1. Imagine a company like **Honeywell** or **Johnson Controls**, but exclusively focused on manufacturing and supplying security systems (alarms, access control, video surveillance).

2. They are like a specialized division of **Bosch** or **Siemens**, solely dedicated to producing comprehensive security and access control solutions.

• Alarm Systems: Manufactures and distributes intrusion and fire alarm control panels, communicators, and peripheral devices for various security applications.
• Access Control Systems: Provides hardware and software solutions, including card readers, biometric devices, and door controllers, for managing entry and exit.
• Video Surveillance Systems: Offers IP cameras, network video recorders (NVRs), and video management software for monitoring and recording security events.
• Door Locking Products: Supplies a variety of mechanical and electronic door locks, exit devices, and related hardware for commercial and institutional use.

Richard L. Soloway Chairman of the Board, President, Chief Executive Officer, and Secretary

Richard L. Soloway founded NAPCO Security Technologies, Inc. as a public company in 1972 on Long Island, New York. He has over 30 years of experience in the international security industry and has served as Chairman of the Board since 1981 and CEO since 1998. Soloway holds numerous electronic design and manufacturing patents for security technology. He was recognized with the Ernst & Young "Entrepreneur of the Year" award. Prior to NAPCO, he was involved in pioneering ventures in electric garage door openers and musical equipment manufacturing, having started designing and manufacturing electronic sound and light equipment for rock bands in the late 1960s. His work includes developing a customized security system for New York City schools during the Lindsay administration and providing electronic security for Air Force One.

Kevin S. Buchel President, Chief Operating Officer, Chief Financial Officer, Senior Vice President of Operations and Finance, and Treasurer

Kevin S. Buchel has been with NAPCO Security Technologies for 30 years, serving in various management positions. He became the Chief Financial Officer in 1995 and was promoted to President and Chief Operating Officer in May 2024, while also maintaining his role as CFO.

Michael Carrieri Executive Vice President of Engineering & Chief Technology Officer

Michael Carrieri has served as the Senior Vice President of Engineering Development for 24 years. He has been instrumental in NAPCO's substantial growth through his skills in creating a diverse range of products.

Andrew J. Vuono Senior Vice President of Finance and Chief Accounting Officer

Andrew J. Vuono was appointed as NAPCO's Senior Vice President of Finance and Chief Accounting Officer in June 2024. He brings over 30 years of public accounting experience, including more than 20 years as a partner at a top 10 Public Accounting Firm. In his role, he oversees the day-to-day accounting department and financial reporting activities, reporting directly to Kevin Buchel.

Stephen Spinelli Senior Vice President of Sales

Stephen Spinelli holds the position of Senior Vice President of Sales at NAPCO Security Technologies.

The key risks to NAPCO Security Technologies (NSSC) include an ongoing securities class action lawsuit and legal investigation, potential prolonged weakness in hardware sales, and the impact of tariffs.

1. Securities Class Action Lawsuit and Legal Investigation: NAPCO Security Technologies is currently facing an ongoing securities class action lawsuit and legal investigation. These legal challenges stem from allegations that the company misled investors regarding its ability to accurately forecast hardware demand and maintain margin targets. Furthermore, the company itself disclosed material weaknesses in its internal controls and significant overstatements of financial results. The court recently allowed the lawsuit to proceed, maintaining concerns about governance and transparency in the spotlight.
2. Prolonged Hardware Weakness and Macroeconomic Pressures: The company faces risks associated with prolonged weakness in its hardware sales. Past declines in sales have been attributed to factors such as distributor destocking and broader macroeconomic pressures. These conditions can directly impact the company's revenue and profitability, especially for its equipment sales segment.
3. Tariff Costs and Concerns: Tariffs have been identified as a factor contributing to past stock declines and reduced margins for NAPCO Security Technologies. These costs directly affect the company's profitability and can present ongoing challenges to its financial performance.

The increasing market penetration and technological sophistication of cloud-native, AI-driven integrated security platforms. Companies like Verkada, Rhombus Systems, and Openpath are rapidly gaining traction by offering comprehensive security solutions (video, access control, alarms) built from the ground up on cloud infrastructure with advanced AI analytics. These platforms often simplify installation, offer superior remote management, and operate on a subscription (SaaS) model, which challenges NAPCO's traditional hardware-centric, professionally installed model by offering a potentially more scalable, feature-rich, and user-friendly alternative for commercial and institutional clients.

The continued expansion and feature enhancement of integrated DIY and smart home security ecosystems. Companies like Ring (Amazon), SimpliSafe, Google Nest, and Arlo are making sophisticated home security and automation more accessible and affordable to consumers. While NAPCO targets the professional installer market, the increasing reliability, comprehensive features, and lower overall cost (both upfront and recurring) of these DIY/smart home solutions can erode the addressable market for entry-level professional installations, putting pressure on NAPCO's dealer network in the residential and small business sectors.

