Financial Data and Key Metrics Changes - Revenue in Q1 of fiscal 2026 increased more than four times to $21.4 million compared to $4.6 million in Q1 of fiscal 2025 [16] - Gross margin increased significantly to 78.6% in Q1 of fiscal 2026 from 24.5% in Q1 of fiscal 2025, primarily driven by staking revenue from the Solana treasury strategy [16] - Net loss for Q1 of fiscal 2026 was approximately $585.6 million, compared to a net loss of $0.7 million in Q1 of fiscal 2025, largely due to a decline in the fair value of SOL holdings [18] Business Line Data and Key Metrics Changes - Forward held approximately 6,962,501 Solana as of December 31, 2025, with over 99% staked, generating a staking yield between 6.5% and 7.2% [13] - Fully diluted SOL per share increased from 0.0604 at the end of September 2025 to 0.0624 as of December 31, 2025, representing a growth of roughly 13% in the fiscal first quarter [14] Market Data and Key Metrics Changes - Solana continues to lead in decentralized exchange trading volumes, active users, and developer engagement, demonstrating resilience and performance [6][7] - Institutional engagement has expanded significantly, with major financial institutions integrating Solana into their operations, such as WisdomTree launching regulated tokenized funds on Solana [7] Company Strategy and Development Direction - The company aims to build a permanent capital vehicle that participates directly in the growth of the Solana ecosystem, evolving beyond a treasury into an active value-generating business [5] - Forward Industries is focused on compounding SOL per share by engaging directly in economic activities on-chain rather than relying solely on passive exposure [6] Management's Comments on Operating Environment and Future Outlook - Management acknowledges the volatility in the market but emphasizes that Solana is now being evaluated based on actual performance rather than theoretical scalability [6] - The company believes that the opportunity in front of Solana is increasingly clear, with significant growth in stablecoins, payments, and DeFi applications [7] Other Important Information - Forward became one of the first public companies to have its SEC-registered shares live on a public blockchain, allowing eligible non-US holders to use tokenized shares as collateral in DeFi [8][9] - The company launched fwdSOL, a proprietary liquid staking token, representing approximately 25% of its SOL holdings, allowing for efficient deployment of staked SOL [9][10] Q&A Session Summary Question: How has the company navigated recent token price volatility? - Management noted that SOL is down approximately 70% from its all-time high, which is typical in the crypto market, and emphasized maintaining a clean balance sheet to avoid risks faced by competitors [19][20] Question: What is the company's approach to potential M&A? - The company is looking for accretive acquisitions and is well-positioned to capitalize on opportunities due to its lack of institutional debt, allowing it to play offense in a dislocated market [23][24] Question: How should shareholders view SOL per share as a performance metric? - Management indicated that SOL per share growth is a key performance indicator, with a target to consistently generate returns greater than the staking yield [24] Question: What factors influence capital allocation decisions? - The company evaluates capital allocation based on market conditions, trading premiums or discounts, and the relative value of potential M&A opportunities [38][39] Question: How do staking yields trend with network usage? - Management clarified that increased validator participation does not impact yields for stakers, and as network activity grows, yields are expected to increase due to higher transaction fees [43][44]

