#Canada #Cybersecurity #Toronto #IT Services #Nerds On Site

Overview of Q3 FY2026 Results

Nerds On Site Inc. (CSE: NERD) recently released its financial results for the third quarter of FY2026, highlighting a significant return to profitability along with positive revenue trends. Serving small and medium-sized enterprises across both Canada and the United States, the managed IT and cybersecurity services provider demonstrated remarkable progress in its business operations.

Financial Performance Highlights

During the three months ending February 28, 2026, the company achieved impressive results that indicate a strong recovery and sustained growth. Key financial metrics from Q3 include:

• - Revenue: Total revenue reached $3,284,428, representing a 9% increase from the previous year's revenue of $3,004,549.
• - Gross Profit: The gross profit improved to $861,370, elevating the gross margin to 26%, up from 23%.
• - Operating Expenses: General and administrative expenses (SGA) dropped by 16%, now constituting just 23% of revenue, compared to 30% in the prior year.
• - Net Income: The company recorded a net income of $51,877, a strong turnaround from the net loss of $198,156 in the same quarter last year.
• - Earnings per Share: There was a notable increase in earnings per share, which reached $0.0006, recovering from a loss of $0.0022 from the previous year.

Over the year-to-date period ending February 2026, Nerds On Site reported:

• - Revenue of $10,077,870, marking an 18% increase year-over-year.
• - Gross Profit of $2,526,147, maintaining a gross margin of 25%.
• - A substantial reduction in net loss to $280,840, down from $559,211 in the prior year.
• - Improved Operating Cash Usage: The operating cash requirement was notably reduced to $104,135, marking an improvement from $693,709 from the previous period.

Key Factors Leading to Profitability

The company's return to net profitability signifies an essential inflection point in its growth journey. Several strategic decisions and operational changes contributed to this success:

• - A growing recurring revenue base driven by business clients in Canada, showing a remarkable 17% increase in recurring revenues.
• - Enhanced cost management practices, which led to reduced operating expenses and greater efficiency.
• - Favorable shifts in product mix and improved sourcing strategies which helped improve margins.
• - The scalability of its service model has allowed the company to operate effectively while catering to increasing demand.

Management sees this quarter's results as a foundation to build on and emphasize sustained profitability moving forward.

Recurring Revenue Model and Service Efficiency

Nerds On Site's high-visibility recurring revenue model has proven to be a significant asset for maintaining stability and contributing to growth. As evidenced, they served over 10,000 customers annually, with close to 130,000 clients served since inception. This model allows the company to maintain consistent cash flow while nurturing long-term relationships with clients. Operational efficiencies gained from reduced payroll costs and optimized internal processes supported margin expansion, with gross margins improved significantly through better supplier pricing and higher-margin services.

CEO Insights

Charlie Regan, the CEO of Nerds On Site, expressed, *"Our return to profitability this quarter is a defining moment for Nerds On Site. We've spent decades humanizing technology, and today we're scaling that vision across Canada and deeper into the USA. This quarter's profitability is not the destination— it marks a shift from a growth story into one focused on performance. Trust, speed, and security are paramount in our approach to delivering value to our clients and shareholders."

Current Market Outlook

As it stands, Nerds On Site is strategically positioned within the rapidly evolving IT landscape, where the demand for managed IT services continues to rise due to increasing cybersecurity threats and the complexity of hybrid work environments. The company's combination of an extensive eNerd contractor network and a foundation of more than 100,950 verified 5-star client reviews sets it apart in the marketplace.

Looking ahead, Nerds On Site aims to:

• - Foster sustained profitability through operational efficiencies.
• - Expand its recurring revenue streams and outreach efforts in the U.S. market.
• - Solidify its role in the managed services and cybersecurity sectors.

As management anticipates ongoing demand for these services, Nerds On Site is enthusiastic about its prospects for growth and value delivery to its clients and stakeholders moving forward.

Conclusion

Nerds On Site Inc. has made significant strides in recovering its profitability while establishing a solid foundation for future growth. With a strong commitment to its recurring revenue model and ongoing operational improvements, the company is poised to capitalize on market demands effectively and continue its upward trajectory in the IT services industry.