By: citybiz
August 15, 2025
Duos Technologies Group Reports Second Quarter 2025 Results
Duos Technologies Group, Inc. (“Duos” or the “Company”) (Nasdaq: DUOT), a provider of adaptive, versatile and streamlined Edge Data Center (“EDC”) solutions and operational services for the deployment of “behind the meter” electrical power reported financial results for the second quarter (“Q2 2025”) ended June 30, 2025. In addition to the equivalent quarter revenue growth, consecutive quarterly revenue growth was more than 16% for a total of $10.7 million for the first six months, the highest revenue for that period in the Company’s history.
Second Quarter 2025 and Recent Operational Highlights
- Recorded over $5.69 million in Services and Consulting revenue including $4.76 million for services related to the Asset Management Agreement (“AMA”) with New APR Energy.
- Significant improvement in Gross Margin compared to the same quarter one year ago and further improvements expected in Q3.
- Showcased the first production standalone Edge Data Center (“EDC”) with revenues starting June 1 and began installation activities at three additional locations with long term land lease agreements and identified “anchor tenants”.
- Placed orders for four additional data centers for a total of 10 units so far, all of which have identified locations plus 20 backup generators the combination of which is expected to meet the goal of 15 deployed units by year end.
- Through the AMA, completed mobilization and installation of six gas turbine generators (150MW) in Mexico resulting in additional high margin revenue for the Company and four additional generators at a Hyperscaler site in Tennessee.
- As of the end of the second quarter, the Company had $40.7 million of revenue in backlog plus approximately $18 million of contracted backlog and near-term awards, renewals and other anticipated business to be recognized during the remainder of 2025.
- Completed a $40 million public offering and raised a further $12.5 million via an At-the-Market (“ATM”) offering bolstering its cash position and putting the Company in position to install 15 EDCs in 2025 and a further 50 EDCs in 2026.
Second Quarter 2025 Financial Results
It should be noted that the following Financial Results represent the consolidation of the Company with its subsidiaries Duos Technologies, Duos Edge AI, Inc., and Duos Energy Corporation (“Duos Energy”).
Total revenues for Q2 2025 increased 280% to $5.74 million compared to $1.51 million in the second quarter of 2024 (“Q2 2024”). Total revenue for Q2 2025 represents an aggregate of approximately $40,000 of technology systems revenue and approximately $5,7 million in recurring services and consulting and hosting revenue. The significant revenue increase in the second quarter, compared to the same quarter last year, was primarily driven by Duos Energy beginning to execute against the Asset Management Agreement (“AMA”) with New APR that was signed on December 31, 2024. Under the AMA, Duos Energy oversees the deployment and operations of a fleet of mobile gas turbines and related balance-of-plant inventory, providing management, sales, and operational support services to New APR. The decrease in technology systems revenues was primarily attributed to delays outside of the Company’s control with deployment of our two high-speed Railcar Inspection Portals. Although these systems remain largely ready for deployment, customer delays at the deployment site continue to prevent the Company from entering the installation phase. In spite of the timing delays that continue to impact the quarterly results, management remains confident in the long-term potential of the RIP product.
Cost of revenues for Q2 2025 increased 144% to $4.22 million compared to $1.73 million for Q2 2024. The significant increase in cost of revenues was primarily due to supporting the AMA with New APR, where Duos Energy oversees the deployment and operations of a fleet of mobile gas turbines and related balance-of-plant inventory, providing management, sales, and operational support services to New APR. The cost of revenues on technology systems decreased compared to the equivalent period in 2024. This reduction is primarily driven by our ability in Q2 2025 to reallocate certain fixed operating and servicing costs for technology systems to support the AMA, an allocation we could not make in the comparative period because the agreement was not yet in effect. It also reflects the ramp-down of manufacturing ahead of field installation of our two high-speed Railcar Inspection Portals, which has continued to temporarily slow project activity and further reduced cost of revenues while we await customer readiness for site deployment.
