Fatpipe Inc/UT
For the period ended Dec 31, 2025. Filed Feb 2, 2026.
View on SEC.govAbout this filing
A company's report for each of its first three quarters. The financial statements are not audited. It shows how the business has moved since the last annual report, and what management says changed.
Dec 31, 2025 · Filed Feb 2, 2026
FATN$4.38-4.2%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-Q
Period ended 2025-09-30; filed 2025-11-03.
0001493152-25-020604
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-Q
Period ended 2025-12-31; filed 2026-02-02.
0001493152-26-004738
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 132 previous paragraphs and 133 current paragraphs.
98 unchanged; 28 reworded; 6 added; 6 removed; 0 previous and 1 current paragraphs rearranged.
Tables are not compared: 7 previous and 7 current tables excluded. Dates, whitespace, punctuation and numbering changes are ignored; changes to financial figures remain significant.
A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (6)
Current report
Net revenue was $4,087,786, an increase of $939,109, or 30%, from the prior period ended December 31, 2024. In the three months ended December 31, 2025, product revenue was $2,572,879 compared to $1,953,706 during the same period in 2024, representing an increase of 32%. Product revenue increased by $619,173 over the prior period, driven by continued execution of FatPipe’s go-to-market strategy and improved core sales activity. Service revenue increased by $459,171, partially offset by a decrease in consulting revenue of $139,235. The increase in service revenue was primarily due to the timing of service engagements, while the decrease in consulting revenue reflects fewer consulting projects completed during the period.
Current report
In the three months ended December 31, 2025, our gross profit was $3,583,970 an increase of $815,163, or 29%, from prior period. The increase in gross profit was primarily due to a higher net revenue as well as lower cost of revenue.
Current report
Our gross margin remained consistent at 88% in the three months ended December 31, 2025, compared to the prior period.
Current report
For the Nine Months Ended December 31, 2025 and 2024
Current report
Net income for the three months ended December 31, 2025 was $310,662, compared to $84,372 for the three months ended December 31, 2024, primarily due to higher revenues in the 2025 period.
Current report
On a rule of 40 basis (revenue growth + EBTIDA margin), the Company achieved a 46% during this quarter, consisting of 30% revenue growth and 16% EBITDA margin.
Removed paragraphs (6)
Previous report
*reflects a one time $1.4 MM contract
Previous report
In the three months ended September 30, 2025, our gross profit was $3,646,327 a decrease of $1,719,934, or 32%, reflecting the effect of the two large contracts during the prior period.
Previous report
Our gross margin decreased to 92% in the three months ended September 30, 2025 from 96% in the prior period reflecting increased tariffs and transportation costs.
Previous report
For the Six Months Ended September 30, 2025 and 2024
Previous report
In the six months ended September 30, 2024, two large contracts were won totaling $1.4M in total revenue, resulting in an exceptional six months. Overall, net revenue was $7,895,154, a decrease of $1,450,741, or 16%, from the prior period ended September 30, 2024. FatPipe continued to execute successfully on its GTM strategy with sales steady YoY when excluding the large contract wins.
Previous report
*lower number reflects the two large contracts in 2024
Reworded paragraphs (28)
Previous wording
In the three months ended September 30, 2025, our cost of revenue was $312,904, an increase of $83,589, or 36%, from the prior period ended September 30, 2024. Cost of revenue increased as costs of inputs increased due to macroeconomic factors. The cost of revenue includes costs associated with providing services to our customers, such as costs associated with hosting our cloud services.
Current wording
In the three months ended December 31, 2025, our cost of revenue was $503,816, an increase of $123,946, or 33%, from the prior period ended December 31, 2024. Cost of revenue increased as costs of inputs increased due to macroeconomic factors. The cost of revenue includes costs associated with providing services to our customers, such as costs associated with hosting our cloud services.
Previous wording
In the three months ended September 30, 2025, our sales and marketing expense was $1,202,636, an increase of $283,244, or 31%, compared to the prior period. This was primarily due to an increase in salary expenses as FatPipe invested in scaling sales headcount across its sales divisions to invest in long-term growth. This use of funds was disclosed in the previously filed S-1.
Current wording
In the three months ended December 31, 2025, our sales and marketing expense was $1,282,706, an increase of $394,160, or 44%, compared to the prior period. This was primarily due to an increase in salary expenses as FatPipe invested in scaling sales headcount across its sales divisions to invest in long-term growth. This use of funds was disclosed in the previously filed S-1.
Previous wording
In the three months ended September 30, 2025, our general and administrative expense was $1,392,675, an increase of $208,879 compared to the prior period primarily due to $625,220 in non-cash stock-based compensation expense recorded in the second quarter, offset by overall cost cutting via automation efforts in 2025. Excluding non-cash stock-based compensation, G&A decreased by 35%.
