Financial Data and Key Metrics Changes - Revenue in Q3 fiscal 2026 increased by 12% year-over-year and 28.5% on a fiscal year-to-date basis, reaching $6.1 million compared to $5.4 million in Q3 fiscal 2025 [3][12] - Gross margin decreased to 52.7% in Q3 fiscal 2026 from 54% in Q3 fiscal 2025, primarily due to product mix [12] - Operating loss for Q3 fiscal 2026 was $6.9 million, compared to an operating loss of $4.1 million in the prior year [13] - Net loss in Q3 fiscal 2026 was $3 million, or $0.09 per diluted share, compared to a net loss of $3.2 million, or $0.11 per diluted share in the previous quarter [14][15] - Cash and cash equivalents increased to $70.7 million as of December 31, 2025, primarily due to $46.9 million in net proceeds from a registered direct offering [17] Business Line Data and Key Metrics Changes - Sales to KYEC were $1.1 million, or 17.9% of net revenues, down from $1.2 million, or 22.7% in the same period a year ago [10] - Sales to Nokia increased to $675,000, or 11.1% of net revenues, compared to $239,000, or 4.4% in the same period a year ago [11] - Military defense sales accounted for 28.5% of third-quarter shipments, slightly down from 30% in the comparable quarter a year ago [11] Market Data and Key Metrics Changes - The company is focusing on defense applications, which have shown early success, particularly with the U.S. Department of Defense [21] - The partnership with G2 Tech aims to leverage the company's technology for real-world applications, including drones and smart cities [24] Company Strategy and Development Direction - The company is advancing its APU roadmap and hardware development, with plans to tape out Plato in early 2027 [3] - The partnership with G2 Tech for the Sentinel program is expected to enhance the company's capabilities in autonomous perimeter security [4] - The focus is on non-dilutive R&D funding through government defense programs and strategic partnerships to support development [5] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about strong demand from major customers in the first half of calendar 2026 [3] - The company anticipates receiving over $1 million in government funding for the Sentinel project, which will offset R&D expenses [6] - The outlook for Q4 fiscal 2026 is net revenues in the range of $5.7 million to $6.5 million, with a gross margin of approximately 54% to 56% [18] Other Important Information - The company is expanding cash disclosures in its quarterly earnings to provide better insights into cash consumption and generation [16] - Total operating expenses in Q3 fiscal 2026 were $10.1 million, up from $7 million in the prior year [12] Q&A Session Summary Question: Importance of defense applications for Gemini 2 - Management highlighted that military and defense sectors have been the quickest to adopt their technology, with successful partnerships and applications already established [21][24] Question: Timelines for government funding - Management indicated a continuous pipeline of submissions for SBIRs and other funding opportunities, emphasizing the non-dilutive nature of this funding [26]

Financial Performance - In the third quarter of fiscal 2026, GSI Technology reported net revenues of $6.1 million, a 12% increase year-over-year from $5.4 million in the same quarter of fiscal 2025[4]. - Gross margin for the third quarter of fiscal 2026 was 52.7%, down from 54.0% in the same quarter of the previous year, primarily due to product mix[4]. - Operating loss for the third quarter of fiscal 2026 was $(6.9) million, compared to an operating loss of $(4.1) million in the prior-year period[8]. - Net loss for the third quarter of fiscal 2026 was $(3.0) million, or $(0.09) per diluted share, an improvement from a net loss of $(4.0) million, or $(0.16) per diluted share, in the same quarter of fiscal 2025[9]. Cash and Assets - Cash and cash equivalents increased to $70.7 million as of December 31, 2025, up from $13.4 million at the end of March 2025, reflecting $46.9 million in net proceeds from a Registered Direct Offering[12]. - Total assets increased to $98,460 million as of December 31, 2025, compared to $43,317 million on March 31, 2025[22]. - Cash and cash equivalents rose significantly to $70,672 million from $13,434 million[22]. - Stockholders' equity improved to $83,620 million, up from $28,226 million[22]. - Current liabilities increased slightly to $7,613 million from $7,074 million[22]. - Long-term liabilities decreased to $7,227 million from $8,017 million[22]. - Accounts receivable decreased to $2,832 million from $3,169 million[22]. - Inventory remained relatively stable at $3,876 million compared to $3,891 million[22]. - Operating lease right-of-use assets decreased to $8,590 million from $9,547 million[22]. - Other current assets decreased to $1,933 million from $2,961 million[22]. - Other assets increased slightly to $9,654 million from $9,507 million[22]. Research and Development - Research and development expenses for the third quarter of fiscal 2026 were $7.5 million, up from $4.0 million in the prior-year period, driven by the development of new technologies[6]. - GSI Technology expects net revenues for the upcoming fiscal fourth quarter to be in the range of $5.7 million to $6.5 million, with gross margin anticipated to be approximately 54% to 56%[3]. - The company is advancing its APU roadmap and pursuing initial design wins for Gemini-II in defense-oriented programs and select commercial edge deployments[3]. - GSI Technology announced a proof-of-concept with G2 Tech and two government agencies, expecting roughly $1 million in government funding[6]. Sales Performance - Sales to KYEC were $1.1 million, representing 17.9% of net revenues, while sales to Nokia increased to $675,000, or 11.1% of net revenues, compared to the same period last year[5].

