Core Insights - The Glimpse Group, Inc. is focusing on strategic initiatives for calendar year 2026 aimed at unlocking shareholder value, which is believed to be undervalued in the current equity valuation [2][4] Business Strategy - The company plans to spin out Brightline Interactive (BLI) through an IPO, positioning it as a standalone entity focused on Physical AI and Spatial Computing for the Defense Tech/AI software segment [5] - BLI's solutions utilize the SpatialCore software platform for operational orchestration and training of digital twins, robotics, and autonomous systems [5] - The IPO is targeted for completion in the first half of CY '26, with Lucid Capital Markets engaged as the investment banking partner [5] - In parallel, the company is exploring private company spin-out alternatives for BLI to maximize its success and create value for shareholders [5] Immersive Technologies - The core Immersive business is driven by the Foretell Ai software product, which provides intelligent, conversational simulations in immersive environments [5] - Foretell Ai is gaining traction in the Education and Healthcare segments, with increasing enterprise interest and new license agreements [5] - A recent contract was secured with a NYC-based higher education institution for the deployment of a local Large Language Model infrastructure to run Foretell Ai [5] Financial Position - The company maintains a healthy capital structure with no debt and sufficient cash reserves for the next 12 months [11] - An S3 and ATM facility has been established, although there is no current intent to utilize these tools [11]

NEW YORK, NY / ACCESS Newswire / December 16, 2025 / The Glimpse Group, Inc. ("Glimpse") (NASDAQ:VRAR), a diversified Immersive Technology platform company providing enterprise-focused Immersive Technology, Spatial Computing and Artificial Intelligence ("AI") driven software and services, announced today that it entered into a six figure contract with a NYC based higher education institution for the design, deployment and integration of a local Large Language Model ("LLM") infrastructure, specifically confi ...

Financial Data and Key Metrics Changes - Q1 fiscal year 2026 revenue was approximately $1.4 million, reflecting a 43% decrease compared to $2.4 million in Q1 fiscal year 2025, attributed to timing of Department of Defense contracts and U.S. government budgetary delays [18] - Gross margin for Q1 fiscal year 2026 was approximately 72%, up from approximately 68% for fiscal year 2025, with expectations to remain in the 65%-75% range [19] - Adjusted EBITDA loss for Q1 fiscal year 2026 was $0.92 million compared to a loss of $0.46 million in Q1 fiscal year 2025, indicating the impact of lower revenues [19] - Cash and equivalents as of September 30, 2025, were approximately $5.56 million, with an additional $0.66 million in accounts receivable, maintaining a clean capital structure with no debt [19] Business Line Data and Key Metrics Changes - Brightline Interactive made an initial successful delivery on a multi-million dollar annual SpatialCore contract with a Department of Defense entity, indicating progress in key contracts [13] - The AI software product, Fortel AI, is gaining traction in education and healthcare segments, with increasing enterprise interest and new licenses [14] Market Data and Key Metrics Changes - The company is closely monitoring the imposition of tariffs and has seen strong quoting activity as customers evaluate near-shore manufacturing strategies for North America and China [5] - Nortech operates under a Maquiladora structure, which reduces direct exposure to tariffs on goods produced in Mexico [8] Company Strategy and Development Direction - The immediate strategic focus is on the potential IPO spinoff of Brightline as an independent publicly traded company, expected to occur in the first half of calendar year 2026 [15] - The company is exploring value creation alternatives as a clean, healthy, NASDAQ-listed technology company, with a focus on growing the Fortel AI software licenses [16] Management's Comments on Operating Environment and Future Outlook - Management acknowledges the challenges posed by government shutdowns and budgetary delays but remains optimistic about contract materialization in 2026 [13] - The company expects continued growth in its business, particularly through the Fortel AI software licenses [21] Other Important Information - The company will not provide revenue guidance for the remainder of fiscal year 2026 due to the many moving parts currently in play [19] Q&A Session Summary Question: Are there any questions from the phone lines? - There were no questions from the phone lines [22] Question: Are there any questions submitted via the webcast? - There were no questions submitted via the webcast [24]

