Financial Data and Key Metrics Changes - OSS reported consolidated revenue of $15.1 million for Q4 2024, reflecting a 15.1% year-over-year increase driven by double-digit growth across both OSS and Bressner segments [29] - Consolidated gross margin for Q4 2024 was 15.7%, down from 33.7% in the prior year, with gross margin excluding one-time charges at 23.8% [30] - The company expects consolidated gross margin to return to the low 30% range in Q1 2025 [30] Business Line Data and Key Metrics Changes - OSS segment gross margin for Q4 2024 was 9.4%, compared to 45.9% in the same period last year, with expectations for improvement to the mid to upper 30% range in Q1 2025 [31] - Customer-funded development revenue increased by 118% in 2024 to $3.7 million, indicating strong growth potential for future revenues [10] Market Data and Key Metrics Changes - The company experienced greater adoption in both defense and commercial end markets, contributing to a broader customer base [9] - The annual book-to-bill ratio for the OSS segment was lifted to 1.14, with expectations for a ratio of approximately 1.2 in 2025 [11][12] Company Strategy and Development Direction - OSS is focused on transforming the company and pursuing growth opportunities driven by artificial intelligence, machine learning, and sensor processing [5] - The company anticipates significant opportunities in composable infrastructure for data centers, with a projected $200 million multiyear pipeline [17] - OSS aims to leverage its technology to meet the increasing demand for rugged enterprise-class compute solutions in both defense and commercial markets [13] Management's Comments on Operating Environment and Future Outlook - Management noted that while uncertainty related to business and government spending is expected to continue in the first half of 2025, the embedded position with customers remains strong [11] - The company projects consolidated revenue of $59 million to $61 million for 2025, with OSS segment revenue expected to grow over 20% year-over-year [22][23] - Management expressed confidence in the financial position and potential for 2025, despite anticipated near-term volatility [24] Other Important Information - OSS incurred a $1.2 million charge related to contract losses and $7.1 million in inventory charges in 2024, impacting gross margin and net income [27][28] - The company had total cash and short-term investments of $10 million as of December 31, 2024, with no borrowings on its revolving line of credit [35] Q&A Session Summary Question: What was the reason for the lower OSS segment gross margin? - Management indicated variability in gross margin based on the mix of products, with lower margin products shipping in Q4 2024 [40][43] Question: How has the order pipeline changed for 2025? - Management stated that the pipeline remains stable, with no significant shifts, and they are seeing increased opportunities [52] Question: Where is the growth expected to come from in the commercial and defense markets? - Growth is expected to be balanced across both markets, with notable opportunities in data centers and medical imaging [64][66] Question: Are there any unexpected areas of strength in the commercial segment? - The medical imaging sector is seeing faster adoption of AI than initially anticipated [70] Question: How many product programs are currently in development under the OSS segment? - Management noted that customer-funded development programs are crucial for long-term opportunities, but specific numbers were not provided [73]

Financial Data and Key Metrics Changes - The company reported consolidated revenue of $15.1 million for Q4 2024, reflecting a 15.1% year-over-year increase driven by double-digit growth across both OSS and Bressner segments [29] - Consolidated gross margin for Q4 was 15.7%, down from 33.7% in the prior year, with gross margin excluding one-time charges at 23.8% [30] - The company expects consolidated gross margin to return to the low 30% range in Q1 2025 [30] Business Line Data and Key Metrics Changes - OSS segment gross margin for Q4 was 9.4%, compared to 45.9% in the same period last year, with expectations for improvement to the mid to upper 30% range in Q1 2025 [31] - Customer-funded development revenue increased by 118% in 2024 to $3.7 million, indicating strong growth potential for larger revenues in the future [10] Market Data and Key Metrics Changes - The company experienced growth in both defense and commercial end markets, with significant demand from the U.S. Army and other defense contractors [9][10] - The company anticipates a projected consolidated revenue of $59 million to $61 million for the full year of 2025, including OSS segment revenue of approximately $30 million, representing over 20% year-over-year growth [22][23] Company Strategy and Development Direction - The company is focused on transforming its business model to capitalize on growth opportunities in artificial intelligence, machine learning, and rugged enterprise-class compute solutions [5][6] - The company has identified a $200 million multiyear pipeline opportunity in composable infrastructure for data centers, which is expected to drive future growth [17] Management's Comments on Operating Environment and Future Outlook - Management noted that while there may be near-term volatility due to budget delays and economic uncertainties, the company feels confident about its financial position and growth potential for 2025 [24] - The company expects to be EBITDA breakeven for the full year of 2025, with revenue and profitability anticipated to improve in the second half of the year [23] Other Important Information - The company incurred a $1.2 million charge related to contract losses and $7.1 million in inventory charges in 2024, which negatively impacted financial results [27][28] - As of December 31, 2024, the company had total cash and short-term investments of $10 million, with no borrowings on its revolving line of credit [35] Q&A Session Summary Question: What was the reason for the lower OSS segment gross margin? - Management indicated variability in gross margin based on the mix of products, with lower margin products shipping in Q4 2024 [40][43] Question: How has the order pipeline changed for 2025? - Management stated that the pipeline remains stable, with no significant shifts, and they are seeing increased opportunities for customer-funded development programs [52][54] Question: Where is the growth expected to come from in the commercial and defense markets? - Management noted that growth is balanced across both commercial and defense markets, with significant opportunities in data centers, medical imaging, and long-term contracts with defense contractors [64][66] Question: Are there any unexpected areas of strength in the commercial segment? - Management highlighted that medical imaging is showing faster adoption of AI than initially anticipated, contributing to growth [70] Question: How many product programs are currently in development under the OSS segment? - Management indicated that multiple customer-funded development programs are in place, which are expected to lead to larger production orders over time [73]

Core Viewpoint - Tesla's stock has faced significant bearish sentiment, leading to a decline of over 50% since its peak in December 2024, resulting in a market capitalization drop of $700 billion, while short sellers have profited significantly during this downturn [1][2]. Group 1: Stock Performance - Tesla's stock initially rose post-election due to CEO Elon Musk's ties with President Trump but has since lost most of those gains, with a decline of over 50% from its December peak [2]. - The stock was valued at $238.01 at the close of the last trading session, down 37% year-to-date, and extended its weakness to $229 in pre-market trading [6]. - RBC Capital lowered its price target for Tesla from $440 to $320 while maintaining an 'Outperform' rating, indicating a potential upside of 36% from the current valuation [7]. Group 2: Short Selling Activity - Short sellers have capitalized on Tesla's stock decline, making a profit of $16.2 billion since the stock's peak, with short interest increasing by 16.3% in the past month, totaling 71.5 million shares shorted [1][3]. Group 3: Market Challenges - Tesla faces headwinds from backlash against Musk's political views, impacting sales in key regions like Europe, and increasing competition from companies like BYD in the electric vehicle market [4]. - The company is also affected by President Trump's tariffs, with Canada threatening to impose 100% tariffs on Tesla following U.S. tariffs [5]. - Global interest in short selling Tesla stock has reached a one-year high, with Canada leading this trend [5]. Group 4: Future Outlook - Investment strategist Shay Baloor argues that the market has misjudged Tesla, suggesting it is more than just an electric vehicle company and is positioned as a leader in AI and autonomy, with significant potential expected to unfold by 2026 [8].