Core Insights - GSI Technology reported a revenue of $6.1 million for the third quarter of fiscal 2026, representing a 12% increase year-over-year, driven by sustained demand for SRAM solutions [3][4][7] - The company achieved significant milestones in the development of its Gemini-II technology, including a successful proof-of-concept for an autonomous perimeter security system [3][7] - GSI's gross margin for the quarter was approximately 52.7%, a decrease from 54.0% in the same quarter last year, attributed to product mix changes [4][6] Financial Performance - Net revenues for the third quarter of fiscal 2026 were $6.1 million, compared to $5.4 million in the same quarter of fiscal 2025 and $6.4 million in the previous quarter [4][10] - The operating loss for the third quarter was $(6.9) million, compared to $(4.1) million in the prior-year period [9][10] - The net loss for the quarter was $(3.0) million, or $(0.09) per diluted share, an improvement from a net loss of $(4.0) million, or $(0.16) per diluted share, in the same quarter last year [10][21] Cash Flow and Balance Sheet - The company ended the quarter with a cash balance of $70.7 million, significantly up from $13.4 million at the end of the previous fiscal year [12][13] - Total operating expenses for the quarter were $10.1 million, an increase from $7.0 million in the same quarter last year, primarily due to higher research and development costs [6][9] - Cash used in operating activities was $(7.9) million, reflecting investments in the development and commercialization of Gemini-II and Plato [12][13] Customer and Market Insights - Sales to KYEC were $1.1 million, accounting for 17.9% of net revenues, while sales to Nokia increased to $675,000, representing 11.1% of net revenues [5] - Military and defense sales constituted 28.5% of third-quarter shipments, slightly down from 30.0% in the same period last year [5] - The company is pursuing initial design wins for Gemini-II in defense-oriented programs and select commercial edge deployments [3][7]

Core Insights - GSI Technology announced preliminary benchmark results for its Gemini-II Compute-in-Memory processor, achieving a time-to-first-token (TTFT) of 3 seconds for multimodal large language models at the edge, with a power consumption of approximately 30 watts [1][2]. Performance Metrics - The Gemini-II processor demonstrated a TTFT of 3 seconds, which is the lowest reported for a multimodal 12B model on an embedded edge processor [2]. - Competitive platforms reported TTFTs of approximately 12 seconds on Qualcomm Snapdragon X Elite at 30W and 3 seconds on NVIDIA Jetson Thor at over 100W, indicating that Gemini-II offers superior performance at lower power levels [3]. Market Implications - The performance profile of Gemini-II is well-suited for "physical AI" markets, including drones and smart city applications, where power and thermal constraints are critical [4]. - The shift from cloud-assisted models to local inference in edge physical AI is expected to enhance latency, reliability, and operational efficiency [5]. Development and Collaboration - GSI's engineering team is focused on optimizing the responsiveness of the Gemini-II processor while collaborating with partners like G2 Tech for system integration and proof-of-concept activities [6].

