Quantum’s QQ3 2025 results demonstrate meaningful operating improvement and a strategic pivot toward higher-margin, recurring revenue. Revenue came in at $72.6 million, GAAP gross margin expanded to 43.8% (up 230 bps QoQ), and non-GAAP operating expenses declined about 6% YoY, delivering a positive adjusted EBITDA of $4.7 million. Annual recurring revenue (ARR) reached $21.3 million in the quarter, up 29% YoY and ~9% sequentially, with subscription-based revenue comprising over 90% of new unit sales, underscoring the company’s transition to a more predictable revenue model. Backlog normalized near $9.3 million, signaling improved revenue visibility as supply-chain constraints ease. Management attributed much of the progress to self-help actions, a higher-margin product mix, and a large U.S. federal deal, while continuing to emphasize debt reduction and balance-sheet strengthening via a standby equity purchase agreement with Yorkville Advisors.