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Lumine Group Inc. Announces Results for the Three and Six Months Ended June 30, 2024

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2 years ago

on

TORONTO, Aug. 7, 2024 /CNW/ – Lumine Group Inc. (“Lumine Group” or “the Company”) (TSXV: LMN)  announces financial results for the three and six months ended June 30, 2024. All amounts referred to in this press release are in US dollars unless otherwise stated.

The following press release should be read in conjunction with the Company’s unaudited condensed consolidated interim financial statements for the three and six months ended June 30, 2024, and management’s discussion and analysis (“MD&A”) for the three and six months ended June 30, 2024, which can be found on SEDAR+ at www.sedarplus.ca. Additional information about Lumine Group is also available on SEDAR+ and on Lumine Group’s website www.luminegroup.com.

Q2 2024 Headlines:

Revenue grew 25% to $162.8 million compared to $129.9 million in the same quarter prior year (including -12% organic growth after adjusting for foreign exchange impacts).The Company generated operating income of $36.6 million during the quarter, a 1% increase from $36.4 million in the same quarter prior year.The Company generated a net loss of $2.2 million during the quarter, from net loss of $489.1 million in the same quarter prior year.Cash flows from operations (“CFO”) decreased $12.4 million to $10.0 million compared to $22.4 million in Q2 2023, representing a decrease of 55%.Free cash flow available to shareholders (“FCFA2S”) decreased $14.5 million to $2.8 million compared to $17.3 million in Q2 2023, representing a decrease of 84%.

Year-to-Date Q2 2024 Headlines:

Revenue grew 35% to $303.9 million compared to $225.3 million in the same six-month period prior year (including -8% organic growth after adjusting for foreign exchange impacts).The Company generated operating income of $81.1 million in the six-month period ended June 30, 2024, an increase of 40% from $58.0 million in the same period prior year.An expense of $317.4 million was incurred in the six-month period ended June 30, 2024 up to the Mandatory Conversion Date, $298.7 million is related to the mark to market adjustments on the fair value of the Preferred and Special Securities and $18.7 million is related to the dividend payable. Fair value of the preferred and special securities is primarily dependent on the price movement of the Company’s Subordinate Voting Shares.The Company generated a net loss of $306.6 million during the six-month period ended June 30, 2024, from net loss of $1,140.7 million in the same period prior year. The net loss is primarily related to the redeemable preferred and special securities expense in 2023.CFO increased $7.7 million to $45.0 million compared to $37.4 million in the six-month period ended June 30, 2023, representing an increase of 21%.FCFA2S increased $2.6 million to $31.5 million compared to $29.0 million in the six-month period ended June 30, 2023, representing an increase of 9%.

Total revenue for the three months ended June 30, 2024 is $162.8 million, an increase of 25%, or $32.9 million, compared to $129.9 million for the comparable period in 2023. For the six months ended June 30, 2024, total revenue was $303.9 million, an increase of 35%, or $78.7 million, compared to $225.3 million for the comparable period in 2023. The increase for the three and six months compared to the same period in the prior year is attributable to revenues from new acquisitions. The Company experienced organic growth of -12% and -7%, respectively for the three and six months ended June 30, 2024, or -12% and -8% after adjusting for the impact of changes in the valuation of the US dollar against most major currencies in which the Company transacts business. For acquired companies, organic growth is calculated as the difference between actual revenues achieved by each business in the financial period following acquisition, compared to the estimated revenues they achieved in the corresponding financial period preceding the date of acquisition by the Company. Organic growth is not a standardized financial measure and might not be comparable to measures disclosed by other issuers.

Operating income for the three months ended June 30, 2024 was $36.6 million, an increase of 1%, or $0.2 million, compared to $36.4 million for the same period in 2023. Operating income for the six months ended June 30, 2024 was $81.1 million, an increase of 40%, or $23.0 million, compared to $58.0 million for the same period in 2023. The increase for the three and six month periods is primarily attributable to growth from 2023 acquisitions partially offset by current period losses from 2024 acquisitions. Operating income is not a standardized financial measure and might not be comparable to measures disclosed by other issuers. See “Non-IFRS Measures”.