Gross margin for Q2 2025 increased 808% to $1.52 million compared to negative $0.21 million for Q2 2024. Gross margin improved primarily due to Duos Energy beginning performance of the AMA with New APR. This includes $904,125 in revenue recognized during the three months ended June 30, 2025, related to the Company’s 5% non-voting equity interest in the ultimate parent of New APR, which carried no associated costs and therefore contributed at a 100% margin. These revenues and the associated margin contribution were not present in the prior year period.
Operating expenses for Q2 2025 increased 65% to $4.96 million compared to $3.0 million for Q2 2024. The increase in expenses is largely attributed to non-cash stock-based compensation charged for restricted stock granted to the executive team on January 1, 2025, under new employment agreements with a three-year cliff vesting schedule. In addition, the Company recorded compensation expenses for commissions and bonuses of which approximately $1.0 million is one time in nature related to the closure of the APR transaction and associated AMA and 5% ownership grant. Overall, sales and marketing costs declined as resources were allocated to costs of service and consulting revenues in support of the AMA with New APR. Additionally, research and development expenses fell by 21% owing to complete development and testing of prospective technologies. The Company continues to focus on stabilizing operating expenses including evaluating reductions in some areas, while continuing to meet the increased requirements of our new businesses.
Net operating loss for Q2 2025 totaled $3.44 million compared to net operating loss of $3.22 million for Q2 2024. The increase in loss from operations was primarily the result of non-cash stock-based compensation charged for restricted stock and onetime expenses that were not in the comparative period, offset by increased revenues during the quarter, driven by revenue generated by Duos Energy through the AMA with New APR.
Net loss for Q2 2025 totaled $3.52 million compared to net loss of $3.20 million for Q2 2024. The 10% increase in net loss was mostly attributed to the non-cash stock-based compensation charged for restricted stock and one-time compensation expenses that were not in the comparative period, offset by an increase in revenues generated by Duos Energy through the AMA with New APR as described above. Net loss per common share was $0.30 and $0.43 for the three months ended June 30, 2025 and 2024, respectively.
Cash and cash equivalents at June 30, 2025 totaled $1.47 million compared to $6.27 million at December 31, 2024. In addition, the Company had over $2.34 million in receivables and contract assets for a total of approximately $3.81 million in cash and expected short-term liquidity.
Six Month 2025 Financial Results
Total revenue increased 314% to $10.69 million from $2.58 million in the same period last year. Total revenue for the first six months of 2025 represents an aggregate of approximately $105,000 of technology systems revenue and approximately $10.59 million in recurring services and consulting revenue. The significant revenue increase in the period, compared to the same period last year, was primarily driven by Duos Energy beginning to execute against the AMA with New APR that was signed on December 31, 2024. Under the AMA, Duos Energy oversees the deployment and operations of a fleet of mobile gas turbines and related balance-of-plant inventory, providing management, sales, and operational support services to New APR. The decrease in technology systems revenues was primarily attributed to delays outside of the Company’s control with deployment of our two high-speed Railcar Inspection Portals. Although these systems remain largely ready for deployment, customer delays at the deployment site continue to prevent the Company from entering the installation phase although this is now expected to be mitigated in the second half of 2025. In spite of the timing delays that continue to impact the quarterly results, management remains confident in the long-term potential of the RIP product.
Cost of revenues increased 191% to $7.86 million from $2.70 million in the same period last year. The significant increase in cost of revenues was primarily due to supporting the AMA with New APR, where Duos Energy oversees the deployment and operations of a fleet of mobile gas turbines and related balance-of-plant inventory, providing management, sales, and operational support services to New APR. The cost of revenues on technology systems decreased compared to the equivalent period in 2024. This reduction is primarily driven by our ability in the period to reallocate certain fixed operating and servicing costs for technology systems to support the AMA, an allocation we could not make in the comparative period because the agreement was not yet in effect. It also reflects the ramp-down of manufacturing ahead of field installation of our two high-speed Railcar Inspection Portals, which has continued to temporarily slow project activity and further reduce cost of revenues while we await customer readiness for site deployment.
