

Victor Dellovo

Yes. We're trying to do that, Mike. That's why we're working with the Rexel Datacoms of the world, the CEDs, the SonoPars. -- because of the relationship they have, that's why we're leveraging those resellers to try to get them to walk us in as one of their premier partners. And that trust -- when talking to the salespeople, Mike, they're like, okay, well, I know Aria, I know you guys are set up. I know you checked all the boxes, but this is my best customer, right? I'm a little nervous that if I walk you in, so you have to build trust with that salesperson. And that doesn't take one drink on a Friday night. It takes time. They only have 4 or 5 customers each. So it's getting them to walk us into the large enterprise hand-in-hand. that takes some time. And that's kind of why we're working with these folks is so we can use their reputation because they've been doing business with these companies. But it's still a process because they're like, okay, we get to the table, and I don't want to share who we're talking to right now, but there's a lot of large -- our pipeline has grown tremendously from quarter-to-quarter with real companies with real budgets. So I think we did -- the team did a great job even turning the sales team over. They did a really good job. This gentleman, George has been with us now for 6 months. He did a really good job picking it up and keeping the ball moving on some of these large opportunities. The South African stuff, I was on a call with them, too. There's a lot of -- there's probably 15 really, really good opportunities that we've been working with for 6, 7 months now. So the -- when I started into this side of it, Mike, I had no idea it was going to take this long because the world of IT does not take this long. But the OT world, it just does. So we're trying to leverage every partner we have, every resource we have to try to build that report with the end user. But there is a process that they go through. It goes in multiple labs. It has to be working for 90 days. And then it goes through a purchasing process potentially. And they were looking at -- when they look at AZT, they look at other products along with it, 5 or 6 or 7 other products. There's one I mentioned in the script that we're down to 2. There was 15 different options they were looking at. It's -- and then when I want to say this is 18 months in the making, it's 18 months and we're down to 2. Hopefully, at the end of the day, we're the ones that they choose. And it's a big, big opportunity.

Mike Price

Well, it just seems like Aria and AZT should be household names. And the expectation is if it catches fire, it will catch fire, and we'll see exponential growth and then everybody is happy. But it's -- like you said, it just seems to be taking forever. So it's very frustrating from an investor standpoint.

Operator

Your next question is coming from Brett Davidson with Investletter.

Brett Davidson

I just got a couple of quick questions here. The router ban by the U.S. government, the foreign-made routers, is that impacting the delivery of product?

Victor Dellovo

Not for us, no. These are just the name brands that are all U.S.-based. It's just with all the AI build-out, it's it's every -- memory hard drives, processors, everything is just taking a long time. It's on the average around 200 days right now compared to 30 to 60. And we just keep closing the business and the funnel just keep going. And when it gets released, we'll just keep processing it. That's all we can do. We don't make the product, so I have no control of when we get it.

Brett Davidson

Is this going to -- I mean, is this going to -- and again, I realize you're talking about third parties, but what do you anticipate the resolution of this looking like? Are you going to get caught up over the next 6 months? Or is this going to dribble in the delay is just going to be extended continuously, maybe not expanding, but it's going to be a constant struggle for the next 6 months, a year to get your hands on this material. Any insight at all?

Victor Dellovo

I would say it's probably at least a year of this. I don't have a crystal ball, and they may have better, but they're not giving us any -- as long as the big boys keep buying all the product out there, this is not going to go away anytime soon. I don't want to guarantee that, but that's the feeling right now. It's going to take some time for this to flush out.

Brett Davidson

I'm sure you've seen the spend numbers, but I mean, trying to remember which one it was, spent $800 billion this past quarter, $200 billion from Google, those numbers aren't sustainable. So I'm thinking maybe in the next year, yes, this is going to start to resolve itself.

Victor Dellovo

Yes. Someday this will wash out, but I don't know exactly when. My goal is to keep building the recurring revenue business on the MSP, the cloud business and AZT, -- those 3 things that I can kind of control, and that's what we're focused on. The hardware, software side of it is definitely -- it's a significant part of the business, and it pays a lot of bills, right, but that's the part that I don't have any control of.

Brett Davidson

And this impacted the gross margin, hold back on you getting hold of inventory?

Victor Dellovo

It held back not -- well, the gross profit, right, because we weren't able to recognize revenue, which that's kind of why a big piece of why I think we were off on the quarter is just our backlog increased by what was 63% or something like that?

Operator

65%, yes. You do have a follow-up question from Joseph Norges with Segren Investments.

Joseph Nerges

Yes. Just one more question. Gary, you mentioned that we're out of that with the U.K. now with their Pension system. Is that it? We bought off the...

Gary Levine

No, we sold it to...

Joseph Nerges

Okay. And what did that hit -- how much did that cost us in the quarter? A couple of hundred thousand? What was the?

Gary Levine

Yes, it was the actuarial legal costs came through and it was a couple of hundred thousand.

Joseph Nerges

Okay. So we have no more problem with -- we're finished with that long-term pension because obviously, the German operation was sold a long time ago, and the U.S. operation doesn't have that same -- we don't have that with our...

Gary Levine

No, we have the life insurance that funds that indirectly. It's not part of the -- but our pensions that we have in the company are funded through that. That's the cash surrender value on the balance sheet.

Operator

There are no additional questions in queue at this time. I would now like to turn the floor back over to Victor Dellovo for closing remarks.

Victor Dellovo

Thank you, everyone, for joining us today. We're continuing to work towards maximizing our opportunities for the remainder of fiscal 2026 and fiscal 2027, both on the service side of our business as well as with AZT Protect, and we look forward to reporting our progress with you. In the meantime, thank you to our shareholders for their support, to our team for their dedication and effort, and we wish everyone a good remainder of their day. Goodbye for now.

Operator

Thank you, everyone. This does conclude today's conference call. You may disconnect your phone lines at this time, and have a wonderful day. Thank you for your participation.