AISPHIGH SIGNALFINANCIAL10-K

AISP achieved a dramatic turnaround from -$57.5M to +$29.3M net income despite declining revenue and worsening operations, indicating significant one-time gains that mask underlying business deterioration.

The massive net income swing appears disconnected from operational reality, as revenue declined 33.5% while operating losses doubled to -$7.2M and operating cash flow worsened. This suggests substantial non-operating gains (likely from asset sales, debt forgiveness, or accounting adjustments) that may not be repeatable, creating a misleading picture of the company's fundamental performance.

Comparing 2026-02-17 vs 2025-02-28View on EDGAR →
FINANCIAL ANALYSIS

AISP presents a contradictory financial picture where net income surged 151% to positive $29.3M while core business metrics deteriorated significantly—revenue dropped 33.5%, operating losses doubled, and operating cash flow worsened by 23%. The balance sheet improved dramatically with total liabilities falling 60% and stockholders' equity recovering from -$53M to -$7M, while accounts receivable spiked over 400%. This pattern strongly suggests major one-time gains or balance sheet restructuring that obscures declining operational fundamentals, making the headline profitability potentially misleading for investors assessing ongoing business performance.

FINANCIAL STATEMENT CHANGES
Accounts Receivable
Balance Sheet
+426.8%
$1.2M$6.5M

Receivables surged 426.8% — revenue recognized but not yet collected; watch for collection issues or channel stuffing.

Net Income
P&L
+151%
-$57.5M$29.3M

Net income grew 151% — bottom-line growth signals improving overall business health.

Operating Income
P&L
-105.9%
-$3.5M-$7.2M

Operating income deteriorated sharply — investigate whether driven by one-time charges or structural cost issues.

Stockholders Equity
Balance Sheet
+86.5%
-$53.0M-$7.1M

Equity base grew 86.5% — retained earnings accumulation or equity issuance strengthening the balance sheet.

Total Liabilities
Balance Sheet
-60.1%
$66.7M$26.6M

Liabilities reduced 60.1% — deleveraging improves balance sheet strength and financial flexibility.

Current Assets
Balance Sheet
+46.2%
$12.7M$18.5M

Current assets grew 46.2% — improving short-term liquidity or inventory/receivables build.

Total Assets
Balance Sheet
+42.1%
$13.7M$19.5M

Asset base grew 42.1% — expansion through organic growth, acquisitions, or capital deployment.

Revenue
P&L
-33.5%
$23.1M$15.3M

Revenue declined 33.5% — significant demand weakness or market share loss warrants investigation.

Gross Profit
P&L
-26.9%
$10.5M$7.7M

Gross margin compression — rising input costs, pricing pressure, or unfavorable product mix shift.

Operating Cash Flow
Cash Flow
-23.1%
-$6.5M-$8.0M

Operating cash flow softened — monitor whether temporary working capital timing or structural deterioration.

LANGUAGE CHANGES
NEW — 2026-02-17
PRIOR — 2025-02-28
ADDED
As of February 13, 2026, there were a total of 34,372,162 shares of the registrant s common stock issued and outstanding.
Since our inception and until the merger in December 2023, we have operated as a 100% employee-owned bootstrapped company with no outside investment, operating in a fiscally conservative model.
Our software is also designed to replace existing capabilities as well as augment and/or enhance existing capabilities, from sensors to IT infrastructure to analytics.
government has set aside $3.2 billion in discretionary resources for state and local grants and $30 billion in mandatory resources to support law enforcement, crime prevention, and violence intervention, based on The President s Budget for Fiscal Year 2023.
We believe our existing product market fit in the law enforcement vertical supported by our rapidly growing edge AI hardware and software offerings positions us well in this market.
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REMOVED
As of February 28, 2025, there were a total of 31,749,319 shares of the registrant s common stock issued and outstanding.
Our typical customer engagement is a multi-year contractual agreement, an agreement which includes our core offerings as well as professional services, technical support, and software maintenance, which we expect will result in predictable, long-term recurring revenue.
Our Solution Airship AI s platform today is used across multiple verticals and markets, including commercial and government, and small and enterprise.
government has set aside $3.2 billion in discretionary resources for state and local grants and $30 billion in mandatory resources to support law enforcement, crime prevention, and violence intervention, based on The President s Budget for Fiscal Year 2023 We believe our existing product market fit in the law enforcement vertical supported by our rapidly growing edge AI hardware and software offerings positions us well in this market.
Growth Strategy For 2025, we start with a pipeline of $137 million, consisting largely of U.S.
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