Revenue Performance - Total revenue for the three months ended September 30, 2025, was approximately $1.40 million, a decrease of approximately 43% compared to $2.44 million for the same period in 2024[106] - Software Services revenue was approximately $1.25 million, down approximately 44% from $2.23 million in the prior year, attributed to timing of Department of War contracts and U.S. Government budget delays[109] - Three customers accounted for approximately 79% of total gross revenues during the three months ended September 30, 2025[113] Profitability and Expenses - Gross profit margin decreased to approximately 72% for the three months ended September 30, 2025, compared to approximately 79% for the same period in 2024, primarily due to changes in the cost structure of Department of War projects[114] - Total operating expenses for the three months ended September 30, 2025, were approximately $2.34 million, a decrease of approximately 21% from $2.96 million in the prior year, reflecting the divestiture of the QReal business[115] - Research and development expenses for the three months ended September 30, 2025, were approximately $0.97 million, a decrease of approximately 13% from $1.12 million in the prior year[117] - Sales and marketing expenses decreased by approximately 57% to $0.32 million for the three months ended September 30, 2025, compared to $0.74 million in the prior year[119] - Adjusted EBITDA loss was $0.92 million for the three months ended September 30, 2025, compared to a loss of approximately $0.46 million for the same period in 2024, reflecting a decrease in revenue and gross margin[128] Net Loss and Cash Flow - Net loss for the three months ended September 30, 2025, was approximately $1.03 million, compared to a net loss of approximately $1.02 million for the same period in 2024, reflecting reduced revenue and gross margin offset by lower operating expenses[123] - Net cash used in operating activities increased to approximately $1.29 million for the three months ended September 30, 2025, from approximately $0.42 million in the same period of 2024, representing a 207% increase[130] - The net decrease in cash and cash equivalents was $1.27 million for the three months ended September 30, 2025, compared to a decrease of $0.43 million in the same period of 2024, indicating a 195% increase in cash outflow[129] Cash Position and Financing - Cash and cash equivalents at the end of the period were $5.56 million, up 294% from $1.41 million at the end of the same period in 2024[129] - The company had no outstanding debt obligations as of September 30, 2025[133] - Net cash provided by financing activities was approximately $0.03 million for the three months ended September 30, 2025, compared to zero for the prior year period[132] Strategic Initiatives - The company entered into a $2+ million SpatialCore contract to be delivered over a 12-month period starting August 13, 2025[104] - The company is exploring a potential spin-off of its BLI subsidiary to unlock shareholder value and provide growth resources, though the process is in early stages and uncertain[105] Other Financial Metrics - As of September 30, 2025, the company had $0.66 million in accounts receivable[133] - The contingent consideration for acquisition liabilities included a $1.50 million cash component, which was paid in October 2025[134] - The company experienced a flat year-over-year net cash used in investing activities, primarily related to equipment purchases[131]