Financial Data and Key Metrics Changes - Revenue in Q1 fiscal 2026 increased more than four times to $21.4 million compared to $4.6 million in Q1 fiscal 2025 [16] - Gross margin increased significantly to 78.6% in Q1 fiscal 2026 from 24.5% in Q1 fiscal 2025, primarily driven by staking revenue from the Solana treasury strategy [16] - Net loss for Q1 fiscal 2026 was approximately $585.6 million, compared to a net loss of $0.7 million in Q1 fiscal 2025, largely due to a decline in the fair value of SOL holdings [18] Business Line Data and Key Metrics Changes - Forward held approximately 6,962,501 Solana as of December 31, 2025, with over 99% staked, generating a staking yield between 6.5% and 7.2% [13] - Fully diluted SOL per share increased from 0.0604 at the end of September 2025 to 0.0624 at the end of December 2025, representing a growth of roughly 13% in the fiscal first quarter [14] Market Data and Key Metrics Changes - Solana continues to lead in key metrics such as decentralized exchange trading volumes, active users, and developer engagement, demonstrating resilience and performance [6][7] - Institutional engagement has expanded significantly, with major financial institutions and payment platforms integrating with Solana [7] Company Strategy and Development Direction - The company aims to build a permanent capital vehicle that participates directly in the growth of the Solana ecosystem, evolving beyond a treasury into an active value-generating business [5] - Forward Industries is focused on compounding SOL per share by engaging directly in economic activities on-chain rather than relying solely on passive exposure [6] Management's Comments on Operating Environment and Future Outlook - Management acknowledges the volatility in the market but emphasizes that Solana is now being evaluated based on actual performance rather than theoretical scalability [6] - The company believes the opportunity in front of Solana is increasingly clear, with a focus on long-term growth and responsible risk management [5][6] Other Important Information - Forward became one of the first public companies to have its SEC-registered shares live on a public blockchain, enhancing its operational capabilities [8] - The company launched fwdSOL, a proprietary liquid staking token, representing approximately 25% of its SOL holdings, allowing for efficient deployment of staked SOL [9] Q&A Session Summary Question: How does the company view recent token price volatility? - Management noted that SOL is down approximately 70% from its all-time high, which is typical in the crypto market, and emphasized maintaining a clean balance sheet [19][20] Question: What is the company's approach to potential M&A? - The company is looking for accretive acquisitions and is well-positioned to capitalize on opportunities due to its lack of institutional debt [23][24] Question: How should shareholders view SOL per share as a performance metric? - SOL per share growth is considered the North Star KPI, with a target to consistently generate returns greater than the staking yield [24] Question: What is the expected trend for staking yields as Solana network usage grows? - Management clarified that increased validator participation does not impact yields for stakers, and they expect yields to increase with network activity [43][44] Question: Can you clarify the nature of related party G&A expenses? - Related party expenses are associated with the launch of the digital asset treasury strategy and are expected to decrease in the coming months [50]

Financial Data and Key Metrics Changes - Revenue in Q1 2026 increased more than four times to $21.4 million, compared to $4.6 million in Q1 2025 [16] - Gross margin increased significantly to 78.6% in Q1 2026, compared to 24.5% in Q1 2025 [16] - Net loss for Q1 2026 was approximately $585.6 million, compared to a net loss of $0.7 million in Q1 2025, primarily due to a loss on digital assets [18] Business Line Data and Key Metrics Changes - Forward held approximately 6,962,501 Solana, with more than 99% staked, generating a staking yield between approximately 6.5% and 7.2% [12] - Fully diluted SOL per share increased from 0.0604 at the end of September 2025 to 0.0624 at the end of December 2025, representing a growth of roughly 13% [13][14] Market Data and Key Metrics Changes - Solana continues to lead across key metrics, including decentralized exchange trading volumes, active users, and developer engagement [6] - Institutional engagement has expanded significantly, with major asset managers like WisdomTree launching tokenized funds on Solana [7] Company Strategy and Development Direction - The company aims to build a permanent capital vehicle that participates directly in the growth of the Solana ecosystem, evolving beyond a treasury into an active value-generating business [5] - Forward Industries is focused on compounding SOL per share by participating directly in economic activities occurring on-chain [6] Management's Comments on Operating Environment and Future Outlook - Management acknowledges the volatility in the market but emphasizes the importance of Solana's current performance and real-world applications [6] - The company believes that the opportunity in front of Solana is increasingly clear, with a focus on long-term growth [5] Other Important Information - Forward became one of the first public companies to have its SEC-registered shares live on a public blockchain, with FWDI now issued on Solana [8] - The company launched fwdSOL, a proprietary liquid staking token, representing approximately 25% of its SOL holdings [9] Q&A Session Summary Question: Thoughts on recent token price volatility - Management noted that SOL is down approximately 70% from its all-time high, which is typical in the crypto market, and emphasized maintaining a clean balance sheet [19][20] Question: Potential M&A framework - The company is looking for accretive businesses in both DAT and non-DAT M&A, with a focus on product market fit and scalable unit economics [23] Question: Importance of SOL per share as a KPI - SOL per share growth is considered the North Star KPI, with a target to consistently generate returns greater than the staking yield [24] Question: Capital allocation strategy in different market conditions - The company plans to be adaptive, focusing on balance sheet quality and potential M&A opportunities when trading at discounts [40][41] Question: Staking yields and network usage growth - Management clarified that increased validator participation does not impact staking yields, and they expect yields to increase as network activity grows [44][46] Question: Related party G&A expenses - Related party expenses are associated with the launch of the digital asset treasury strategy and are expected to decrease in the coming months [50]