Summary of GSI Technology Conference Call Company Overview - **Company**: GSI Technology - **Headquarters**: Sunnyvale, California - **Founded**: 30 years ago, went public in 2007 - **Core Technologies**: APU (Associative Processing Unit) for AI, SRAM technology, and radiation-hardened memory solutions for space and military applications [1][3][4] Financial Performance - **Last Fiscal Year Revenue**: Just over $20 million - **Projected Growth**: Expected to grow about 20% for the current fiscal year [5][27] - **Cash and Cash Equivalents**: $25 million as of September, excluding a recent $47 million raised [6][27] - **Market Capitalization**: Approximately $270 million with 21% insider ownership [6] Product Lines SRAM Technology - **Product Line**: Highest density and performance SRAMs in the market, primarily from the Sigma Quad family [6][7] - **Revenue Contribution**: Majority of revenues come from the Sigma Quad family, with significant design wins in the third and fourth generations [6][7] APU Technology - **APU Overview**: Focused on edge computing with unique compute-in-memory architecture, allowing for massive parallel processing [10][11] - **Gemini 1 and Gemini 2**: AI chips designed for edge applications, with Gemini 2 being more versatile and capable of being sold as a chip [17][18] - **Performance Comparison**: Gemini 1 demonstrated 98% less power usage compared to NVIDIA's GPU in a specific application [17] Future Products - **Plato**: A next-generation device aimed at addressing large language models (LLMs) on the edge, with a tape-out expected in early 2027 [20][22][29] Market Opportunities - **Edge Computing Market**: Expected to grow from nearly $7 billion this year to over $16 billion in five years [10] - **Radiation-Hardened SRAM Market**: Projected to grow from $2 billion to nearly $5 billion by 2032, with high ASPs ranging from $10,000 to $30,000 and gross margins over 90% [9] Strategic Partnerships and Projects - **Partnership with G2 Tech**: Involved in a proof of concept (POC) for a multimodal VLM model for the Department of Defense, focusing on drone applications [19][37] - **Government Grants**: Awarded $3.4 million in SBIRs and additional funding for various defense projects [23][24][26] Competitive Landscape - **Market Position**: GSI Technology positions itself as a strong competitor against larger firms like NVIDIA and AMD, leveraging its established manufacturing capabilities and expertise in SRAM [28][29] Challenges and Future Outlook - **Revenue Growth**: The SRAM market has been flat, and future revenue growth is expected to come from the APU segment [42][44] - **Software Development**: Ongoing efforts to develop a compiler stack and functional libraries to support APU applications are critical for future design wins [45][48] - **Production Timeline**: Anticipated production for Gemini 2 in 2027, with prototypes expected by the end of 2026 [46][48] Key Takeaways - GSI Technology is at the forefront of AI and edge computing with its innovative APU technology - The company has a solid financial foundation and is strategically positioned for growth in the defense and aerospace sectors - Continued investment in R&D and software development is essential for capitalizing on emerging market opportunities and achieving profitability [27][44]

Core Viewpoint - GSI Technology, Inc. will announce its financial results for the fiscal third quarter of 2026 on January 29, 2026, and will provide an outlook for the fourth quarter during a conference call [1]. Group 1: Financial Results Announcement - The financial results for the fiscal third quarter 2026, which ended on December 31, 2025, will be released after market close on January 29, 2026 [1]. - A conference call to discuss the third quarter financial results and the outlook for the fourth quarter will take place at 1:30 p.m. Pacific time (4:30 p.m. Eastern Time) on the same day [1]. Group 2: Participation Details - Participants can join the call by dialing 1-877-407-3982 in the U.S. or 1-201-493-6780 internationally, approximately 10 minutes before the start time, using Conference ID 13758230 [2]. - The call will also be streamed live on the internet via the company's investor relations website [2]. Group 3: Replay Information - A replay of the conference call will be available from January 29, 2026, at 7:30 p.m. Eastern Time until February 5, 2026, at 11:59 p.m. Eastern Time [3]. - The replay can be accessed by dialing 1-844-512-2921 for U.S. callers or 1-412-317-6671 for international callers, using pin number 13758230 [3]. - A webcast of the call will be archived on the company's investor relations website under the Events and Presentations tab [3]. Group 4: Company Overview - GSI Technology is a leader in the AI sector with its innovative Associative Processing Unit (APU) technology, which enhances efficiency in large database searches and high-performance computing [4]. - The company's products, Gemini-I® and Gemini-II®, provide scalable, low-power, high-capacity computing solutions that improve edge computing capabilities [4]. - GSI Technology is headquartered in Sunnyvale, California, and has sales offices across the Americas, Europe, and Asia [4].