Net loss for the three months ended June 30, 2024 was $2.2 million compared to net loss of $489.1 million for the same period in 2023. Net loss for the six months ended June 30, 2024 was $306.6 million compared to net loss of $1,140.7 million for the same period in 2023. The decrease in net loss for the three and six month periods is primarily attributable to the Mandatory Conversion of Preferred and Special Securities on March 25, 2024 such that no further preferred and special securities expense was booked in the current quarter.

For the three months ended June 30, 2024, CFO decreased $12.4 million to $10.0 million compared to $22.4 million for the same period in 2023 representing a decrease of 55%. The decrease in CFO is primarily attributable to current period losses from 2024 acquisitions.

For the six months ended June 30, 2024, CFO increased $7.7 million to $45.0 million compared to $37.4 million for the same period in 2023 representing an increase of 21%. The primary reason for the increase is that CFO includes the impact of changes in non-cash operating assets and liabilities exclusive of effects of business combinations or, changes in non-cash operating working capital (“NCOWC”) which improved during the six months ended June 30, 2024 compared to the same period prior year.

For the three months ended June 30, 2024, FCFA2S decreased $14.5 million, or 84%, to $2.8 million compared to $17.3 million for the same period in 2023. The decrease is primarily a result of lower CFO during the period. For the six months ended June 30, 2024, FCFA2S increased $2.6 million, or 9%, to $31.5 million compared to $29.0 million for the same period in 2023. The increase is primarily a result of higher CFO during the period. FCFA2S is not a standardized financial measure and might not be comparable to measures disclosed by other issuers.  See “Non-IFRS Measures”.

Non-IFRS Measures

Operating income (loss) refers to income (loss) before income taxes, amortization of intangible assets, redeemable Preferred and Special Share expense, and finance and other expenses (income). We believe that operating income is useful supplemental information as it provides an indication of the profitability of the Company related to its core operations. Operating income (loss) is not a recognized measure under IFRS and may not be comparable to similar financial measures disclosed by other issuers. Accordingly, readers are cautioned that operating income (loss) should not be construed as an alternative to net income (loss).

The following table reconciles operating income to net income:

Three months ended

June 30,

Six months ended

June 30,

2024

2023

2024

2023

Net income (loss)

(2.2)

(489.1)

(306.6)

(1,140.7)

Adjusted for:

Amortization of intangible assets

29.2

21.5

52.0

36.3

Redeemable preferred and special securities expense

–

496.6

317.4

1,151.2

Finance and other expense (income)

5.7

4.3

10.0

6.3

Income tax expense (recovery)

3.9

3.1

8.3

4.9

Operating income (loss)

36.6

36.4

81.1

58.0

Free cash flow available to shareholders ”FCFA2S” refers to net cash flows from operating activities less interest paid on lease obligations, interest paid on bank debt, transaction costs on bank debt, repayments of lease obligations, dividends paid to redeemable preferred and special securities holders, and property and equipment purchased. The Company believes that FCFA2S is useful supplemental information as it provides an indication of the uncommitted cash flow that is available to shareholders if Lumine Group does not make any acquisitions, or investments, and does not repay any debts. While the Company could use the FCFA2S to pay dividends or repurchase shares, the Company’s objective is to invest all of its FCFA2S in acquisitions which meet the Company’s hurdle rate.

FCFA2S is not a recognized measure under IFRS and may not be comparable to similar financial measures disclosed by other issuers. Accordingly, readers are cautioned that FCFA2S should not be construed as an alternative to net cash flows from operating activities.

The following table reconciles FCFA2S to net cash flows from operating activities:

 Three months ended
June 30,

 Six months ended
June 30,

2024

2023

2024

2023

Net cash flows from operating activities:

10.0

22.4

45.0

37.4

Adjusted for:

Interest paid on lease obligations

(0.1)

(0.2)

(0.3)

(0.3)

Interest paid on other facilities

(5.1)

(3.2)

(7.6)

(3.6)

Credit facility transaction costs

(0.2)

0.0

(1.8)

(1.8)

Payment of lease obligations

(1.5)

(1.5)

(3.0)

(2.4)

Property and equipment purchased

(0.4)

(0.2)

(0.7)

(0.4)

Free cash flow available to shareholders

2.8

17.3

31.5

29.0

Forward Looking Statements

Certain statements herein may be “forward looking” statements that involve known and unknown risks, uncertainties and other factors that may cause the actual results, performance or achievements of Lumine Group or the industry to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements. Forward looking statements involve significant risks and uncertainties, should not be read as guarantees of future performance or results, and will not necessarily be accurate indications of whether or not such results will be achieved. A number of factors could cause actual results to vary significantly from the results discussed in the forward looking statements. These forward looking statements reflect current assumptions and expectations regarding future events and operating performance and are made as of the date hereof and Lumine Group assumes no obligation, except as required by law, to update any forward looking statements to reflect new events or circumstances.