Revenue and Growth - The company generated revenues of $21.4 million in the 2026 Quarter, a 364% increase from $4.6 million in the 2025 Quarter, primarily driven by its new digital asset treasury strategy [126]. - The increase in net revenues was partially offset by a $570,000 decline in design segment revenue due to the loss of a major customer [129]. Gross Margin and Profitability - Gross margin improved significantly from 24.5% in the 2025 Quarter to 78.6% in the 2026 Quarter, attributed to high-margin staking revenue from the digital asset treasury strategy [126]. - The company reported a basic and diluted loss per share from continuing operations of $5.91 for the 2026 Quarter, compared to $0.82 for the 2025 Quarter [136]. Digital Asset Strategy - The company launched fwdSOL, a Liquid Staking Token, which allows for generating staking yield on SOL while unlocking additional returns through DeFi and institutional borrowing strategies [126]. - The loss on digital assets in the 2026 Quarter was $560.2 million, driven by a decline in the market value of SOL [135]. - An impairment charge of $33.0 million was recorded for fwdSOL due to the decrease in market value of SOL, reflecting the volatility of digital asset holdings [135]. - The company tokenized 1,489,896 shares of common stock on the Solana blockchain, allowing for self-custody and use in the DeFi ecosystem [126]. - The company reported non-cash net digital asset revenue of $16,462,000 during the 2026 Quarter [140]. Expenses - Sales and marketing expenses increased to $535,000, primarily due to corporate marketing spend related to market research activities [131]. - General and administrative expenses rose to $6.7 million, largely due to higher professional fees and personnel costs associated with the digital assets treasury strategy [133]. Cash Flow and Liquidity - As of December 31, 2025, the company's working capital was approximately $52.9 million [137]. - The cash balance as of January 31, 2026, was approximately $12 million [137]. - In the 2026 Quarter, cash used in operating activities amounted to $7,929,000, resulting from a net loss of $585,651,000 [140]. - Cash used in investing activities in the 2026 Quarter included purchases of digital assets totaling $335,050,000 [142]. - Cash used in financing activities in the 2026 Quarter included share repurchases of $10,883,000 [143]. - The company executed open market purchases totaling 3,330,000 shares at an average cost of $7.32 per share, for an aggregate cost of $24,387,000 [138]. - In the 2025 Quarter, cash used in operating activities was $434,000, resulting from a net loss of $708,000 [141]. - The company anticipates that its current liquidity will remain adequate for at least the next twelve months, assuming it can liquidate digital assets as needed [137]. - The liquidity assessment does not account for potential margin calls or collateral requirements from DeFi activities [137].

Core Viewpoint - Forward Industries, Inc. will host a conference call on February 12, 2026, to discuss its financial and operating results for the three months ended December 31, 2025 [1]. Group 1: Conference Call Details - The conference call will take place at 5:00 p.m. Eastern Time [1]. - Participants can join the call using a toll-free dial-in number (877) 407-2991 or an international dial-in number (201) 389-0925 [3]. - A webcast of the earnings call will be available, and participants can access it using the "call me" option for instant telephone access [3]. Group 2: Company Overview - Forward Industries, Inc. is a Solana-focused digital asset treasury company, aiming to buy, hold, stake, trade, invest in, and grow SOL and related digital assets [5]. - The company's mission is to expand and strengthen the Solana ecosystem by acquiring and staking SOL and engaging with Solana developers and projects to increase shareholder value [5]. - The digital asset treasury strategy was launched in September 2025, supported by industry-leading investors and operating partners, including Galaxy Digital and Jump Crypto [5].