Core Viewpoint - GSI Technology, Inc. (GSIT) shares experienced a decline of 7.29 percent, trading at $7.12, despite the announcement of a new proof-of-concept engagement with two government agencies and a partnership with Israel's G2 Tech for the Sentinel project, which is supported by the U.S. Department of War and a foreign government [1]. Group 1 - GSI Technology's stock opened at $7.96, up from a previous close of $7.68, with trading occurring between $6.90 and $8.90 during the session [2]. - The current bid for GSI Technology shares was $3.96, while the ask was $6.77, indicating a significant spread [2]. - Trading volume reached approximately 6.14 million shares, surpassing the average volume of 5.66 million shares [2]. Group 2 - GSI Technology's 52-week stock price range is between $1.62 and $18.15, highlighting significant volatility in its stock performance over the past year [3].

Core Insights - GSI Technology, Inc. announced a new proof-of-concept engagement with two government agencies to develop an autonomous perimeter security system in partnership with G2 Tech [1][2] - The project, named Sentinel, aims to utilize drones and cameras for real-time monitoring, detection, and response, and is backed by the U.S. Department of War and a foreign government agency [1][2] - GSI expects to receive approximately one million dollars in funding for software optimization and integration of its Gemini-II platform into the Sentinel system [3] Company Overview - GSI Technology is recognized for its Associative Processing Unit (APU) technology, which offers compute-in-memory capabilities for high-performance computing and AI applications [4] - The company’s Gemini-I and Gemini-II products are designed for scalable, low-power, high-capacity computing, enhancing edge computing capabilities [4] - GSI Technology is headquartered in Sunnyvale, California, with sales offices across the Americas, Europe, and Asia [4] Partner Overview - G2 Tech is a deep-technology company focused on advanced AI and edge computing, working on translating deep-tech research into operational capabilities for civilian and defense sectors [5] - The collaboration with GSI Technology aims to unlock new capabilities for autonomous systems in both civilian and defense applications [2][5] Project Details - Under the proof-of-concept, G2 Tech is leading the development of a system-level platform for real-time data processing and autonomous response in mission-critical environments [2] - The platform is designed to support autonomous operations while ensuring human oversight and decision-support capabilities [2] - The Gemini-II APU will enable on-device AI inference for real-time responsiveness in the Sentinel system [2]

Group 1 - The analyst has extensive experience in financial markets, particularly in hedge funds, focusing on technology sectors like SaaS and cloud businesses, as well as energy and minerals sectors, which are seen as offering significant growth opportunities [1] - The current market sentiment around AI stocks is highly volatile, with frequent news impacting investor perceptions [1] Group 2 - The analyst maintains a beneficial long position in GSIT shares, indicating confidence in the company's future performance [2] - The article reflects the analyst's personal opinions and research, emphasizing independence from external influences [2]

Group 1 - The analyst has extensive experience in financial markets, particularly in hedge funds, focusing on technology sectors like SaaS and cloud businesses, as well as energy and minerals sectors, which are seen as offering significant growth opportunities [1] - The current market sentiment around AI stocks is highly volatile, with frequent news impacting investor perceptions [1] Group 2 - The analyst maintains a beneficial long position in GSIT shares, indicating confidence in the company's future performance [2] - The article reflects the analyst's personal opinions and research, emphasizing independence from external influences [2]