About Lumine Group Inc.

Lumine Group acquires, strengthens, and grows, vertical market software businesses in the communications and media industry. Learn more at www.luminegroup.com. 

Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.

Lumine Group Inc.
Condensed Consolidated Interim Statements of Financial Position
(In thousands of USD.  Due to rounding, numbers presented may not foot.)

Unaudited

June 30, 2024

December 31, 2023

Assets

Current assets:

Cash

$                167,773

$           146,509

Accounts receivable, net

127,329

104,955

Unbilled revenue, net

49,828

39,858

Inventories

561

521

Other assets

46,780

46,377

392,271

338,220

Non-current assets:

Property and equipment

7,138

4,164

Right of use assets

9,060

11,973

Deferred income taxes

6,371

6,197

Other assets

11,518

13,063

Intangible assets and goodwill

845,525

762,665

879,612

798,062

Total assets

$             1,271,883

$        1,136,282

Liabilities and Equity

Current liabilities:

Accounts payable and accrued liabilities

$                100,821

$             97,533

Due to related parties, net

1,529

2,380

Current portion of bank debt

2,166

3,071

Deferred revenue

97,110

91,726

Acquisition holdback payables

318

319

Lease obligations

6,073

6,358

Income taxes payable

11,702

12,436

Preferred and Special Securities

–

4,469,996

219,720

4,683,819

Non-current liabilities:

Deferred income taxes

115,341

124,878

Bank debt

288,818

149,636

Lease obligations

4,079

6,921

Other liabilities

9,684

12,995

417,922

294,430

Total liabilities

637,641

4,978,249

Equity:

Capital stock

490,669

–

Contributed surplus

185,142

(1,015,661)

Accumulated other comprehensive income (loss)

(10,896)

(6,296)

Retained earnings (deficit)

(30,673)

(2,820,010)

634,242

(3,841,967)

Subsequent events

Total liabilities and equity

$             1,271,883

$              1,136,282

Lumine Groupe Inc.
Condensed Consolidated Interim Statements of Income (Loss)
(In thousands of USD, except per share amounts. Due to rounding, numbers presented may not foot.)

Unaudited

Three months ended June 30,

Six months ended June 30,

2024

2023

2024

2023

Revenue

License

$         11,687

$            11,094

$         23,407

$           21,743

Professional services

28,909

23,440

53,842

40,267

Hardware and other

2,326

4,728

4,743

9,336

Maintenance and other recurring

119,903

90,623

221,932

153,920

162,825

129,885

303,924

225,266

Expenses

Staff

87,704

71,285

160,733

119,904

Hardware

1,418

3,132

2,938

6,451

Third party license, maintenance and professional services

11,867

8,050

20,406

12,785

Occupancy

975

789

1,871

1,566

Travel, telecommunications, supplies, software and equipment

12,751

5,214

19,508

9,886

Professional fees

5,655

2,919

8,487

10,232

Other, net

3,509

(94)

4,455

2,688

Depreciation

2,337

2,195

4,452

3,705

Amortization of intangible assets

29,211

21,481

52,032

36,317

155,427

114,971

274,882

203,535

Redeemable Preferred and Special Securities expense

–

496,588

317,362

1,151,203

Finance and other expenses (income)

5,698

4,332

9,970

6,257

5,698

500,920

327,332

1,157,460

Income (loss) before income taxes

1,700

(486,006)

(298,290)

(1,135,729)

Current income tax expense (recovery)

9,209

10,649

17,555

18,162

Deferred income tax expense (recovery)

(5,274)

(7,557)

(9,272)

(13,227)

Income tax expense (recovery)

3,935

3,092

8,283

4,935

Net income (loss)

$         (2,235)

$        (489,098)

$     (306,573)

$        (1,140,664)

Weighted average shares outstanding:

Basic

256,620,388

74,008,247

171,366,154

70,914,357

Diluted

256,620,388

253,106,712

254,978,572

236,914,312

Earnings per share:

Basic and diluted

$           (0.01)

$              (6.61)

$           (1.79)

$        (16.09)

Lumine Group Inc.
Condensed Consolidated Interim Statements of Comprehensive Income (Loss)
(In thousands of USD. Due to rounding, numbers presented may not foot.)