Market Overview - U.S. stock futures are lower, with Dow futures dropping approximately 700 points [1] Company-Specific Developments - Valneva SE has withdrawn its IXCHIQ Chikungunya vaccine BLA and IND in the U.S. following an FDA suspension and a review of new serious adverse events, leading to a 7.7% decline in shares to $9.29 in pre-market trading [1] - Rezolve AI PLC shares fell 15% to $3.92 in pre-market trading [2] - POET Technologies Inc experienced an 11.2% decline to $7.37 in pre-market trading [2] - Forward Industries Inc shares decreased by 10.5% to $7.70 after a previous gain of 4% on Friday [2] - Babcock & Wilcox Enterprises Inc shares dipped 9.9% to $7.59 in pre-market trading [2] - Bakkt Holdings Inc fell 9.5% to $19.38 after a 10% increase on Friday [2] - Applovin Corp shares decreased by 9.5% to $515.03 after a 6% decline on Friday [2] - ALT5 Sigma Corp shares fell 8.9% to $2.36 after gaining 7% on Friday, despite regaining Nasdaq compliance [2] - HIVE Digital Technologies Ltd shares dropped 7.7% to $3.20 in pre-market trading [2] - Aeva Technologies Inc shares declined 6.8% to $18.01 in pre-market trading [2] - Bitdeer Technologies Group fell 6.8% to $14.75 in pre-market trading [2] - Terrestrial Energy Inc shares decreased by 6.3% to $10.95 in pre-market trading [2] - Tesla Inc shares fell 2.7% to $425.75, with CEO Elon Musk confirming that vehicles equipped with the AI4 (HW4) chip will achieve unsupervised autonomous driving without upgrades [2] - NVIDIA Corp shares declined 2.4% to $181.77 in pre-market trading [2]

Core Insights - Galaxy Digital Inc. CEO Mike Novogratz highlighted the need for cryptocurrency treasury companies to create shareholder value beyond merely holding assets, warning that they will continue to trade at 80% to 95% below their net asset value unless management evolves these firms into operational companies [1][2]. Group 1: Current Landscape of Cryptocurrency Treasury Companies - Novogratz emphasized that the era of inflating stock prices through hype is over, stating that only a few individuals have successfully profited from this model [3]. - He suggested that if he were in charge of a cryptocurrency treasury company, he would leverage the unique skill sets of his team to innovate and differentiate from traditional exchange-traded funds [3][4]. - The popularity of cryptocurrency treasury firms has surged, with at least 200 such companies now existing and a combined market capitalization of approximately $150 billion, which has more than tripled from the previous year [6]. Group 2: Market Dynamics and Challenges - The market for cryptocurrency treasury firms is under scrutiny, with many criticized for pursuing volatile and obscure tokens, leading to increased pressure on their equities during market downturns [6]. - Notably, Strategy Inc., the largest Bitcoin holder, is trading at 86% below the value of its Bitcoin holdings, reflecting the challenges faced by these companies [5].

Core Insights - Forward Industries has launched SEC-registered shares on the Solana blockchain, enabling the first public company's equity to be utilized directly within decentralized finance (DeFi) [1] - This integration allows ex-US holders of tokenized FWDI shares to use their equity as collateral on Kamino, a Solana lending protocol, facilitating access to on-chain liquidity while retaining exposure to the underlying equity [1] - The collaboration between Forward, Superstate, and Kamino sets a precedent for future on-chain functionalities as regulatory guidance evolves [1] Group 1: Company Overview - Forward Industries is a design company focused on serving medical and technology sectors, developing a portfolio of products for global brands [1] - The company initiated a Solana treasury strategy in September 2025, aimed at acquiring SOL and enhancing SOL-per-share through active treasury management [1] - Forward's treasury strategy is backed by notable investors and operating partners, including Galaxy Digital, Jump Crypto, and Multicoin Capital [1] Group 2: Technological Integration - The Opening Bell platform by Superstate allows for the tokenization of SEC-registered shares, marking a significant advancement in the integration of public equity with digital finance ecosystems [1] - Superstate's technology provides real-time price feeds and market data, ensuring transparency and accuracy for protocols that incorporate tokenized FWDI shares [1] - Unlike other tokenized stock products that rely on synthetic structures, Superstate's Opening Bell enables direct tokenization of actual shares, recorded on-chain in real time [1] Group 3: Market Implications - The launch of tokenized FWDI shares represents a shift in how public companies can extend the utility of their stock beyond traditional exchanges, promoting programmable ownership linked to the digital asset economy [1] - The Opening Bell platform, launched in May 2025, is designed to facilitate compliant, programmable equity participation in digital finance ecosystems [1] - Superstate aims to reshape public capital markets by connecting financial assets with crypto capital markets, enhancing access, liquidity, and capital formation through on-chain public listings [1]