NAPCO Security Technologies (NSSC) operates within several addressable markets for its main products and services, primarily focused on electronic security solutions. These include intrusion alarms, access control systems, fire alarms, video surveillance, and specialized school security products. The market sizes for these areas are outlined below:

• Physical Security Market (overall): The global physical security market was valued at approximately USD 139.04 billion in 2024 and is projected to reach USD 255.46 billion by 2032, with a compound annual growth rate (CAGR) of 7.90%. North America holds the largest share of this market, accounting for 37.05%. Other estimates place the global market at USD 147.36 billion in 2024, growing to USD 216.43 billion by 2030 at a CAGR of 6.5%.
• Intrusion Detection and Prevention Systems (IDPS) Market: The global intrusion detection and prevention systems market was estimated at USD 6.25 billion in 2024 and is projected to reach USD 12.14 billion by 2030, demonstrating a CAGR of 12.2%. North America held a significant share of over 35% in 2024. The U.S. IDPS market size alone was USD 1.66 billion in 2024 and is projected to reach approximately USD 5.41 billion by 2034, with a CAGR of 12.54%.
• Access Control Market: The global access control market size was estimated at USD 10.76 billion in 2024 and is expected to reach USD 17.30 billion by 2030, with a CAGR of 8.4%. North America dominated this market with a 32.9% share in 2024. Another report estimates the global market at USD 10.6 billion in 2024, anticipated to grow to USD 18.8 billion by 2033, exhibiting a CAGR of 6.5%. North America accounts for over 38% of this market.
• Fire Alarm and Detection Market: The global fire alarm and detection market size was valued at USD 49.60 billion in 2024 and is projected to reach USD 71.21 billion by 2033, growing at a CAGR of 4.1%. North America dominated the global market in 2024. Another source indicates the global market size was approximately USD 35.23 billion in 2023 and is expected to reach USD 57.61 billion by 2032, with a CAGR of roughly 5.6%. North America holds the largest market share, accounting for approximately 38.2% of the global revenue in 2023.
• Smart Home Security Market: The global smart home security market was valued at USD 29.04 billion in 2024 and is projected to reach USD 93.14 billion by 2032, at a CAGR of 15.9%. North America held the largest share of 36.16% in 2024. Another estimate places the global market at USD 36.94 billion in 2025, rising to USD 70.54 billion by 2030 at a 13.81% CAGR.
• School and Campus Security Market: The global school and campus security market size was valued at USD 4.221 billion in 2025 and is expected to reach USD 22.71 billion by 2034, with a CAGR of about 20.56%. North America accounted for approximately 40% of the global market share in 2023, with the U.S. market size projected at USD 1.27486 billion in 2025. Other data suggests the global market reached USD 3.0 billion in 2024 and is projected to reach USD 9.2 billion by 2033, exhibiting a CAGR of 13.35%.

Here are 3-5 expected drivers of future revenue growth for NAPCO Security Technologies (NSSC) over the next 2-3 years:

1. Growth in Recurring Monthly Service Revenue (RMR): NAPCO anticipates continued expansion of its high-margin recurring monthly service revenue, primarily fueled by increased deployments of StarLink fire radios and the anticipated ramp-up of new cloud-based platforms, such as MVP. This shift towards a higher mix of subscription-style revenue is expected to provide more stable and predictable earnings.
2. Expansion into New Addressable Markets: The company is positioned to capitalize on broader societal demand for robust security and access control. This is particularly evident in verticals like schools and commercial buildings, which are opening new addressable markets for NAPCO's integrated solutions.
3. Launch and Growth of New Cloud-Based Products and Technological Advancements: New product introductions, notably the cloud-based MVP access control system, are expected to drive future revenue. NAPCO is investing in research and development to introduce innovative security solutions that meet evolving customer needs, thereby enhancing its competitive edge and contributing to revenue growth.
4. Strategic Price Increases: NAPCO has implemented strategic price adjustments, including those related to tariffs and normal annual increases, which have contributed to equipment revenue growth and are expected to continue to benefit the company in upcoming quarters.
5. Strong Performance and Demand for Door Locking Products: The company's door locking products, specifically the Alarm Lock and Marks brands, have demonstrated strong performance and are expected to continue to be significant contributors to equipment sales, driven by ongoing demand in sectors such as schools.

Share Repurchases

• In November 2024, NAPCO Security Technologies announced a share repurchase program authorizing the company to repurchase up to 1,000,000 shares.
• During fiscal year 2025, the company repurchased $36.8 million of its common stock, which amounted to 1.2 million shares at an average price of $30.40 per share.
• As of November 7, 2025, NAPCO completed the repurchase of 640,259 shares for $16.15 million under the buyback program initiated in November 2024.

Share Issuance

• In March 2024, a secondary public offering of 2,000,000 shares of common stock at $40.75 per share was conducted by a selling stockholder, Richard L. Soloway; NAPCO Security Technologies itself did not issue or sell any shares in this offering and did not receive any proceeds.

Capital Expenditures

• Investments in Research and Development (R&D) increased by 16.9% to $12.6 million in fiscal year 2025, making up 7% of sales, compared to $10.8 million or 6% of sales in the previous year.
• These R&D expenditures are primarily focused on developing innovative security solutions, such as the new cloud-based MVP Access platform, to enhance competitiveness and drive revenue growth.
• For the first quarter of fiscal year 2026 (ended September 30, 2025), R&D costs totaled $3.2 million, representing 6.6% of revenue.