It's been a long day for everyone. Appreciate you joining us late in the day and still have the energy to absorb new stuff. Maybe, you know, the most important slide, who are we? Allot Ltd. was a company established over two decades ago, focused on a network intelligence solution. The idea of the company was that someone needed to better manage the Internet. There were always bottlenecks, whether it was initially on the days going outside to the Internet, then when mobile customers started to build mobile broadband connectivity, then the radio access became a bottleneck. In recent days, it's more about the data centers. The company built unique technology in the carrier space that is something only a handful of companies owns. As you're probably aware, those that follow the communication sector, in the last decade, this was a bit struggling.
Carriers squeezed on CapEx budget, as well as OpEx. They're trying to save costs, and they were using our technology in order to better optimize and serve their customers. What we decided about five years ago is that we want to diverse into cybersecurity. Networking and cybersecurity are very adjusted, and we identified that there is an untapped opportunity in our space. You might want to say there are so many cybersecurity... it's a very crowded space, and other Israeli-based companies that try to invent a new cyber protection solution. We are quite unique in what we offer. What we identified is that while many of the big names, the Palo Altos, Wiz, Fortinet, Check Point, all those guys, they are all targeting the upper market.
They are going after the enterprises, the ones that have large IT organizations, they have large security teams, they are looking to invest big in order to stay secure, and this was mainly where the investment was in the last decade. What we realized is that the lower market stayed unprotected. All of us as consumers, whether if we are talking about our mobile device, our home Wi-Fi, or if we are talking about the small businesses, we don't really have any good solution to protect our connectivity. Now, those big guys, they have great cybersecurity assets, they have all the bells and whistles, but their solutions are expensive, complicated to operate, and not really scalable to the mass market.
What we realized is that we have a unique asset that is the relationship with the communication service providers, and instead of looking to sell to them our solutions, let's turn them into strategic partners. They have millions of customers, consumer customers, or hundreds of thousands or millions of small businesses, and if we use them as a channel instead of a customer, we can reach and sell cybersecurity as a B2B2C or B2B2B business model. We also have a unique technology, again, built based on our networking technology. Instead of using it to optimize the Internet, make sure your network is faster, better, which is super important, we can use the networking engines in order to deploy on top of the cybersecurity engines, and by that protect all those millions of customers from the backbone of the network. This is in essence what we focus on today.
This is our main growth engine. We call it cybersecurity-as-a-service, or SECaaS in short, and this is going for us extremely well. Last quarter, Q2, we reported 73% growth year-over-year, and we are looking to reach $30 million ARR only from this new business line as of this year. Maybe some information about us. Allot Ltd., as I said, we've been around for a while. We have today over 1 billion connected customers that we manage their Internet traffic by working mainly with the most prestigious CSPs around the globe, from Vodafone, Telefónica, Verizon Business, as well as many of the Fortune 500 enterprise customers. We are connecting between the access point where people are connecting to the Internet, to the data centers, allowing you to have better customer experience, allowing you to optimize your network, and secure your connectivity. We sell today two main product lines.
Our core, what we did for the last decade or more, is the network intelligence part. This is today about 75% of our business. It provides both cybersecurity engines to protect the network itself, as well as network management and intelligence solutions. About 25% of our business today is what I mentioned, cybersecurity-as-a-service. Instead of selling into the CSP themselves, we are leveraging our relationship with them and selling to their customers. We are becoming, instead of a cost center, we become a profit center. They are able to monetize their network, and many of you know it's very hard today for the service provider to monetize their service on top of the flat-rate package they all sell to us. We are doing about $100 million this year. This is what we guided, expecting to grow about 8% this year. Last 12 months, we are on $95 million.