Unaudited

Three months ended June 30,

Six months ended June 30,

2024

2023

2024

2023

Net income (loss)

$            (2,235)

$    (489,098)

$        (306,573)

$ (1,140,664)

Items that are or may be reclassified subsequently to net income (loss):

Foreign currency translation differences from foreign operations and other

5,321

(900)

(4,600)

(311)

Other comprehensive (loss) income for the year, net of income tax

5,321

(900)

(4,600)

(311)

Total comprehensive income (loss) for the year

$              3,086

$    (489,998)

$        (311,173)

$ (1,140,975)

Lumine Group Inc.
Condensed Consolidated Interim Statement of Changes in Equity
(In thousands of USD.  Due to rounding, numbers presented may not foot.)

Unaudited

Six months ended June 30, 2024

Capital stock

Contributed
surplus

Accumulated other
comprehensive
(loss) income

Retained
earnings
(deficit)

Total equity

Balance at January 1, 2024

$                –

$     (1,015,661)

$           (6,296)

$   (2,820,010)

$      (3,841,967)

Total comprehensive income (loss) for the period:

Net income (loss)

–

–

–

(306,573)

(306,573)

Other comprehensive income (loss):

Foreign currency translation differences from foreign operations and other

–

–

(4,600)

–

(4,600)

Total other comprehensive income (loss) for the period

–

–

(4,600)

–

(4,600)

Total comprehensive income (loss) for the period

–

–

(4,600)

(306,573)

(311,173)

Mandatory Conversion of Special and Preferred Shares

87,368

–

–

–

87,368

Settlement of Preferred and Special Share Dividends in Subordinate Voting Shares

403,301

1,200,803

–

3,095,910

4,700,014

Balance at June 30, 2024

$   490,669

$            185,142

$      (10,896)

$      (30,673)

$      634,242

Lumine Group Inc.
Condensed Consolidated Interim Statement of Changes in Equity
(In thousands of USD.  Due to rounding, numbers presented may not foot.)

Unaudited

Six months ended June 30, 2023

Capital stock

Contributed
surplus

Accumulated other
comprehensive
(loss) income

Retained
earnings
(deficit)

Total equity

Balance at January 1, 2023

$                –

$          162,692

$           (8,912)

$                   –

$         153,780

Total comprehensive income (loss) for the period:

Net income (loss)

–

–

–

(1,140,664)

(1,140,664)

Other comprehensive income (loss):

Foreign currency translation differences from foreign operations and other

–

–

(311)

–

(311)

Total other comprehensive income (loss) for the period

–

–

(311)

–

(311)

Total comprehensive income (loss) for the period

–

–

(311)

(1,140,664)

(1,140,975)

Transactions with Parent, recorded directly in equity

Capital contributions by Parent

–

22,451

–

–

22,451

Amalgamation with Lumine Group (Holdings) Inc.

–

(1,200,803)

–

–

(1,200,803)

Special Share conversion

–

–

–

4,040

4,040

Balance at June 30, 2023

$             –

$  (1,015,660)

$        (9,223)

$ (1,136,624)

$ (2,161,507)

Lumine Group Inc.
Condensed Consolidated Interim Statements of Cash Flows
(In thousands of USD.  Due to rounding, numbers presented may not foot.)

