Allot Ltd.'s Q2 2025: Unpacking Contradictions in Verizon Partnership, Gross Margins, and SECaaS Growth

Attachment rates and opportunities with Verizon Business Mobile, gross margin expectations, SECaaS ARR growth expectations, pipeline strength and deal expectations, and contribution of SECaaS to revenue growth are the key contradictions discussed in Allot Ltd.’s latest 2025Q2 earnings call.



SECaaS Growth and Contribution:
- Allot's SECaaS ARR increased by 73% year-over-year, ending the quarter at $25.2 million, contributing over 25% of revenues for the first time.
- This growth was driven by new customer deals, increased adoption, and upselling of new applications, particularly with Verizon and Vodafone.

Revenue Growth and Profitability:
- The company reported 9% year-over-year overall revenue growth with improved margins and profitability.
- The strong performance was attributed to the successful launch of Verizon Business's My Biz Plan and positive operating cash generation.

Network Intelligence Deal:
- Allot signed a landmark deal worth tens of millions of dollars with a Tier 1 telco in EMEA, set to be executed over 2026 and 2027.
- This deal, which includes a long-term recurring revenue tail, validates Allot's ability to expand its network intelligence footprint and offers potential for additional projects.

Cash and Debt Position:
- Allot ended the quarter with over $72 million in net cash and equivalents and no debt, following a successful share offering.
- The strong cash position and debt repayment were a result of effective capital management and positive operating cash flow.