Financial Performance - Q1 FY '26 revenue was approximately $1.40 million, a 43% decrease from Q1 FY '25 revenue of approximately $2.44 million, attributed to timing of contracts and U.S. Government budget delays [3] - Adjusted EBITDA loss for Q1 FY '26 was -$0.92 million, compared to -$0.46 million for Q1 FY '25, indicating a decline in revenue [3] - The net loss for Q1 FY '26 was $1.03 million, with a basic and diluted net loss per share of $0.05 [16] - For the three months ended September 30, 2025, the net loss was $1.03 million, compared to a net loss of $1.02 million in 2024, indicating a slight increase in losses year-over-year [19] - Adjusted EBITDA loss for Q3 2025 was $0.92 million, compared to a loss of $0.46 million in Q3 2024, reflecting a deterioration in operational performance [19] - Cash flows used in operating activities for Q3 2025 totaled $1.29 million, significantly higher than $0.43 million in Q3 2024, indicating increased cash outflows [18] Assets and Liabilities - The company's cash and equivalents as of September 30, 2025, were approximately $5.56 million, with an additional $0.66 million in accounts receivable [3] - Total current assets as of September 30, 2025, were approximately $7.33 million, down from $8.17 million as of June 30, 2025 [14] - Total liabilities as of September 30, 2025, were approximately $2.20 million, compared to $2.34 million as of June 30, 2025 [14] - The company reported a cash and cash equivalents balance of $5.56 million at the end of Q3 2025, down from $6.83 million at the beginning of the period [18] Revenue Recognition and Contracts - Brightline Interactive made an initial delivery on a multi-million annual SpatialCore contract with a Department of War entity, with further significant opportunities anticipated [3] - The company signed several contracts with a major oil service company, with an aggregate contract value in the mid 6-figure dollars for 3D brand environments and corporate presentations [3] - Deferred revenue increased by $0.02 million in Q3 2025, contrasting with a substantial decrease of $0.38 million in Q3 2024, indicating a shift in revenue recognition [18] Expenses and Compensation - Gross Margin for Q1 FY '26 was approximately 72%, compared to approximately 68% for FY '25, with expectations to remain in the 65-75% range [3] - Stock-based compensation expenses for Q3 2025 were $0.25 million, down from $0.37 million in Q3 2024, showing a reduction in employee compensation costs [19] - Depreciation and amortization expenses decreased to $0.06 million in Q3 2025 from $0.16 million in Q3 2024, indicating lower asset depreciation [19] IPO and Future Prospects - The company initiated the IPO/Spin-out process for Brightline Interactive in October 2025, with a potential IPO expected in the first half of calendar year 2026 [9] Changes in Accounts Receivable - The company experienced a significant change in accounts receivable, with an increase of $0.18 million in Q3 2025 compared to a decrease of $0.15 million in Q3 2024 [18]

Core Insights - The Glimpse Group, Inc. has initiated the IPO/spin-off process for its subsidiary Brightline Interactive, marking a significant strategic move [1] - Brightline Interactive has made its first delivery on a multi-million dollar SpatialCore contract with a Department of War entity, indicating strong business development [1] Financial Summary - For Q1 FY '26, which ended on September 30, 2025, the company reported financial results that reflect growth and strategic advancements [1] - The revenue generated from the initial delivery of the SpatialCore contract is expected to contribute positively to the company's financial performance [1]

Group 1: Virtual Reality Stocks Overview - Seven Virtual Reality stocks to watch include Meta Platforms, zSpace, DIH Holding US, and The Glimpse Group, identified by MarketBeat's stock screener tool [2] - Virtual reality stocks are shares of companies involved in developing, manufacturing, or supporting VR hardware, software, and content, with performance driven by adoption rates and technological advances [2] Group 2: Meta Platforms (META) - Meta Platforms, Inc. develops products for connecting people through mobile devices, PCs, VR headsets, and wearables, operating in two segments: Family of Apps and Reality Labs [3] - The Family of Apps segment includes Facebook, Instagram, Messenger, and WhatsApp, facilitating sharing, messaging, and community engagement [3] Group 3: zSpace (ZSPC) - zSpace Technologies, Inc. provides augmented and virtual reality technology primarily for the education market, offering hardware and software for K-12 STEM applications and career education [4] Group 4: DIH Holding US (DHAI) - DIH Holding US, Inc. operates as a robotics and VR technology provider in the rehabilitation industry across multiple regions, offering products like ArmeoPower and ArmeoSpring for arm and hand therapy [5][8] Group 5: The Glimpse Group (VRAR) - The Glimpse Group, Inc. is a VR and AR platform company providing enterprise-focused software and solutions, including QReal for 3D interactive models and Immersive Health Group for healthcare solutions [6]