Unaudited

Three months ended June 30,

Six months ended June 30,

2024

2023

2024

2023

Cash flows from (used in) operating activities:

Net income (loss)

$     (2,235)

$  (489,098)

$  (306,573)

$  (1,140,664)

Adjustments for:

Depreciation

2,337

2,195

4,452

3,705

Amortization of intangible assets

29,211

21,481

52,032

36,317

Contingent consideration adjustments

915

(3,149)

958

(2,478)

Preferred and Special Securities expense (income)

–

496,588

317,362

1,151,203

Finance and other expenses (income)

5,698

4,332

9,970

6,257

Income tax expense (recovery)

3,935

3,092

8,283

4,935

Change in non-cash operating assets and liabilities exclusive of effects of business combinations

(26,134)

(6,355)

(34,127)

(10,388)

Income taxes (paid) received

(3,680)

(6,679)

(7,317)

(11,512)

Net cash flows from (used in) operating activities

10,047

22,407

45,040

37,375

Cash flows from (used in) financing activities:

Interest paid on lease obligations

(130)

(167)

(284)

(259)

Interest paid on bank debt

(5,130)

(3,249)

(7,602)

(3,591)

Cash transferred from (to) Parent

118

(7,165)

(1,990)

(11,835)

Proceeds from issuance of bank debt

50,500

–

140,500

175,000

Repayments of bank debt

(244)

(410)

(488)

(654)

Transaction costs on bank debt

(194)

–

(1,849)

(1,771)

Payments of lease obligations

(1,468)

(1,525)

(3,034)

(2,365)

Issuance of Preferred Shares to Parent

–

–

–

181,484

Dividends paid

–

(12)

–

(12)

Net cash flows from (used in) in financing activities

43,452

(12,528)

125,253

335,997

Cash flows from (used in) investing activities:

Acquisition of businesses

(144,325)

–

(144,325)

(314,760)

Cash obtained with acquired businesses

–

–

–

33,965

Post-acquisition settlement payments, net of receipts

–

(2,307)

(685)

(2,669)

Property and equipment purchased

(363)

(180)

(724)

(421)

Other investing activities

(271)

(657)

(265)

(657)

Net cash flows from (used in) investing activities

(144,959)

(3,143)

(145,999)

(284,542)

Effect of foreign currency on cash and cash equivalents

(554)

(314)

(3,030)

(12)

Increase (decrease) in cash

(92,014)

6,422

21,264

88,818

Cash, beginning of period

259,787

149,481

146,509

67,085

Cash, end of period

$   167,773

$    155,903

$   167,773

$         155,903

SOURCE Lumine Group Inc

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Technology

U.S. Quartz Workers: Strong Safeguard Remedies Needed to Save 100,000 American Manufacturing Jobs

Published

3 minutes ago

on

July 23, 2026

By

WASHINGTON, July 23, 2026 /PRNewswire/ — The Quartz Manufacturers Alliance for America (QMAA) released a powerful video featuring quartz manufacturing workers from across the country calling for free and fair trade policies to save 100,000 American jobs. QMAA, a coalition of leading U.S.-based quartz slab manufacturers, are calling for strong safeguard remedies after the U.S. International Trade Commission (ITC) found a huge flood of foreign imports had caused tremendous injury to the domestic quartz industry.

QMAA members are urging the Trump Administration to build on the ITC’s strong recommendation and address this major flood of quartz imports with a Tariff of 50% and a Reshoring Import Cap of 141 million square feet on imported quartz surface products. This will ensure a reshoring of the good-paying U.S. quartz manufacturing jobs stolen by companies who cheat U.S. trade law, distort competition and are decimating U.S. quartz manufacturing. Together, these trade remedies will provide the relief necessary to save the 100,000 jobs supported by the U.S. quartz industry.

The video features workers from LX Hausys, Guidoni USA and Cambria Company and is available here:
Save 100,000 American Quartz Jobs

Quotes from QMAA Quartz Manufacturing Workers
“This facility used to be a Husqvarna plant. Husqvarna closed down due to cheap foreign imports. There were over 1,000 people working here and all of a sudden…I’m worried I may see the same thing take place again.”
-Raymond Mack, Production Operator, Guidoni USA, Helena-McRae, GA

“Foreign countries, mainly China, Thailand, Malaysia, Vietnam, Indonesia, have been circumventing and cheating the American market. We believe in the industry. We believe in the American working power. We just want to level the playing field, make it fair for everyone and everyone will benefit.”
– Daniel Vas de Melo SA, Business Development Manager, Guidoni USA, McRae-Helena, GA