A very significant part of this is recurring revenue. About 60% of our business is recurring, all the security business that I mentioned before, as well as some of our networking part. Last year, we got into break-even, and we are, with scale, starting to be more and more profitable. Last quarter, we started to generate, since Q4 of last year, positive cash flow, as well as positive non-GAAP operating profit. Why now and why it's unique? Allot Ltd. has invested into this specific niche where network and cybersecurity meet, and we have a unique platform that is hundreds of engineering years invested into it that can manage millions of customer traffic. There are very few companies in the world that can manage such traffic. Some of them are the big names, like, you know, Nokia, Cisco, and Ericsson, but we have this converged with cybersecurity engines.
Where cyber and network meet, this is where we shine. We launched a new platform last year that is the highest capacity, highest scalability in our space, that is really designed to meet those tier-one customers, and we moved and built our operational model that, starting as of Q4 last year, we are profitable and generating cash. Two product lines today, about one-third, actually a bit more of our business is already cybersecurity. We are selling both solutions to protect the networks. It could be the service provider network or the enterprise network. This could be primarily protected from DDoS attacks, firewalls, and things like that. Where we are really unique is the mass market. We are partnering with carriers around the globe and going after their customers. I will share in a couple of slides some more details about some of the interesting projects we are involved in.
About two-thirds of our business is on the networking side. This was a declining business for us until this year. This year, we are going to have stable revenue on the score part, and most of our growth is coming from the cybersecurity. One of the interesting things for us is that during 2025, we had some very significant wins. One of them I will elaborate on soon, of new multimillion-dollar customers. This is indicating that while this business line was declining until now, with the new platform we launched end of last year, this is starting to get traction, and we see, while our main focus and strategic goal is into the cyberspace, we are starting to see growth potential also on the networking side.
Part of it is because one of our competitors went out of business, as Chapter 11, and is restructuring, and they lost a lot of market share, which opened an opportunity, as well as the new technology we launched to the market, which is a couple of years ahead of the competition. High growth on the cybersecurity space and starting to grow also on the networking. This starts to be creating serious growth potential on the top line, and we are already profitable. We were break-even on $92 million. This year, we guided around $100 million, and this should create about 5% operating profit margin. Some of our partners are the best names in the industry. You see here companies like Telefónica, Vodafone, Singtel, Play, Verizon, of course, which I will elaborate soon. This is for the new growth engine, SECaaS product that I mentioned.
Today, we have 20 million connections that we are securing between all those names and some more. These are the top names that we work with. We are blocking and protecting from over 11 billion threats yearly. While cybersecurity, as mentioned, started more from the enterprise space, the insurance companies, the banks, where they were very worried on their business risk, we see a big trend of cybersecurity going down market. With AI, it's much easier today to create attack vectors. It's much cheaper. It's commoditized. I'm sure all of you are being attacked with different fraud and phishing attempts daily, and this is just becoming more and more sophisticated and more and more, I would say, common. Without solutions that automatically monitor and block your threats, there will be big issues for many of us as consumers, but most importantly, we identified that small businesses are really at risk.
Because imagine someone that put all his life investment into a small business. He's focused on whatever he does. It can be a pizza shop. It can be a flower shop. It could be a small law firm. He doesn't have the cybersecurity knowledge. He doesn't have any IT guys, maybe outsourced. He doesn't have CISO in-house. How he's going to protect his life savings, how he's going to make sure he's not losing his business due to malware or botnet attacks. They are looking into going to their service providers, the Verizons, the Vodafones, the Telefónica, that are selling them the connectivity. This is where all the threats are coming from. Instead of Verizon telling them, "Look, guys, we are providing the connectivity. We are not in charge of cyber threats," now they have an option to upsell and get some more money out of their subscribers.
The beauty of that is we are not charging a lot of money per subscriber. If we take the consumer market, typically the basic service cost is $1 - $2 or euros in Europe. It's something very incremental to your $30, $40, $50 bill, something people are easy to sell. The sales channel of those carriers, they know how to sell commodity, either on their digital space, the call centers, the chat, or the stores, and they really love the solution we offer. Today, most customers we work with, we are the second-best service after device protection. All carriers around the globe, the number one add-on service on top of connectivity is selling insurance on the device. This is something you cannot compete with, but we are usually the first after this service. We are getting into high attach rates.
