archTIS Ltd (ASX:AR9, OTCQB:ARHLF) has submitted an updated licensing proposal to the United States Department of Defense (DoD), indicating potential annual revenue of between A$7.5 million and A$15 million under a one-year agreement.
The data security software provider was formally requested to prepare tiered pricing covering between 121,000 and 325,000 users, along with single and multi-year contract options, following executive briefings in Washington DC.
archTIS has now issued the quotation, which is being considered by the relevant DoD stakeholders.
The opportunity remains active and has progressed to commercial negotiations after successful live production deployments across multiple environments and the completion of technical testing.
Further product demonstrations
During the Washington visit, archTIS also demonstrated its Trusted Data Integration (TDI) Platform, which combines sensitive or classified information from multiple sources and applies centralised, policy-based controls governing access and use.
The demonstration was well received and prompted further presentations to additional teams within the DoD.
Engagement is continuing across both the company’s NC Protect licensing platform and TDI technology.
archTIS cautioned that the request for quotation represents one stage of the US federal procurement process and does not constitute a purchase order, contract award or binding commitment.
The company cannot guarantee that the proposal will convert into revenue or provide certainty over the timing or value of any resulting contract.
Revenue and recurring sales rise
The update follows a year of considerable expansion for archTIS, with sales revenue increasing 120% to A$13.35 million in the 12 months to June 30, 2026.
Annual recurring revenue reached A$14.8 million, up 208%, while contracted sales climbed 65% to A$14.1 million. On a pro forma basis, including a full-year contribution from acquired US data security business Spirion, contracted sales totalled A$16.6 million.
Gross margin remained strong at 75%, although investment, acquisition and integration costs contributed to a net loss of A$16.33 million. The company held A$2.86 million in cash at year-end.
archTIS has identified A$4.5 million in annualised cost synergies from the Spirion acquisition, with quarterly operating expenses declining during the second half, including an 11% reduction in the June quarter.
About archTIS
archTIS provides data-centric security software for government, defence, enterprise and regulated industries.
Its product portfolio includes NC Protect, Kojensi, Trusted Data Integration and Spirion, which protect sensitive information across cloud, on-premises and hybrid environments using policy-enforced access controls and Zero Trust security principles.