“In order for us to continue to compete, we need a strong Tariff and Import Cap on imported quartz surfaces. That will ensure we can play on an even playing field. That’s all we’re asking for. I would hate to see cheap, imported quartz have a negative impact on families such as mine and the other families that we employ here.”
– Mike Morici, Vice President – LX Hausys, Adairsville, GA

“The surge of foreign imports has shocked the U.S. economy, and the market for surfaces. It’s taken prices down to unsustainably low levels for any domestic supplier. The result of that is we’re not producing as much as we should, we can’t hire as many people as we would like to, and we can’t grow our business in the way that we and our peers in the U.S. want to grow.”
– Andrew Eich, President and Chief Operating Officer, Cambria

“As these foreign imports flood the market, we lose the ability to create and sustain jobs that ensure good paying conditions for manufacturing workers. There will be over 100,000 jobs that have the strong potential to go away.”
– Jack Sundry, SVP Core and Lexus – Cambria, Southern Minnesota

Background
In September 2025, QMAA filed a Global Safeguard petition with the U.S. International Trade Commission (ITC) under Section 201 of the U.S. Trade Act of 1974. The ITC’s thorough investigation found serious injury to the domestic industry caused by a massive import surge designed to undercut American businesses. Quartz imports have surged by 78.3% within the past five years, leading to a nearly 20% decline in domestic production, factory closures and major job reductions.

A final safeguard decision from the United States Trade Representative is expected by Aug. 1, 2026.

About the Quartz Manufacturing Alliance for America:
QMAA is a coalition of U.S.-based, American quartz slab manufacturing factories, united with other industry leaders to support and strengthen the American quartz industry. QMAA is committed to ensuring a free and fair, competitive marketplace born of free enterprise that provides the opportunity to compete on a level playing field for American quartz slab manufacturing factories and their valued workers. We also believe this effort will have a positive impact throughout the entire quartz surfacing industry, including to the strong benefit of American stone fabrication shops and upstream suppliers of quartz minerals and resin. Learn more at: https://www.qmaa.org/

View original content to download multimedia:https://www.prnewswire.com/news-releases/us-quartz-workers-strong-safeguard-remedies-needed-to-save-100-000-american-manufacturing-jobs-302833444.html

SOURCE Quartz Manufacturing Alliance of America

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Technology

Databricks and Microsoft expand partnership to help enterprises bring business context to enterprise AI

Published

3 minutes ago

on

July 23, 2026

By

Databricks and Microsoft extend strategic partnership through the 2030s to scale enterprise AIDatabricks deepens its bet on Azure, growing its use of Azure Databricks to run its own core business operations and analytics, while both companies advance native integration across the Microsoft stack, including Databricks Genie and Microsoft 365Databricks increases its use of Microsoft Azure Cobalt to improve performance and efficiency

REDMOND, Wash. and SAN FRANCISCO, July 23, 2026 /PRNewswire/ — Microsoft Corp. and Databricks on Wednesday announced an expansion of their decade-long strategic partnership, extending into the 2030s. Databricks will deepen its use of Azure Databricks to run core business operations and build its unified lakehouse, while leveraging Azure Cobalt, Microsoft’s next-generation Arm-based infrastructure, to improve performance and efficiency. Microsoft will also continue integrating Databricks Data and AI platform across its products, bringing capabilities like Genie, Databricks’ AI co-worker, directly into customer workflows. Together, the companies are helping enterprises build AI grounded in their own business context with the cost efficiency, control and choice needed to scale successfully.

Enterprises want AI that understands their customers, products, operations, metrics and business processes, all while running securely where work happens. Yet, most still struggle to connect AI to trusted business knowledge, govern models and agents consistently, and control costs. Microsoft and Databricks are helping customers close that gap: 

“For nearly a decade, Databricks and Microsoft have helped enterprises innovate with data and AI,” said Ali Ghodsi, Co‑Founder and CEO of Databricks. “Today, our partnership is stronger than ever. With Databricks Genie and Unity AI Gateway deeply integrated across Microsoft’s products, we’re helping enterprises unify their data and ground AI in business knowledge. This lets customers get the full benefits of agents and models while controlling costs and ensuring governance.”