Financial Data and Key Metrics Changes - Fiscal year 2025 revenue was approximately $10.5 million, a 20% increase from fiscal year 2024 revenue of approximately $8.8 million, primarily driven by an increase in SpatialCore revenues [14] - Q4 fiscal year 2025 revenue was approximately $3.5 million, a 105% increase compared to Q4 fiscal year 2024 revenue of approximately $1.7 million, and a 150% increase compared to Q3 fiscal year 2025 revenue of approximately $1.4 million [15] - Gross margin for fiscal year 2025 was approximately 67.5%, consistent with 67% for fiscal year 2024, and expected to remain in the 65%-75% range [15][16] Business Line Data and Key Metrics Changes - Brightline Interactive (BLI) is identified as the main growth engine, focusing on advanced spatial computing and AI-driven operational simulation middleware software [5][10] - BLI achieved significant milestones, including a $4 million+ initial contract for a unified synthetic training ecosystem for the Department of Defense [7] - Additional contracts include a $2 million SpatialCore contract and the delivery of an advanced immersive simulator to the U.S. Navy [8][9] Market Data and Key Metrics Changes - BLI's growth potential is emphasized in the U.S. Department of Defense and enterprise big data segments, including oil and gas and aviation [10] - The company has established relationships with major customers and a significant pipeline for future growth, although the contracting process with the Department of Defense is noted to be slow and complex [10][11] Company Strategy and Development Direction - The company plans to spin out Brightline Interactive to maximize shareholder value and enhance its chances of success as an independent entity [12] - The spin-out is expected to occur early in 2026, with Glimpse shareholders receiving shares in the new entity [13][33] - The company aims to maintain a clean capital structure with no debt and to continue focusing on existing businesses while pursuing growth opportunities [16][17] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about future revenue growth, although they cautioned that revenue recognition may be choppy due to the nature of DOD contracts [15] - The company is focused on unlocking shareholder value and has several strategic options to achieve this [17] - Management highlighted the importance of integrating immersive technologies with AI in education and healthcare sectors, although these are less of a focus for BLI [22] Other Important Information - The company achieved cash flow neutrality for the first time in its history, with a net operating cash loss of approximately -$0.27 million for fiscal year 2025 compared to -$5.2 million in fiscal year 2024 [16] - The cash and equivalent position as of June 30, 2025, was approximately $6.85 million, with an additional $0.85 million in accounts receivable [16] Q&A Session Summary Question: What are BLI's opportunities outside of defense? - Management indicated that while BLI has made strides in defense, there are also opportunities in enterprise sectors, although education and healthcare are more focused on other entities within the company [20][22] Question: What is the expected timeframe for the spin-off? - Management expects to initiate the spin-off process in the coming weeks, aiming for completion early in 2026 [23][33] Question: Will there be a name change for Brightline Interactive? - Management confirmed that there are no plans for a name change, as Brightline has a strong brand presence [26] Question: Will the company have cash needs moving forward? - Management stated that they expect to operate fully with the current cash reserves [34] Question: Will there be joint ventures with larger companies for Brightline Interactive? - Management is actively looking for partnerships and has significant relationships with leading technology companies [43]

Financial Data and Key Metrics Changes - Fiscal year 2025 revenue was approximately $10.5 million, a 20% increase compared to fiscal year 2024 revenue of approximately $8.8 million, primarily driven by an increase in SpatialCore revenues [14] - Q4 fiscal year 2025 revenue was approximately $3.5 million, a 105% increase compared to Q4 fiscal year 2024 revenue of approximately $1.7 million, and a 150% increase compared to Q3 fiscal year 2025 revenue of approximately $1.4 million [15] - Gross margin for fiscal year 2025 was approximately 67.5%, consistent with 67% for fiscal year 2024, and is expected to remain in the 65% to 75% range [15][16] Business Line Data and Key Metrics Changes - Brightline Interactive (BLI) is identified as the main growth engine, focusing on advanced spatial computing and AI-driven operational simulation middleware software [5][10] - BLI achieved several critical milestones, including a $4+ million contract for a unified synthetic training ecosystem for a major Department of Defense entity [7] - BLI has a robust pipeline of potential customers in the U.S. Department of Defense and enterprise sectors, including oil and gas and aviation [10] Market Data and Key Metrics Changes - The company has established significant relationships with major customers across various industries, indicating a strong market presence [5] - The U.S. Department of Defense is highlighted as a primary market, with additional opportunities in education and healthcare being explored [22] Company Strategy and Development Direction - The company plans to spin out Brightline Interactive to maximize shareholder value and enhance its growth potential as an independent entity [12] - The strategy includes maintaining a clean capital structure with no debt and focusing on high-margin software sales [16] - The company aims to aggressively pursue growth opportunities while minimizing public communications during the transition period [17] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about future revenue growth, expecting fiscal year 2026 revenue to exceed fiscal year 2025 revenue, despite potential revenue recognition timing challenges [15] - The management acknowledged the complexity and slow nature of U.S. Department of Defense contracting but remains confident in the growth potential of Brightline Interactive [10][12] Other Important Information - The company achieved annual cash flow neutrality for the first time in its history, marking a significant turnaround [4] - The company maintains a clean balance sheet with approximately $6.85 million in cash and equivalents as of June 30, 2025 [16] Q&A Session Summary Question: What are the primary opportunities for BLI? - Management indicated that BLI's opportunities are primarily in defense, with some exploration into education and healthcare through other subsidiaries [20][22] Question: What is the expected timeframe for the spin-off of BLI? - Management expects to initiate the spin-off process in the coming weeks, aiming for completion early in 2026 [23][33] Question: Will there be a name change for Brightline Interactive post-spin-off? - Management confirmed that there are no plans for a name change, as Brightline has a strong brand presence [26] Question: Will the company have sufficient cash to operate without additional needs? - Management affirmed that the current cash position is sufficient for operations [34]