Current wording
In the three months ended December 31, 2025, our general and administrative expense was $828,350, an increase of $254,444 compared to the prior period. General and administrative expenses increased primarily due to higher compliance costs, offset by overall cost cutting via automation efforts in 2025.
Previous wording
Product development expense in the three months ended September 30, 2025 was $489,157, an increase of $53,755 compared to the prior period, as the Company continued its development plans for its cybersecurity and satellite products. The Company has ramped up its product development in early 2025 following its April 2025 IPO.
Current wording
Product development expense in the three months ended December 31, 2025 was $453,539, an increase of $4,971 compared to the prior period, as the Company continued its development plans for its cybersecurity and satellite products. The Company has ramped up its product development in early 2025 following its April 2025 IPO.
Previous wording
Employee cost expenses in the three months ended September 30, 2025 were $562,652, a decrease of $1,646, compared to the prior period.
Current wording
Employee cost expenses in the three months ended December 31, 2025 were $616,955, a decrease of $56,004, compared to the prior period.
Previous wording
Depreciation and amortization expense in the three months ended September 30, 2025 was $691, a decrease of $7,405, compared to the prior period. These expenses are categorized under general and administrative expenses.
Current wording
Depreciation and amortization expense in the three months ended December 31, 2025 was $102,837, a decrease of $29,825, compared to the prior period. These expenses are categorized under general and administrative expenses.
Previous wording
Interest income during the three months ended September 30, 2025 was $42,949 as compared to $0 in the prior fiscal year, reflecting the deposit of funds raised from the IPO.
Current wording
Interest income during the three months ended December 31, 2025 was $41,145 as compared to $15,342 in the prior fiscal year.
Previous wording
Interest expense during the three months ended September 30, 2025 was $126,033, as compared to $86,411 in the prior fiscal year. The increase was due to higher loan amount in 2025.
Current wording
Interest expense during the three months ended December 31, 2025 was $104,072, as compared to $118,081 in the prior fiscal year. The increase was due to lower loan amount in 2025.
Previous wording
In Q2 2025, two large contracts totaling $1.4 MM was won resulting in an exceptional quarter. in Q2, 2026, the current year, ended September 30, 2025, Net revenue was $3,959,231, a decrease of $1,636,345, or 29%, from the prior period ended September 30, 2024 primarily due to the two large contracts in Q2 2025. The decrease in revenue was primarily due to a comparison against an exceptionally strong Q2 2025. FatPipe continued to execute successfully on its GTM strategy. Consulting and services revenue increased due to the timing of consulting engagements.
Current wording
In the nine months ended December 31, 2025, Product revenue was $7,385,761 compared to $8,546,999 during the same period in 2024, representing a decrease of 14%. Overall, net revenue was $11,982,940, a decrease of $511,632, or 4%, from the prior period ended December 31, 2024. Product and consulting revenue decreased by $1,350,554 over the prior period, partially offset by an increase in service revenue of $838,922. The decrease in product and consulting revenue was because of a tough comparison against an exceptionally strong Q3 2024 due to two large single contracts that signed in the previous year. FatPipe continued to execute successfully on its GTM strategy with sales increasing YoY when excluding the large contract wins.
Previous wording
In the six months ended September 30, 2025, our cost of revenue was $539,838, an increase of $26,843, or 5%, from the prior period ended September 30, 2024. Cost of revenue increased as higher costs of inputs increased due to macroeconomic factors. The cost of revenue includes costs associated with providing services to our customers, such as costs associated with hosting our cloud services.
Current wording
In the nine months ended December 31, 2025, our cost of revenue was $1,043,654, an increase of $150,789, or 17%, from the prior period ended December 31, 2024. Cost of revenue increased as higher costs of inputs increased due to macroeconomic factors. The cost of revenue includes costs associated with providing services to our customers, such as costs associated with hosting our cloud services.
Previous wording
In the six months ended September 30, 2025, our gross profit was $7,355,316, a decrease of $1,477,584, or 17%, from prior period. The decrease in gross profit reflects the effect of the two large contracts during the prior period.
Current wording
In the nine months ended December 31, 2025, our gross profit was $10,939,286, a decrease of $662,421, or 6%, from prior period. The decrease in gross profit reflects a decrease in net revenue.
Previous wording
Our gross margin decreased to 93% in the six months ended September 30, 2025 from 95% in the prior period reflecting increased tariffs and transportation costs.
Current wording
Our gross margin decreased to 91% in the nine months ended December 31, 2025 from 93% in the prior period.
Previous wording
In the six months ended September 30, 2025, our sales and marketing expense was $2,254,301, an increase of $319,974, or 17%, compared to the prior period, primarily due to an increase in salary expenses as FatPipe invested in scaling sales headcount across its sales divisions to invest in long-term growth. This is in line with the Use of Funds guidelines disclosed in the previously filed S-1.