“The next generation of AI will be defined by how effectively organizations turn their unique knowledge into intelligence,” said Judson Althoff, CEO, Microsoft Commercial Business. “Microsoft and Databricks are helping customers connect data, AI and business context to accelerate decision-making and drive measurable impact. With Databricks deepening its investment in Azure Databricks and Azure Cobalt-powered infrastructure, customers will benefit from greater performance, efficiency and scale for their most demanding workloads. Databricks’ decision to run its own core business operations on Azure Databricks also gives customers confidence in a platform proven at enterprise scale.”

Databricks runs core business operations on Azure Databricks 

As part of this latest deal, Databricks deepens its commitment to Azure, running its own core business operations and analytics on Azure Databricks, using the very platform it delivers to customers at scale.

Advancing performance with Azure Cobalt

Databricks will also expand its use of Azure Cobalt, Microsoft’s next-generation Arm-based infrastructure, to improve performance and efficiency for agentic and data-intensive workloads. Databricks currently uses Cobalt 100 and plans to adopt Cobalt 200, which delivers up to 50% better performance and includes memory encryption enabled by default.

Deep integrations for Databricks Genie and Unity AI Gateway with Microsoft product stack

By combining the Databricks Data + AI Platform with Azure’s global scale, customers can accelerate AI transformation while maintaining control and reliability. As a native Azure service, Azure Databricks makes its AI capabilities available directly within customers’ existing Microsoft environment, grounding and operating agents on enterprise data with Genie and Genie Ontology, and governing models, agents and cost through Unity AI Gateway. Deeply integrated across the Microsoft ecosystem spanning Microsoft Entra, Azure Data Lake Storage, Azure security, Microsoft OneLake, Power BI, Microsoft Purview, Microsoft Foundry, Power Platform, Microsoft 365, Teams and Copilot, these capabilities bring governed, real-time data and AI into business workflows, giving organizations the context, control, choice and cost efficiency needed to drive impact.

Continued investment is evident from our recent announcements with Databricks at Data + AI Summit in June.

Customer impact with Azure Databricks

The deepened collaboration strengthens support for joint customers running data, analytics and AI workloads on Azure Databricks, delivering improved performance, security, AI governance and enterprise readiness. Thousands of customers, including Banco Bradesco, the Cincinnati Reds, Electrolux, SMBC and Unilever, already use Azure Databricks to run critical workloads and scale AI with confidence.

Read more on the proven business value of the Databricks and Microsoft partnership on the Microsoft Azure blog.

About Databricks

Databricks is the Data and AI company. More than 20,000 organizations worldwide — including AT&T, Bayer, BMW Group, HSBC, T-Mobile, Unilever, and 70% of the Fortune 500 — rely on Databricks Data + AI Platform to build and scale data and AI apps, analytics and agents. Headquartered in San Francisco with 30+ offices around the globe, Databricks offers a unified platform that includes Genie, Lakebase, Agent Bricks, Lakeflow, Lakehouse, and Unity Catalog. To learn more, follow Databricks on LinkedIn, X, YouTube, and Instagram.

About Microsoft

Microsoft (Nasdaq “MSFT” @microsoft) creates platforms and tools powered by AI to deliver innovative solutions that meet the evolving needs of our customers. The technology company is committed to making AI available broadly and doing so responsibly, with a mission to empower every person and every organization on the planet to achieve more.

 

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SOURCE Microsoft Corp.

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Harness and Kong Expand Strategic Partnership to Deliver Comprehensive API and AI Security

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July 23, 2026

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Joint solution extends proven API gateway security to the AI era — with automated AI discovery and runtime AI protection

SAN FRANCISCO, July 23, 2026 /PRNewswire/ — Harness, the AI Software Delivery Platform™ company, and Kong Inc., a leading developer of API and AI connectivity technologies, today announced an expansion of their strategic partnership to address the growing security challenges posed by AI-driven architectures, autonomous agents, and Model Context Protocol (MCP) deployments.

According to The State of AI-Native Application Security 2025 report, as enterprises race to deploy AI at scale, 62% have no visibility into where LLMs are in use across their environment, and 74% say AI sprawl will outpace API sprawl when it comes to risk — making embedded, infrastructure-level security more critical than ever. And companies are now deploying agents into their operations at an exponentially increasing rate, making it a necessity to protect the agents themselves and the systems interacting with those agents.

