Financial Data and Key Metrics Changes - Revenues for the full year of 2025 were $261 million, up 32% year-over-year [5] - Total revenue in the fourth quarter was a record $81.2 million, an increase of 71% compared to $47.4 million in the fourth quarter of 2024 [16] - Gross margins increased to approximately 30% in 2025, up from 17% in 2024 [15] - Adjusted EBITDA for the fourth quarter was a positive $10.7 million, compared to a loss of $11.3 million in the same quarter last year [22] Business Line Data and Key Metrics Changes - Aerospace and defense (A&D) revenue was a record $175 million for the full year, growing 60% year-over-year [5] - A&D revenue in the fourth quarter was $56.3 million, up 87% year-over-year [16] - Development revenue in the fourth quarter was $26.1 million, an increase of 66% year-over-year [16] - Revenue from commercial markets was $24.9 million, an increase of 44% year-over-year [17] Market Data and Key Metrics Changes - The company experienced strong growth in directed energy and laser sensing markets, with significant contract awards expected [6][10] - The company began shipping to several new international customers during 2025, indicating a growing pipeline of global opportunities [10] Company Strategy and Development Direction - The company plans to focus on directed energy and laser sensing markets, which are expected to drive growth in the coming years [6] - A decision was made to exit the cutting and welding markets to align resources with higher growth opportunities in A&D [13] - The company raised over $190 million to invest in manufacturing capabilities and accelerate new product development [12] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in continued growth, particularly in A&D markets, despite challenges in execution due to the technical nature of defense work [24] - The company expects total revenue growth in 2026, supported by a funded backlog of approximately $162 million [24] - Management highlighted the importance of staying vigilant and responsive to market demands and government requirements [66] Other Important Information - The company plans to build a new 50,000 sq ft manufacturing facility in Longmont, Colorado, to support growth [13] - The decision to exit cutting and welding is expected to result in a revenue headwind of approximately $25 million-$30 million in 2026 [18] Q&A Session Summary Question: Expectations for orders in directed energy - Management indicated that there will be orders for new programs, continuation of existing programs, and low-rate production orders [30] Question: Near-term prospects for sensing programs - Existing laser sensing programs are in full-rate production and will drive more revenue in the near term, while new programs will contribute over the next year or two [33] Question: Decision to exit cutting and welding - The decision was made to focus on core growth opportunities in directed energy and sensing, despite the cutting and welding business having a positive contribution margin [36] Question: Revenue headwind from exiting cutting and welding - The revenue headwind will start in 2026, with a significant impact expected in the second half of the year [39] Question: Growth expectations for A&D business - The A&D business is expected to grow double digits in 2026, with current backlog supporting this growth [42] Question: Concerns looking into 2026 and 2027 - Management emphasized the need for vigilance and focus on execution to maintain growth and respond to market demands [66]

Financial Data and Key Metrics Changes - Total revenue for Q3 2025 was $66.7 million, a 19% increase from $56.1 million in Q3 2024 and an 8% increase from Q2 2025 [11] - Aerospace and defense revenue reached a record $45.6 million, up 50% year over year and 12% sequentially [11] - Gross margin for the quarter was 31.1%, compared to 22.4% in Q3 2023 and 29.9% in Q2 2025 [13] - Adjusted EBITDA for Q3 was $7.1 million, compared to a loss of approximately $1 million in the same quarter last year [17] Business Line Data and Key Metrics Changes - Aerospace and defense products revenue grew 71% year over year, driven by record sales [11] - Development revenue was $19.1 million, a 28% year-over-year increase, but down 8% sequentially due to the completion of smaller programs [12] - Commercial revenue was $21.2 million, down 18% year over year but slightly up compared to the previous quarter [12] Market Data and Key Metrics Changes - The company is focused on two key markets in aerospace and defense: directed energy and laser sensing, both of which outperformed expectations [5] - A new $50 million contract was signed for a long-running missile program incorporating laser sensing products [9] Company Strategy and Development Direction - The company is well-positioned to benefit from U.S. government initiatives, particularly in directed energy programs [8] - The HELSI-2 program, a $171 million contract, is expected to contribute significantly to revenue growth through 2026 [5] - The company is transitioning its latest generation of amplifier products into advanced production to optimize manufacturing for higher volumes [6] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the growth trajectory of aerospace and defense revenue, expecting it to exceed prior growth outlooks of at least 40% year over year [18] - The company anticipates new contracts in directed energy programs in the coming quarters [7] - Management noted that while the commercial business is expected to decline in 2026, there is stabilization in microfabrication markets [48] Other Important Information - GAAP net loss for Q3 was $6.9 million, an improvement from a loss of $10.3 million in Q3 2024 [16] - The company ended Q3 with total cash and investments of $116 million and generated $5.2 million in cash flow from operations [17] Q&A Session Summary Question: Is there a chance that the HELSI-2 completion date has changed? - Management confirmed that they are on track for the 2026 completion date [21] Question: Can you provide more color on the product gross margins? - Management indicated that gross margin fluctuations are influenced by freight costs and product mix, but they are pleased with the overall expansion [24] Question: How much incremental margin benefit is expected from the HELSI-2 contract? - Management explained that the HELSI-2 contract is a cost-plus type and revenue recognition will not be linear [32] Question: What is driving growth in advanced development? - Management noted that advanced development includes various programs, and while not all will become programs of record, they are well-positioned for future opportunities [36] Question: What is the status of the laser sensing contracts? - Management confirmed that both confidential laser sensing programs are progressing and support the overall business outlook [67]