Company Announcements

Subscription Revenue mix Grows 27% as Company Continues the Accelerated Shift to Recurring Revenue Model; Solid Cash Position Funds AI Initiative Advancing on Schedule With Agent Harness Development for Industrial Deployments

MISSISSAUGA, ON - June 18, 2026 (NEWMEDIAWIRE) - Skkynet Cloud Systems, Inc. (“Skkynet” or “the Company”) (OTCQB: SKKY), a global leader in industrial software for secure, real-time data connectivity and edge processing, today announced financial results for the second quarter and six-month period ended April 30, 2026.

Q2 FY2026 Financial Highlights

• Q2 Revenue Growth: Revenue for the second quarter was $606,106, an increase of approximately 4% over $585,712 in Q2 FY2025.
• Subscription Revenue Mix: Subscription revenue as a percentage of sales grew to 15% for the six-month period, up from 11.8% in the same period of FY2025 - an increase of approximately 27% in subscription mix.
• Deferred Revenue Surge: Deferred revenue increased 37% to $476,797 from $347,686 at fiscal year-end, reflecting the build-up of subscription contracts that will drive future recognized revenue.
• Solid Cash Position: Cash and cash equivalents of $1,339,191 and working capital of $1,003,773 - providing a strong financial foundation to execute the Company’s strategic plans.
• Q2 Loss Improvement: Net loss for Q2 improved by approximately 52% to $(109,392) compared to $(227,723) in Q2 FY2025.
• Six-Month Revenue: Revenue for the six-month period was $1,155,499 compared to $1,414,764 in the same period of FY2025, a decrease of approximately 18% attributable to the shift from perpetual to subscription license models.

“The decline in our six-month reported revenue is the expected result of a deliberate and strategic shift,” said Gary Tillery, CEO of Skkynet. “When customers choose subscription licenses over perpetual licenses, the same total contract value is recognized over two or three years rather than immediately. This temporarily reduces reported revenue, but it builds a higher-quality, predictable, recurring revenue base. The 27% growth in our subscription mix and the 37% increase in deferred revenue confirm that this strategy is gaining traction. At the same time, we are investing from a position of financial strength - with over $1.3 million in cash and working capital above $1 million, we have the runway to execute our plans without compromise.”

AI Initiative Advancing with Agent Harness for Industrial Deployments

Skkynet’s C$2.6 million Industrial AI product development initiative, supported by FedDev Ontario, is progressing on schedule. The project is advancing in step with improvements in AI model capabilities, as the Company develops an agent harness specifically designed for the strict requirements of industrial customers.

Industrial environments demand security, reliability, real-time performance, and deterministic behavior that consumer AI solutions do not address. Skkynet’s secure-by-design architecture and over 25 years of industrial data connectivity experience uniquely position the Company to build the data backbone for the AI-driven industrial future. The agent harness being developed will enable industrial AI agents to operate within the rigorous constraints that Skkynet’s customers require - security, auditability, and real-time determinism.

Investing Now for a Platform of Future Growth

The operating loss for the period reflects deliberate investment in leadership, product development, and market expansion. During the period, the Company expanded its executive team and advisory board, increased go-to-market activities including presence at AVEVA World, CSIA Conference, Hannover Messe, EXPONOR, SPS Italia and ProveIT, and granted stock options to 19 individuals to align the team with long-term value creation. Working capital declined only $23,942 over the six-month period despite this investment spending, demonstrating the Company’s ability to fund its strategy while the subscription revenue base builds.

“Solid cash and working capital give us the foundation to invest confidently in the platform that will drive our future growth,” concluded Tillery. “We are building the secure data backbone to provide clean, secure, real-time OT data to wherever it needs to go, securely so that every other application you've invested in, like AI, can actually work - and we are doing it from a position of industry thought leadership, financial discipline and strength.”

About Skkynet

Skkynet has been helping organizations securely share real-time data for more than 25 years.  We offer secure, real-time data connectivity and edge processing for industrial systems of all types.  Skkynet’s technologies bridge plant systems, cloud platforms, and AI, enabling safe, intelligent, and resilient operations across all industrial verticals.  Skkynet’s solutions empower organizations to optimize operations, enhance efficiency, and drive innovation by connecting, monitoring, and controlling their systems in real time while maintaining robust security and data privacy standards.  For more information, visit skkynet.com.

Forward-Looking Statements

This press release contains statements that may constitute forward-looking statements, which can be identified by terminology such as “may,” “will,” “expect,” “believe,” “anticipate,” “estimate,” “approximate,” or “continue,” or the negative thereof. These statements speak only as of the date made and are based on management’s current expectations and assumptions. Actual results could differ materially due to risks including the Company’s ability to obtain necessary capital, meet anticipated development timelines, protect its proprietary technology and knowhow, establish a global market, successfully consummate future acquisitions, and other risk factors identified in the Company’s reports filed with the Securities and Exchange Commission. The Company disclaims any obligation to revise any forward-looking statement to reflect events or circumstances after the date thereof.

Contact

Skkynet Cloud Systems, Inc.
Paul E. Thomas, President
Tel: (888) 702-7851
Web: https://skkynet.com
Email: ir@skkynet.com

News Source: Skkynet