The two companies are extending their joint solution from Kong API Gateway to also include Kong AI Gateway, bringing Harness’s AI security intelligence directly into the AI infrastructure layer and enabling enterprises to discover, monitor, and protect every agent, AI asset, LLM-powered service, and MCP-connected workflow that traverses it.

A Proven Foundation: Harness and Kong API Gateway

Harness and Kong have been jointly trusted by enterprises to deliver best-in-class API security for years. The existing Harness and Kong API Gateway integration provides:

Comprehensive API traffic visibility and behavioral analysis across all Kong-managed servicesReal-time detection and blocking of API threats, including OWASP API Security Top 10 risks, credential stuffing attacks, and business logic abuseContinuous sensitive data tracking to identify PII exposure and regulatory riskZero-friction deployment alongside existing Kong configurations

This new offering of the AI Gateway solution applies the same level of security depth to AI infrastructure, ensuring that security teams are not left behind as their organizations adopt AI and agentic operations.

“Our partnership with Harness has given joint customers production-grade API security that works with the way they build, not against it,” said Ken Kim, Senior Vice President, Business Development at Kong Inc. “Extending to include Kong AI Gateway is a natural next step. The same enterprises are now moving AI into production through our gateway and need the same depth of visibility and control they’ve come to rely on for their APIs for all AI traffic types including LLM, MCP, and A2A. That’s exactly what this delivers and is crucial for organizations scaling in the agentic era.”

The New Frontier: Kong AI Gateway and Harness AI Security

As enterprises accelerate AI adoption, the attack surface has fundamentally shifted. AI agents, LLM-powered microservices, and MCP-enabled integrations introduce new vectors that traditional security tools were not designed to address. Unlike traditional software, AI agents are non-deterministic — the same agent can behave differently on consecutive runs, making it impossible to secure them the way you’d secure a static API. The new Harness and Kong AI Gateway integration directly tackles these challenges across two critical domains: AI discovery and AI protection.

AI Discovery
Harness automatically inventories every AI asset, API, MCP server, tool, prompt, and resource routed through Kong AI Gateway — providing security teams with a continuously updated catalog of their AI attack surface. No manual documentation. No blind spots.

AI Protection
Harness applies behavioral analysis and anomaly detection to AI traffic in real time, identifying prompt injection attacks, data exfiltration through AI responses, jailbreaking, malicious code in prompts, and other AI-specific threats. Enterprises gain the same depth of observability and protection for their agents and AI workloads that they already rely on for traditional APIs, with full prompt and response details available for incident investigation and inline policy enforcement through Kong AI Gateway.

“Shadow AI has become the defining security blind spot for enterprises today. Traditional tools were built for static code and predictable systems, not for adaptive AI models, agent-to-agent communication, and MCP-connected workflows that evolve continuously,” said Rahul Sood, GM of Application Security at Harness. “This integration of Harness AI Security with Kong puts security intelligence directly into the connectivity layer where AI traffic flows. Joint customers now have the visibility and control they need to move fast without losing sight of what’s happening across their AI infrastructure.”

Availability

The Harness and Kong API Gateway integration is generally available today for all joint customers. The Kong AI Gateway integration, including AI Discovery and AI Protection, is also generally available now. Joint customers can contact their account team or request a demo.

About Harness
Harness is the AI Software Delivery Platform™ company, enabling engineering teams to build, test, and deliver software faster and more securely. Powered by Harness AI and the Software Delivery Knowledge Graph, the platform brings intelligent automation to every stage of the software delivery lifecycle after code — removing toil and freeing developers from manual, repetitive work. Companies like United Airlines, Morningstar, and Choice Hotels use Harness to accelerate releases by up to 75%, cut cloud costs by 60%, and achieve 10x efficiency across DevOps. Based in San Francisco, Harness is backed by Goldman Sachs, Menlo Ventures, IVP, Unusual Ventures, and Citi Ventures.

About Kong

Kong Inc., a leading developer of API and AI connectivity technologies, is building the connectivity layer of AI. Trusted by the Fortune 500® and AI-native startups alike, Kong’s unified API and AI platform enables organizations to secure, manage, accelerate, govern, and monetize the flow of intelligence across APIs and AI traffic — on any model, any cloud. For more information, visit www.konghq.com.

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SOURCE Harness

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