We usually double-digit between 15% to 50% of the customer base of the carrier is attached to the service, and if you start to do the math, let's take a carrier like Verizon. They have 120 million subscribers. If each of them paid $2 a month to Verizon, we are talking about $4 billion TAM for Verizon. Similar to AT&T, similar to T-Mobile, and if you take the whole tier-one mobiles around the globe, we are talking about tens of billions of dollars potential. We are taking part of this pie by getting a fee per subscriber, but this is still a billion-dollar opportunity for us. We are now scaling up very rapidly.
This year, we are expecting to grow 60% in this business line, which starts to grow, which will affect our top revenue in about 8%, and this is highly profitable, as who is doing all the heavy lifting is the carrier himself. We provide the technology. We install it once in the backbone with our network assets that we built over the last two decades. They are doing the marketing. They are doing the sales. They are doing the operations. They bring the data centers. It is a very high gross margin business in the high 80s, sometimes even in the 90% range. It depends on the relationship we build with them, and it is scaling. Typically, when we start to engage with a carrier, for them to reach their millions of customers, it is a sales cycle of growth between 36 - 48 months.
Every month, they add new subscribers, and because of the cycles of sales into customers, whether you change your device or they have the opportunity to upsell, or you move a plan or things like that, what we see, typically, they get to 15% - 50% penetration in about 36 - 48 months. We are going so rapidly because we have four vectors driving our growth. The first is we are today working with about two dozen carriers around the globe, out of probably 3,000 leading carriers that are out there. We are actively increasing our go-to-market teams to go after new partners. The beauty is that our core product, the networking side, we have 1,000 customers, give or take, which are a good opportunity for upsell and cross-sell into this new security product.
Some customers we are going after are not existing customers, and each of them is a very sizable, addressable market. Every new partnership we build, we install once in the network, and then we expand our TAM into additional millions of subscribers that they serve. We work globally and are working to really target specific accounts to go after this expansion. Second, accounts that we work with, we are working to expand into different services in the network. If you look at a carrier, they do fixed connectivity. It could be Wi-Fi for consumers. It could be connectivity for offices with fiber. It could be a mobile device. It could be IoT. Mainly on the larger carriers like Verizon Business, you do different parts of the network.
Every customer we start to work with, there are customer success teams working to further expand into additional services and additional areas in the network. Third, as I mentioned, when we launch a new service, we start with, let's say, no customers, and then every month, we start to add more and more subscribers. Those subscribers and work with the carrier is driving growth. It is not only that each win by itself brings you this incremental revenue. We see three to four years of sustainable growth from each new account that we bring. Last, we are still investing in innovation. We add new products, new capabilities. For example, we launched recently what we call the OffNetSecure. I won't go deeper into the technology. That is a new model, a new cybersecurity engine that you can upsell to the existing customers.
If you are paying today already to Verizon a couple of bucks a month for the basic package, now they can offer you, maybe you want an upgrade for $5, and you will get a more comprehensive solution. A win for Verizon, a win for us. Same with all those different carriers around the globe that we mentioned. On the networking side, we are very well known in this space. We have probably the best logos out there in this space if you consider on the right part of the slide. Carriers, really, all the geographies, we are very strong in the EMEA region, but we have good customers from Australia to APAC to North America, and we are seeing now this business line is starting to expand. Some of the recent wins, before we move to some Q&A, I will start actually with the last one.
Last July, we announced our biggest win in over five years. This is a networking deal, not a cybersecurity-as-a-service that I mentioned. We announced tens of millions of dollars contract with new logo, committed contract of tens of millions of dollars with potential for further expansion. This is still, this is announced in July. Of course, we announced Q2 numbers. This is mainly going to be part of our 2026 revenue and 2027. Part of the reason, on top of some, several multimillion-dollar new logos we won, due to the competitor weakness, that why we feel that there is a potential to grow on the networking side. On the SECaaS, we have a few examples here of customers that are expanding with us. Some are new customers, like Rakuten, that are adding our security services. As I mentioned, part of the growth is going after new partnerships.