Gross margin increased 2,462% to $2.83 million from negative $120,000 in the same period last year. Gross margin improved primarily due to Duos Energy beginning performance of the AMA with New APR. This includes $1.81 million in revenue recognized during the period, related to the Company’s 5% non-voting equity interest in the ultimate parent of New APR, which carried no associated costs and therefore contributed at a 100% margin. These revenues and the associated margin contribution were not present in the prior year period.
Operating expenses increased 38% to $8.06 million from $5.86 million in the same period last year. The Company experienced a significant increase in overall operating expenses compared to the same period in 2024. Sales and marketing costs declined as resources were allocated to costs of service and consulting revenues in support of the AMA with New APR. Additionally, research and development expenses fell by 5% owing to scaled-back testing of prospective technologies. General and administration costs increased 73%, largely due to non-cash stock-based compensation charged for restricted stock granted to the executive team on January 1, 2025, under new employment agreements with a three-year cliff vesting schedule as well as one time compensation costs related to the closing of the AMA and 5% ownership agreements as previously described. Additionally, there were general and administration costs that were allocated to cost of service and consulting revenues in support of the AMA with New APR. Overall, the Company continues to focus on stabilizing operating expenses while meeting the increased needs of our customers.
Net operating loss totaled $5.23 million compared to net operating loss of $5.98 million in the same period last year. The decrease in loss from operations was primarily the result of increased revenues during the period, driven by revenue generated by Duos Energy through the AMA with New APR. The net operating losses are expected to improve in the second half of 2025.
Net loss totaled $5.60 million compared to a net loss of $5.96 million in the same period last year. The 6% decrease in net loss was mostly attributed to the increase in revenues generated by Duos Energy through the Asset Management Agreement with New APR as described above. Net loss per common share was $0.48 and $0.81 for the six months ending June 30, 2025 and 2024, respectively.
Financial Outlook
At the end of the second quarter, the Company’s contracts in backlog represented approximately $40.7 million in revenue, of which approximately $18 million is expected to be recognized in calendar 2025 including an estimated $12.3 million of contracted backlog and $5.7 million in expected near-term awards, renewals and anticipated additional business. The remaining contract backlog consists of multi-year service and software agreements, along with project revenues extending beyond 2025, related to Duos, Duos Edge AI, and Duos Energy.
Based on these committed contracts and near-term pending orders that are already performing or scheduled to be executed throughout the course of 2025, the Company is reiterating its previously stated revenue expectations for the fiscal year ending December 31, 2025. The Company expects total revenue for 2025 to range between $28 million and $30 million, representing an increase of 285% to 312% from 2024. Duos expects this improvement in operating results to be reflected over the course of the full year in 2025.
Management Commentary
“I continue to be impressed with the significant improvement in the business since our pivot in the middle of 2024 to add new businesses to the Duos portfolio. We have recorded higher revenues in the first half than at any other time in the Company’s history and I am highly confident of our continued progress in the second half, not only achieving our revenue guidance but also I am anticipating that we will be recording the first quarter of breakeven or better in the Company’s history,” said Chuck Ferry, Duos CEO. “My expectation is that we will continue to deliver growth, in the second half and beyond, as the results of all our current and planned initiatives become booked revenues.”
Conference Call
The Company’s management will host a conference call today, August 14, 2025, at 4:30 p.m. Eastern time (1:30 p.m. Pacific time) to discuss these results, followed by a question-and-answer period.
Date: Thursday, August 14, 2025
Time: 4:30 p.m. Eastern time (1:30 p.m. Pacific time)
U.S. dial-in: 877-407-3088
International dial-in: 201-389-0927
Confirmation: 13755359
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