Financial Data and Key Metrics Changes - Fiscal year 2025 revenue was approximately $10.5 million, a 20% increase from fiscal year 2024 revenue of approximately $8.8 million, primarily driven by an increase in SpatialCore revenues [14] - Q4 fiscal year 2025 revenue was approximately $3.5 million, a 105% increase compared to Q4 fiscal year 2024 revenue of approximately $1.7 million, and a 150% increase compared to Q3 fiscal year 2025 revenue of approximately $1.4 million [15] - Gross margin for fiscal year 2025 was approximately 67.5%, consistent with 67% for fiscal year 2024, and is expected to remain in the 65% to 75% range [15][16] - The company achieved annual cash flow neutrality for the first time in its history, with a net operating cash loss of approximately negative $0.27 million for fiscal year 2025, compared to negative $5.2 million for fiscal year 2024 [16] Business Line Data and Key Metrics Changes - Brightline Interactive (BLI) is identified as the main growth engine, focusing on advanced spatial computing and AI-driven operational simulation middleware software [5] - BLI secured a $4+ million initial contract for a unified synthetic training ecosystem for a major Department of Defense entity, along with a $2+ million SpatialCore contract with another Department of Defense entity [6][10] - BLI delivered an advanced immersive simulation to the U.S. Navy, enhancing military training capabilities [8] Market Data and Key Metrics Changes - The company has established significant relationships with major customers across various industries, including the Department of Defense and big data-driven enterprises [5] - There is a robust pipeline of new potential customers in sectors such as oil and gas, aviation, and technology [10] Company Strategy and Development Direction - The company plans to spin out Brightline Interactive to maximize shareholder value and enhance its growth potential as an independent entity [12] - The strategy aims to allow Glimpse shareholders to receive shares in the spun-out BLI public entity while maintaining their holdings in Glimpse [13] - The focus will remain on existing businesses while pursuing aggressive growth strategies in the coming months [17] Management's Comments on Operating Environment and Future Outlook - Management acknowledges that while significant strides have been made, the current valuation does not reflect the true value of Brightline Interactive [11] - The company expects fiscal year 2026 revenue to exceed fiscal year 2025 revenue, although quarterly revenue may be choppy due to the nature of government contracts [15][16] - Management is optimistic about the future, emphasizing the immense opportunities ahead [17] Other Important Information - The company filed seven new patents focused on integrating AI with immersive technologies during fiscal year 2025 [4] - The company maintains a clean capital structure with no debt, convertible debt, or preferred equity [16] Q&A Session Summary Question: What are the primary opportunities for BLI? - Management indicated that BLI's opportunities are primarily in defense, but there are also potential overlaps with education and healthcare [19][20] Question: What is the expected timeframe for the spin-off of BLI? - Management expects to initiate the spin-off process in the coming weeks, with completion anticipated early in 2026 [23][30] Question: Will there be a name change for Brightline Interactive post-spin-off? - Management does not expect any name changes, as Brightline Interactive has a strong brand presence [25] Question: How does the company plan to integrate AI solutions into healthcare and education? - Management plans to partner with industry specialists to integrate their know-how with the company's AI solutions for broader market offerings [28][29] Question: What are the cash needs for the company moving forward? - Management expects to operate fully with the current cash reserves without additional cash needs [32]