Financial Performance - Net revenue for Fiscal 2025 was $18.2 million, a decrease of 9% compared to $20.0 million in the prior year[5] - The company reported a net loss of $167.0 million for Fiscal 2025, compared to a net loss of $2.0 million in the prior year, primarily due to a $160.0 million non-cash, unrealized loss on SOL holdings[5] - Basic loss per share from continuing operations was $24.90 for Fiscal 2025, compared to $1.97 in the prior year, highlighting the impact of increased losses[11] Operating Expenses - Total operating expenses increased to $13.6 million, up from $7.3 million in the prior year, reflecting a significant rise in operational costs[5] Revenue Sources - In the fourth quarter of Fiscal 2025, Forward Industries generated approximately $4.6 million in staking revenue from its newly launched Solana treasury strategy[3] Asset Management - Total current assets increased to $41.2 million in Fiscal 2025, compared to $9.6 million in the prior year, driven by a significant increase in cash holdings[9] - Digital assets on the balance sheet amounted to $1.43 billion as of September 30, 2025, reflecting the company's investment in Solana[9] - The company’s total assets reached $1.47 billion in Fiscal 2025, a substantial increase from $14.8 million in the prior year, reflecting its growth in digital asset investments[9] Strategic Focus - Forward Industries is focused on expanding its treasury strategy to unlock additional on-chain yield opportunities, indicating a strategic shift towards digital asset management[3] - The company’s gross profit for Fiscal 2025 was $5.2 million, slightly up from $5.2 million in the previous year, indicating stable gross margins despite revenue decline[11]

Financial Performance - Net revenues for Fiscal 2025 were $18,188,000, a decrease of $1,803,000 or 9.0% compared to Fiscal 2024's $19,991,000[212] - The operating loss for Fiscal 2025 was $8,392,000, a substantial increase from the loss of $2,151,000 in Fiscal 2024[212] - The company incurred a loss from continuing operations before income taxes of $169,069,000 in Fiscal 2025, with an effective tax rate of 0%[219] - Consolidated basic and diluted loss per share from continuing operations was $24.90 for Fiscal 2025[220] Revenue Breakdown - The design segment revenue declined by $6,385,000, primarily due to the loss of a major design customer in December 2024[213] - Staking revenue from the digital assets segment contributed $4,582,000, partially offsetting the decline in design segment revenue[213] Profitability Metrics - Gross profit slightly increased to $5,191,000, with gross margin improving from 25.9% in Fiscal 2024 to 28.5% in Fiscal 2025[214] - The digital assets segment generated a gross profit of $4,412,000 with a gross margin of 96.3%[214] Expenses - General and administrative expenses rose significantly to $10,528,000, an increase of 65.4% from $6,366,000 in Fiscal 2024[212] - Sales and marketing expenses increased by $500,000 due to corporate marketing spend, partially offset by a $240,000 reduction in the design segment[215] - Corporate general and administrative expenses rose by $4,392,000, driven by higher share-based compensation and professional fees, while design segment expenses decreased by $769,000[216] - The company recorded goodwill impairment charges of $1,167,000 and intangible asset impairment charges of $271,000 related to the IPS reporting unit[217] Goodwill and Asset Impairment - Goodwill impairment increased to $2,026,000 in Fiscal 2025, compared to $200,000 in Fiscal 2024[212] - A $160,035,000 reduction in the fair value of digital assets was noted, primarily due to a decline in the market value of SOL[218] Cash Flow and Capital - Cash used in operating activities during Fiscal 2025 was $4,502,000, resulting from a net loss of $166,974,000[229] - Cash used for investing activities in Fiscal 2025 included $900,791,000 for purchasing digital assets[231] - As of September 30, 2025, the company's working capital was approximately $38.5 million, and cash balance was approximately $41.2 million[221] - The company raised approximately $1.65 billion through private placements and other financing transactions in September 2025[222] Digital Asset Strategy - As of November 30, 2025, digital asset holdings comprised more than 90% of the company's total assets[197] - The company launched a digital asset treasury strategy, acquiring 6,822,000 SOL at an average price of $232 per SOL, totaling approximately $1.58 billion[195]