Current wording
In the nine months ended December 31, 2025, our sales and marketing expense was $3,537,007, an increase of $714,134, or 25%, compared to the prior period. This was primarily due to an increase in salary expenses as FatPipe invested in scaling sales headcount across its sales divisions to invest in long-term growth. This use of funds was disclosed in the previously filed S-1.
Previous wording
In the six months ended September 30, 2025, our general and administrative expense was $1,979,674, an increase of $214,756 compared to the prior period. General and administrative expenses increased primarily due to $625,220 in non-cash stock-based compensation expense recorded in the second quarter, offset by overall cost cutting via automation efforts in 2025. Excluding non-cash stock-based compensation, G&A decreased by 23%.
Current wording
In the nine months ended December 31, 2025, our general and administrative expense was $2,808,024, an increase of $469,200 compared to the prior period. General and administrative expenses increased primarily due to $625,220 in non-cash stock-based compensation expense recorded in the second quarter, offset by overall cost cutting via automation efforts in 2025.
Previous wording
Product development expense in the six months ended September 30, 2025 was $963,614, an increase of $104,712 compared to the prior period, as the Company continued its development plans for its cybersecurity and satellite products. The Company has ramped up its product development in early 2025 following its April 2025 IPO.
Current wording
Product development expense in the nine months ended December 31, 2025 was $1,417,153, an increase of $109,683 compared to the prior period, as the Company continued its development plans for its cybersecurity and satellite products. The Company has ramped up its product development in early 2025 following its April 2025 IPO.
Previous wording
Employee cost expenses in the six months ended September 30, 2025 were $1,155,843, an increase of $4,306, compared to the prior period. The increase in employee cost expense is attributable to the increase in professional services revenues.
Current wording
Employee cost expenses in the nine months ended December 31, 2025 were $1,772,798, a decrease of $51,698, compared to the prior period. The decrease in employee cost expense is attributable to the decrease in professional services revenues.
Previous wording
Depreciation and amortization expense in the six months ended September 30, 2025 was $196,064, a decrease of $70,629, compared to the prior period. These expenses are categorized under general and administrative expenses.
Current wording
Depreciation and amortization expense in the nine months ended December 31, 2025 was $298,902, a decrease of $100,452, compared to the prior period. These expenses are categorized under general and administrative expenses.
Previous wording
Interest income during the six months ended September 30, 2025 was $48,748 as compared to $10,514 in the prior fiscal year. The increase was due to interest on larger cash reserves.
Current wording
Interest income during the nine months ended December 31, 2025 was $89,893 as compared to $25,856 in the prior fiscal year. The increase was due to interest on larger cash reserves.
Previous wording
Interest expense during the six months ended September 30, 2025 was $195,921, as compared to $172,443 in the prior fiscal year. The increase was due to higher loan amount in 2025.
Current wording
Interest expense during the nine months ended December 31, 2025 was $299,993, as compared to $290,524 in the prior fiscal year. The increase was due to higher loan amount in 2025.
Previous wording
In March 2025, the Company obtained a $5 million term loan from Fortis Bank, of which $3 million was used to repay an outstanding loan from the bank loan noted above. The Fortis Bank loan is repayable in 120 equal monthly installments commencing from March 1, 2025 and the interest is charged at the Prime Rate plus 1%. The “Prime Rate” is the Prime Rate in effect on the first business day of the month (as published in the Wall Street Journal newspaper) in which SBA received the application, or the first day of the month in which any interest rate change occurs. The interest rate will be adjusted every calendar quarter (the “change period”) beginning April 1, 2025 (date of first rate adjustment). The interest rate works out to 8.75% as on the reporting date. The loan is secured by substantially all assets of the Company, certain personal properties of Directors of the Company, along with a personal guarantee given by them and a Trust, where the directors are trustees. During the six months ended September 30, 2025, the Company made principal payments totaling $152,635.
Current wording
In March 2025, the Company obtained a $5 million term loan from Fortis Bank, of which $3 million was used to repay an outstanding loan from the bank loan noted above. The Fortis Bank loan is repayable in 120 equal monthly installments commencing from March 1, 2025 and the interest is charged at the Prime Rate plus 1%. The “Prime Rate” is the Prime Rate in effect on the first business day of the month (as published in the Wall Street Journal newspaper) in which SBA received the application, or the first day of the month in which any interest rate change occurs. The interest rate will be adjusted every calendar quarter (the “change period”) beginning April 1, 2025 (date of first rate adjustment). The interest rate works out to 8.75% as on the reporting date. The loan is secured by substantially all assets of the Company, certain personal properties of Directors of the Company, along with a personal guarantee given by them and a Trust, where the directors are trustees. During the nine months ended December 31, 2025, the Company made principal payments totaling $254,594.