Some are existing customers, like Verizon. We started small with them on a niche service, fixed wireless access, which is Wi-Fi connectivity that is backhauling on 5G. They saw how successful it is. They took us now into the mobile space. Now mobile business customers can also take the cybersecurity engine, and this is like 10 times addressable market for them. They have 35 million mobile business customers as opposed to a couple of millions of fixed wireless access. This is part of the reason we start to see significant growth, and this service was only launched end of April. In our Q2 numbers, there is only the initial launch, as mentioned, 36 - 48 months of expected growth. We are seeing also expanding into additional cyber applications. The Vodafone case that we announced late 2024, we were doing the consumer network, the mobile consumer.
They were selling our solution for EUR 1.50 in the United Kingdom. Now they also offer security at home. No matter where you are connected, if you are working with your carrier, they have fixed connectivity. They have mobile. As I mentioned, we are trying to expand into additional services. We invest in innovation in order to expand our cybersecurity capabilities, and we are working closely with our strategic partners in order to build more applications. With that, I will maybe end with the last comment. We did a secondary offering end of June. We raised $55 million on a secondary offering with some of the leading banks focusing on sponsoring our cybersecurity efforts. We used to have convertible debt that we eliminated, so we are debt-free now, over $70 million in our capital as of end of Q2. As mentioned, we are profitable and generating cash every quarter. Yeah?
In one of your earliest charts, you showed some of your customers, and I'll just pull out one example, like McDonald's, right? Are you covering the enterprise or specific franchises or franchise groups?
As mentioned, on the networking side, we are usually covering the enterprise part. What we do is that the franchises are connecting to the headquarters, and in order to manage their connectivity, both from a security perspective and connectivity, they implement our technology in order to optimize that. This is typically where we go. Today, about 15% of our business is on the enterprise. About 85% is on the CSP space.
Are you considering any direct-to-consumer sales? I noticed on your website, it's pretty opaque. It makes me think it's not a premium service. You know, it's clear that it is.
Today, I believe that we have a unique advantage that we must leverage. That is, as we are about a half-billion-dollar company, we don't want to go after the consumer by ourselves. We leverage our relationship with the CSPs and their huge sales channels and go-to-market in order to accelerate things. If we look down the road, a couple of years, two, three years down the road, as we further expand, this is part of the area we explore. As of today, this is our advantage. At some point, we will view it as a limitation because today we need to build this relationship in order to go to the market. It's part of the revenue.
Are you working with Verizon Business and stuff exclusive, or are you?
No, no. We are not exclusive with any of our customers. We are working with everyone. The sales cycle, again, to build this relationship is usually quite long sales cycles. If you try to work with those giants, they are very conservative. They want to test everything. They go to RFPs. This is a very tedious process that we go and we have sales cycles in different stages with partnerships with those carriers. Part of the long-term vision is to see how we can create additional channels. I think this is, you touched really the right spot, that we move from using the CSPs as customers. They are now a channel. It could be only one of the channels. We can create additional channels and get in other ways to the consumers.
We are still trying to be very, very focused, and we feel that we have now a great opportunity that we want to leverage.
Can you bundle your offerings with the back of the template?
Definitely. Some of our customers, what they do is, and we love once they do it, some sell it as an add-on, and then you need to have an incremental sales effort to sell it. Some do it as a bundled part of their premium package, and then we are bundled automatically, and once they do their main efforts to sell their connectivity, they do sell also our cybersecurity protection.
How do you bundle your products to your customers?
Typically, it's two different buying personas. We do have a unified platform, but it's two different buying personas. We are trying to leverage relationship and install base, but it's typically not bundled. In some cases, we give them that if they go with us on the cyberspace, this will sponsor the platform for the network guys that don't have budgets.
We are officially out of time. If there's any additional questions, we can take them outside.
Thank you very much.
Thank you.