Previous wording
Interest expense for the three months ended September 30, 2025 and 2024 amounted to $126,033 and $86,411, respectively. Interest expense for the six months ended September 30, 2025 and 2024 amounted to $195,921 and $172,443, respectively.
Current wording
Interest expense for the three months ended December 31, 2025 and 2024 amounted to $104,072 and $118,081, respectively. Interest expense for the nine months ended December 31, 2025 and 2024 amounted to $299,993 and $290,524, respectively.
Previous wording
On June 15, 2023, the company received an interest free loan for $120,000 from Stay in Business Inc., repayable on demand. During the year ended March 31, 2025, the Company received an additional $13,652 under the same arrangement During the six months ended September 30, 2025, the Company repaid the entire outstanding balance of the loan.
Current wording
On June 15, 2023, the company received an interest free loan for $120,000 from Stay in Business Inc., repayable on demand. During the year ended March 31, 2025, the Company received an additional $13,652 under the same arrangement During the nine months ended December 31, 2025, the Company repaid the entire outstanding balance of the loan.
Previous wording
Net cash used in operating activities in the six months ended September 30, 2025 was $108,769 compared to $204,175 in the prior period. The increase in cash used in operating activities was primarily due to a lower net income in 2025.
Current wording
Net cash provide by operating activities in the nine months ended December 31, 2025 was $132,132 compared to net cash used in $314,150 in the prior period. The increase in cash provided by operating activities was primarily due to stock based compensation expense in 2025.
Previous wording
Net cash used in investing activities in the six months ended September 30, 2025 was $35,447 as compared to $12,228 in the prior period. Cash used in investing activities was primarily due to the purchase of furniture for office improvement.
Current wording
Net cash used in investing activities in the nine months ended December 31, 2025 was $43,969 as compared to $12,748 in the prior period. Cash used in investing activities was primarily due to the purchase of equipment.
Previous wording
Net cash provided by financing activities in the six months ended September 30, 2025 was $3,581,185. Cash provided by financing activities included $3,867,472 in proceeds from the Company’s April 2025 IPO and proceeds from issue of share to consultant, partially offset by $286,287 in net repayments of debt. Net cash used in financing activities in the six months ended September 30, 2024 was $87,424. Cash used in financing activities included $87,424 in repayment of financing obligation of lease.
Current wording
Net cash provided by financing activities in the nine months ended December 31, 2025 was $3,295,802. Cash provided by financing activities included $3,742,472 in proceeds from the Company’s April 2025 IPO and proceeds from issue of share to consultant, partially offset by $446,670 in net repayments of debt. Net cash provided by financing activities in the nine months ended December 31, 2024 was $513,652. Cash provided by financing activities included $513,652 proceeds from debt.
Previous wording
In the six months ended September 30, 2025, our adjusted EBITDA decreased by $345,933 compared to the prior fiscal year, primarily due to a decrease in operating income as a result of lower revenues. Adjusted EBITDA margin for the six months ended September 30, 2025 was 24%, vs 24% for the 6 months ended September 30, 2024.
Current wording
In the nine months ended December 31, 2025, adjusted EBITDA margin for the nine months ended December 31, 2025 was 21%, vs 31% for the nine months ended December 31, 2024. Our adjusted EBITDA decreased by $1,353,649 compared to the prior fiscal year, primarily due to a decrease in operating income as a result of lower revenues.
Previous wording
Net Income for the Six Months Ended September 30, 2025 of $697,810 was lower than Net Income for the Six Months Ended September 30, 2024 of $2,236,725, primarily due to Stock-Based Compensation Expense of $625,220 recognized in the three months ended on September 30, 2025.
Current wording
Net income for the nine months ended December 31, 2025 of $1,008,470 was lower than net income for the nine months ended December 31, 2024 of $2,321,098, primarily due to stock-based compensation expense of $625,220 recognized in the three months ended on December 31, 2025.
Previous wording
New bookings in Q2’25 were booked by 8 salespeople. As part of FatPipe’s strategy post-IPO, we’ve expanded the sales team to 25 salespeople.
Current wording
New bookings in Q2’25 were booked by 15 salespeople. As part of FatPipe’s strategy post-IPO, we’ve expanded the sales team in Q3’25 to 25 salespeople.
Rearranged current paragraphs (1)
Current report — wording carried from elsewhere
In the three months ended December 31, 2025, adjusted EBITDA margin for the three months ended December 31, 2025 was 14%, vs 18% for the three months ended December 31, 2024. Our adjusted EBITDA increased by $13,139 compared to the prior fiscal year, primarily due to an increase in operating income as a result of higher revenues.